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EXHIBIT 10.12
2001 STOCK OPTION PLAN
OF
UNITED PETROLEUM CORPORATION
1. Purpose. The purpose of this Stock Option Plan is to advance the
interests of the Corporation by encouraging and enabling the acquisition of a
proprietary interest in the Corporation by directors and key employees of the
Corporation and its Subsidiaries and other persons that make a special
contribution to the success of the Company, upon whose judgment and keen
interest the Corporation is largely dependent for the successful conduct of its
operations, and by providing such directors and key employees and other persons
with incentives to put forth maximum efforts for the success of the
Corporation's business. It is anticipated that the acquisition of such
proprietary interest in the Corporation and such incentives will stimulate the
efforts of directors and key employees and other persons on behalf of the
Corporation and its Subsidiaries and strengthen their desire to remain with the
Corporation and its Subsidiaries. It is also expected that such incentives and
the opportunity to acquire such a proprietary interest will enable the
Corporation and its Subsidiaries to attract desirable personnel.
2. Definitions. When used in this Plan, unless the context otherwise
requires:
(a) "Board of Directors" shall mean the Board of Directors of
the Corporation, as constituted at any time.
(b) "Chairman of the Board" shall mean the person who at the
time shall be Chairman of the Board of Directors.
(c) "Committee" shall mean the Committee hereinafter described
in Section 3.
(d) "Corporation" shall mean United Petroleum Corporation, a
Delaware corporation.
(d) "Eligible Persons" shall mean those persons described in
Section 4 who are potential recipients of stock options.
(f) "Fair Market Value" on a specified date shall mean the
closing price at which a Share is traded on the stock exchange, if any,
on which Shares are primarily traded or, if the Shares are not then
traded on a stock exchange, the closing price of a Share as reported on
the NASDAQ National Market System or, if the Shares are not then traded
on the NASDAQ National Market System, the average of the closing bid and
asked prices at which a Share is traded on the over-the-counter market,
but if no Shares were traded on such date, then on the last previous
date on which a Share was so traded, or, if none of the above are
applicable, the value of a Share as established by the Board of
Directors for such date using any reasonable method of valuation, and
the good faith determination of the Board shall be conclusive on all
parties for such purpose.
(g) "Options" shall mean the stock options granted pursuant to
this Plan.
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(h) "Plan" shall mean this 2001 Stock Option Plan of United
Petroleum Corporation, as such Plan from time to time may be amended.
(i) "President" shall mean the person who at the time shall be
the President of the Corporation.
(j) "Share" shall mean a share of common stock, par value $0.01
per share, of the Corporation.
(k) "Subsidiary" shall mean any corporation 50% or more of whose
stock having general voting power is owned by the Corporation, or by
another Subsidiary, as herein defined, of the Corporation.
3. Administration. The Plan shall be administered by a Committee of the
Board of Directors which shall consist of two of more directors of the
Corporation. The Committee shall establish such rules and procedures as are
necessary or advisable to administer the Plan.
Determinations of the Committee as to any question which may arise with
respect to the interpretation of the provisions of the Plan and Options shall be
final and conclusive on all parties. The Committee may authorize and establish
such rules, regulations and revisions thereof not inconsistent with the
provisions of the Plan, as it may deem advisable to make the Plan and Options
effective or provide for their administration, and may take such other action
with regard to the Plan and Options as it shall deem desirable to effectuate
their purpose.
4. Participants. Except as hereinafter provided, the class of persons
who are potential recipients of Options granted under this Plan shall consist of
the directors and employees of the Corporation or a Subsidiary or other persons
that make a significant contribution to the success of the Company (including
consultants, independent contractors and the like), as determined by the
Committee or the Board of Directors. The parties to whom Options are granted
under this Plan, and the number of Shares subject to each such Option, shall be
determined by the Committee or the Board of Directors, in its sole discretion,
subject, however, to the terms and conditions of this Plan.
5. Shares. Subject to the provisions of Section 13 hereof, the Board of
Directors may grant Options with respect to an aggregate of up to 650,000
Shares, all of which Shares may be either Shares held in treasury or authorized
but unissued Shares. If the Shares that would be issued pursuant to any Options
are not issued and cease to be issuable for any reason, the number of Shares
subject to such Option will no longer be charged against the limitation provided
for herein and may again be made subject to Options.
6. Grant of Options. The number of Options to be granted to any Eligible
Person shall be determined by the Committee or the Board of Directors in its
sole discretion. Nothing herein
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contained shall be construed to prohibit the issuance of Options at different
times to the same person.
The form of Option shall be determined from time to time by the
Committee. A certificate of Option and/or Option agreement signed by the
Chairman of the Board or the President or a Vice President of the Corporation
shall be issued to each person to whom an Option is granted.
7. Purchase Price. The price per Share of the Shares to be purchased
pursuant to the exercise of any Option shall be fixed by the Committee or the
Board of Directors at the time of grant.
8. Duration of Options. The duration of any Option granted under this
Plan shall be fixed by the Committee or the Board of Directors at the time of
grant; provided, however, that no Option shall remain in effect for a period of
more than ten years from the date upon which the Option is granted.
