SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-----------------
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended SEPTEMBER 30, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from __________________________ to ___________________
COMMISSION FILE NUMBERS 333-18455 AND 333-18455-01
-----------------
STATIA TERMINALS INTERNATIONAL N.V.
------------------------------------------------------
(Exact name of registrant as specified in its charter)
NETHERLANDS ANTILLES 52-2003102
------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
TUMBLEDOWN DICK BAY
ST. EUSTATIUS, NETHERLANDS ANTILLES
(011) 5993-82300
-----------------------------------------------------------------
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
STATIA TERMINALS CANADA, INCORPORATED
------------------------------------------------------
(Exact name of registrant as specified in its charter)
NOVA SCOTIA, CANADA 98-0164788
------------------------------- -------------------
(State or other jurisdiction of (I.R.S.Employer
incorporation or organization) Identification No.)
3817 PORT MALCOLM ROAD
PORT HAWKESBURY, NOVA SCOTIA B0E 2V0
(902) 625-1711
-----------------------------------------------------------------
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
-----------------
Indicate by check mark whether each of the registrants: (1) has filed
all reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been subject
to such filing requirements for the past 90 days. Yes [X] No [ ]
The equity securities of the registrants have not been, and are not
required to be, registered under either the Securities Act of 1933 or the
Securities Exchange Act of 1934.
<PAGE>
STATIA TERMINALS INTERNATIONAL N.V.
AND
STATIA TERMINALS CANADA, INCORPORATED
QUARTERLY REPORT ON FORM 10-Q
<TABLE>
<CAPTION>
TABLE OF CONTENTS
PAGE NO.
--------
PART I. FINANCIAL INFORMATION
<S> <C>
Item 1. Financial Statements
Consolidated Balance Sheets 1
Consolidated Statements of Income and Accumulated Deficit 2
Consolidated Statement of Cash Flows 3
Notes to Consolidated Financial Statements 4
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations 13
Item 3. Quantitative and Qualitative Disclosures About Market Risk 18
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 19
Item 2. Changes in Securities 19
Item 3. Defaults Upon Senior Securities 19
Item 4. Submission of Matters to a Vote of Security Holders 19
Item 5. Other Information 19
Item 6. Exhibits and Reports on Form 8-K 19
</TABLE>
THIS QUARTERLY REPORT ON FORM 10-Q (THIS "REPORT") CONTAINS
FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF 27A OF THE SECURITIES ACT OF
1933. DISCUSSIONS CONTAINING SUCH FORWARD-LOOKING STATEMENTS MAY BE FOUND IN
ITEMS 1, 2 AND 3 OF PART I HEREOF, AS WELL AS WITHIN THIS REPORT GENERALLY. IN
ADDITION, WHEN USED IN THIS REPORT, THE WORDS "BELIEVES," "ANTICIPATES,"
"EXPECTS" AND SIMILAR EXPRESSIONS ARE INTENDED TO IDENTIFY FORWARD-LOOKING
STATEMENTS. SUCH STATEMENTS ARE SUBJECT TO A NUMBER OF RISKS AND UNCERTAINTIES.
ACTUAL RESULTS IN THE FUTURE COULD DIFFER MATERIALLY FROM THOSE DESCRIBED IN THE
FORWARD-LOOKING STATEMENTS AS A RESULT OF FLUCTUATIONS IN THE SUPPLY OF AND
DEMAND FOR CRUDE OIL AND OTHER PETROLEUM PRODUCTS, CHANGES IN THE LIQUID
TERMINALING INDUSTRY, CHANGES IN GOVERNMENT REGULATIONS AFFECTING THE PETROLEUM
INDUSTRY, THE FINANCIAL CONDITION OF THE COMPANY'S CUSTOMERS, ADVERSE WEATHER
CONDITIONS, THE CONDITION OF THE UNITED STATES ECONOMY AND OTHER MATTERS SET
FORTH IN THIS REPORT. THE COMPANY DOES NOT UNDERTAKE ANY OBLIGATION TO PUBLICLY
RELEASE THE RESULTS OF ANY REVISIONS TO THESE FORWARD-LOOKING STATEMENTS THAT
MAY BE MADE TO REFLECT ANY FUTURE EVENTS OR CIRCUMSTANCES.
<PAGE>
PART I.
FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
STATIA TERMINALS INTERNATIONAL N.V. AND ITS SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(DOLLARS IN THOUSANDS)
UNAUDITED
DECEMBER 31, SEPTEMBER 30,
1996 1997
------------ ------------
ASSETS:
Current assets:
Cash and cash equivalents $ 9,264 $ 9,946
Accounts receivable -
Trade, net 12,165 12,273
Other 3,096 1,660
Inventory, net 4,969 2,302
Prepaid expenses 1,036 963
Assets held for sale 20,000 20,118
--------- ---------
Total current assets 50,530 47,262
Property and equipment, net 203,187 200,018
Other non-current assets, net 6,438 5,890
--------- ---------
$ 260,155 $ 253,170
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY:
Current liabilities:
Accounts payable $ 9,926 $ 11,030
Accrued interest expense 1,521 5,993
Accrued expenses 15,303 8,406
--------- ---------
Total current liabilities 26,750 25,429
Long-term debt 135,000 135,000
--------- ---------
Total liabilities 161,750 160,429
--------- ---------
Equity subject to reduction 20,000 20,000
Stockholders' equity:
Common stock 6 6
Additional paid-in capital 78,494 78,494
Accumulated deficit (95) (5,759)
--------- ---------
Total stockholders' equity 78,405 72,741
--------- ---------
$ 260,155 $ 253,170
========= =========
The accompanying notes are an integral part of these financial statements.
Page 1
<PAGE>
<TABLE>
<CAPTION>
STATIA TERMINALS INTERNATIONAL N.V. AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME AND ACCUMULATED DEFICIT
(DOLLARS IN THOUSANDS)
UNAUDITED UNAUDITED
QUARTER ENDED SEPTEMBER 30, YEAR TO DATE SEPTEMBER 30,
--------------------------- --------------------------
1996 1997 1996 1997
---------- ---------- ---------- ---------
<S> <C> <C> <C> <C>
Revenues $ 38,129 $ 35,333 $ 114,978 $ 101,190
Costs of services and products sold 36,201 31,076 104,859 88,418
--------- --------- --------- ---------
Gross profit 1,928 4,257 10,119 12,772
Administrative expense 1,243 1,483 4,463 4,644
--------- --------- --------- ---------
Income from operations 685 2,774 5,656 8,128
Interest expense 1,164 3,992 3,498 11,966
--------- --------- --------- ---------
Income (loss) before income taxes (479) (1,218) 2,158 (3,838)
Provision for income taxes 212 243 498 476
--------- --------- --------- ---------
Net income (loss) (691) (1,461) 1,660 (4,314)
Preferred dividends 223 -- 788 --
--------- --------- --------- ---------
Net income (loss) available to
common shareholders (914) (1,461) 872 (4,314)
Accumulated deficit, opening balance (23,214) (4,298) -- (95)
Dividends -- -- (25,000) (1,350)
--------- --------- --------- ---------
Accumulated deficit, closing balance $ (24,128) $ (5,759) $ (24,128) $ (5,759)
========= ========= ========= =========
</TABLE>
The accompanying notes are an integral part of these financial statements.
Page 2
<PAGE>
<TABLE>
<CAPTION>
STATIA TERMINALS INTERNATIONAL N.V. AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
(DOLLARS IN THOUSANDS)
UNAUDITED UNAUDITED
YEAR TO DATE AS OF YEAR TO DATE AS OF
SEPTEMBER 30, 1996 SEPTEMBER 30, 1997
------------------ ------------------
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $ 1,660 $ (4,314)
Adjustments to reconcile net income (loss) to net cash
provided by operating activities-
Depreciation and amortization expense 7,544 8,136
(Gain) on disposal of fixed assets (69) (105)
Increase in accounts receivable-trade, net (735) (108)
Decrease in other receivables 3,964 1,382
Decrease (increase) in inventory (4,818) 2,667
Decrease (increase) in prepaid expenses (288) 73
Decrease (increase) in other non-current assets 391 (253)
Increase in accounts payable 2,490 1,103
Increase (decrease) in accrued expenses 2,468 (2,411)
Increase (decrease) in payables to affiliates (1,247) 42
-------- --------
Net cash provided by operating activities 11,360 6,212
-------- --------
Cash flows from investing activities:
Proceeds from sale of fixed assets 111 104
Purchase of property and equipment (12,479) (4,284)
-------- --------
Net cash used in investing activities (12,368) (4,180)
-------- --------
Cash flows from financing activities:
Bank loan repayments (66,400) --
Increase in notes payable 66,000 --
Increase in advances from CBI/Praxair 26,376 --
Dividends paid (25,789) (1,350)
-------- --------
Net cash provided by (used in) financing activities 187 (1,350)
-------- --------
Increase (decrease) in cash and cash equivalents (821) 682
Cash and cash equivalents, beginning balance 1,469 9,264
-------- --------
Cash and cash equivalents, ending balance $ 648 $ 9,946
======== ========
Supplemental disclosure of cash flow information:
Cash paid for income taxes $ 601 $ 307
Cash paid for interest $ 3,667 $ 7,403
</TABLE>
The accompanying notes are an integral part of these financial statements.
