HAGLER BAILLY, INC.
EMPLOYEE INCENTIVE AND NON-QUALIFIED STOCK
OPTION AND RESTRICTED STOCK PLAN
Originally Adopted May 17, 1995
Amended and Restated, Effective as of December 31, 1996
TABLE OF CONTENTS
HAGLER BAILLY, INC.
EMPLOYEE INCENTIVE AND NON-QUALIFIED STOCK
OPTION AND RESTRICTED STOCK PLAN
Page
----
Section 1. Purposes....................................................... 1
Section 2. Definitions.................................................... 1
Section 3. Participation. ................................................ 4
Section 4. Administration. ............................................... 5
Section 5. Eligibility. ................................................. 6
Section 6. Stock Subject to the Plan...................................... 6
Section 7. Terms and Conditions of Options................................ 6
Section 8. Restricted Stock............................................... 10
Section 9. Determination of Fair Market Value Per Share of Common Stock... 11
Section 10. Adjustments................................................... 11
Section 11. Rights as a Stockholder....................................... 12
Section 12. Time of Awarding Options...................................... 12
Section 13. Modification, Extension and Renewal of Option.................. 12
Section 14. Purchase for Investment and Other Restrictions................ 13
Section 15. Transferability............................................... 14
Section 16. Other Provisions.............................................. 14
Section 17. Power of Board in Case of Change of Control................... 14
Section 18. Amendment of the Plan......................................... 14
Section 19. Application of Funds.......................................... 15
Section 20. No Obligation to Exercise Option.............................. 15
Section 21. Approval of Stockholders...................................... 15
Section 22. Conditions Upon Issuance of Shares............................ 15
Section 23. Reservation of Shares......................................... 15
Section 24. Stock Option and Stock Purchase Agreements.................... 16
Section 25. Taxes, Fees, Expenses and Withholding of Taxes................ 16
Section 26. Notices....................................................... 16
Section 27. No Enlargement of Awardee Rights.............................. 17
Section 28. Information to Awardees....................................... 17
Section 29. Availability of Plan.......................................... 17
Section 30. Invalid Provisions............................................ 17
Section 31. Applicable Law................................................ 17
Section 32. Board Action.................................................. 18
EXHIBIT A-1 - INCENTIVE STOCK OPTION AGREEMENT.......................... Tab 2
EXHIBIT A-2 - NON-QUALIFIED STOCK OPTION AGREEMENT...................... Tab 3
EXHIBIT B - STOCK PURCHASE AGREEMENT.................................... Tab 4
FORM OF GRANT LETTERS .................................................. Tab 5
HAGLER BAILLY, INC.
EMPLOYEE INCENTIVE AND NON-QUALIFIED STOCK
OPTION AND RESTRICTED STOCK PLAN
Section 1. Purposes.
The Hagler Bailly, Inc. Employee Incentive and Non-Qualified Stock
Option and Restricted Stock Plan (the "Plan") was originally adopted on May 17,
1995. The Plan was amended and restated, effective December 31, 1996. The
purposes of the Plan are (a) to recognize and compensate selected key Employees
of Hagler Bailly, Inc. ("the Company") and its Subsidiaries who contribute to
the development and success of the Company and its Subsidiaries; (b) to maintain
the competitive position of the Company and its Subsidiaries by attracting and
retaining key Employees; and (c) to provide incentive compensation to such key
Employees based upon the Company's performance, as measured by the appreciation
in Common Stock. The Options granted pursuant to the Plan are intended to
constitute either Incentive Stock Options within the meaning of section 422 of
the Code, or non-qualified stock options, as determined by the Committee, or the
Board if no Committee has been appointed, at the time of Award. The type of
Options awarded will be specified in the Option Agreement between the Company
and the Optionee. The terms of this Plan shall be incorporated in the Option
Agreement to be executed by the Optionee.
Section 2. Definitions.
(a) "Affiliate" shall mean, with respect to a Person, a Person that
directly or indirectly controls, or is controlled by, or is under common control
with such Person.
(b) "Award" shall mean a grant of an Option or Options or an award
of Restricted Stock to an Employee pursuant to the provisions of this Plan. Each
separate grant of an Option or Options to an Employee, and each separate award
of Restricted Stock, and each group of Options which matures on a separate date,
is treated as a separate Award.
(c) "Awardee" shall mean an Employee to whom an Award is made.
(d) "Board" shall mean the Board of Directors of the Company, as
constituted from time to time.
(e) "Change of Control" shall mean a change in the control of the
Company which shall be deemed to have occurred upon the earliest to occur of the
following: (i) the date the stockholders of the Company (or the Board, if
stockholder action is not required) approve a plan or other arrangement pursuant
to which the Company will be dissolved or liquidated, or (ii) the date the
stockholders of the Company approve a definitive agreement to sell or otherwise
dispose of all or substantially all of the assets of the Company, or (iii) the
date the stockholders
of the Company and the stockholders of the other constituent corporations (or
their respective boards of directors, if and to the extent that stockholder
action is not required) have approved a definitive agreement to merge or
consolidate the Company with or into another corporation, other than, in either
case, a merger or consolidation of the Company in which the Company is the
surviving entity, and in which shares of the Company's voting capital stock
outstanding immediately before such merger or consolidation are exchanged or
converted into shares which represent more than 50% of the Company's voting
capital stock after such merger or consolidation, as such holders' ownership of
voting capital stock of the Company immediately before the merger or
consolidation, or (iv) the date any Person, other than (A) the Company, or (B)
any of its Subsidiaries, or (C) any of the holders of the capital stock of the
Company, as determined on the date that this Plan is adopted by the Board, or
(D) any employee benefit plan (or related trust) sponsored or maintained by the
Company or any of its Subsidiaries or (E) any Affiliate of any of the foregoing,
shall have acquired beneficial ownership of, or shall have acquired voting
control over more than 50% of the outstanding shares of the Company's voting
capital stock (on a fully diluted basis), unless the transaction pursuant to
which such Person acquired such beneficial ownership or control resulted from
the original issuance by the Company of shares of its voting capital stock and
was approved by at least a majority of the directors then in office.
(f) "Code" shall mean the Internal Revenue Code of 1986, as amended.
(g) "Committee" shall mean the Committee appointed by the Board in
accordance with Section 4(a) of the Plan, if one is appointed, in which event in
connection with this Plan, the Committee shall possess all of the power and
authority of, and shall be authorized to take any and all actions required to be
taken hereunder by, and make any and all determinations required taken hereunder
by, the Board.
(h) "Common Stock" shall mean Class A common stock of the Company,
$.01 par value per Share.
(i) "Company" shall mean Hagler Bailly, Inc., a Delaware
corporation.
(j) "Covenant Not to Compete" shall mean the noncompetition covenant
set forth in Section 10 of the Stockholders Agreement or (if an Awardee is not a
party thereto) otherwise applicable to the Awardee and the Company or its
Subsidiaries.
(k) "Disability" shall mean a disability of an employee, officer or
a director which renders such employee, officer or director unable to perform
the full extent of his duties and responsibilities by reason of his illness or
incapacity which would entitle that employee, officer or director to receive
Social Security Disability Income under the Social Security Act, as amended, and
the regulations promulgated thereunder. "Disabled" shall mean having a
Disability. The determination of whether an Optionee is Disabled shall be made
by the Board, whose determination shall be conclusive; provided that, (i) if an
Optionee is bound by the terms of an Employment Agreement between the Optionee
and the Company, whether the Optionee is
2
"Disabled" for purposes of the Plan shall be determined in accordance with the
procedures set forth in said Employment Agreement, if such procedures are
therein provided; and (ii) an Optionee bound by such an Employment Agreement
shall not be determined to be Disabled under the Plan any earlier than he would
be determined to be disabled under his Employment Agreement.
(l) "Employee" shall mean any person employed by the Company or any
of its Subsidiaries on whose behalf wages are reported on IRS Form W-2.
Additionally, solely for purposes of determining those persons eligible under
the Plan to be recipients of Awards of Options, which Options shall be limited
to non-qualified stock options or Restricted Stock, and not for the purpose of
affecting the status of the relationship between such person and the Company,
the term "Employee" shall include independent contractors of and consultants to
the Company, as well as members of the Board or of the board of directors of a
Subsidiary.
(m) "Exchange Act" shall mean The Securities Exchange Act of 1934,
as amended.
(n) "Fair Market Value Per Share" shall mean the fair market value
of a share of Common Stock, as determined pursuant to Section 9 hereof.
(o) "Grant Date" means (i) the effective date of registration under
Section 12 of the Exchange Act of a class of equity securities of the Company
and (ii) each date thereafter prescribed under the Company's Articles of
Incorporation and By-laws for the election of directors which falls before the
earlier of (A) the date six months after the termination of such registration,
or (B) the tenth anniversary of the date on which this Plan is adopted by the
Board.
(p) "Incentive Stock Option" shall mean an Option which is an
incentive stock option as described in Section 422 of the Code.
(q) "Non-Employee Director" shall have the meaning set forth in Rule
16b-3(b)(3)(i) promulgated by the Securities and Exchange Commission under the
Exchange Act, or any successor definition adopted by the Securities and Exchange
Commission.
(r) "Option(s)" shall mean an Incentive Stock Option or a
non-qualified stock option to purchase Shares that is Awarded pursuant to the
Plan.
(s) "Option Agreement" shall mean a written agreement substantially
in the form of Exhibit A-1 and A-2, or such other form or forms as the Board or
Committee (subject to the terms and conditions of this Plan) may from time to
time approve evidencing and reflecting the terms of an Option.
(t) "Optionee" shall mean an Employee to whom an Option is awarded.
3
(u) "Participant" shall mean each Employee of the Company or a
Subsidiary to whom an Award is granted pursuant to the Plan.
(v) "Person" shall mean an individual, partnership, corporation,
limited liability company, trust, joint venture, unincorporated association, or
other entity or association.
(w) "Plan" shall mean the Hagler Bailly, Inc. Employee Incentive and
Non- Qualified Stock Option and Restricted Stock Plan, as amended from time to
time.
(x) "Pool" shall mean the pool of Shares of Common Stock subject to
the Plan, as described in Section 6 hereof.
(y) "Restricted Stock" shall mean an Award of Shares of Common Stock
that is subject to restrictions pursuant to Section 8 hereof.
(z) "Securities Act" shall mean The Securities Act of 1933, as
amended.
(aa) "Shares" shall mean shares of Common Stock contained in the
Pool, as adjusted in accordance with Section 10 of the Plan.
(bb) "Stock Purchase Agreement" shall mean an agreement
substantially in the form attached hereto as Exhibit B, or such other form as
the Board or Committee (subject to the terms and conditions of this Plan) may
from time to time approve, which an Optionee shall be required to execute as a
condition of purchasing Shares upon the exercise of an Option.
(cc) "Stockholders Agreement" shall mean the Stockholders Agreement
dated as of May 15, 1995 by and among the Company and its stockholders, as
amended from time to time.
(dd) "Subsidiary" shall mean a subsidiary corporation, whether now
or hereafter existing, as defined in sections 424(f) and (g) of the Code.
Section 3. Participation.
