1
EXHIBIT 4.1
1999 EMPLOYEE AWARD AGREEMENT
INCENTIVE STOCK OPTION
1. Grant of Option. Pursuant to the 1997 Incentive Plan of Venus
Exploration, Inc. (the "Plan") for key management employees, directors and
independent contractors of Venus Exploration, Inc., a Delaware corporation (the
"Company") and its Subsidiaries, the Company grants to
---------------
(the "Participant")
an option to purchase from the Company a total of ________ full shares
("Optioned Shares") of Common Stock of the Company at $______ per share (being
the Fair Market Value per share of the Common Stock on the Date of Grant of
this option, as provided in Code Section 422), in the amounts, during the
periods, and upon the terms and conditions set forth in this Agreement. The
Date of Grant of this Stock Option is _________, 1999. This is an Incentive
Stock Option.
2. Subject to Plan. This Stock Option and its exercise are subject to
the terms and conditions of the Plan, but the terms of the Plan shall not be
considered an enlargement of any benefits under this Agreement. The capitalized
terms used herein that are defined in the Plan shall have the same meanings
assigned to them in the Plan. This Stock Option is subject to any rules
promulgated pursuant to the Plan by the Board or the Committee and communicated
to the Participant in writing.
3. Vesting; Time of Exercise. Except as specifically provided in
this Agreement and subject to certain restrictions and conditions set forth in
the Plan, this Stock Option is exercisable in semi-monthly installments of
________ shares. The first installment shall vest on __________ 1, 1999, the
next installment shall vest on __________ 15, 1999, and the subsequent
installments shall vest on the 1st and 15th of each following calendar month
until __________ 15, 1999, which installment shall be the last one to vest
under this Employee Award Agreement.
4. Term; Forfeiture. This Stock Option, and all unexercised Optioned
Shares granted to the Participant hereunder, will terminate and be forfeited at
the first of the following to occur:
(a) 5 p.m. on (first business day immediately preceding tenth
anniversary of date of grant);
2
(b) 5 p.m. on the date which is twelve (12) months following
the Participant's termination of employment with the Company and all
its Subsidiaries ("Termination of Service") due to death or Total and
Permanent Disability;
(c) 5 p.m. on the date which is three (3) months following
the Participant's Termination of Service due to retirement (in
accordance with Company retirement policies); or
(d) 5 p.m. on the 30th day after the day of any other
Termination of Service.
5. Who May Exercise. Subject to the terms and conditions set forth
in Sections 3 and 4 above, during the lifetime of the Participant, this Stock
Option may be exercised only by the Participant or by the Participant's
guardian. If the Participant's employment terminates as a result of death or
Total and Permanent Disability prior to the termination date specified in
Section 4(a) hereof and the Participant has not exercised this Stock Option as
to the maximum percentage of Optioned Shares set forth in Section 3 hereof as
of the date of death or Total and Permanent Disability, the following persons
may exercise the exercisable portion of this Stock Option on behalf of the
Participant at any time prior to the earlier of the dates specified in Sections
4(a) or (b) hereof: (i) if the Participant is disabled, the guardian of the
Participant; or (ii) if the Participant dies, the personal representative of
his estate, or the person who acquired the right to exercise this Stock Option
by bequest or inheritance or by reason of the death of the Participant;
provided that this Stock Option shall remain subject to the other terms of this
Agreement, the Plan, and applicable laws, rules, and regulations.
6. Restrictions. This Stock Option may be exercised only with respect
to full shares, and no fractional share of stock shall be issued.