Page 3
<PAGE>
STATIA TERMINALS INTERNATIONAL N.V. AND ITS SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 1997
(DOLLARS IN THOUSANDS)
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The unaudited consolidated financial statements of Statia Terminals
International N.V. ("Statia Terminals") and its subsidiaries (together with
Statia Terminals, the "Company") have been prepared in accordance with generally
accepted accounting principles for interim financial information and with the
instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do
not include all the information and footnotes required by generally accepted
accounting principles for complete financial statements. Significant accounting
policies followed by the Company were disclosed in the Notes to the Consolidated
Financial Statements included in the Company's Annual Report on Form 10-K for
the year ended December 31, 1996. In the opinion of the Company's management,
the accompanying consolidated financial statements contain adjustments,
consisting of normal recurring accruals, necessary to present fairly the
financial position of the Company at September 30, 1997 and the results of
operations and cash flows for the periods ended September 30, 1997 and 1996.
Operating results for the three months and nine months ended September 30, 1997
are not necessarily indicative of the results that may be expected for the year
ended December 31, 1997.
2. ACQUISITIONS
Prior to January 12, 1996, the Company was a wholly owned subsidiary of
CBI Industries, Inc. ("CBI"). On January 12, 1996, pursuant to a Merger
Agreement dated December 22, 1995, CBI became a wholly owned subsidiary of
Praxair, Inc. ("Praxair"). The Praxair purchase transaction was reflected in the
Company's consolidated financial statements in accordance with the purchase
method of accounting effective January 1, 1996. On November 27, 1996, Castle
Harlan II, L.P., a private merchant bank, management of the Company and others
acquired from Praxair all of the outstanding common shares of Statia Terminals,
Inc. and its subsidiaries and certain affiliates (the "CHPII Acquisition"). The
CHPII Acquisition has been accounted for under the purchase method of
accounting. Accordingly, the purchase price has been allocated on a preliminary
basis to the assets and liabilities of the Company based on their respective
fair values as of the date of the CHPII Acquisition. The preliminary estimates
may be revised at a later date. The application of purchase accounting resulted
in changes to the historical cost basis of accounting for certain assets. In
addition, in conjunction with the Praxair purchase transaction and CHPII
Acquisition, the Company refinanced or paid its bank debt, retired certain
preferred stock, satisfied an off-balance sheet lease obligation and issued
11-3/4% First Mortgage Notes (the "Notes"). Accordingly, the financial
information provided in the consolidated statements of income and cash flows for
the periods ended September 30, 1996 and 1997 may not be comparable. A solid
black line has been inserted in the financial statements and in Management's
Discussion and Analysis of Financial Condition and Results of Operations where
financial information may not be comparable across periods.
3. FINANCIAL STATEMENTS BY JURISDICTION
The Notes are guaranteed on a full, unconditional, joint and several
basis by each of the indirect and direct active subsidiaries of Statia Terminals
International N.V., other than Statia Terminals Canada, Incorporated ("Statia
Canada") which is a co-obligor on the Notes. Each of the subsidiary guarantors
are, directly or indirectly, wholly-owned by Statia Terminals. The Company has
several inactive non-guaranteeing subsidiaries which are inconsequential,
individually and in the aggregate, and which have no assets, liabilities or
operations, and are in process of being dissolved by the Company. The following
condensed combining financial data illustrates the composition of the Company's
subsidiary guarantors combined by jurisdiction. The enforceability of the
guarantees may be affected differently under the laws of the applicable
jurisdictions. Separate financial statements of the subsidiaries are not
presented because management of the Company has determined that they are not
material to investors.