(a) In General. Participants in the Plan shall be selected by the
Board from the Employees. The Board may make Awards at any time and from time to
time to Employees. Any Award may include or exclude any Employee, as the Board
shall determine in its sole discretion.
(b) Non-Employee Directors. In the event the Company has a class of
equity securities registered under Section 12 of the Exchange Act, from the
effective date of such registration until six months after the termination of
such registration, no Awards of Options shall be made under the Plan to any
director of the Company who is a Non-Employee Director except pursuant to this
Section 3(b).
4
(i) Automatic Awards. Awards of Options to directors of the
Company who are Non-Employee Directors shall be granted, without any further
action by the Board or Committee, as follows. Upon the effective date of the
Company's registration of a class of equity securities under Section 12 of the
Exchange Act, and on each Grant Date thereafter, each director of the Company
who is a Non-Employee Director shall receive an Award of a non-qualified stock
Option to purchase 3,000 Shares.
(ii) Option Price. The price per Share payable upon the
exercise of any Option granted under this Section 3(b) shall be 100% of the Fair
Market Value of such Share on the Grant Date.
Section 4. Administration.
(a) Procedure. The Plan shall be administered by the Board. The
Board may at any time by a unanimous vote, with each Member voting, appoint a
Committee consisting of not less than two persons, each of whom is a
Non-Employee Director, to administer the Plan on behalf of the Board, subject to
such terms and conditions as the Board may prescribe. Members of the Committee
shall serve for such period of time as the Board may determine. Members of the
Board or the Committee who are eligible for Options or have been Awarded Options
may vote on any matters affecting the administration of the Plan or the Award of
any Options pursuant to the Plan, except that no such member shall act upon the
Award of an Option to himself or herself, but any such member may be counted in
determining the existence of a quorum at any meeting of the Board or Committee
during which action is taken with respect to the Award of Options to himself or
herself.
From time to time the Board may increase the size of the Committee
and appoint additional members thereto, remove members (with or without cause)
and appoint new members in substitution therefor, fill vacancies however caused,
or remove all members of the Committee and thereafter directly administer the
Plan.
(b) Powers of the Board and the Committee. Subject to the provisions
of the Plan, the Board or its Committee shall have the authority, in its
discretion: (i) to make Awards; (ii) to determine the Fair Market Value Per
Share; (iii) to determine the exercise price of the Options to be Awarded in
accordance with Sections 7 and 8 of the Plan; (iv) to determine the Employees to
whom, and the time or times at which, Awards shall be made, and the number of
Shares to be subject to each Award; (v) to prescribe, amend and rescind rules
and regulations relating to the Plan; (vi) to determine the terms and provisions
of each Award under the Plan, each Option Agreement and each Stock Purchase
Agreement (which need not be identical with the terms of other Awards, Option
Agreements and Stock Purchase Agreements) and, with the consent of the Optionee,
to modify or amend an outstanding Option, Option Agreement or Stock Purchase
Agreement; (vii) to accelerate the vesting or exercise date of any Award; (viii)
to interpret the Plan or any agreement entered into with respect to an Award or
exercise of Options; (ix) to authorize any person to execute on behalf of the
Company any instrument required to effectuate an Award or to take such other
actions as may be necessary or appropriate with respect
5
to the Company's rights pursuant to Awards or agreements relating to the Award
or exercise thereof; and (x) to make such other determinations and establish
such other procedures as it deems necessary or advisable for the administration
of the Plan.
(c) Effect of the Board's or Committee's Decision. All decisions,
determinations and interpretations of the Board or the Committee shall be final
and binding with respect to all Awards under the Plan.
(d) Limitation of Liability. Notwithstanding anything herein to the
contrary (with the exception of Section 32 hereof), no member of the Board or of
the Committee shall be liable for any good faith determination, act or failure
to act in connection with the Plan or any Award hereunder.
Section 5. Eligibility.
Awards may be made only to Employees. An Employee who has received
an Award, if he or she is otherwise eligible, may receive additional Awards.
Section 6. Stock Subject to the Plan.
Subject to the provisions of this Section 6 and the provisions of
Section 10 of the Plan, the maximum aggregate number of Shares which may be
Awarded and sold under the Plan is 462,767.6 Shares of Common Stock
(collectively, the "Pool"). Options Awarded from the Pool may be either
Incentive Stock Options or non-qualified stock options, as determined by the
Board. If an Option should expire or become unexercisable for any reason without
having been exercised in full, or if a Restricted Stock Award shall fail to
become vested, or if Shares are subsequently repurchased by the Company, the
unpurchased or repurchased Shares which were subject thereto shall, unless the
Plan shall have been terminated, be returned to the Plan and become available
for future Award under the Plan.
Section 7. Terms and Conditions of Options.
Each Option Awarded pursuant to the Plan shall be authorized by the
Board and shall be evidenced by an Option Agreement in such form as the Board
may from time to time determine. Each Option Agreement shall incorporate by
reference all other terms and conditions of the Plan, including the following
terms and conditions:
(a) Number of Shares. The number of Shares subject to the Option,
which may include fractional Shares.
(b) Option Price. The price per Share payable on the exercise of any
Option which is an Incentive Stock Option shall be stated in the Option
Agreement and shall be no less than the Fair Market Value Per Share of the
Common Stock on the date such Option is Awarded, without regard to any
restriction other than a restriction which will never lapse. Notwithstanding
6
the foregoing, if an Option which is an Incentive Stock Option shall be Awarded
under this Plan to any person who, at the time of the Award of such Option, owns
stock possessing more than 10% of the total combined voting power of all classes
of the Company's stock, the price per Share payable upon exercise of such
Incentive Stock Option shall be no less than 110 percent (110%) of the Fair
Market Value Per Share of the Common Stock on the date such Option is Awarded.
The price per Share payable on the exercise of an Option which is a
non-qualified stock option shall be at least $.01 per Share and shall be stated
in the Option Agreement.
(c) Consideration. The consideration to be paid for the Shares to be
issued upon the exercise of an Option, including the method of payment, shall be
determined by the Board and may consist entirely of cash, check, promissory
notes or Shares of Common Stock having an aggregate Fair Market Value Per Share
on the date of surrender equal to the aggregate exercise price of the Shares as
to which said Option shall be exercised, or any combination of such methods of
payment, or such other consideration and method of payment permitted under any
laws to which the Company is subject and which is approved by the Board. In
making its determination as to the type of consideration to accept, the Board
shall consider if acceptance of such consideration may be reasonably expected to
benefit the Company.
(i) If the consideration for the exercise of an Option is a
promissory note, it may, in the discretion of the Board, be either full recourse
or nonrecourse and shall bear interest at a per annum rate which is not less
than the applicable federal rate determined in accordance with section 1274(d)
of the Code as of the date of exercise. In such an instance the Company may, in
its sole discretion, retain the Shares purchased upon exercise of the Option in
escrow as security for payment of the promissory note.
(ii) If the consideration for the exercise of an Option is the
surrender of previously acquired and owned shares of Common Stock, the Optionee
will be required to make representations and warranties satisfactory to the
Company regarding his title to the shares of Common Stock used to effect the
purchase (the "Payment Shares"), including without limitation, representations
and warranties that the Optionee has good and marketable title to such Payment
Shares free and clear of any and all liens, encumbrances, charges, equities,
claims, security interests, options or restrictions, and has full power to
deliver such Payment Shares without obtaining the consent or approval of any
person or governmental authority other than those which have already given
consent or approval in a manner satisfactory to the Company. The per Share value
of the Payment Shares shall be the Fair Market Value Per Share of such Payment
Shares on the date of exercise as determined by the Board in its sole
discretion, exercised in good faith. If such Payment Shares were acquired upon
previous exercise of Incentive Stock Options granted within two years prior to
the exercise of the Option or acquired by the Optionee within one year prior to
the exercise of the Option, such Optionee shall be required, as a condition to
using the Payment Shares in payment of the exercise price of the Option, to
acknowledge the tax consequences of doing so, in that such previously exercised
Incentive Stock Options may have, by such action, lost their status as Incentive
Stock Options, and the Optionee may have to recognize ordinary income for tax
purposes as a result.
7
(d) Form of Option. The Option Agreement will state whether the
Option Awarded is an Incentive Stock Option or a non-qualified stock option, and
will constitute a binding determination as to the form of Option Awarded.
(e) Exercise of Options. Any Option Awarded hereunder shall be
exercisable at such times and under such conditions as shall be set forth in the
Option Agreement (as may be determined by the Board and as shall be permissible
under the terms of the Plan), which may include performance criteria with
respect to the Company and/or the Optionee, and as shall be permissible under
the terms of the Plan. Notwithstanding the foregoing, any Option awarded under
Section 3(b) hereunder shall be immediately exercisable in full.
An Option may be exercised in accordance with the provisions
of this Plan as to all or any portion of the Shares then exercisable under an
Option from time to time during the term of the Option. An Option may not be
exercised for a fraction of a Share.
An Option shall be deemed to be exercised when written notice
of such exercise has been given to the Company at its principal executive office
in accordance with the terms of the Option Agreement by the person entitled to
exercise the Option and full payment for the Shares with respect to which the
Option is exercised has been received by the Company, accompanied by any
agreements required by the terms of the Plan and/or Option Agreement, including
an executed Stock Purchase Agreement. Full payment may consist of such
consideration and method of payment allowable under Section 7 of the Plan. No
adjustment shall be made for a dividend or other right for which the record date
is prior to the date the Option is exercised, except as provided in Section 10
of the Plan.
As soon as practicable after any proper exercise of an Option
in accordance with the provisions of the Plan, the Company shall, without
transfer or issue tax to the Optionee, deliver to the Optionee at the principal
executive office of the Company or such other place as shall be mutually agreed
upon between the Company and the Optionee, a certificate or certificates
representing the Shares for which the Option shall have been exercised.
Exercise of an Option in any manner shall result in a decrease
in the number of Shares which thereafter may be available, both for purposes of
the Plan and for sale under the Option, by the number of Shares as to which the
Option is exercised.
(f) Term and Vesting of Options.
(i) Notwithstanding any other provision of this Plan, no
Option shall be (A) Awarded under this Plan after ten (10) years from the date
on which this Plan is adopted by the Board, or (B) exercisable more than ten
(10) years from the date of Award; provided, however, that if an Option that is
intended to be an Incentive Stock Option shall be Awarded under this Plan to any
person who, at the time of the Award of such Option, owns stock possessing more
than 10% of the total combined voting power for all classes of the Company's
8
stock, the foregoing clause (B) shall be deemed modified by substituting "five
(5) years" for the term "ten (10) years" that appears therein.
(ii) No Option Awarded to any Optionee shall be treated as an
Incentive Stock Option, to the extent such Option would cause the aggregate Fair
Market Value Per Share (determined as of the date of Award of each such Option)
of the Shares with respect to which Incentive Stock Options are exercisable by
such Optionee for the first time during any calendar year to exceed $100,000.
For purposes of determining whether an Incentive Stock Option would cause such
aggregate Fair Market Value Per Share to exceed the $100,000 limitation, such
Incentive Stock Options shall be taken into account in the order Awarded. For
purposes of this subsection, Incentive Stock Options include all Incentive Stock
Options under all plans of the Company that are Incentive Stock Option plans
within the meaning of section 422 of the Code.