9. Exercise of Options. Except as otherwise provided herein, Options,
after the grant thereof, shall be exercisable by the holder at such rate and
times as may be fixed by the Committee or the Board of Directors.
Notwithstanding the foregoing, all or any part of any remaining
unexercised Options granted to any person may be exercised in the following
circumstances: (a) immediately upon (but prior to the expiration of the term of
the Option) the holder's retirement from the Corporation and all Subsidiaries on
or after his or her 65th birthday, (b) subject to the provisions of Section 12
hereof, upon the disability (to the extent and in a manner as shall be
determined by the Committee in its sole discretion) or the death of the holder,
(c) upon the occurrence of such special circumstance or event as in the opinion
of the Committee merits special consideration, or (d) if, during the term of an
outstanding Option, there occurs a Change in Control. For purposes of this Plan,
a "Change in Control" shall be deemed to have occurred if (x) any "person" or
group of "persons" (as the term "person" is used in Sections 13(d) and 14(d) of
the Exchange Act) ("Person"), acquires (or has acquired during the twelve-month
period ending on the date of the most recent acquisition by such Person) direct
or indirect beneficial ownership of securities of the Corporation representing
33% or more of the combined voting power of the then outstanding securities of
the Corporation or (y) a Person acquires (or has acquired during the
twelve-month period ending on the date of the most recent acquisition by such
Person) assets from the Corporation that have a total fair market value equal to
or more than one-third of the total fair market value of all of the assets of
the Corporation immediately prior to such acquisition. Notwithstanding the
foregoing, for purposes of subsection (x), a Change in Control will not be
deemed to have occurred if the power to control (directly or indirectly) the
management and policies of the Corporation is not transferred from a Person to
another Person; and, for purposes of subsection (y), a Change in Control will
not be deemed to occur if the assets of the Corporation are transferred (i) to
an entity in which the Corporation has (directly or indirectly)
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50% ownership, or (ii) to a Person that has (directly or directly) at least 50%
ownership of the Corporation with respect to its stock outstanding, or to any
entity in which such Person possesses (directly or indirectly) 50% ownership.
An Option shall be exercised by the delivery of a written notice duly
signed by the holder thereof to such effect ("Exercise Notice"), together with
the Option certificate and Option agreement and the full purchase price of the
Shares purchased pursuant to the exercise of the Option, to the Chairman of the
Board or an officer of the Corporation appointed by the Chairman of the Board
for the purpose of receiving the same. Payment of the full purchase price shall
be made in the manner permitted by the Option agreement with the holder of such
Option, which may include the following: in cash or by check payable to the
order of the Corporation; by delivery to the Corporation of Shares which shall
be valued at their Fair Market Value on the date of exercise of the Option
(provided, that a holder may not use any Shares acquired pursuant to this Plan
or any other plan maintained by the Corporation or a Subsidiary unless the
holder has beneficially owned such Shares for at least six months); by
providing with the Exercise Notice an order to a designated broker to sell
part or all of the Shares and to deliver sufficient proceeds to the
Corporation, in cash or by check payable to the order of the Corporation, to
pay the full purchase price of the Shares and all applicable withholding taxes;
or by such other methods as the Committee or the Board of Directors may permit
from time to time.
Within a reasonable time after the exercise of an Option, the Corporation
shall cause to be delivered to the person entitled thereto a certificate for
the Shares purchased pursuant to the exercise of the Option. If the Option
shall have been exercised with respect to less than all of the Shares subject
to the Option, the Corporation shall also cause to be delivered to the person
entitled thereto a new Option certificate and/or agreement in replacement of
the certificate and agreement surrendered at the time of the exercise of the
Option, indicating the number of Shares with respect to which the Option
remains available for exercise, or the original Option certificate and/or
agreement shall be endorsed to give effect to the partial exercise thereof.
Notwithstanding any other provision of the Plan or of any Option, no
Option granted pursuant to the Plan may be exercised at any time when the
Option or the granting or exercise thereof violates any law or governmental
order or regulation.
10. Consideration for Options. The Corporation shall obtain such
consideration (if any) for the grant of an Option as the Committee or the Board
of Directors in its discretion may determine.
11. Restrictions on Transferability of Options. An Option shall not be
transferable otherwise than by will or the laws of descent and distribution or
as provided in this Section 11. Notwithstanding the preceding, the Committee
may, in its discretion, authorize a transfer of any Option, other than an
Option which is an Incentive Stock Option, by the initial holder to (i) the
spouse, children, step children, grandchildren or other family members of the
initial holder ("Family Members"), (ii) a trust or trusts for the exclusive
benefit of such Family Members, (iii) a
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corporation or partnership in which such Family Members and the initial holder
are the only shareholders or partners, or (iv) such other persons or entities
which the Committee or the Board of Directors may permit, subject in each case
to such terms and conditions as the Committee or the Board of Directors shall
approve; provided, however, that subsequent transfers of such Options shall be
prohibited except by will or the laws of descent and distribution. Following
any transfer of such an Option, such Option shall continue to be subject to the
same terms and conditions of the Option and of the Plan.
