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EXHIBIT 10.36
TRANSCOASTAL MARINE SERVICES, INC.
1998 STOCK OPTION PLAN
ARTICLE I
GENERAL PROVISIONS
1.1 PURPOSE.
The purposes of the TransCoastal Marine Services, Inc. 1998 Stock
Option Plan (the "Plan") are to advance the best interest of TransCoastal Marine
Services, Inc. (the "Company") and to attract, retain, and motivate certain key
management employees of the Company (the "Participants"), and provide such
persons with additional incentive to further the business, promote the long-term
financial success and increase shareholder value of the Company by increasing
their proprietary interest in the success of the Company. Pursuant to the Plan,
the Company may grant stock options ("Options") that are not intended to be
qualified pursuant to Section 422 of the Internal Revenue Code of 1986, as
amended (the "Code").
1.2 GENERAL.
The terms and provisions of this Article I shall be applicable Options,
unless the context herein clearly indicates to the contrary.
1.3 ADMINISTRATION OF THE PLAN.
The Plan shall be administered by the Board of Directors (the "Board")
of the Company. The Board may designate and appoint a committee (the
"Committee") which shall be constituted so as to permit the Plan to comply with
SEC Rule 16b-3. All references to the Board shall also include the Committee, if
one is appointed. The members of the Committee shall serve at the pleasure of
the Board. The Board shall have the power where consistent with the general
purpose and intent of the Plan to (i) modify the requirements of the Plan to
conform with the law or to meet special circumstances not anticipated or covered
in the Plan, (ii) establish policies and (iii) adopt rules and regulations and
prescribe forms for carrying out the purposes and provisions of the Plan,
including the form of any stock option agreements ("Option Agreements"). Unless
otherwise provided in the Plan, the Board shall have the authority to interpret
and construe the Plan and determine all questions arising under the Plan and any
agreement made pursuant to the Plan. Any interpretation, decision or
determination made by the Board shall be final, binding and conclusive. A
majority of the Board shall constitute a quorum and an act of the majority of
the members present at any meeting at which a quorum is present shall be the act
of the Board.
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1.4 STOCK SUBJECT TO THE PLAN.
Shares of stock ("Stock") covered by Options shall consist of that
number of shares of the Common Stock at $.001 par value per share of the Company
as are necessary to fulfill the Company's obligations under those certain
Employment Agreements effective as of November 16, 1998, by and between the
Company and each of Nathan M. Avery and Pamela L. Reiland (respectively, the
"Avery Employment Agreement" and the "Reiland Employment Agreement"). Either
authorized and unissued shares or treasury shares may be delivered pursuant to
the Plan. If any option for shares of Stock granted to a Participant lapses, or
is otherwise terminated, the Board may grant Options for such shares of Stock to
other Participants.
1.5 PARTICIPATION IN THE PLAN.
Participation in the Plan shall be limited to Nathan M. Avery and
Pamela L. Reiland. Options shall be granted from time to time to Mr. Avery and
Ms. Reiland in accordance with the terms of the Avery Employment Agreement and
the Reiland Employment Agreement, respectively.
1.6 DETERMINATION OF FAIR MARKET VALUE.
As used in the Plan, "fair market value" shall mean on any particular
day (i) if the Stock is listed or admitted for trading on any national
securities exchange or the National Market System of the National Association of
Securities Dealers, Inc. Automated Quotation System, the last sale price, or if
no sale occurred, the mean between the closing high bid and low asked quotations
for such date of the Stock on the principal securities exchange on which shares
of Stock are listed, (ii) if Stock is not traded on any national securities
exchange but is quoted on the National Association of Securities Dealers, Inc.