Except as provided in Section 7(g)(iv), Options Awarded hereunder
shall mature and become exercisable in whole or in part, in accordance with such
vesting schedule as the Board shall determine, which schedule shall be stated in
the Option Agreement. Notwithstanding the preceding sentence, Options awarded
pursuant to Section 3(b) hereunder shall be fully vested at grant. Options may
be exercised in any order elected by the Optionee whether or not the Optionee
holds any unexercised Options under this Plan or any other plan of the Company.
(g) Termination of Options.
(i) Unless sooner terminated as provided in this Plan, each
Option shall be exercisable for such period of time as shall be determined by
the Board and set forth in the Option Agreement, and shall be void and
unexercisable thereafter.
(ii) Except as otherwise provided herein or by the terms of
any Award, no Option shall be exercisable after termination of the Optionee's
employment with or other engagement by the Company for any reason.
(iii) Except as otherwise provided herein of by the terms of
any Award, upon the Disability or death of an Optionee while in the employ of
the Company, Options held by such Optionee which are exercisable on the date of
Disability or death shall be exercisable for a period of twelve (12) months
commencing on the date of the Optionee's Disability or death, by the Optionee or
his legal guardian or representative or, in the case of death, by his
executor(s) or administrator(s).
(iv) Options may be terminated at any time by agreement
between the Company and the Optionee.
(h) Forfeiture. Notwithstanding any other provision of this Plan, if
an Optionee shall engage in any activity in breach of the Covenant Not to
Compete, all Options held
9
by such Optionee which have not yet been exercised shall terminate immediately
upon the commencement thereof. Notwithstanding any other provision of this Plan,
if the Optionee's employment or engagement is terminated for "cause" (as such
term is defined in the Optionee's employment agreement or non-disclosure
agreement with the Company, if any) or if the Board makes a determination that
the Optionee:
(i) has engaged in any type of disloyalty to the Company,
including without limitation, fraud, embezzlement, theft, or dishonesty in the
course of his employment or engagement, or has otherwise breached any fiduciary
duty owed to the Company;
(ii) has been convicted of a felony;
(iii) has disclosed trade secrets or confidential information
of the Company;
(iv) has breached any agreement with or duty to the Company in
respect of confidentiality, non-disclosure, non-competition or otherwise, all
unexercised Options shall terminate upon the date of such a finding, or, if
earlier, the date of termination of employment or engagement for "cause."
In the event of such a finding, in addition to immediate termination
of all unexercised Options, the Optionee shall forfeit all Shares for which the
Company has not yet delivered share certificates to the Optionee and the Company
shall refund to the Optionee the Option purchase price paid to it, if any, in
the same form as it was paid (or in cash at the Company's discretion).
Notwithstanding anything herein to the contrary, the Company may withhold
delivery of share certificates pending the resolution of any inquiry that could
lead to a finding resulting in forfeiture.
Section 8. Restricted Stock.
(a) Administration. Shares of Restricted Stock may be issued either
alone or in addition to other Awards granted under the Plan. The Board shall
determine the persons to whom, and the time or times at which, grants of
Restricted Stock will be made, the number of Shares to be Awarded, the price (if
any) to be paid by the recipient of Restricted Stock, the time or times within
which such Awards may be subject to forfeiture, and all other conditions of the
Awards.
The Board may condition the vesting of Restricted Stock upon the
attainment of specified performance goals or such other factors as the Board may
determine, in its sole discretion, at the time of the Award.
The provisions of Restricted Stock Awards need not be the same with
respect to each recipient.
10
(b) Awards. The prospective recipient of a Restricted Stock Award
shall not have any rights with respect to such Award, unless and until such
recipient has executed an agreement evidencing the Award and has delivered a
fully executed copy thereof to the Company, and has otherwise complied with the
applicable terms and conditions of such Award. The purchase price for shares of
Restricted Stock may be zero.
Each Employee receiving a Restricted Stock Award shall be required,
as a condition precedent to receipt of such Award, to execute a joinder or other
counterpart to the Stockholders Agreement.
(c) Restrictions and Conditions. Except as provided in this Section
8(c), the Employee shall have, with respect to the Shares of Restricted Stock,
all of the rights of a shareholder of the Company, including the right to vote
the shares, and the right to receive any cash dividends. The Board, in its sole
discretion, as determined at the time of Award, may permit or require the
payment of cash dividends in respect of Shares of Restricted Stock Awarded under
the Plan to be deferred and, if the Board so determines, reinvested in
additional Shares of Restricted Stock to the extent Shares are available under
Section 6 of the Plan.
Section 9. Determination of Fair Market Value Per Share of Common
Stock.
(a) Except to the extent otherwise provided in this Section 9, the
Fair Market Value Per Share of Common Stock shall be determined by the Board in
its sole discretion.
(b) Notwithstanding the provisions of Section 9(a), in the event
that shares of Common Stock are traded in the over-the-counter market, the Fair
Market Value Per Share of Common Stock shall be the mean of the bid and asked
prices for a share of Common Stock on the relevant valuation date as reported in
The Wall Street Journal (or, if not so reported, as otherwise reported by the
National Association of Securities Dealers Automated Quotations ("NASDAQ")
System), as applicable or, if there is no trading on such date, on the next
trading date. In the event shares of Common Stock are listed on a national or
regional securities exchange or traded through the NASDAQ National Market, the
Fair Market Value of a share of Common Stock shall be the closing price for a
share of Common Stock on the exchange or on the NASDAQ National Market, as
reported in The Wall Street Journal on the relevant valuation date, or if there
is no trading on that date, on the next trading date.
Section 10. Adjustments.
(a) Subject to required action by the stockholders, if any, the
number of Shares as to which Awards may be made under this Plan and the number
of Shares subject to outstanding Options and the Option prices thereof shall be
adjusted proportionately for any increase or decrease in the number of
outstanding Shares of Common Stock of the Company resulting from stock splits,
reverse stock splits, stock dividends, reclassifications and recapitalizations,
merger, consolidation, exchange of shares, or rights offered to purchase shares
11
of Common Stock at a price substantially below Fair Market Value Per Share or
any similar change affecting Common Stock.
(b) No fractional Shares shall be issuable on account of any action
mentioned in Section 10(a), and the aggregate number of Shares into which Shares
then covered by the Award, when changed as the result of such action, shall be
reduced to the number of whole Shares resulting from such action, unless the
Board, in its sole discretion, shall determine to issue scrip certificates with
respect to any fractional Shares, which scrip certificates, in such event, shall
be in a form and have such terms and conditions as the Board in its discretion
shall prescribe.
Section 11. Rights as a Stockholder.
A recipient of an Option Award shall have no rights as a stockholder
of the Company and shall neither have the right to vote nor receive dividends
with respect to any Shares subject to an Option until such Option has been
exercised and a certificate with respect to the Shares purchased upon such
exercise has been issued to him. A recipient of a Restricted Stock Award shall
have all rights as a stockholder with respect to the Shares of Restricted Stock
Awarded from and after the later to occur of (i) the date of the Award (as
determined under Section 12 hereof) or (ii) the date the Awardee makes payment
of the purchase price, if any, designated by the Board as a condition of such
Award.
Section 12. Time of Awarding Options.
The date of an Award shall, for all purposes, be the date which the
Board specifies when the Board makes its determination that an Award is made or
if none is specified, then the date of the Board's determination. Notice of the
determination shall be given to each Employee to whom an Award is made within a
reasonable time after the date of such Award.
Section 13. Modification, Extension and Renewal of Option.
Subject to the terms and conditions of the Plan, the Board may
modify, extend or renew an Award, or accept the surrender of an Award (to the
extent not theretofore exercised). Notwithstanding the foregoing, (a) no
modification of an Award which adversely affects the Awardee shall be made
without the consent of the Awardee, and (b) no Incentive Stock Option may be
modified, extended or renewed if such action would cause it to cease to be an
"Incentive Stock Option" within the meaning of section 422 of the Code, unless
the Optionee specifically acknowledges and consents to the tax consequences of
such action.
12
Section 14. Purchase for Investment and Other Restrictions.
(a) The obligation of the Company to issue Shares to an Awardee upon
the exercise of an Option or as part of a Restricted Stock Award granted under
the Plan is conditioned upon (i) the Company obtaining any required permit or
order from appropriate governmental agencies, authorizing the Company to issue
such Shares, and (ii) such issuance complying with all relevant provisions of
the law, including, without limitation, the Securities Act, the Exchange Act,
the rules and regulations promulgated thereunder.
(b) At the option of the Board, the obligation of the Company to
issue Shares to an Awardee upon the exercise of an Option granted, or upon a
Restricted Stock Award made, under the Plan may be conditioned upon obtaining
appropriate representations, warranties, restrictions and agreements of the
Awardee as set forth in the applicable Stock Purchase Agreement. Among other
representations, warranties, restrictions and agreements, the Awardee may be
required to represent and agree that the purchase of Shares shall be for
investment, and not with a view to the public resale or distribution thereof,
unless the Shares are registered under the Securities Act and the issuance and
sale of the Shares complies with all other laws, rules and regulations
applicable thereto. Unless the issuance of such Shares is registered under the
Securities Act, the Awardee shall acknowledge that the Shares purchased are not
registered under the Securities Act and may not be sold or otherwise transferred
unless the Shares have been registered under the Securities Act in connection
with the sale or other transfer thereof, or that counsel satisfactory to the
Company has issued an opinion satisfactory to the Company that the sale or other
transfer of such Shares is exempt from registration under the Securities Act,
and unless said sale or transfer is in compliance with all other applicable
laws, rules and regulations, including all applicable federal and state
securities laws, rules and regulations. Additionally, the Shares, when issued,
shall be subject to other transfer restrictions, rights of first refusal and
rights of repurchase as set forth in Stockholders Agreement. Unless the Shares
subject to an Award are registered under the Securities Act, the certificates
representing such Shares issued shall contain the following legend in
substantially the following form:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED OR ANY APPLICABLE STATE
SECURITIES LAWS. THESE SHARES HAVE NOT BEEN ACQUIRED WITH A VIEW TO
DISTRIBUTION OR RESALE, AND MAY NOT BE SOLD, ASSIGNED, EXCHANGED,
MORTGAGED, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED OR
DISPOSED OF, BY GIFT OR OTHERWISE, OR IN ANY WAY ENCUMBERED WITHOUT
AN EFFECTIVE REGISTRATION STATEMENT FOR SUCH SHARES UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, AND ANY APPLICABLE STATE
SECURITIES LAWS, OR A SATISFACTORY OPINION OF COUNSEL SATISFACTORY
TO HAGLER BAILLY, INC. THAT REGISTRATION IS NOT REQUIRED UNDER SUCH
ACT AND UNDER APPLICABLE STATE SECURITIES LAWS.
13
Section 15. Transferability.
No Option shall be assignable or transferable otherwise than by will
or by the laws of descent and distribution. During the lifetime of the Optionee,
his Options shall be exercisable only by such Optionee, or, in the event of his
or her legal incapacity or Disability, then by the Optionee's legal guardian or
representative.