7. Manner of Exercise. Subject to such administrative regulations as
the Committee may from time to time adopt, this Stock Option may be exercised
by the delivery of written notice to the Committee setting forth the number of
shares of Common Stock with respect to which the Stock Option is to be
exercised and the date of exercise thereof (the "Exercise Date"), which shall
be at least three (3) days after giving such notice unless an earlier time
shall have been mutually agreed upon. On the Exercise Date, the Participant
shall deliver to the Company consideration with a value equal to the total
Option Price of the shares to be purchased, payable as follows: (a) cash,
certified check, bank draft, or money order payable to the order of the
Company, (b) Common Stock (including Restricted Stock), valued at its Fair
Market Value on the Exercise Date, and/or (c) any other form of payment which
is acceptable to the Committee. In the event that shares of Restricted Stock
are tendered as consideration
2
3
for the exercise of a Stock Option, a number of shares of Common Stock issued
upon the exercise of the Stock Option, equal to the number of shares of
Restricted Stock used as consideration therefor, shall be subject to the same
restrictions as the Restricted Stock so submitted. Provided that, if Common
Stock which is tendered was acquired by the Participant pursuant to an Employee
Award or an Independent Contractor Award under the Plan, such shares may only
be tendered if they have been held by the Participant for at least six (6)
months.
Upon payment of all amounts due from the Participant, the Company
shall cause certificates for the Optioned Shares then being purchased to be
delivered to the Participant (or the person exercising the Participant's Stock
Option in the event of his death) at its principal business office within ten
(10) business days after the Exercise Date. The obligation of the Company to
deliver shares of Common Stock shall, however, be subject to the condition that
if at any time the Committee shall determine in its discretion that the
listing, registration or qualification of the Stock Option or the Optioned
Shares upon any securities exchange or under any state or federal law, or the
consent or approval of any governmental regulatory body, is necessary or
desirable as a condition of, or in connection with, the Stock Option or the
issuance or purchase of shares of Common Stock thereunder, then the Stock
Option may not be exercised in whole or in part unless such listing,
registration, qualification, consent or approval shall have been effected or
obtained free of any conditions not acceptable to the Committee.
If the Participant fails to pay for any of the Optioned Shares
specified in such notice or fails to accept delivery thereof, then the
Participant's right to purchase such Optioned Shares may be terminated by the
Company.
8. Disqualifying Disposition. In the event that Common Stock
acquired upon exercise of this Stock Option is disposed of by the Participant
prior to the expiration of either two years from the Date of Grant of such
Stock Option or one year from the transfer of shares to the Participant
pursuant to the exercise of such Stock Option, such Participant shall notify
the Company in writing within thirty (30) days after such disposition of the
date and terms of such disposition.
9. Non-Assignability. This Stock Option is not assignable or
transferable by the Participant except by will or by the laws of descent and
distribution.
10. Rights as Stockholder. The Participant will have no rights as a
stockholder with respect to any shares covered by this Stock Option until the
issuance of a certificate or certificates to the Participant for the shares.
Except as otherwise provided in Section 11 hereof, no adjustment shall be made
for dividends or other rights for which the record date is prior to the
issuance of such certificate or certificates.
3
4
11. Adjustment of Number of Shares and Related Matters. The number of
shares of Common Stock covered by this Stock Option, and the Option Price
thereof, shall be subject to adjustment in accordance with Paragraph 15 of the
Plan.
12. Participant's Representations. Notwithstanding any of the
provisions hereof, the Participant hereby agrees that he or she will not
exercise the Stock Option granted hereby, and that the Company will not be
obligated to issue any shares to the Participant hereunder, if the exercise
thereof or the issuance of such shares shall constitute a violation by the
Participant or the Company of any provision of any law or regulation of any
governmental authority. Any determination in this connection by the Committee
shall be final, binding and conclusive. The obligations of the Company and the
rights of the Participant are subject to all applicable laws, rules and
regulations.
13. Investment Representation. Unless the Common Stock is issued to
him or her in a transaction registered under applicable federal and state
securities laws, by his or her execution hereof, the Participant represents and
warrants to the Company that all Common Stock that may be purchased hereunder
will be acquired by the Participant for investment purposes for his or her own
account and not with any intent for resale or distribution in violation of
federal or state securities laws. Unless the Common Stock is issued to him or
her in a transaction registered under the applicable federal and state
securities laws, all certificates issued with respect to the Common Stock shall
bear an appropriate restrictive investment legend.
14. Participant's Acknowledgments. The Participant acknowledges
receipt of a copy of the Plan and represents that he or she is familiar with
the terms and provisions thereof. The Participant hereby accepts this Option
subject to all the terms and provisions thereof. The Participant hereby agrees
to accept as binding, conclusive and final all decisions or interpretations of
the Committee, as that term is defined in the Plan, upon any questions arising
under the Plan or this Agreement.