Automated Operations System, or any similar system of automated dissemination of
quotations or securities prices in common use, the mean between the closing high
bid and low asked quotations for such day of the Stock on such system, (iii) if
neither clause (i) nor (ii) is applicable, the mean between the high bid and low
asked quotations for the Stock as reported by the National Quotation Bureau
Incorporated if at least two securities dealers have inserted both bid and asked
quotations for shares of the Stock on at least five (5) of the ten (10)
preceding days, or (iv) if none of the conditions set forth above is met, the
fair market value of shares of Stock as determined by the Board. Provided, for
purposes of determining "fair market value" of the Stock, such value shall be
determined without regard to any restriction other than a restriction which will
never lapse. In no event shall the fair market value of the Stock be less than
its par value.
1.7 ADJUSTMENTS UPON CHANGES IN CAPITALIZATION.
The aggregate number of shares of Stock under Options granted under the
Plan, the Option Price, and the total number of shares of Stock which may be
purchased by a Participant upon exercise of an Option shall be adjusted by the
Board to reflect approximately any recapitalization, stock split, merger,
consolidation, reorganization, combination, liquidation, stock dividend or
similar transaction involving the Company.
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1.8 AMENDMENT AND TERMINATION OF THE PLAN.
The Plan shall terminate at midnight, November 15, 2001, but prior
thereto, may be altered, changed, modified, amended or terminated by written
amendment approved by the Board. Except as provided in this Article I, no
amendment, modification or termination of the Plan shall in any manner adversely
affect any Option previously granted under the Plan without the consent of the
affected Participant.
1.9 EFFECTIVE DATE.
The Plan shall be effective as of November 16, 1998.
1.10 SECURITIES LAW REQUIREMENTS.
(a) Legality of Issuance. No Stock shall be issued upon the exercise of
any Option unless and until the Board has determined that:
(i) The Company and the Participant have taken all actions
required to register the Stock under the Securities Act of 1933, as
amended (the "Act"), or to perfect an exemption from registration
requirements of the Act, or to determine that the registration
requirements of the Act do not apply to such exercise;
(ii) Any applicable listing requirement of any stock exchange
on which the Stock is listed has been satisfied; and
(iii) Any other applicable provision of state, federal or
foreign law has been satisfied.
(b) Restrictions on Transfer; Representations of Participant; Legends.
Regardless of whether the offering and sale of Stock under the Plan have been
registered under the Act or have been registered or qualified under the
securities laws of any state, the Company may impose restrictions and/or
prohibitions upon the sale, pledge, or other transfer of such Stock (including
the placement of appropriate legends on stock certificates) if, in the judgment
of the Company and its counsel, such restrictions and/or prohibitions are
necessary or desirable to achieve compliance with the provisions of the Act, the
securities laws of any state, or any other law or rule, including rules of
accounting. If the offering and/or sale of Stock under the Plan is not
registered under the Act and the Company determines that the registration
requirements of the Act apply but an exemption is available which requires an
investment representation or other representation, the Participant shall be
required, as a condition to acquiring such Stock, to represent that such Stock
is being acquired for investment, and not with a view to the sale or
distribution thereof, except in compliance with the Act, and to make such other
representations as are deemed necessary or appropriate by the Company and its
counsel. Stock certificates evidencing Stock acquired pursuant to an
unregistered transaction to which the Act applies shall bear a restrictive
legend as may be required or deemed advisable under the Plan or the provisions
of any applicable law.
Any determination by the Company and its counsel in connection with any
of the matters set forth in this Section 1.10 shall be conclusive and binding on
all persons.
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(c) Registration or Qualification of Securities. The Company may, but
shall not be obligated to, register or qualify the offering or sale of Stock
under the Act or any other applicable law.
(d) Exchange of Certificates. If, in the opinion of the Company and
its counsel, any legend placed on a stock certificate representing shares of
Stock issued pursuant to the Plan is no longer required, the Participant or the
holder of such certificate shall be entitled to exchange such certificate for a
certificate representing the same number of shares of Stock but lacking such
legend.
1.11 SEPARATE CERTIFICATE.
Separate certificates representing the Stock to be delivered to a
Participant upon the exercise of any Option will be issued to such Participant.