Section 16. Other Provisions.
The Option Agreement and Stock Purchase Agreement may contain such
other provisions as the Board in its discretion deems advisable and which are
not inconsistent with the provisions of this Plan, including, without
limitation, restrictions upon or conditions precedent to the exercise of the
Option.
Section 17. Power of Board in Case of Change of Control.
Notwithstanding anything to the contrary set forth in this Plan
(with the exception of Section 32 hereof), in the event of a Change of Control,
the Board shall have the right to accelerate the vesting of all unmatured
Options or Restricted Stock Awards. In addition, in the event of a Change of
Control of the Company by reason of a merger, consolidation or tax free
reorganization or sale of all or substantially all of the assets of the Company,
the Board shall have the right to terminate this Plan and to (a) exchange all
Options or Restricted Stock Awards for options to purchase common stock in the
successor corporation or (b) distribute to each Awardee cash and/or other
property in an amount equal to and in the same form as the Optionee would have
received from the successor corporation if the Optionee had owned the Shares
subject to the Option rather than the Option at the time of the Change of
Control. The form of payment or distribution to the Optionee pursuant to this
Section shall be determined by the Board.
Section 18. Amendment of the Plan.
Insofar as permitted by law and the Plan, the Board may from time to
time suspend, terminate or discontinue the Plan or revise or amend it in any
respect whatsoever with respect to any Shares at the time not subject to an
Option; provided, however, that without approval of the stockholders, no such
revision or amendment may change the aggregate number of Shares for which
Options may be awarded hereunder, change the designation of the class of
Employees eligible to receive Options or decrease the price at which Options may
be awarded.
Any other provision of this Section 18 notwithstanding, the Board
specifically is authorized to adopt any amendment to this Plan deemed by the
Board to be necessary or advisable to assure that the Incentive Stock Options or
the non-qualified stock options available under the Plan continue to be treated
as such, respectively, under all applicable laws.
14
Section 19. Application of Funds.
The proceeds received by the Company from the sale of Shares
pursuant to the exercise of Options or the purchase of Restricted Stock shall be
used for general corporate purposes or such other purpose as may be determined
by the Board.
Section 20. No Obligation to Exercise Option.
The Awarding of an Option shall impose no obligation upon the
Optionee to exercise such Option.
Section 21. Approval of Stockholders.
This Plan shall become effective on the date that it is adopted by
the Board; provided, however, that it shall become limited to a non-qualified
stock option plan if it is not approved by the holders of a majority of the
Company's outstanding voting stock within one year (365 days) of its adoption by
the Board. The Board may make Awards hereunder prior to approval of the Plan or
any material amendments thereto by the holders of a majority of the Company's
outstanding voting stock; provided, however, that any and all Options so Awarded
automatically shall be converted into non-qualified stock options if the Plan is
not approved by such stockholders within 365 days of its adoption or material
amendment.
Section 22. Conditions Upon Issuance of Shares.
Shares shall not be issued pursuant to the exercise of an Option or
Award of Restricted Stock unless the exercise of such Option and the issuance
and delivery of such Shares pursuant thereto or the issuance of Restricted Stock
shall comply with all relevant provisions of law, including, without limitation,
the Securities Act, the Exchange Act, the rules and regulations promulgated
thereunder, and the requirements of any stock exchange upon which the Shares may
then be listed, and shall be further subject to the approval of counsel for the
Company with respect to such compliance.
Section 23. Reservation of Shares.
The Company, during the term of this Plan, shall at all times
reserve and keep available such number of Shares as shall be sufficient to
satisfy the requirements of the Plan.
The Company, during the term of this Plan, shall use its best
efforts to seek to obtain from appropriate regulatory agencies any requisite
authorization in order to issue and sell such number of Shares as shall be
sufficient to satisfy the requirements of the Plan. The inability of the Company
to obtain from any such regulatory agency having jurisdiction the requisite
authorization(s) deemed by the Company's counsel to be necessary for the lawful
issuance and sale of any Shares hereunder, or the inability of the Company to
confirm to its satisfaction that any issuance and sale of any Shares hereunder
will meet applicable legal requirements, shall
15
relieve the Company of any liability in respect to the failure to issue or sell
such Shares as to which such requisite authority shall not have been obtained.
Section 24. Stock Option and Stock Purchase Agreements.
Options shall be evidenced by an Option Agreement in such form or
forms as the Board shall approve from time to time. Upon the exercise of an
Option, the Optionee shall sign and deliver to the Company a Stock Purchase
Agreement in such form or forms as the Board shall approve from time to time.
Section 25. Taxes, Fees, Expenses and Withholding of Taxes.
(a) The Company shall pay all original issue and transfer taxes (but
not income taxes, if any) with respect to the Award of Options and/or the issue
and transfer of Shares pursuant to the exercise thereof, and all other fees and
expenses necessarily incurred by the Company in connection therewith, and will
from time to time use its best efforts to comply with all laws and regulations
which, in the opinion of counsel for the Company, shall be applicable thereto.
(b) The Award of Options or Restricted Stock hereunder and the
issuance of Shares pursuant to the exercise of Options is conditioned upon the
Company's reservation of the right to withhold in accordance with any applicable
law, from any compensation or other amounts payable to the Awardee, any taxes
required to be withheld under federal, state or local law as a result of the
Award or exercise of such Option or the sale of the Shares issued upon exercise
thereof. To the extent that compensation or other amounts, if any, payable to
the Awardee is insufficient to pay any taxes required to be so withheld, the
Company may, in its sole discretion, require the Awardee (or such other person
entitled herein to exercise the Option), as a condition of the exercise of an
Option, to pay in cash to the Company an amount sufficient to cover such tax
liability or otherwise to make adequate provision for the Company's satisfaction
of its withholding obligations under federal, state and local law.
Section 26. Notices.
Any notice to be given to the Company pursuant to the provisions of
this Plan shall be addressed to the Company in care of its Secretary (or such
other person as the Company may designate from time to time) at its principal
executive office, and any notice to be given to an Awardee shall be delivered
personally or addressed to him or her at the address given beneath his or her
signature on his or her Option Agreement, or at such other address as such
Awardee or his or her permitted transferee (upon the transfer of the Shares) may
hereafter designate in writing to the Company. Any such notice shall be deemed
duly given on the date and at the time delivered via personal, courier or
recognized overnight delivery service or, if sent via telecopier, on the date
and at the time telecopied with confirmation of delivery or, if mailed, on the
date five (5) days after the date of the mailing (which shall be by regular,
registered or certified mail). Delivery of a notice by telecopy (with
confirmation) shall be permitted and shall be considered
16
delivery of a notice notwithstanding that it is not an original that is
received. It shall be the obligation of each Optionee and each permitted
transferee holding Shares purchased upon exercise of an Option to provide the
Secretary of the Company, by letter mailed as provided herein, with written
notice of his or her direct mailing address.
Section 27. No Enlargement of Awardee Rights.
This Plan is purely voluntary on the part of the Company, and the
continuance of the Plan shall not be deemed to constitute a contract between the
Company and any Awardee, or to be consideration for or a condition of the
employment or service of any Awardee. Nothing contained in this Plan shall be
deemed to give any Awardee the right to be retained in the employ or service of
the Company or any Subsidiary, or to interfere with the right of the Company or
any such corporation to discharge or retire any Awardee thereof at any time
subject to applicable law. No Awardee shall have any right to or interest in
Awards authorized hereunder prior to the Award thereof to such Awardee, and upon
such Award he shall have only such rights and interests as are expressly
provided herein, subject, however, to all applicable provisions of the Company's
Certificate of Incorporation, as the same may be amended from time to time.
Section 28. Information to Awardees.
The Company, upon request, shall provide without charge to each
Awardee copies of such annual and periodic reports as are provided by the
Company to its stockholders generally.
Section 29. Availability of Plan.
A copy of this Plan shall be delivered to the Secretary of the
Company and shall be shown by him to any eligible person making reasonable
inquiry concerning it.
Section 30. Invalid Provisions.
In the event that any provision of this Plan is found to be invalid
or otherwise unenforceable under any applicable law, such invalidity or
unenforceability shall not be construed as rendering any other provisions
contained herein as invalid or unenforceable, and all such other provisions
shall be given full force and effect to the same extent as though the invalid or
unenforceable provision was not contained herein.
Section 31. Applicable Law.
This Plan shall be governed by and construed in accordance with the
laws of the State of Delaware.
17
Section 32. Board Action.
Notwithstanding anything to the contrary set forth in this Plan, any
and all actions of the Board or Committee, as the case may be, taken under or in
connection with this Plan and any agreements, instruments, documents,
certificates or other writings entered into, executed, granted, issued and/or
delivered pursuant to the terms hereof, shall be subject to and limited by any
and all votes, consents, approvals, waivers or other actions of all or certain
stockholders of the Company or other persons required pursuant to (i) the
Company's Certificate of Incorporation (as the same may be amended and/or
restated from time to time), (ii) the Company's Bylaws (as the same may be
amended and/or restated from time to time), and (iii) any other agreement,
instrument, document or writing now or hereafter existing, between or among the
Company and its stockholders or other persons (as the same may be amended from
time to time).
18
EXHIBIT A-1
HAGLER BAILLY, INC. EMPLOYEE INCENTIVE AND
NON-QUALIFIED STOCK OPTION AND RESTRICTED STOCK PLAN
INCENTIVE STOCK OPTION AGREEMENT
Hagler Bailly, Inc., a Delaware corporation (the "Company"), hereby
grants to ____________________________ (the "Optionee") an option to purchase a
total of __________ shares of Common Stock of the Company, at the price and on
the terms set forth herein, and in all respects subject to the terms,
definitions and provisions of the Hagler Bailly, Inc. Employee Incentive and
Non-Qualified Stock Option and Restricted Stock Plan (the "Plan") applicable to
Incentive Stock Options, which terms and provisions are hereby incorporated by
reference herein. Unless the context herein otherwise requires, the terms
defined in the Plan shall have the same meanings when used herein.
1. Nature of the Option. This Option is intended to be an Incentive
Stock Option within the meaning of section 422 of the Internal Revenue Code of
1986, as amended (the "Code").
2. Date of Grant; Term of Option. This Option is granted this ____
day of ______________, 199_, and it may not be exercised later than
___________________________, subject to earlier termination, as provided in the
Plan.
3. Option Exercise Price. The Option exercise price is ________
($____) per Share.
4. Exercise of Option. This Option shall be exercisable during its
term only in accordance with the terms and provisions of the Plan and this
Option Agreement as follows:
(a) Right to Exercise. This Option shall vest and be
exercisable as follows: ________________________________________________________
_______________________________________________________________________________.
(b) Method of Exercise. This Option shall be exercisable
during its term by written notice which shall state the election to exercise
this Option, the number of full Shares in respect to which this Option is being
exercised and which shall contain or be accompanied by such other
representations and agreements as to the Optionee's investment intent with
respect to such Shares as may be reasonably required by the Company as
contemplated by the Plan. Such written notice shall be signed by the Optionee
and shall be delivered in person or
1
by certified mail to the Secretary of the Company or such other person as may be
designated by the Company. The written notice shall be accompanied by payment of
the purchase price and an executed Stock Purchase Agreement in the form attached
hereto. Payment of the purchase price shall be by check or such other
consideration and other method of payment as may be authorized by the Board
pursuant to the Plan. The certificate or certificates for the Shares as to which
the Option shall be exercised shall be registered in the name of the Optionee
and shall be legended as required under the Plan, the Stock Purchase Agreement,
and/or applicable law.