12. Termination of Employment or Service. All or any part of any Option,
to the extent unexercised, shall terminate immediately, upon the cessation or
termination for any reason of the holder's employment by, or service as a
director of, or consultant to, the Corporation or any Subsidiary, except that
the holder shall have until the end of the tenth business day following the
cessation of his employment or service with the Corporation or its
Subsidiaries, and no longer, to exercise any unexercised Option that he could
have exercised on the day on which such employment or service terminated;
provided, that such exercise must be accomplished prior to the expiration of
the term of such Option. Notwithstanding the foregoing, if the cessation of
employment or service is due to retirement on or after attaining the age of
sixty-five (65) years, or to disability (to an extent and in a manner as shall
be determined in each case by the Committee or the Board of Directors in its
sole discretion) or to death, the holder or the representative of the Estate or
the heirs of a deceased holder shall have the privilege of exercising the
Options which are unexercised at the time of such retirement, or of such
disability or death; provided, however, that such exercise must be accomplished
prior to the expiration of the term of such Option and (a) within three months
of the holder's retirement or disability, or (b) within six months of the
holder's death, as the case may be. If the employment or service of any holder
of an Option with the Corporation or a Subsidiary shall be terminated because
of the holder's violation of the duties of such employment or service with the
Corporation or a Subsidiary as he may from time to time have or for "cause" as
defined in the Option holder's agreement with the Company (if applicable) or as
otherwise determined in good faith by the Committee or the Board of Directors,
the existence of which violation shall be determined by the Committee or the
Board of Directors in its sole discretion (which determination by the Committee
or the Board of Directors shall be conclusive), all unexercised Options of such
holder shall terminate immediately upon such termination of the holder's
employment or service with the Corporation and all Subsidiaries, and a holder
of Options whose employment or service with the Corporation and Subsidiaries
is so terminated shall have no right after such termination to exercise any
unexercised Option he might have exercised prior to the termination of his
employment or service with the Corporation and Subsidiaries.
13. Adjustment Provision. If prior to the complete exercise of any Option,
there shall be declared and paid a stock dividend upon the Shares or if the
Shares shall be split up, converted, exchanged, reclassified, or in any way
substituted for, then the Option, the extent that it has not been
exercised, shall entitle the holder thereof upon the future exercise of the
Option to such number and kind of securities or cash or other property subject
to the terms of the Option to which he would have been entitled had he
actually owned the Shares subject to the unexercised
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portion of the Option at the time of the occurrence of such stock dividend,
split-up, conversion, exchange, reclassification or substitution, and the
aggregate purchase price upon the future exercise of the Option shall be the
same as if the originally optioned Shares were being purchased thereunder.
In the event of a recapitalization, merger, consolidation, rights
offering, separation, reorganization or liquidation, or any other change in the
corporate structure or outstanding Shares, the Committee may make such
equitable adjustments to the number of Shares and the class of shares available
hereunder or to any outstanding Options as it shall deem appropriate to prevent
dilution or enlargement of rights.
14. Issuance of Shares and Compliance with Securities Act. The Corporation
may postpone the issuance and delivery of Shares pursuant to the grant or
exercise of any Option until (a) the admission of such Shares to listing on any
stock exchange on which Shares of the Corporation of the same class are then
listed, and (b) the completion of such registration or other qualification of
such Shares under any State or Federal law, rule or regulation as the
Corporation shall determine to be necessary or advisable. Any holder of an
Option shall make such representations and furnish such information as may, in
the opinion of counsel for the Corporation, be appropriate to permit the
Corporation, in the light of the then existence or non-existence with respect
to such Shares of an effective Registration Statement under the Securities Act
of 1933, as from time to time amended (the "Securities Act"), to issue the
Shares in compliance with the provisions of the Securities Act or any
comparable act. The Corporation shall have the right, in its sole discretion,
to legend any Shares which may be issued pursuant to the grant or exercise of
any Option, or may issue stop transfer orders in respect thereof.
15. Income Tax Withholding. If the Corporation or a Subsidiary shall be
required to withhold any amounts by reason of any Federal, State or local tax
rules or regulations in respect of the issuance of Shares pursuant to the grant
or exercise of any Option, the Corporation or the Subsidiary shall be entitled
to deduct and withhold such amounts from any cash payments to be made to the
holder of such Option. In any event, the holder shall make available to the
Corporation or Subsidiary, promptly when requested by the Corporation or such
Subsidiary, sufficient funds to meet the requirements of such withholding; and
the Corporation or Subsidiary shall be entitled to take and authorize such steps
as it may deem advisable in order to have such funds made available to the
Corporation or Subsidiary out of any funds or property due or to become due to
the holder of such Option.
16. Amendment of the Plan. Except as hereinafter provided, the Board of
Directors or the Committee may at any time withdraw or from time to time amend
the Plan as it relates to, and the terms and conditions of, any Options not
theretofore granted, and the Board of Directors or the Committee, with the
consent of the affected holder of an Option, may at any time withdraw or from
time to time amend the Plan as it relates to, and the terms and conditions of,
any outstanding Option.
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