1.12 PAYMENT FOR STOCK.
Payment for shares of Stock purchased under this Plan shall be made in
full and in cash or check made payable to the Company. However, the Board in its
discretion may allow payment for shares of Stock purchased under this Plan to be
made in Stock or a combination of cash and Stock. Further, the Option Agreement
may provide for a "cashless exercise" of stock options pursuant to procedures
established by the Board. In the event that Stock is utilized in consideration
for the purchase of Stock upon the exercise of an Option, then such Stock shall
be valued at the "fair market value" as defined in Section 1.6 of the Plan.
1.13 GRANTS OF OPTIONS AND OPTION AGREEMENT.
Each Option granted under this Plan shall be evidenced by a written
Option Agreement effective on the date of grant and executed by the Company and
the Participant. Each Option granted hereunder shall contain such terms,
restrictions and conditions as the Board may determine, which terms restrictions
and conditions may or may not be the same in each case.
1.14 USE OF PROCEEDS.
The proceeds received by the Company from the sale of Stock pursuant to
the exercise of Options granted under the Plan shall be added to the Company's
general funds and used for general corporate purposes.
1.15 NON-TRANSFERABILITY OF OPTIONS.
Except as otherwise herein provided, any Option granted shall not be
transferable otherwise than by will or the laws of descent and distribution and
only the Participant may exercise the Option during his lifetime. Specifically
(but without limiting the generality of the foregoing), the Option may not be
assigned, transferred (except as provided above), pledged or hypothecated in any
way, shall not be assignable by operation of law, and shall not be subject to
execution, attachment, or similar process. Any attempted assignment, transfer,
pledge, hypothecation, or other disposition of the Option contrary to the
provisions hereof shall be null and void and without effect.
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1.16 ADDITIONAL DOCUMENTS ON DEATH OF PARTICIPANT.
No transfer of an Option by the Participant by will or the laws of
descent and distribution shall be effective to bind the Company unless the
Company shall have been furnished with written notice and such other evidence as
the Board may deem necessary to establish the validity of the transfer and the
acceptance by the successor to the Option of the terms and conditions of such
Option.
1.17 CHANGES IN EMPLOYMENT.
So long as the Participant shall continue to be an employee of the
Company, any Option granted to him shall not be affected by any change of duty
or position.
1.18 STOCKHOLDER RIGHTS.
No Participant shall have a right as a stockholder with respect to any
shares of Stock subject to an Option prior to the purchase of such shares of
Stock by exercise of the Option.
1.19 CHANGE OF CONTROL.
(a) In the event of a Change of Control (as hereinafter defined), the
Board, in its discretion may act to effect one or more of the following
alternatives with respect to outstanding Options, which may vary among
individual Participants and which may vary among Options held by any individual
Participant: (i) determine a limited period of time on or before a specified
date (before or after such Change of Control) after which specified date all
unexercised Options and all rights of Participants thereunder shall terminate,
(2) require the mandatory surrender to the Company by selected Participants of
some or all of the outstanding Options held by such Participants (irrespective
of whether such Options are then exercisable under the provisions of the Plan)
as of a date, before or after such Change of Control, specified by the Board, in
which event the Board shall thereupon cancel such Options and the Company shall
pay to each Participant an amount of cash per share equal to the excess, if any,
of the Change of Control value of the shares subject to such Option over the
exercise price(s) under such Options for such shares, (3) make such adjustments
to Options then outstanding as the Board deems appropriate to reflect such
Change of Control (provided, however, that the Board may determine in its sole
discretion that no adjustment is necessary to Options then outstanding) or (4)
provide that thereafter upon any exercise of an Option theretofore granted the
Participant shall be entitled to purchase under such Option, in lieu of the
number of shares of Stock then covered by such Option the number and class of
shares of stock or other securities or property (including, without limitation,
cash) to which the Participant would have been entitled pursuant to the terms of
the agreement of merger, consolidation or sale of assets and dissolution if,
immediately prior to such merger, consolidation or sale of assets and
dissolution the Participant has been the Participant of record of the number of
shares of Stock then covered by such Option. The provisions contained in this
paragraph shall not terminate any rights of the Participant to further payments
pursuant to any other agreement with the Company following a Change of Control.