(c) Restrictions on Exercise. This Option may not be exercised
if the issuance of the Shares upon such exercise or the method of payment of
consideration for such Shares would constitute a violation of any applicable
federal or state securities laws or other laws or regulations. As a condition to
the exercise of this Option, the Company may require the Optionee to make any
representation and warranty to the Company as may be required by any applicable
law or regulation.
5. Investment Representations. Unless the Shares have been
registered under the Securities Act of 1933, in connection with the acquisition
of this Option, the Optionee represents and warrants as follows:
(a) The Optionee is acquiring this Option, and upon exercise
of this Option, he will be acquiring the Shares for investment for his own
account, not as a nominee or agent, and not with a view to, or for resale in
connection with, any distribution thereof.
(b) The Optionee has a preexisting business or personal
relationship with the Company or one of its directors, officers or controlling
persons and by reason of his business or financial experience, has, and could be
reasonably assumed to have, the capacity to protect his interests in connection
with the acquisition of this Option and the Shares.
6. Termination of Status as an Employee. Subject to the provisions
of Section 7 hereof, if the Optionee ceases to serve the Company or its
Subsidiaries for any reason other than death or Disability and thereby
terminates his status as an Employee, the Optionee shall have the right to
exercise this Option at any time within the three (3) month period after the
date of such termination to the extent that the Optionee was entitled to
exercise the Option at the date of such termination. If the Optionee ceases to
serve the Company due to death or Disability, this Option may be exercised at
any time within one (1) year after the date of death or termination of service
due to Disability, in the case of death, by the Optionee's estate or by a person
who acquired the right to exercise this Option by bequest or inheritance, or, in
the case of Disability, by the Optionee or his legal guardian or representative,
but in any case only to the extent the Optionee was entitled to exercise this
Option at the date of such termination. To the extent that the Optionee was not
entitled to exercise the Option at the date of termination, or to the extent the
Option is not exercised within the time specified herein, this Option shall
2
terminate. Notwithstanding the foregoing, this Option shall not be exercisable
after the expiration of the term set forth in Section 2 hereof.
7. Forfeiture of Option. Notwithstanding any other provision of this
Option, if an Optionee shall engage in any activity in breach of the Covenant
Not to Compete, all Options held by such Optionee which have not yet been
exercised shall terminate immediately upon the commencement thereof. If an
Optionee's employment is terminated for "Cause" (as defined in the Stockholders
Agreement), all unexercised Options shall terminate upon the date of termination
of employment for Cause.
8. Non-transferability of Option. This Option may not be sold,
pledged, assigned, hypothecated, gifted, transferred or disposed of in any
manner either voluntarily or involuntarily by operation of law, other than by
will or by the laws of descent or distribution, and may be exercised during the
lifetime of the Optionee only by such Optionee (or by such Optionee's
representation pursuant to Section 6). Subject to the foregoing and the terms of
the Plan, the terms of this Option shall be binding upon the executors,
administrators, heirs, successors and assigns of the Optionee.
9. Continuation of Employment. Neither the Plan nor this Option
shall confer upon any Optionee any right to continue in the employment of the
Company or limit in any respect the right of the Company to discharge the
Optionee at any time, with or without cause and with or without notice.
10. Withholding. The Company reserves the right to withhold, in
accordance with any applicable laws, from any consideration payable to Optionee
any taxes required to be withheld by federal, state or local law as a result of
the grant or exercise of this Option or the sale or other disposition of the
Shares issued upon exercise of this Option. If the amount of any consideration
payable to the Optionee is insufficient to pay such taxes or if no consideration
is payable to the Optionee, upon the request of the Company, the Optionee (or
such other person entitled to exercise the Option pursuant to Section 6 hereof)
shall pay to the Company an amount sufficient for the Company to satisfy any
federal, state or local tax withholding requirements it may incur, as a result
of the grant or exercise of this Option or the sale or other disposition of the
Shares issued upon the exercise of this Option.
11. The Plan. This Option is subject to, and the Company and the
Optionee agree to be bound by, all of the terms and conditions of the Plan as
such Plan may be amended from time to time in accordance with the terms thereof.
Pursuant to the Plan, the Board of Directors of the Company is authorized to
adopt rules and regulations not inconsistent with the Plan as it shall deem
appropriate and proper. A copy of the Plan in its present form is available for
inspection during business hours by the Optionee or the persons entitled to
exercise this Option at the Company's principal office.
3
12. Conversion to Non-Qualified Option. Notwithstanding anything to
the contrary set forth herein, this Option is being granted subject to the
condition that in the event the Plan is not approved by the stockholders of the
Company within 365 days of the date that the Plan was adopted by the Board of
Directors of the Company, this Option shall automatically be converted into a
non-qualified stock option.
13. Early Disposition of Stock. Subject to the fulfillment by
Optionee of any conditions upon the disposition of Shares received under this
Option, Optionee hereby agrees that if he disposes of any Shares received under
this Option within one (1) year after such Shares were transferred to him, or
within two (2) years after the Option was awarded to him, he will notify the
Company in writing within thirty (30) days after the date of such disposition.
Optionee acknowledges that disposition by him within such one (1) year or two
(2) year period would disqualify him from capital gain treatment for any gain
realized upon such disposition.
14. Entire Agreement. This Agreement, together with the Plan and the
other exhibits attached thereto or hereto, represents the entire agreement
between the parties.
15. Governing Law. This Agreement shall be construed in accordance
with the laws of the State of Delaware.
16. Amendment. Subject to the provisions of the Plan, this Agreement
may only be amended by a writing signed by each of the parties hereto.
IN WITNESS WHEREOF, the Company has caused its duly authorized
officers to execute and attest this instrument, this _____ day of __________,
199_.
By: _________________________
Name: _________________________
Title:_________________________
4
ACKNOWLEDGEMENT
The Optionee acknowledges receipt of a copy of the Hagler Bailly,
Inc. Employee Incentive and Non-Qualified Stock Option and Restricted Stock Plan
(the "Plan"), a copy of which is attached hereto, and represents that he or she
has read and is familiar with the terms and provisions thereof, and hereby
accepts this Option subject to all of the terms and provisions thereof. The
Optionee hereby agrees to accept as binding, conclusive and final all decisions
or interpretations of the Board of Directors or the Committee upon any questions
arising under the Plan.
Date: ____________________ _________________________
Signature of Optionee
_________________________
Name of Optionee
_________________________
Address
_________________________
City, State, Zip Code
THIS OPTION AND THE SECURITIES WHICH MAY BE PURCHASED UPON EXERCISE
OF THIS OPTION HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN
CONNECTION WITH, THE SALE, TRANSFER OR DISTRIBUTION THEREOF. NO SUCH SALE,
TRANSFER OR DISTRIBUTION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION
STATEMENT RELATING THERETO OR A SATISFACTORY OPINION OF COUNSEL SATISFACTORY TO
THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.
THE SHARES WHICH MAY BE PURCHASED UPON EXERCISE OF THIS OPTION MAY
BE TRANSFERRED ONLY IN ACCORDANCE WITH THE TERMS OF A STOCK PURCHASE AGREEMENT
TO BE ENTERED INTO BETWEEN THE HOLDER OF THIS OPTION AND THE COMPANY UPON
EXERCISE OF THIS OPTION, A COPY OF WHICH AGREEMENT IS ON FILE WITH THE SECRETARY
OF THE COMPANY.
5
EXHIBIT A-2
HAGLER BAILLY, INC. EMPLOYEE INCENTIVE AND
NON-QUALIFIED STOCK OPTION AND RESTRICTED STOCK PLAN
NON-QUALIFIED STOCK OPTION AGREEMENT
Hagler Bailly, Inc., a Delaware corporation (the "Company"), hereby
grants to ____________________________ (the "Optionee") an option to purchase a
total of __________ shares of Common Stock of the Company, at the price and on
the terms set forth herein, and in all respects subject to the terms,
definitions and provisions of the Hagler Bailly, Inc. Employee Incentive and
Non-Qualified Stock Option and Restricted Stock Plan (the "Plan") applicable to
non-qualified stock options, which terms and provisions are hereby incorporated
by reference herein. Unless the context herein otherwise requires, the terms
defined in the Plan shall have the same meanings when used herein.
1. Nature of the Option. This Option is intended to be a
nonstatutory stock option and is not intended to be an Incentive Stock Option
within the meaning of section 422 of the Internal Revenue Code of 1986, as
amended (the "Code"), or to otherwise qualify for any special tax benefits to
the Optionee.
2. Date of Grant; Term of Option. This Option is granted this _____
day of ________________, 199_, and it may not be exercised later than
_______________________, subject to earlier termination, as provided in the
Plan.
3. Option Exercise Price. The Option exercise price is ______
($_____) per Share.
4. Exercise of Option. This Option shall be exercisable during its
term only in accordance with the terms and provisions of the Plan and this
Option Agreement as follows:
(a) Right to Exercise. This Option shall vest and be
exercisable as follows: ________________________________________________________
_______________________________________________________________________________.
(b) Method of Exercise. This Option shall be exercisable
during its term by written notice which shall state the election to exercise
this Option, the number of full Shares in respect to which this Option is being
exercised and which shall contain or be accompanied by such other
representations and agreements as to the Optionee's investment intent
1
with respect to such Shares as may be reasonably required by the Company as
contemplated by the Plan. Such written notice shall be signed by the Optionee
and shall be delivered in person or by certified mail to the Secretary of the
Company or such other person as may be designated by the Company. The written
notice shall be accompanied by payment of the purchase price and an executed
Stock Purchase Agreement in the form attached hereto. Payment of the purchase
price shall be by check or such consideration and method of payment authorized
by the Board pursuant to the Plan. The certificate or certificates for the
Shares as to which the Option shall be exercised shall be registered in the name
of the Optionee and shall be legended as required under the Plan, the Stock
Purchase Agreement, and/or applicable law.
(c) Restrictions on Exercise. This Option may not be exercised
if the issuance of the Shares upon such exercise would constitute a violation of
any applicable federal or state securities laws or other laws or regulations. As
a condition to the exercise of this Option, the Company may require the Optionee
to make any representation and warranty to the Company as may be required by any
applicable law or regulation.
5. Investment Representations. Unless the Shares have been
registered under the Securities Act of 1933, in connection with the acquisition
of this Option, the Optionee represents and warrants as follows:
(a) The Optionee is acquiring this Option, and upon exercise
of this Option, he will be acquiring the Shares for investment for his own
account, not as a nominee or agent, and not with a view to, or for resale in
connection with, any distribution thereof.