Page 4
<PAGE>
<TABLE>
<CAPTION>
STATIA TERMINALS INTERNATIONAL N.V. AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
CONDENSED COMBINING BALANCE SHEETS
AS OF DECEMBER 31, 1996
(DOLLARS IN THOUSANDS)
GUARANTEEING SUBSIDIARIES
-------------------------------------------------
STATIA NETHERLANDS
TERMINALS ANTILLES
STATIA CANADA, INC. OTHER
TERMINALS (WHICH THAN
INTERNATIONAL INCLUDES ALL STATIA STATIA RECLASSIFICATIONS
N.V. CANADIAN TERMINALS TERMINALS UNITED AND CONSOLIDATED
(UNCONSOLIDATED) ENTITIES) N.V. N.V. STATES ELIMINATIONS TOTAL
--------------- ------------ --------- ----------- ------ ----------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Current assets:
Cash and cash
equivalents $ 7,065 $ 854 $ 1,304 $ 41 $ -- $ -- $ 9,264
Accounts receivable -
Trade, net -- 873 10,876 (88) 504 -- 12,165
Other 54 630 2,421 33 414 (456) 3,096
Inventory, net -- 1,157 3,812 -- -- -- 4,969
Prepaid expenses -- 67 26 1 942 -- 1,036
Receivable from
(payable to)
affiliates (11,020) -- (37) 20,557 (4,517) (4,983) --
Assets held for sale -- -- 10,000 -- 10,000 -- 20,000
--------- --------- --------- --------- --------- --------- ---------
Total current
assets (3,901) 3,581 28,402 20,544 7,343 (5,439) 50,530
Property and equipment, net -- 29,036 172,316 1,394 441 -- 203,187
Investment in subsidiaries 103,040 -- -- 180,424 213 (283,677) --
Other non-current assets, net -- 1,366 5,039 -- 33 -- 6,438
--------- --------- --------- --------- --------- --------- ---------
$ 99,139 $ 33,983 $ 205,757 $ 202,362 $ 8,030 $(289,116) $ 260,155
========= ========= ========= ========= ========= ========= =========
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities:
Accounts payable $ -- $ 688 $ 5,453 $ 43 $ 4,199 $ (457) $ 9,926
Accrued expenses 734 4,613 8,814 (29) 1,131 40 15,303
Accrued interest -- 316 1,205 -- -- -- 1,521
--------- --------- --------- --------- --------- --------- ---------
Total current
liabilities 734 5,617 15,472 14 5,330 (417) 26,750
Long-term debt -- 28,060 106,940 -- -- -- 135,000
Payable to (receivable from)
CBI affiliates -- (1,597) 6,619 -- -- (5,022) --
--------- --------- --------- --------- --------- --------- ---------
Total liabilities 734 32,080 129,031 14 5,330 (5,439) 161,750
--------- --------- --------- --------- --------- --------- ---------
Equity subject to reduction 20,000 -- -- -- -- -- 20,000
Stockholders' equity:
Common stock 6 -- 19,395 159,006 3,000 (181,401) 6
Additional paid-in capital 78,494 2,266 56,847 43,207 -- (102,320) 78,494
Retained earnings (deficit) (95) (363) 484 135 (300) 44 (95)
--------- --------- --------- --------- --------- --------- ---------
Total stockholders'
equity 78,405 1,903 76,726 202,348 2,700 (283,677) 78,405
--------- --------- --------- --------- --------- --------- ---------
$ 99,139 $ 33,983 $ 205,757 $ 202,362 $ 8,030 $(289,116) $ 260,155
========= ========= ========= ========= ========= ========= =========
</TABLE>
Page 5
<PAGE>
<TABLE>
<CAPTION>
STATIA TERMINALS INTERNATIONAL N.V. AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
CONDENSED COMBINING STATEMENTS OF INCOME AND ACCUMULATED DEFICIT
FOR THE THREE MONTH PERIOD ENDED SEPTEMBER 30, 1996
(DOLLARS IN THOUSANDS)
RECLASSIFICATIONS
NETHERLANDS UNITED AND
CANADA ANTILLES STATES ELIMINATIONS TOTAL
-------- ----------- -------- ----------------- --------
<S> <C> <C> <C> <C> <C>
Revenues $ 2,687 $ 34,393 $ 2,221 $ (1,172) $ 38,129
Costs of services and products sold 2,035 33,398 832 (64) 36,201
-------- -------- -------- -------- --------
Gross profit 652 995 1,389 (1,108) 1,928
Administrative expense 402 706 1,243 (1,108) 1,243
-------- -------- -------- -------- --------
Income from operations 250 289 146 -- 685
Interest expense 1,102 62 -- -- 1,164
-------- -------- -------- -------- --------
Income (loss) before income taxes (852) 227 146 -- (479)
Provision for (benefit from) income taxes 46 66 100 -- 212
-------- -------- -------- -------- --------
Net income (loss) (898) 161 46 -- (691)
Preferred dividends 223 -- -- -- 223
-------- -------- -------- -------- --------
Net income (loss) available to
common shareholders (1,121) 161 46 -- (914)
Accumulated deficit, opening balance (3,615) (19,149) (450) -- (23,214)
Dividends -- -- -- -- --
-------- -------- -------- -------- --------
Accumulated deficit, closing balance $ (4,736) $(18,988) $ (404) $ -- $(24,128)
======== ======== ======== ======== ========
</TABLE>
Page 6
<PAGE>
<TABLE>
<CAPTION>