Further, the provisions contained in this Paragraph shall not diminish any
rights of the Participant with respect to Options granted under the Plan
pursuant to the Avery Employment Agreement or the Reiland Employment Agreement,
as applicable.
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(b) For purposes of the Plan, "Change of Control" means the occurrence
of any of the following events: (i) the Company shall not be the surviving
entity in any merger, consolidation or other reorganization (or survives only as
a subsidiary of an entity other than a previously wholly-owned subsidiary of the
Company); (ii) the Company sells, leases or exchanges all or substantially all
of its assets to any other person or entity (other than a wholly-owned
subsidiary of the Company); (iii) the Company is to be dissolved and liquidated;
(iv) any person or entity, including a "group" as contemplated by Section
13(d)(3) of the Securities Exchange Act of 1934, as amended (the "1934 Act"),
acquires or gains ownership or control (including, without limitation, power to
vote) of more than 50% of the outstanding shares of the Company's voting stock
(based upon voting power); or (v) as a result of or in connection with a
contested election of directors, the persons who were directors of the Company
before such election, together with their nominees, shall cease to constitute a
majority of the Board.
ARTICLE II
TERMS OF STOCK OPTIONS AND EXERCISE
2.1 GENERAL TERMS.
(a) Grants and Terms of Stock Options. Stock Options shall be granted
by the Board on the following terms and conditions: Each Option shall have a
term of ten (10) years and shall not be exercisable after the expiration of such
term. Each Option shall be evidenced by an Option Agreement in such form and
containing such provisions not inconsistent with the provisions of the Plan as
the Board shall approve. Each Option Agreement shall specify the effect of
termination of employment on the exercisability of Options.
(b) Option Price. The option price ("Option Price") for shares of Stock
subject to Options shall be determined by the Board pursuant to the terms of the
Avery Employment Agreement and the Reiland Employment Agreement, as applicable,
but in no event shall such Option Price be less than 85% of the fair market
value of the Stock on the date of grant.
(c) Number of Options Granted. The Board shall determine the number of
Options which are to be granted to each Participant pursuant to the terms of the
Avery Employment Agreement and the Reiland Employment Agreement, as applicable.
The granting of an Option under the Plan shall not affect any outstanding Option
previously granted to a Participant under the Plan.
(d) Notice to Exercise Option. Upon exercise of an Option, a
Participant shall give written notice to the Secretary of the Company, or other
officer designated by the Board at the Company's principal office in Houston,
Texas. No Stock shall be issued to any Participant until the Company receives
full payment for the Stock purchased, if applicable, and any required state and
federal withholding taxes.
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ARTICLE III
MISCELLANEOUS
3.1 NO RIGHT TO A GRANT.
Neither the adoption of the Plan by the Company nor any action of the
Board or the Committee shall be deemed to give a Participant any right to be
granted an Option or any of the rights hereunder except as may be evidenced by
an Option Agreement.
3.2 NO EMPLOYMENT RIGHTS CONFERRED.
Nothing in the Plan or in any Option Agreement which relates to the
Plan shall confer upon any Participant any right to continue as an employee of
the Company, or interfere in any way with the right of the Company to terminate
his employment at any time.
3.3 RULE 16B-3.
It is intended that the Plan and any grant of options made to a person
subject to Section 16 of the 1934 Act meet all of the requirements of Rule
16b-3. If any provision of the Plan or any such grant would disqualify the Plan
or such grant under, or would otherwise not comply with, Rule 16b-3, such
provision or grant shall be construed or deemed amended to conform to Rule
16b-3.
3.4 GOVERNING LAW.
This Plan shall be construed in accordance with the laws of the state
of Delaware.
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