(b) The Optionee has a preexisting business or personal
relationship with the Company or one of its directors, officers or controlling
persons and by reason of his business or financial experience, has, and could be
reasonably assumed to have, the capacity to protect his interests in connection
with the acquisition of this Option and the Shares.
6. Termination of Status as an Employee. Subject to the provisions
of Section 7 hereof, if the Optionee ceases to serve the Company or its
Subsidiaries for any reason other than death or Disability and thereby
terminates his status as an Employee, the Optionee shall have the right to
exercise this Option at any time within the three (3) month period after the
date of such termination to the extent that the Optionee was entitled to
exercise the Option at the date of such termination. If the Optionee ceases to
serve the Company due to death or Disability, this Option may be exercised at
any time within one (1) year after the date of death or termination of service
due to Disability, in the case of death, by the Optionee's estate or by a person
who acquired the right to exercise this Option by bequest or inheritance, or, in
the case of Disability, by the Optionee or his legal guardian or representative,
but in any case only to the extent the Optionee was entitled to exercise this
Option at the date of such termination. To the extent that the Optionee was not
entitled to exercise the Option at the date of termination, or to
2
the extent the Option is not exercised within the time specified herein, this
Option shall terminate. Notwithstanding the foregoing, this Option shall not be
exercisable after the expiration of the term set forth in Section 2 hereof.
7. Forfeiture of Option. Notwithstanding any other provision of this
Option, if an Optionee shall engage in any activity in breach of the Covenant
Not to Compete, all Options held by such Optionee which have not yet been
exercised shall terminate immediately upon the commencement thereof. If an
Optionee's employment is terminated for "Cause" (as defined in the Stockholders
Agreement), all unexercised Options shall terminate upon the date of termination
of employment for Cause.
8. Non-transferability of Option. This Option may not be sold,
pledged, assigned, hypothecated, gifted, transferred or disposed of in any
manner either voluntarily or involuntarily by operation of law, other than by
will or by the laws of descent or distribution, and may be exercised during the
lifetime of the Optionee only by such Optionee (or by such Optionee's
representative pursuant to Section 6). Subject to the foregoing and the terms of
the Plan, the terms of this Option shall be binding upon the executors,
administrators, heirs, successors and assigns of the Optionee.
9. Continuation of Employment or Engagement. Neither the Plan nor
this Option shall confer upon any Optionee any right to continue in the service
of the Company or any of its Subsidiaries or limit, in any respect, the right of
the Company to discharge the Optionee at any time, with or without cause and
with or without notice.
10. Withholding. The Company reserves the right to withhold, in
accordance with any applicable laws, from any consideration payable to Optionee
any taxes required to be withheld by federal, state or local law as a result of
the grant or exercise of this Option or the sale or other disposition of the
Shares issued upon exercise of this Option. If the amount of any consideration
payable to the Optionee is insufficient to pay such taxes or if no consideration
is payable to the Optionee, upon the request of the Company, the Optionee (or
such other person entitled to exercise the Option pursuant to Section 6 hereof)
shall pay to the Company an amount sufficient for the Company to satisfy any
federal, state or local tax withholding requirements it may incur, as a result
of the grant or exercise of this Option or the sale or other disposition of the
Shares issued upon the exercise of this Option.
11. The Plan. This Option is subject to, and the Company and the
Optionee agree to be bound by, all of the terms and conditions of the Plan as
such Plan may be amended from time to time in accordance with the terms thereof.
Pursuant to the Plan, the Board of Directors of the Company is authorized to
adopt rules and regulations not inconsistent with the Plan as it shall deem
appropriate and proper. A copy of the Plan in its present form is available
3
for inspection during business hours by the Optionee or the persons entitled to
exercise this Option at the Company's principal office.
12. Entire Agreement. This Agreement, together with the Plan and the
other exhibits attached thereto or hereto, represents the entire agreement
between the parties.
13. Governing Law. This Agreement shall be construed in accordance
with the laws of the State of Delaware.
14. Amendment. Subject to the provisions of the Plan, this Agreement
may only be amended by a writing signed by each of the parties hereto.
IN WITNESS WHEREOF, the Company has caused its duly authorized
officers to execute and attest this instrument this _____ day of __________,
199_.
By: _________________________
Name: _________________________
Title:_________________________
4
ACKNOWLEDGEMENT
The Optionee acknowledges receipt of a copy of the Hagler Bailly,
Inc. Employee Incentive and Non-Qualified Stock Option and Restricted Stock Plan
(the "Plan"), a copy of which is attached hereto, and represents that he or she
has read and is familiar with the terms and provisions thereof, and hereby
accepts this Option subject to all of the terms and provisions thereof. The
Optionee hereby agrees to accept as binding, conclusive and final all decisions
or interpretations of the Board of Directors or the Committee upon any questions
arising under the Plan.
Date: ____________________ _________________________
Signature of Optionee
_________________________
Name of Optionee
_________________________
Address
_________________________
City, State, Zip Code
THIS OPTION AND THE SECURITIES WHICH MAY BE PURCHASED UPON EXERCISE
OF THIS OPTION HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN
CONNECTION WITH, THE SALE, TRANSFER OR DISTRIBUTION THEREOF. NO SUCH SALE,
TRANSFER OR DISTRIBUTION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION
STATEMENT RELATING THERETO OR A SATISFACTORY OPINION OF COUNSEL SATISFACTORY TO
THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.
THE SHARES WHICH MAY BE PURCHASED UPON EXERCISE OF THIS OPTION MAY
BE TRANSFERRED ONLY IN ACCORDANCE WITH THE TERMS OF A STOCK PURCHASE AGREEMENT
TO BE ENTERED INTO BETWEEN THE HOLDER OF THIS OPTION AND THE COMPANY UPON
EXERCISE OF THIS OPTION, A COPY OF WHICH AGREEMENT IS ON FILE WITH THE SECRETARY
OF THE COMPANY.
5
EXHIBIT B
HAGLER BAILLY, INC. EMPLOYEE INCENTIVE AND
NON-QUALIFIED STOCK OPTION AND RESTRICTED STOCK PLAN
STOCK PURCHASE AGREEMENT
This Agreement is made this _____ day of ____________, 199_, by and
between Hagler Bailly, Inc., a Delaware corporation (the "Company"), and
___________________________ (the "Optionee").
R E C I T A L S:
1. Optionee was granted a Stock Option (the "Option") on
________________, 19___ pursuant to the Hagler Bailly, Inc. Employee Incentive
and NonQualified Stock Option and Restricted Stock Plan (the "Plan"), the terms
and conditions of which are incorporated herein by reference.
2. Pursuant to said Option, Optionee was granted the right to
purchase _________ shares of the Company's Common Stock, as adjusted in
accordance with the Plan (the "Optioned Shares").
3. Optionee has elected to exercise the Option to purchase
______________ of such Optioned Shares (herein referred to as the "Shares")
under the Stock Option Agreement evidencing said Option (the "Option
Agreement").
4. As required by the Option Agreement, as a condition to Optionee's
exercise of the Option, Optionee must execute this Agreement which gives the
Company certain rights, including, but not limited to, transfer restrictions
with respect to the Shares, rights of first refusal upon a proposed sale or
transfer of the Shares and other rights to repurchase the Shares being issued
pursuant to the terms hereof.
NOW, THEREFORE, IT IS AGREED between the parties as follows:
1. Definitions. Unless the context herein otherwise requires, or a
definition is otherwise provided below in this Section 1 or elsewhere in the
Agreement, the defined terms in the Plan shall have the same meaning herein.
1
As used in this Agreement, the following terms shall have the following
respective meanings:
"Termination of Employment" shall mean the termination or cessation
of the Employee's employment with or engagement by the Company (or any
subsidiary thereof).
"Transfer" shall include any direct or indirect sale, assignment,
transfer, pledge, hypothecation or other disposition of any Shares or of any
legal or beneficial interest therein.
2. Exercise of Option. Subject to the terms and conditions hereof,
Optionee hereby agrees to exercise his Option or a portion thereof to purchase
______________ Shares of Common Stock at $________ per Share, payable in
accordance with the terms and provisions of the Option Agreement.
3. Transfer Restrictions.
(a) In General. Optionee hereby agrees to be bound by the
terms, conditions and restrictions set forth in the Stockholders Agreement.
Optionee hereby agrees to become a signatory and party to the Stockholders
Agreement and to execute any and all necessary or appropriate documents or
instruments to effect the foregoing. The terms of the Stockholders Agreement are
incorporated herein by reference.
(b) No Transfers During Employment or Other Engagement. In
addition to the restrictions imposed by Section 3(a) herein, Optionee hereby
agrees that he shall not Transfer any of his Shares except as otherwise
specifically provided for herein. Anything to the contrary herein
notwithstanding, the Stockholder shall not at any time Transfer any Shares for
so long as he shall be employed by the Company and such Shares remain subject to
the Company's repurchase option under this Agreement, except pursuant to Section
3(c) herein.
(c) Permitted Transfers. Notwithstanding anything to the
contrary contained herein, the Stockholder may Transfer all or any of his Shares
to the spouse, parents, siblings or lineal descendants of the Stockholder or to
any trust for the exclusive benefit of any of the foregoing or of the
Stockholder; provided that any such transferee shall agree in writing with the
Company, prior to and as a condition precedent to such transfer, to be bound by
all of the provisions of this Agreement to the same extent as if such transferee
was the Stockholder (including, but not limited to, being affected hereunder by
all subsequent occurrences giving rise to repurchase rights of the Company to
purchase the Shares of the original Stockholder/transferor then held by the
permitted transferee) and provided, further, that the interests in such trusts
shall be non-transferable.
2
(d) Public Offering. If requested in writing by the managing
underwriters, if any, of any public offering of the Company's Common Stock, the
Stockholder agrees not to offer, sell, contract to sell or otherwise dispose of
any Shares, except to the extent such Shares are being registered for sale in
such public offering, within thirty (30) days before and up to three hundred and
sixty-five (365) days after the effective date of the registration statement
filed with respect to said public offering.
4. Right of First Refusal on Dispositions.
(a) To the extent permitted by applicable securities laws, if
at any time the Stockholder receives a bona fide, arm's length offer from a
credit worthy third party which such Stockholder desires to accept (the
"Proposed Transferee"), the Stockholder shall submit a written offer (the
"Offer") to sell such Shares (the "Offered Shares") to the Company, on terms and
conditions, including price, not less favorable to the Company than those on
which the Stockholder proposes to sell the Offered Shares to the Proposed
Transferee. The Offer shall disclose the identity of the Proposed Transferee,
the number of Offered Shares proposed to be sold, the total number of Shares
owned by the Stockholder, the terms and conditions, including price, of the
proposed sale, the address of the Stockholder and any other material facts
relating to the proposed sale.
(b) If the Company desires to purchase all of the Offered
Shares, the Company shall communicate in writing its election to purchase (an
"Acceptance") to the Stockholder, which Acceptance shall be delivered in person
or mailed to the Stockholder within twenty (20) days after the date the Offer
was made.