STATIA TERMINALS INTERNATIONAL N.V. AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
CONDENSED COMBINING STATEMENTS OF INCOME AND ACCUMULATED DEFICIT
FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 1996
(DOLLARS IN THOUSANDS)
RECLASSIFICATIONS
NETHERLANDS UNITED AND
CANADA ANTILLES STATES ELIMINATIONS TOTAL
------- ---------- --------- ------------------ ---------
<S> <C> <C> <C> <C> <C>
Revenues $ 7,922 $ 104,762 $ 6,352 $ (4,058) $ 114,978
Costs of services and products sold 7,054 95,760 2,255 (210) 104,859
------- ---------- --------- --------- ---------
Gross profit 868 9,002 4,097 (3,848) 10,119
Administrative expense 1,367 2,482 4,462 (3,848) 4,463
------- ---------- --------- --------- ---------
Income (loss) from operations (499) 6,520 (365) -- 5,656
Interest expense 3,151 347 -- -- 3,498
------- ---------- --------- --------- ---------
Income (loss) before income taxes (3,650) 6,173 (365) -- 2,158
Provision for income taxes 298 161 39 -- 498
------- ---------- --------- --------- ---------
Net income (loss) (3,948) 6,012 (404) -- 1,660
Preferred dividends 788 -- -- -- 788
------- ---------- --------- --------- ---------
Net income (loss) available to
common shareholders (4,736) 6,012 (404) -- 872
Retained earnings, opening balance -- -- -- -- --
Dividends -- (25,000) -- -- (25,000)
------- ---------- --------- --------- ---------
Accumulated deficit, closing balance $(4,736) $ (18,988) $ (404) $ -- $ (24,128)
======= ========== ========= ========= =========
</TABLE>
Page 7
<PAGE>
<TABLE>
<CAPTION>
STATIA TERMINALS INTERNATIONAL N.V. AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
CONDENSED COMBINING STATEMENT OF CASH FLOWS
FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 1996
(DOLLARS IN THOUSANDS)
RECLASSIFICATIONS
NETHERLANDS AND
CANADA ANTILLES UNITED STATES ELIMINATIONS TOTAL
--------- ----------- ------------- ----------------- --------
<S> <C> <C> <C> <C> <C>
Net cash provided by (used in) operating
activities $ (7,813) $ 34,765 $(15,592) $ -- $ 11,360
-------- -------- -------- -------- --------
Cash flows from investing activities:
Investment in subsidiary -- -- (7) 7 --
Proceeds from sale of property
and equipment -- 111 -- -- 111
Purchase of property and equipment (800) (10,229) (1,450) -- (12,479)
-------- -------- -------- -------- --------
Net cash used in
investing activities (800) (10,118) (1,457) 7 (12,368)
-------- -------- -------- -------- --------
Cash flows from financing activities:
Bank loan repayments (66,400) -- -- -- (66,400)
Increase in notes payable 66,000 -- -- -- 66,000
Additional capital contribution -- 7 -- (7) --
Increase in advances to affiliates 8,805 322 17,249 -- 26,376
Dividends paid (789) (25,000) -- -- (25,789)
-------- -------- -------- -------- --------
Net cash provided by
(used in) financing
activities 7,616 (24,671) 17,249 (7) 187
-------- -------- -------- -------- --------
Increase (decrease) in cash and cash
equivalents (997) (24) 200 -- (821)
Cash and cash equivalents, beginning
balance 1,207 300 (38) -- 1,469
-------- -------- -------- -------- --------
Cash and cash equivalents, ending balance $ 210 $ 276 $ 162 $ -- $ 648
======== ======== ======== ======== ========
Supplemental disclosure of cash flow
information:
Cash paid for income taxes $ 115 $ 210 $ 276 $ -- $ 601
Cash paid for interest $ 3,667 $ -- $ -- $ -- $ 3,667
</TABLE>
Page 8
<PAGE>
<TABLE>
<CAPTION>
STATIA TERMINALS INTERNATIONAL N.V. AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
CONDENSED COMBINING BALANCE SHEETS
AS OF SEPTEMBER 30, 1997
(DOLLARS IN THOUSANDS)
GUARANTEEING SUBSIDIARIES
---------------------------------------------------
STATIA NETHERLANDS
TERMINALS ANTILLES
STATIA CANADA, INC. OTHER
TERMINALS (WHICH STATIA THAN
INTERNATIONAL INCLUDES ALL TERMINALS STATIA RECLASSIFICATIONS
N.V. CANADIAN N.V. TERMINALS UNITED AND CONSOLIDATED
(UNCONSOLIDATED) ENTITIES) CONSOLIDATED N.V. STATES ELIMINATIONS TOTAL
--------------- ------------ ------------ ----------- ------ ----------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS
Current assets:
Cash and cash
equivalents $ 1 $ 800 $ 8,833 $ 19 $ 293 $ -- $ 9,946
Accounts receivable -
Trade, net -- 2,643 9,373 -- 257 -- 12,273
Other -- 537 948 1 174 -- 1,660
Inventory, net -- 937 1,365 -- -- -- 2,302
Prepaid expenses -- 118 94 1 750 -- 963
Assets held for sale -- 118 10,000 -- 10,000 -- 20,118
--------- --------- --------- --------- --------- --------- ---------
Total current
assets 1 5,153 30,613 21 11,474 -- 47,262