15. Law Governing. This Agreement shall be governed by, construed and
enforced in accordance with the laws of the State of Texas (excluding any
conflict of laws rule or principle of Texas law that might refer the
governance, construction or interpretation of this agreement to the laws of
another state).
16. No Right to Continue Employment. Nothing herein shall be
construed to confer upon the Participant the right to continue in the
employment of the Company or any Subsidiary or interfere with or restrict in
any way the right of the Company or any Subsidiary to discharge the Participant
at any time (subject to any contract rights of the Participant).
4
5
17. Legal Construction. In the event that any one or more of the
terms, provisions or agreements that are contained in this Agreement shall be
held by a Court of competent jurisdiction to be invalid, illegal or
unenforceable in any respect for any reason, the invalid, illegal or
unenforceable term, provision or agreement shall not affect any other term,
provision or agreement that is contained in this Agreement, and this Agreement
shall be construed in all respects as if the invalid, illegal or unenforceable
term, provision, or agreement had never been contained herein.
18. Covenants and Agreements as Independent Agreements. Each of the
covenants and agreements that is set forth in this Agreement shall be construed
as a covenant and agreement independent of any other provision of this
Agreement. The existence of any claim or cause of action of the Participant
against the Company, whether predicated on this Agreement or otherwise, shall
not constitute a defense to the enforcement by the Company of the covenants and
agreements that are set forth in this Agreement.
19. Entire Agreement. This Agreement together with the Plan supersede
any and all other prior understandings and agreements, either oral or in
writing, between the parties with respect to the subject matter hereof and
constitute the sole and only agreements between the parties with respect to the
said subject matter. All prior negotiations and agreements between the parties
with respect to the subject matter hereof are merged into this Agreement. Each
party to this Agreement acknowledges that no representations, inducements,
promises or agreements, oral or otherwise, have been made by any party or by
anyone acting on behalf of any party that are not embodied in this Agreement or
the Plan and that any agreement, statement or promise that is not contained in
this Agreement or the Plan shall not be valid or binding or of any force or
effect.
20. Parties Bound. The terms, provisions, representations,
warranties, covenants and agreements that are contained in this Agreement shall
apply to, be binding upon, and inure to the benefit of the parties and their
respective heirs, executors, administrators, legal representatives, and
permitted successors and assigns.
21. Modification. No change or modification of this Agreement shall
be valid or binding upon the parties unless the change or modification is in
writing and signed by the parties. Notwithstanding the preceding sentence, the
Company may amend the Plan or revoke this Stock Option to the extent permitted
in the Plan.
22. Headings. The headings that are used in this Agreement are used
for reference and convenience purposes only and do not constitute substantive
matters to be considered in construing the terms and provisions of this
Agreement.
5
6
23. Gender and Number. Words of any gender used in this Agreement
shall be held and construed to include any other gender, and words in the
singular number shall be held to include the plural, and vice versa, unless the
context requires otherwise.
24. Notice. Any notice required or permitted to be delivered
hereunder shall be deemed to be delivered only when actually received by the
Company or by the Participant, as the case may be, at the addresses set forth
below, or at such other addresses as they have theretofore specified by written
notice delivered in accordance herewith:
(A) Notice to the Company shall be addressed and delivered as
follows:
VENUS EXPLORATION, INC.
1250 N.E. Loop 410, Suite 1000
SAN ANTONIO, TEXAS 78209
ATTENTION: John Y. Ames, President
(B) Notice to the Participant shall be addressed and
delivered as follows:
---------------
---------------
---------------
IN WITNESS WHEREOF, the Committee has caused this Agreement to be
executed by its duly authorized officer, and the Participant, to evidence his
or her consent and approval of all the terms hereof, has duly executed this
Agreement, as of the date specified in Section 1 hereof.
VENUS EXPLORATION, INC.
By:
---------------------------------
Title:
-------------------------------
PARTICIPANT:
--------------------------------------
6