(c) If the Company accepts the Offer as to all of the Offered
Shares, the sale of the Offered Shares to be sold to the Company pursuant to
this Section 4(c) shall be made at the offices of the Company on or before the
thirtieth (30th) day following the expiration of the aforementioned 20-day
period, after the Offer is made (or if such thirtieth (30th) day is not a
business day, then on the next succeeding business day). Such sales shall be
effected by the Stockholder's delivery to the Company of a certificate or
certificates evidencing the Offered Shares to be purchased by it or him, duly
endorsed for transfer to the Company, which Shares shall be delivered free and
clear of all liens, charges, claims and encumbrances of any nature whatsoever,
against payment to the Stockholder of the purchase price therefor by the
Company. Payment for the Offered Shares shall be made as provided in the Offer
or by wire transfer or certified check.
(d) If the Company does not agree to purchase all of the
Offered Shares, then the Offered Shares may be sold by the Stockholder at any
time within ninety (90) days after the date the Offer was made. Any such sale
shall be to the Proposed Transferee, at not less than the price and upon other
terms and conditions, if any, not more favorable to the
3
Proposed Transferee than those specified in the Offer. Any Offered Shares not
sold within such 90-day period shall continue to be subject to the requirements
of a prior offer pursuant to this Section 4(d).
(e) Nothing herein shall exempt Stockholder from complying
with the terms and conditions of the Stockholders Agreement in the event of a
sale to the Proposed Transferee.
5. Failure to Deliver Shares. If the Stockholder becomes obligated
to sell any Shares to the Company under this Agreement and fails to deliver such
Shares in accordance with the terms of this Agreement (a "Defaulting
Stockholder"), the Company, at its option, in addition to all other remedies
available at law or in equity, may send to the Stockholder the purchase price
for such Shares as is herein specified. Thereupon, the Company, upon written
notice to the Stockholder, shall cancel on its books the certificate or
certificates representing the Shares to be sold.
6. Escrow. As security for his faithful performance of the terms of
this Agreement and to insure the availability for delivery of Stockholder's
Shares upon exercise, under this Agreement, of the rights of the Company and the
rights of the other beneficiaries to this Agreement, Stockholder agrees, if
requested in writing by the Company, to deliver to and deposit with the
Secretary of the Company or his nominee ("the Escrow Holder"), as escrow holder
in this transaction, five Stock Assignments duly endorsed (with date and number
of shares blank) in the form attached hereto as Attachment A, together with the
certificate or certificates evidencing the Shares; said documents are to be held
by the Escrow Holder and delivered to said Escrow Holder pursuant to the Joint
Escrow Instructions of the Company and Stockholder set forth in Attachment B
attached hereto and incorporated herein by this reference, which instructions
shall also be delivered to the Escrow Holder at the closing hereunder.
7. Assignment. The Company may assign its rights under paragraph 4
hereof to one or more persons, who shall have the right to so exercise such
rights in his own name and for his own account. If the exercise of any such
right requires the consent of any state or other regulatory authority, the
parties agree to cooperate in requesting such consent.
8. Adjustment. If, from time to time during the term of the
Stockholders Agreement:
(a) There is any stock dividend or liquidating dividend of
cash and/or property, stock split or other change in the character or amount of
any of the outstanding securities of the Company; or
4
(b) There is any consolidation, merger or sale of all or
substantially all of the assets of the Company;
then, in such event, any and all new, substituted or additional securities or
other property to which Optionee is entitled by reason of his ownership of
Shares shall be immediately subject to the terms of the Stockholders Agreement,
and be included in the term "Stock" (as defined therein) for all purposes with
the same force and effect as the Stock presently subject to such rights and
restrictions (provided, however, that if such consolidation, merger or sale of
all, or substantially all, of the assets of the Company causes a termination of
the rights and restrictions set forth in the Stockholders Agreement, then such
new, substituted or additional securities or other property shall not be
included in the word "Stock" for the purposes of this paragraph).
9. Legends. All certificates representing any Shares of the Company
subject to the provisions of this Agreement shall have endorsed thereon the
following legend in substantially the following form unless in the opinion of
counsel such legend is no longer necessary:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED OR ANY APPLICABLE STATE
SECURITIES LAWS. THESE SHARES HAVE NOT BEEN ACQUIRED WITH A VIEW TO
DISTRIBUTION OR RESALE, AND MAY NOT BE SOLD, ASSIGNED, EXCHANGED,
MORTGAGED, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED OR
DISPOSED OF, BY GIFT OR OTHERWISE, OR IN ANY WAY ENCUMBERED WITHOUT
AN EFFECTIVE REGISTRATION STATEMENT FOR SUCH SHARES UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, AND ANY APPLICABLE STATE
SECURITIES LAWS, OR A SATISFACTORY OPINION OF COUNSEL SATISFACTORY
TO HAGLER BAILLY, INC. THAT REGISTRATION IS NOT REQUIRED UNDER SUCH
ACT AND UNDER APPLICABLE STATE SECURITIES LAWS. MOREOVER, THE SHARES
REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO AND RESTRICTED BY THE
PROVISIONS OF A CERTAIN STOCK PURCHASE AGREEMENT BETWEEN HAGLER
BAILLY, INC. AND THE STOCKHOLDER AND THE TERMS OF A CERTAIN
STOCKHOLDERS AGREEMENT, A COPY OF WHICH AGREEMENT WILL BE FURNISHED
BY HAGLER BAILLY, INC. UPON WRITTEN REQUEST AND WITHOUT CHARGE,
5
AND ALL OF THE PROVISIONS OF SUCH AGREEMENTS ARE INCORPORATED BY
REFERENCE IN THIS CERTIFICATE.
10. Investment Representations. Unless the Shares have been
registered under the Securities Act of 1933, as amended (the "Act"), in which
event the Company will so advise Optionee in writing, Optionee agrees,
represents and warrants, in connection with the proposed purchase of the Shares,
that:
(a) he is purchasing the Shares solely for his own account for
investment and not with a view to, or for resale in connection with any
distribution thereof within the meaning of the Act. Optionee further represents
that he does not have any present intention of selling, offering to sell or
otherwise disposing of or distributing the Shares or any portion thereof; and
that the entire legal and beneficial interest of the Shares he is purchasing is
being purchased for, and will be held for the account of, Optionee only and
neither in whole nor in part for any other person;
(b) he is aware of the Company's business affairs and
financial condition and has acquired sufficient information about the Company to
reach an informed and knowledgeable decision to acquire the Shares. Optionee
further represents that he has a preexisting personal or business relationship
with the officers and directors of the Company and that he has such knowledge
and experience in business and financial matters to enable him to evaluate the
risks of the prospective investment and to make an informed investment decision
with respect thereto and that he has the capacity to protect his own interests
in connection with the purchase of the Shares. Optionee further represents and
warrants that he has discussed the Company and its plans, operations and
financial condition with its officers, has received all such information as he
deems necessary and appropriate to enable him to evaluate the financial risk
inherent in making an investment in the Shares and has received satisfactory and
complete information concerning the business and financial condition of the
Company in response to all inquiries in respect thereof;
(c) he realizes that his purchase of the Shares will be a
speculative investment and that he is able, without impairing his financial
condition, to hold the Shares for an indefinite period of time and to suffer a
complete loss on his investment;
(d) the Company has disclosed to him in writing that (i) the
sale of the Shares has not been registered under the Act, and the Shares must be
held indefinitely unless a transfer of them is subsequently registered under the
Act or an exemption from such registration is available, and that the Company is
under no obligation to register the Shares; and (ii) the Company shall make a
notation in its records of the aforementioned restrictions on transfer and
legends.
6
11. Miscellaneous.
(a) Subject to the provisions of this Agreement, Optionee
shall, during the term of this Agreement, exercise all rights and privileges of
a stockholder of the Company with respect to the purchased Shares.
(b) The parties agree to execute such further instruments and
to take such further action as may reasonably be necessary to carry out the
intent of this Agreement.
(c) Any notice required or permitted hereunder shall be given
in writing and shall be deemed effectively given upon personal delivery or upon
deposit in the United States Post Office, by registered or certified mail with
postage and fees prepaid, addressed to the other party hereto at his address
hereinafter shown below his signature or at such other address as such party may
designate by ten (10) days' advance written notice to the other party hereto.
(d) This Agreement shall inure to the benefit of the
successors and assigns of the Company and, subject to all compliance with the
restrictions on transfer herein set forth, be binding upon Optionee, his heirs,
executors, administrators, and permitted successors and assigns.
(e) This Agreement shall be construed under the laws of the
State of Delaware and constitutes the entire Agreement of the parties with
respect to the subject matter hereof superseding all prior written or oral
agreements, and no amendment or addition hereto shall be deemed effective unless
agreed to in writing by the parties hereto.
(f) If any provision of this Agreement is held by a court of
competent jurisdiction to be invalid, void or unenforceable, the remaining
provisions shall nevertheless continue in full force and effect without being
impaired or invalidated in any way and shall be construed in accordance with the
purposes and tenor and effect of this Agreement.
(g) Nothing in this Agreement shall be deemed to create any
term of employment or affect in any manner whatsoever the right or power of the
Company to terminate Optionee's employment.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the day and year first above-written.
7
HAGLER BAILLY, INC.
By: _____________________________
Title:_____________________________
___________________________________
(Optionee's Signature)
Address: __________________________
__________________________
8
CONSENT OF SPOUSE
Name of Optionee:__________________________
The undersigned spouse of Optionee agrees that his or her interest,
if any, in the Shares subject to the foregoing Stock Purchase Agreement shall be
irrevocably bound by this Stock Purchase Agreement and further understands and
agrees that any community property interest, if any, shall be similarly bound by
this Stock Purchase Agreement.
Date: ________________ _______________________
Spouse of Optionee
9
ATTACHMENT A
ASSIGNMENT SEPARATE FROM CERTIFICATE
FOR VALUE RECEIVED _________________________ hereby sells, assigns and
transfers unto _________________________________________________________________
(_________) shares of the Common Stock (the "Shares") of Hagler Bailly, Inc., a
Delaware corporation (the "Company"), standing in the undersigned's name on the
books of the Company represented by Certificate No. __________ herewith, and
does hereby irrevocably constitute and appoint __________________________
attorney to transfer the said shares on the books of the Company with full power
of substitution in the premises.
Dated: ________________ Signature: ________________________
10
JOINT ESCROW INSTRUCTIONS
__________, 19__
__________________________
Secretary,
Hagler Bailly, Inc.
[address & phone number]
Dear _____________________:
As Escrow Agent for both Hagler Bailly, Inc., a Delaware corporation
(the "Company"), and the undersigned grantee of an option to purchase stock of
the Company (the "Optionee"), you are hereby authorized and directed to hold the
documents delivered to you pursuant to the terms of that certain Stock Purchase
Agreement dated _______________, 19__, to which a copy of these Joint Escrow
Instructions is attached as Attachment B (the "Agreement"), in accordance with
the following instructions:
1. In the event the Company and/or any assignee or designee of the
Company (referred to collectively for convenience herein as the "Company")
and/or any other signatory to or beneficiary of rights set forth in the
Agreement shall elect to exercise any rights of first refusal, other rights of
repurchase and/or other rights (collectively, "Rights") set forth in the
Agreement, the Company shall give to Optionee and you a written notice
specifying the number of shares of stock to be purchased, the purchase price,
and the time for a closing hereunder at the principal executive office of the
Company. The Optionee and the Company hereby irrevocably authorize and direct
you to close the transaction contemplated by such notice in accordance with the
terms of said notice.