Property and equipment, net -- 28,620 170,067 1,260 71 -- 200,018
Investment in subsidiaries 93,025 -- -- 177,717 205 (270,947) --
Other non-current
assets, net -- 1,223 4,499 1 167 -- 5,890
--------- --------- --------- --------- --------- --------- ---------
$ 93,026 $ 34,996 $ 205,179 $ 178,999 $ 11,917 $(270,947) $ 253,170
========= ========= ========= ========= ========= ========= =========
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities:
Accounts payable $ 22 $ 1,011 $ 9,456 $ 3 $ 538 $ -- $ 11,030
Accrued interest expense -- 1,246 4,747 -- -- -- 5,993
Accrued expenses 79 2,253 4,087 (9) 1,956 -- 8,366
Receivable from (payable
to) affiliates 184 851 11,466 (20,589) 8,128 -- 40
--------- --------- --------- --------- --------- --------- ---------
Total current
liabilities 285 5,361 29,756 (20,595) 10,622 -- 25,429
Long-term debt -- 28,060 106,940 -- -- -- 135,000
--------- --------- --------- --------- --------- --------- ---------
Total liabilities 285 33,421 136,696 (20,595) 10,622 -- 160,429
--------- --------- --------- --------- --------- --------- ---------
Equity subject to reduction 20,000 -- -- -- -- -- 20,000
Stockholders' equity:
Common stock 6 -- 19,395 159,006 3,000 (181,401) 6
Additional paid-in
capital 78,494 2,266 56,847 43,207 -- (102,320) 78,494
Retained earnings
(deficit) (5,759) (691) (7,759) (2,619) (1,705) 12,774 (5,759)
--------- --------- --------- --------- --------- --------- ---------
Total stockholders'
equity 72,741 1,575 68,483 199,594 1,295 (270,947) 72,741
--------- --------- --------- --------- --------- --------- ---------
$ 93,026 $ 34,996 $ 205,179 $ 178,999 $ 11,917 $(270,947) $ 253,170
========= ========= ========= ========= ========= ========= =========
</TABLE>
Page 9
<PAGE>
<TABLE>
<CAPTION>
STATIA TERMINALS INTERNATIONAL N.V. AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
CONDENSED COMBINING STATEMENTS OF INCOME AND ACCUMULATED DEFICIT
FOR THE THREE MONTH PERIOD ENDING SEPTEMBER 30, 1997
(DOLLARS IN THOUSANDS)
GUARANTEEING SUBSIDIARIES
---------------------------------------------------
STATIA NETHERLANDS
TERMINALS ANTILLES
STATIA CANADA, INC. OTHER
TERMINALS (WHICH THAN
INTERNATIONAL INCLUDES ALL STATIA STATIA RECLASSIFICATIONS
N.V. CANADIAN TERMINALS TERMINALS UNITED AND CONSOLIDATED
(UNCONSOLIDATED) ENTITIES) N.V. N.V. STATES ELIMINATIONS TOTAL
--------------- ------------ ------------ ----------- ------ ----------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Revenues $ -- $ 6,309 $ 28,552 $ 146 $ 2,029 $ (1,703) $ 35,333
Costs of services and
products sold -- 3,741 26,414 212 1,133 (424) 31,076
-------- -------- -------- -------- -------- -------- --------
Gross Profit -- 2,568 2,138 (66) 896 (1,279) 4,257
Administrative expense 86 504 775 -- 1,397 (1,279) 1,483
-------- -------- -------- -------- -------- -------- --------
Income (loss) from
operations (86) 2,064 1,363 (66) (501) -- 2,774
Interest expense -- 829 3,160 -- 3 -- 3,992
-------- -------- -------- -------- -------- -------- --------
Income (loss) before
income taxes (86) 1,235 (1,797) (66) (504) -- (1,218)
Provision for income taxes -- 103 71 (25) 94 -- 243
-------- -------- -------- -------- -------- -------- --------
Net income (loss) (86) 1,132 (1,868) (41) (598) -- (1,461)
Earnings (loss) from equity
investments (1,375) -- -- (736) 2 2,109 --
-------- -------- -------- -------- -------- -------- --------
Net income (loss)
available to common
shareholders (1,461) 1,132 (1,868) (777) (596) 2,109 (1,461)
Accumulated deficit,
opening balance (4,298) (1,823) (5,891) (1,842) (1,109) 10,665 (4,298)
Dividends -- -- -- -- -- -- --
-------- -------- -------- -------- -------- -------- --------
Accumulated deficit,
closing balance $ (5,759) $ (691) $ (7,759) $ (2,619) $ (1,705) $ 12,774 $ (5,759)
======== ======== ======== ======== ======== ======== ========
</TABLE>
Page 10
<PAGE>
<TABLE>
<CAPTION>
STATIA TERMINALS INTERNATIONAL N.V. AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
CONDENSED COMBINING STATEMENTS OF INCOME AND ACCUMULATED DEFICIT
FOR THE NINE MONTH PERIOD ENDING SEPTEMBER 30, 1997
(DOLLARS IN THOUSANDS)
GUARANTEEING SUBSIDIARIES
---------------------------------------------------
STATIA NETHERLANDS
TERMINALS ANTILLES
STATIA CANADA, INC. OTHER
TERMINALS (WHICH THAN
INTERNATIONAL INCLUDES ALL STATIA STATIA RECLASSIFICATIONS
N.V. CANADIAN TERMINALS TERMINALS UNITED AND CONSOLIDATED
(UNCONSOLIDATED) ENTITIES) N.V. N.V. STATES ELIMINATIONS TOTAL
