NON-QUALIFIED STOCK OPTION AGREEMENT
UNDER THE AMENDED AND RESTATED
PETROLEUM HELICOPTERS, INC.
1995 INCENTIVE COMPENSATION PLAN, AS AMENDED
THIS AGREEMENT is entered into as of July 30, 1996, by and between
Petroleum Helicopters, Inc., a Louisiana corporation ("PHI"), and Xxxxxxx
X. Xxxxx (the "Optionee").
WHEREAS, under the Amended and Restated Petroleum Helicopters, Inc.
1995 Incentive Compensation Plan, as amended (the "Plan"), the Compensation
Committee of the PHI Board of Directors (the "Committee") may, among other
things, award options to purchase shares of the non-voting common stock,
$.10 par value per share, of PHI (the "Common Stock") to a key employee of
PHI or one of its subsidiaries (collectively, the "Company"); and
WHEREAS, pursuant to the Plan, on July 30, 1996, the Committee awarded
an option to purchase Common Stock to the Optionee.
NOW, THEREFORE, in consideration of the premises, it is agreed as
follows:
1.
Grant of Option
1.1 PHI hereby grants to the Optionee effective July 30, 1996 (the
"Date of Grant") the right, privilege and option to purchase 23,200 shares
of Common Stock (the "Option") at an exercise price of $14.875 per share
(the "Exercise Price"). The Option shall vest, become exercisable and
expire as provided in Sections 2 and 3 below.
1.2 The Option is a non-qualified stock option and shall not be
treated as an incentive stock option under Section 422 of the Internal
Revenue Code of 1986, as amended.
2.
Vesting of Option
2.1 Effective July 31, 1997, the Compensation Committee of the Board
of Directors of PHI (the "Committee") shall make a determination as to the
portion of the Option that is vested as follows:
(a) Company Performance Goals
(1) If the Company's consolidated earnings before
income taxes for the fiscal year ending April 30, 1997, as adjusted
by the Committee for extraordinary items ("Actual Operating Income"),
equals the consolidated earnings before income taxes reflected in the
Company's annual budget for the fiscal year ending April 30, 1997
("Budgeted Operating Income"), the Option shall vest with respect to
16,000 of the shares covered thereby.
(2) If Actual Operating Income exceeds Budgeted
Operating Income, the Option shall vest with respect to an additional
160 shares for each 1% by which Actual Operating Income exceeds
Budgeted Operating Income, up to a maximum of 3,200 additional
shares.
(3) If Actual Operating Income is less than Budgeted
Operating Income, but is between 90% and 100% of Budgeted Operating
Income, then the Option shall vest with respect to 16,000 shares,
less 320 shares for each 1% or fraction of 1% by which Actual
Operating Income is less than Budgeted Operating Income.
(4) If Actual Operating Income is less than 90% of
Budgeted Operating Income, no portion of the Option shall vest based
upon Company performance.
(b) Individual Performance
The Option may vest with respect to up to an additional 4,000 shares
in the discretion of the Compensation Committee based on an evaluation of
the Optionee's performance for the year.
2.2 All unvested Options or portions thereof shall be forfeited.
3.
Time of Exercise
3.1 Subject to the provisions of the Plan and Section 2 hereof, the
Optionee shall be entitled to exercise the vested portion of the Option with
respect to 50% of the shares beginning July 31, 1997 and with respect to the
remaining 50% of the shares beginning July 31, 1998.
3.2 The Option shall expire and may not be exercised later than ten
years following the Date of Grant.
3.3 Notwithstanding the foregoing, the Option shall become
accelerated and immediately exercisable to the extent vested if (a.) the
Optionee dies while she is employed by the Company, (b.) the Optionee
becomes disabled within the meaning of Section 22(e)(3) of the Code
("Disability") while she is employed by the Company, (c.) the Optionee
retires from employment with the Company on or after attaining the age of
65 or is granted early retirement by a vote of the Board of Directors
("Retirement") or (d.) pursuant to the provisions of the Plan.
4.
Conditions for Exercise of Option
During the Optionee's lifetime, the Option may be exercised only by
her or by her guardian or legal representative. The Option must be exer-
cised while the Optionee is employed by the Company, or, to the extent
exercisable at the time of termination of employment, within 190 days of the
date on which she ceases to be an employee, except that (a.) if she ceases
to be an employee because of Retirement or Disability, the Option may be
exercised within three years from the date on which she ceases to be an
employee, (b.) if the Optionee's employment is terminated for cause, the
unexercised portion of the Option is immediately terminated, and (c.) in the
event of the Optionee's death, the Option may be exercised by her estate,
or by the person to whom such right devolves from her by reason of her death
within two years after the date of her death; provided, however, that no
Option may be exercised later than 10 years after the Date of Grant.
5.
Additional Conditions
Anything in this Agreement to the contrary notwithstanding, if at any
time PHI further determines, in its sole discretion, that the listing,
registration or qualification (or any updating of any such document) of the
shares of Common Stock issuable pursuant to the exercise of an Option is
necessary on any securities exchange or under any federal or state
securities or blue sky law, or that the consent or approval of any
governmental regulatory body is necessary or desirable as a condition of,
or in connection with the issuance of shares of Common Stock pursuant
thereto, or the removal of any restrictions imposed on such shares, such
shares of Common Stock shall not be issued, 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 PHI.
6.
No Contract of Employment Intended
Nothing in this Agreement shall confer upon the Optionee any right to
continue in the employ of the Company or to interfere in any way with the
right of PHI to terminate the Optionee's employment relationship with the
Company at any time.
7.
Taxes
The Company may make such provisions as it may deem appropriate for
the withholding of any federal, state and local taxes that it determines are
required to be withheld on the exercise of the Option.
8.
Binding Effect
This Agreement shall inure to the benefit of and be binding upon the
parties hereto and their respective heirs, executors, administrators and
successors.
9.
Inconsistent Provisions
The Option granted hereby is subject to the provisions of the Plan.
If any provision of this Agreement conflicts with a provision of the Plan,
the Plan provision shall control.
10.
Adjustments to Options
Appropriate adjustments shall be made to the number and class of
shares of Common Stock subject to the Option and to the Exercise Price in
certain situations described in Section 12.6 of the Plan.
11.
Termination of Option
The Committee, in its sole discretion, may terminate the Option.
However, no termination may adversely affect the rights of the Optionee to
the extent that the Option is currently vested on the date of such
termination.
IN WITNESS WHEREOF the parties hereto have caused this Agreement to
be executed as of the day and year first above written.
PETROLEUM HELICOPTERS, INC.
By: /s/ Xxxxxxx X. Xxxxxx
Xxxxxxx X. Xxxxxx, Chairman,
Compensation Committee
/s/ Xxxxxxx X. Xxxxx
Xxxxxxx X. Xxxxx
Optionee