2. At the closing, you are directed (a) to date the stock
assignments necessary for the transfer in question, (b) to fill in the number of
shares being transferred, (c) to deliver same, together with the certificate
evidencing the shares of stock to be transferred, to the Company or other
applicable purchaser against the simultaneous delivery to you of the purchase
price (by check, delivery of shares of common stock of the Company having a fair
market value equal to the purchase price, or some combination thereof) for the
number of shares of stock being purchased pursuant to the exercise of the
Rights, and (d) to take any and all other actions deemed by you to be necessary,
appropriate or desirable to effect the terms of or contemplated by the
Agreement.
1
3. Optionee irrevocably authorizes the Company to deposit with you
any certificates evidencing shares of stock (and stock assignments) to be held
by you hereunder and any additions and substitutions to said stock as defined in
the Agreement. Optionee does hereby irrevocably constitute and appoint you as
his attorney-in-fact and agent for the term of this escrow to execute with
respect to such securities all stock certificates, stock assignments, or other
documents necessary or appropriate to make such securities negotiable and
complete any transaction contemplated herein or in the Agreement or the
Company's Incentive and NonQualified Stock Option and Restricted Stock Plan.
4. This escrow shall terminate at such time as there are no longer
any shares of stock subject to the Rights.
5. The Employee shall have the right to vote the shares of stock
deposited hereunder (the "Shares"). Subject to the next succeeding sentence, all
dividends and other distributions of cash or property, other than securities
(which are addressed below), paid or made with respect to the Shares held in
escrow shall be accumulated and held in escrow by the Company for the benefit of
the Optionee and will, upon termination of the escrow, be paid over to the
Optionee, together with interest actually earned thereon from the date of
payment of such dividends or distributions through the date as of which such
dividends or distributions are paid over. If and to the extent any Shares are
repurchased by the Company, all undistributed dividends and other distributions
attributable to the Shares so repurchased, as well as the interest actually
earned thereon, shall become the sole property of the Company, free and clear of
any claim by the Optionee. If, from time to time during the term of the escrow
arrangement, there is (i) any stock dividend, stock split or other change in the
Shares, or (ii) any merger or sale of all or substantially all of the assets or
other acquisition of the company, any and all new, substituted or additional
securities to which the Optionee is entitled by reason of his ownership of the
Shares shall be immediately subject to this escrow, deposited with the Escrow
Agent and included thereafter as Shares subject to repurchase for purposes of
the Agreement.
6. If at the time of termination of this escrow you should have in
your possession any documents, securities, or other property belonging to
Optionee, you shall deliver all of same to Optionee and shall be discharged of
all further obligations hereunder.
7. Your duties hereunder may be altered, amended, modified or
revoked only by a writing signed by all of the parties hereto, provided,
however, that the Company may, at any time, elect to terminate this escrow by
notice to the Optionee and you.
8. You shall be obligated only for the performance of such duties as
are specifically set forth herein and may rely and shall be protected in relying
or refraining from acting on any instrument reasonably believed by you to be
genuine and to have been signed or presented by the proper party or parties. You
shall not be personally liable for any act you may do or omit to do hereunder as
Escrow Agent or as attorney-in-fact for Optionee while acting in good faith and
in the exercise of your own good judgment, and any act done or omitted by you
2
pursuant to the advice of your own attorneys, who may be counsel to the Company,
shall be conclusive evidence of such good faith.
9. You are hereby expressly authorized to disregard any and all
directions, notices and/or warnings given by any of the parties hereto or by any
other person or corporation, excepting only orders or process of courts of law,
and are hereby expressly authorized to comply with and obey orders, judgments or
decrees of any court. In case you obey or comply with any such order, judgment
or decree of any court, you shall not be liable to any of the parties hereto or
to any other person, firm or corporation by reason of such compliance,
notwithstanding any such order, judgment or decree being subsequently reversed,
modified, annulled, set aside, vacated or found to have been entered without
jurisdiction.
10. You shall not be liable in any respect on account of the
identity, authorities or rights of the parties executing or delivering or
purporting to execute or deliver the Agreement or any documents or papers
deposited or called for hereunder.
11. You shall not be liable for the unenforceability or outlawing of
any rights with respect to these Joint Escrow Instructions, the Agreement or any
documents deposited with you nor shall you be liable for the running of any
statute of limitations with respect to any such rights.
12. You may, but need not, submit a memorandum to the Optionee and
to the Company setting forth action you intend to take with respect to the
escrow of the Shares and requesting the parties to acknowledge the propriety of
the intended action. If, in any such case, either party fails or refuses to
acknowledge the propriety of the intended action, you may engage and seek the
advice of counsel, who may be counsel to the Company, and other experts (and may
pay such counsel and experts reasonable compensation and expenses), and any
action taken in accordance with the written advice of such counsel and/or
experts shall be full protection to you in respect thereto against any person.
It is agreed that in any event you shall not be liable for any action or failure
to act taken in good faith, and that your liability shall be limited to actions
or inaction constituting gross negligence or willful misconduct.
13. All reasonable costs, fees and disbursements incurred by the
Escrow Holder in connection with the performance of his duties hereunder shall
be borne by the Company.
14. Your responsibilities as Escrow Agent hereunder shall terminate
if you shall cease to be Secretary of the Company or if you shall resign by
written notice to each party. In the event of any such termination or
resignation, the Company shall have the right to appoint any officer of the
company as successor Escrow Agent.
15. If you reasonably require other or further instruments in
connection with these Joint Escrow Instructions or obligations in respect
hereto, the necessary parties hereto shall join in furnishing such instruments.
3
16. It is understood and agreed that should any dispute arise with
respect to the delivery and/or ownership or right to possession of the
securities held by you hereunder, you are authorized and directed to retain in
your possession without liability to anyone all or any part of said securities
until such dispute shall have been settled either by a mutual written agreement
of the parties concerned or by a final order, decree or judgment of a court of
competent jurisdiction after the time for appeal has expired and no appeal has
been perfected, but you shall be under no duty whatsoever to institute or defend
any such proceedings.
17. Any notice required or permitted hereunder shall be given in
writing and shall be deemed effectively given upon personal delivery or upon
deposit in the United States Post office, by registered or certified mail with
postage and fees prepaid, addressed to each of the other parties thereunto
entitled at the following addresses, or at such other address as a party may
designate by ten (10) days' advance written notice to each of the other parties
hereto.
COMPANY: Hagler Bailly, Inc.
1530 Wilson Boulevard
Suite 900
Arlington, VA 22209-2406
OPTIONEE: ______________________________
______________________________
______________________________
ESCROW AGENT: Secretary
Hagler Bailly, Inc.
1530 Wilson Boulevard
Suite 900
Arlington, VA 22209-2406
18. By signing these Joint Escrow Instructions, you become a party
hereto only for the purpose of said Joint Escrow Instructions; you do not become
a party to the Agreement.
19. The parties hereto understand that in the event that the Escrow
Agent is legal counsel to the Company, said counsel may continue to act as such
in the event of any dispute in connection with these Joint Escrow Instructions
or any other transaction contemplated herein or affected hereby.
20. This instrument shall be binding upon and inure to the benefit
of the parties hereto, and their respective successors and permitted assigns.
4
Very truly yours,
HAGLER BAILLY, INC.
By: ________________________________
Title: _____________________________
Optionee:
____________________________________
(signature)
Name: ______________________________
Address: ___________________________
___________________________
5
Agreed to and accepted as of the date set forth
above.
Escrow Agent
By: _________________________________
Secretary of
Hagler Bailly, Inc.
Name: ________________________________
HAGLER BAILLY, INC.
1530 Wilson Boulevard
Suite 900
Arlington, VA 22209-2406
____________ __, 199_
[Name of Grantee]
_____________________
_____________________
_____________________
RE: Grant of Non-Qualified Stock Option
Dear ______________:
I am pleased to inform you that effective ___________ __, 199_,
Hagler Bailly, Inc., a Delaware corporation (the "Company"), has granted to you
an option to purchase _______ shares of the Company's Common Stock at an
exercise price of $_______ per share (the "Option"). This Option constitutes a
non-qualified stock option and is governed by the Hagler Bailly, Inc. Employee
Incentive and Non-Qualified Stock Option and Restricted Stock Plan (the "Plan"),
a copy of which is attached to this letter.
This grant is conditioned upon your execution of (1) an
Acknowledgement, attached to the Non-Qualified Stock Option Agreement which
describes the terms of your Option and (2) a joinder or counterpart to the
Stockholders Agreement with the Company which will apply to all shares of the
Company's Common Stock issued to you upon exercise of your Option. You will find
a copy of the Non-Qualified Stock Option Agreement and accompanying
Acknowledgement, as well as the Stockholders Agreement, enclosed herein. Please
sign the Acknowledgement and Stockholders Agreement as indicated and return them
with this letter.
Please indicate your acceptance of this Option by signing this
letter in the space provided below and returning it to the attention of the
Options Committee at the above-listed address, along with the executed
Acknowledgement and Stockholders Agreement.
1
If you have any questions, please do not hesitate to contact me.
HAGLER BAILLY, INC.
BY:____________________________
ACCEPTED AND ACKNOWLEDGED:
___________________________
Grantee
Dated: ____________________
HAGLER BAILLY, INC.
1530 Wilson Boulevard
Suite 900
Arlington, VA 22209-2406
____________ __, 199_
[Name of Grantee]
_____________________
_____________________
_____________________
RE: Grant of Incentive Stock Option
Dear ______________:
I am pleased to inform you that effective ___________ __, 199_,
Hagler Bailly, Inc., a Delaware corporation (the "Company"), has granted to you
an option to purchase _______ shares of the Company's Common Stock at an
exercise price of $_______ per share (the "Option"). This Option constitutes an
incentive stock option within the meaning of section 422 of the Internal Revenue
Code of 1986, as amended, and is governed by the Hagler Bailly, Inc. Employee
Incentive and Non-Qualified Stock Option and Restricted Stock Plan (the "Plan"),
a copy of which is attached to this letter.
This grant is conditioned upon your execution of (1) an
Acknowledgement, attached to the Incentive Stock Option Agreement which
describes the terms of your Option and (2) a joinder or counterpart to the
Stockholders Agreement with the Company which will apply to all shares of the
Company's Common Stock issued to you upon exercise of your Option. You will find
a copy of the Incentive Stock Option Agreement and accompanying Acknowledgement,
as well as the Stockholders Agreement, enclosed herein. Please sign the
Acknowledgement and Stockholders Agreement as indicated and return them with
this letter.
Please indicate your acceptance of this Option by signing this
letter in the space provided below and returning it to the attention of the
Options Committee at the above-listed address, along with the executed
Acknowledgement and Stockholders Agreement.
3
If you have any questions, please do not hesitate to contact me.
HAGLER BAILLY, INC.
BY:____________________________
ACCEPTED AND ACKNOWLEDGED:
___________________________
___________________________
Grantee
Dated: ____________________