--------------- ------------ ------------ ----------- ------ ----------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Revenues $ 5,864 $ 13,672 $ 87,185 $ 6,229 $ 6,285 $ (18,045) $ 101,190
Costs of services and
products sold -- 9,849 77,455 428 3,054 (2,368) 88,418
--------- --------- --------- --------- --------- --------- ---------
Gross Profit 5,864 3,823 9,730 5,801 3,231 (15,677) 12,772
Administrative expense 164 1,523 2,427 -- 4,479 (3,949) 4,644
--------- --------- --------- --------- --------- --------- ---------
Income (loss) from
operations 5,700 2,300 7,303 5,801 (1,248) (11,728) 8,128
Interest expense -- 2,486 9,471 -- 9 -- 11,966
--------- --------- --------- --------- --------- --------- ---------
Income (loss) before
income taxes 5,700 (186) (2,168) 5,801 (1,257) (11,728) (3,838)
Provision for income taxes -- 142 211 (16) 139 -- 476
--------- --------- --------- --------- --------- --------- ---------
Net income (loss) 5,700 (328) (2,379) 5,817 (1,396) (11,728) (4,314)
Earnings (loss) from
equity investments (10,014) -- -- (2,707) (9) 12,730 --
--------- --------- --------- --------- --------- --------- ---------
Net income (loss)
available to
common shareholders (4,314) (328) (2,379) 3,110 (1,405) 1,002 (4,314)
Retained earnings
(accumulated
deficit), opening
balance (95) (363) 484 135 (300) 44 (95)
Dividends (1,350) -- (5,864) (5,864) -- 11,728 (1,350)
--------- --------- --------- --------- --------- --------- ---------
Accumulated deficit,
closing balance $ (5,759) $ (691) $ (7,759) $ (2,619) $ (1,705) $ 12,774 $ (5,759)
========= ========= ========= ========= ========= ========= =========
</TABLE>
Page 11
<PAGE>
<TABLE>
<CAPTION>
STATIA TERMINALS INTERNATIONAL N.V. AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
CONDENSED COMBINING STATEMENT OF CASH FLOWS
FOR THE NINE MONTH PERIOD ENDED SEPTEMBER 30, 1997
(DOLLARS IN THOUSANDS)
GUARANTEEING SUBSIDIARIES
---------------------------------------------------
STATIA NETHERLANDS
TERMINALS ANTILLES
STATIA CANADA, INC. OTHER
TERMINALS (WHICH THAN
INTERNATIONAL INCLUDES ALL STATIA STATIA RECLASSIFICATIONS
N.V. CANADIAN TERMINALS TERMINALS UNITED AND CONSOLIDATED
(UNCONSOLIDATED) ENTITIES) N.V. N.V. STATES ELIMINATIONS TOTAL
--------------- ------------ ------------ ----------- ------ ----------------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Net cash provided by
(used in) operating
activities $(15,728) $ 522 $ 16,514 $ 3,135 $ 767 $ 1,002 $ 6,212
-------- -------- -------- -------- -------- -------- --------
Cash flows from
investing activities:
Purchase of
property and
equipment -- (576) (3,121) -- (687) 100 (4,284)
Income from
Equity
Investment 10,014 -- -- 2,707 9 (12,730) --
Proceeds from sale
of fixed assets -- -- -- -- 204 (100) 104
-------- -------- -------- -------- -------- -------- --------
Net cash
provided
by (used
in)
investing
activities 10,014 (576) (3,121) 2,707 (474) (12,730) (4,180)
-------- -------- -------- -------- -------- -------- --------
Cash flows from
financing activities:
Dividends paid (1,350) -- (5,864) (5,864) -- 11,728 (1,350)
-------- -------- -------- -------- -------- -------- --------
Net cash
provided
by (used
in)
financing
activities (1,350) -- (5,864) (5,864) -- 11,728 (1,350)
-------- -------- -------- -------- -------- -------- --------
Increase (decrease) in
cash and cash
equivalents (7,064) (54) 7,529 (22) 293 -- 682
Cash and cash
equivalents,
beginning
balance 7,065 854 1,304 41 -- -- 9,264
-------- -------- -------- -------- -------- -------- --------
Cash and cash
equivalents,
ending
balance $ 1 $ 800 $ 8,833 $ 19 $ 293 $ -- $ 9,946
======== ======== ======== ======== ======== ======== ========
Supplemental
disclosure of cash
flow information:
Cash paid for
income taxes $ -- $ 71 $ 210 $ -- $ 26 $ -- $ 307
Cash paid for
interest $ -- $ 1,539 $ 5,864 $ -- $ -- $ -- $ 7,403
</TABLE>
Page 12
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
For purposes of the discussion below, reference is made to the
unaudited Consolidated Financial Statements and Notes thereto of Statia
Terminals International N.V. and its subsidiaries as of September 30, 1997 and
the periods ended September 30, 1997 and 1996 included herein. Reference should
also be made to the Company's Annual Report on Form 10-K as of and for the year
ended December 31, 1996 including the consolidated financial statements of the
Company, Statia Canada and Statia Terminals N.V. ("STNV").
