1996 NON-QUALIFIED STOCK OPTION AGREEMENT
Date of Grant: , 19
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THIS 1996 NON-QUALIFIED STOCK OPTION AGREEMENT ("Agreement"), dated as
of the date of grant first stated above (the "Date of Grant"), is delivered
by US Liquids Inc., a Delaware corporation ("Company") to _________________
(the "Grantee").
WHEREAS, the Board of Directors of the Company ("Board") believes that
the Company's association with Grantee increases and enhances the Company's
business opportunities and provides avenues for useful business counsel to
the Company; and
WHEREAS, the Board desires to incentivise Grantee to maintain an
association with the Company, and has determined that it would be in the best
interest of the Company to grant the stock options documented herein to
Grantee.
NOW, THEREFORE, the parties hereto, intending to be legally bound
hereby, agree as follows:
1. GRANT OF OPTION. Subject to the terms and conditions hereinafter
set forth, Company hereby grants to the Grantee, as of the Date of Grant, an
option to purchase up to _____________ shares of common stock, par value $.01
per share ("Stock"), at a price of $______ per share, the fair market value
of such Stock on the Date of Grant. Such option is hereinafter referred to
as the "Option" and the shares of stock purchasable upon exercise of the
Option are hereinafter sometimes referred to as the "Option Shares."
2. INSTALLMENT EXERCISE. Subject to the prerequisites of this Section
2 and subject to such further limitations as are provided in this Agreement,
the Option Shares shall become exercisable as set forth below:
(a) after December 31, 1997, _________ of the Option Shares shall
become exercisable, PROVIDED that on or before December 31, 1997 the Company
or a subsidiary of the Company has completed the acquisition of the stock or
substantially all of the assets of a business (an "Acquisition") as the
result of a business opportunity and introductions or facilitating meetings
presented to the Company by Grantee with respect to such business (an
"Acquisition Opportunity Presentation"); and PROVIDED FURTHER, that if the
Company has not completed an Acquisition pursuant to an Acquisition
Opportunity Presentation by Grantee on or before December 31, 1997, the
Option of Grantee to acquire ___________ of the Option Shares shall terminate
at the close of business on December 31, 1997 without ever having become
exercisable;
(b) after December 31, 1998, ________ of the Option Shares shall become
exercisable, PROVIDED that during calendar year 1998 the Company or a
subsidiary of the
Company has completed an Acquisition as the result of an Acquisition
Opportunity Presentation by Grantee; and PROVIDED FURTHER, that if the
Company has not completed an Acquisition pursuant to an Acquisition
Opportunity Presentation by Grantee during calendar year 1998, the Option of
Grantee to acquire _____________ of the Option Shares shall terminate at the
close of business on December 31, 1998 without ever having become
exercisable; and
(c) after December 31, 1999, ___________ of the Option Shares shall
become exercisable, PROVIDED that during calendar year 1999 the Company or a
subsidiary of the Company has completed an Acquisition as the result of an
Acquisition Opportunity Presentation by Grantee; and PROVIDED FURTHER, that
if the Company has not completed an Acquisition pursuant to an Acquisition
Opportunity Presentation by Grantee during calendar year 1999, the Option of
Grantee to acquire ____________ of the Option Shares shall terminate at the
close of business on December 31, 1999 without ever having become exercisable.
By way of clarification and in summary, one-third of the Option Shares shall
become exercisable after the end of each calendar year if the Grantee has
brought an Acquisition Opportunity Presentation to the Company which results
in an Acquisition by the Company during such calendar year. If in any
calendar year 1997, 1998 or 1999 the Company does not complete an Acquisition
pursuant to an Acquisition Opportunity Presentation by Grantee, Grantee's
Option to acquire one-third of the Option Shares shall terminate, without
regard to the number of Acquisitions completed by the Company in other
calendar years as the result of Acquisition Opportunity Presentations by
Grantee.
3. TERMINATION OF OPTION.
(a) The Option and all rights hereunder with respect thereto, to
the extent such rights shall not have been exercised or otherwise terminated
pursuant to the terms of this Agreement, shall terminate and become null and
void after the expiration of ten (10) years from the Date of Grant (the
"Option Term").
(b) In the event of the death of Grantee, the Option shall
terminate, but the Option may be exercised by the Grantee's legal
representative(s) during the six-month period following the date of issuance
of letters testamentary or letters of administration to the executor or
administrator of a deceased Grantee, but not later than one year after the
Grantee's death. The Option may be exercised by the Grantee's legal
representative(s) only to the extent that the Option was outstanding and
exercisable by Grantee on the date of Grantee's death. In no event shall the
six-month period referenced in this Section 3(b) extend beyond the Option
Term otherwise delineated in this Agreement.
(c) Notwithstanding any other provisions set forth herein, if the
Grantee shall commit any act of malfeasance or wrongdoing with regard to the
Company or any
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subsidiary of Company, any unexercised portion of the Option shall
immediately terminate and be void.
4. EXERCISE OF OPTIONS.
(a) The Grantee may exercise the Option with respect to all or any
part of the number of Option Shares then exercisable hereunder by giving the
Secretary of Company written notice of intent to exercise. The notice of
exercise shall specify the number of Option Shares as to which the Option is
to be exercised and the date of exercise thereof, which date shall be at
least five days after the giving of such notice unless an earlier time shall
have been mutually agreed upon.
(b) Full payment (in U.S. dollars) by the Grantee of the option
price for the Option Shares purchased shall be made on or before the exercise
date specified in the notice of exercise in cash, or, with the prior written
consent of the Board, in whole or in part through the surrender of previously
acquired shares of Stock at their fair market value on the exercise date.
(c) On the exercise date specified in the Grantee's notice or as
soon thereafter as is practicable, Company shall cause to be delivered to the
Grantee, a certificate or certificates for the Option Shares then being
purchased (out of theretofore unissued Stock or reacquired Stock, as Company
may elect) upon full payment for such Option Shares. The obligation of
Company to deliver Stock shall, however, be subject to the condition that if
at any time the Board shall determine in its discretion that the listing,
registration or qualification of the Option or the Option 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 Option or the issuance or purchase
of Stock thereunder, the 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
Board.
(d) If the Grantee fails to pay for any of the Option Shares
specified in such notice or fails to accept delivery thereof, the Grantee's
right to purchase such Option Shares may be terminated by Company. The date
specified in the Grantee's notice as the date of exercise shall be deemed the
date of exercise of the Option, provided that payment in full for the Option
Shares to be purchased upon such exercise shall have been received by such
date.
5. ADJUSTMENT OF AND CHANGES IN STOCK OF COMPANY. In the event of a
reorganization, recapitalization, change of shares, stock split, spin-off,
stock dividend, reclassification, subdivision or combination of shares,
merger, consolidation, rights offering, or any other change in the corporate
structure or shares of capital stock of
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Company, the Board shall make such adjustment as it deems appropriate in the
number and kind of shares of Stock subject to the Option or in the option
price; provided, however, that no such adjustment shall give the Grantee any
additional benefits under the Option.
6. FAIR MARKET VALUE. As used herein, the "fair market value" of a
share of Stock shall be the average of the high and low sale prices per share
of Stock on the exchange on which it trades or, if it is not traded on an
exchange, the fair market value of a share shall be determined through the
best efforts of the Board.
7. NO RIGHTS OF STOCKHOLDERS. Neither the Grantee nor any personal
representative shall be, or shall have any of the rights and privileges of, a
stockholder of Company with respect to any shares of Stock purchasable or
issuable upon the exercise of the Option, in whole or in part, prior to the
date of exercise of the Option.
8. NON-TRANSFERABILITY OF OPTION. During the Grantee's lifetime, the
Option hereunder shall be exercisable only by the Grantee or any guardian or
legal representative of the Grantee, and the Option shall not be transferable
except, in case of the death of the Grantee, by will or the laws of descent
and distribution, nor shall the Option be subject to attachment, execution or
other similar process. In the event of (a) any attempt by the Grantee to
alienate, assign, pledge, hypothecate or otherwise dispose of the Option,
except as provided for herein, or (b) the levy of any attachment, execution
or similar process upon the rights or interest hereby conferred, Company may
terminate the Option by notice to the Grantee and it shall thereupon become
null and void.
9. AMENDMENT OF OPTION. The Option may be amended by the Board at any
time (i) if the Board determines, in its sole discretion, that amendment is
necessary or advisable in the light of any addition to or change in the
Internal Revenue Code of 1986, including amendments, or in the regulations
issued thereunder, or any federal or state securities law or other law or
regulation, which change occurs after the Date of Grant and by its terms
applies to the Option; or (ii) other than in the circumstances described in
clause (i), with the consent of the Grantee.
10. NOTICE. Any notice to Company provided for in this instrument
shall be addressed to it in care of its Secretary at its executive offices at
0000 X. Xxxxxxx Xx., Xxxxx 000, Xxxxxxxxx, Xxxxxxxxx 00000, and any notice
to the Grantee shall be addressed to the Grantee at the address shown on the
signature page of this Agreement. Any notice shall be deemed to be duly
given if and when properly addressed and posted by registered or certified
mail, postage prepaid. Any party to this Agreement may change its address for
notice by notice to the other party in accordance with this Section.
11. GOVERNING LAW. The validity, construction, interpretation and
effect of this instrument shall exclusively be governed by and determined in
accordance with the laws of the State of Texas, except to the extent
preempted by federal law.
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IN WITNESS WHEREOF, Company has used its duly authorized officers to
execute this Agreement, and the Grantee has placed his or her signature
hereon, effective as of the Date of Grant.
US LIQUIDS INC.
By: /s/ W. Xxxxxxx Xxx
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W. Xxxxxxx Xxx, President
GRANTEE
By:*
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Address for notice:
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* Xxxxxxx X. Xxxxxxxx XX, Xxxxx Xxxxxx, Xxxx Xxxxxxxxxx and Xxxx Xxxxxxx have
each entered into a 1996 Nonqualified Stock Option Agreement with U S Liquids
Inc.
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