RESULTS OF OPERATIONS
Total revenues for the quarter ending September 30, 1997 were $35.3
million compared to $38.1 million for the same period in 1996, a decrease of
$2.8 million, or 7.3%. Comparative nine month revenues were down $13.8 million,
or 12.0%, falling to $101.2 million from $115.0 million. The decreases in
revenues resulted primarily from reduced bunker and bulk product sales at the
Company's St. Eustatius, Netherlands Antilles facility partially offset by an
increase in bunker and bulk product sales at the Point Tupper, Canada facility.
Terminaling services revenue (consisting of storage, throughput, docking
charges, response fees and other terminal charges) declined at St. Eustatius,
but showed improvement at Point Tupper for the first nine months of 1997
compared to the first nine months of 1996. Terminaling services typically
produce higher gross margins than bunker and bulk product sales.
Gross profit, operating income and net income (loss) for the periods
ended September 30, 1996 and 1997 are not comparable due to the effects of
purchase accounting applied as a result of the CHPII Acquisition. See Note 2 to
the Consolidated Financial Statements of Statia Terminals International N.V. on
Page 4 herein for further discussion. Depreciation, amortization and other
operating expenses, which are components of gross profit, changed as a result of
the revaluation of various assets to their fair values on November 27, 1996 in
connection with the CHPII Acquisition. In addition, since the Company can no
longer effectively pool costs with affiliated companies, certain expenses
related to insurance increased during the third quarter and first nine months of
1997 compared to the same periods a year ago. During 1997 the Company instituted
certain cost reduction programs lowering the number of persons employed and
reducing certain marine equipment costs. Changes in the components of the
Company's debt and equity accounts, including termination of certain lease
obligations which previously had been charged to operating expenses, resulted in
changes to cost of services and products sold, interest expense and preferred
dividends.
Page 13
<PAGE>
<TABLE>
<CAPTION>
REVENUES AND OPERATING INCOME (LOSS) BY LOCATION
(DOLLARS IN THOUSANDS)
QUARTER ENDED SEPTEMBER 30, YEAR TO DATE SEPTEMBER 30,
---------------------------- ----------------------------
1996 1997 1996 1997
---------- --------- --------- ---------
<S> <C> <C> <C> <C>
REVENUES
Netherlands Antilles and the Caribbean
Terminaling services $ 8,475 $ 8,535 $ 28,617 $ 25,428
Bunker and bulk product sales 25,918 20,121 76,145 61,996
--------- --------- --------- ---------
34,393 28,656 104,762 87,424
--------- --------- --------- ---------
Canada
Terminaling services 2,413 5,056 6,445 10,847
Bunker and bulk product sales 274 1,253 1,477 2,825
--------- --------- --------- ---------
2,687 6,309 7,922 13,672
--------- --------- --------- ---------
United States
Terminaling services 1,114 751 2,504 2,336
Corporate services 1,107 1,278 3,848 3,949
--------- --------- --------- ---------
2,221 2,029 6,352 6,285
--------- --------- --------- ---------
Eliminations (1,172) (1,661) (4,058) (6,191)
--------- --------- --------- ---------
Total revenues $ 38,129 $ 35,333 $ 114,978 $ 101,190
========= ========= ========= =========
OPERATING INCOME (LOSS)
Netherlands Antilles and the Caribbean $ 290 $ 1,211 $ 6,520 $ 7,076
Canada 249 2,064 (499) 2,300
United States 146 (501) (365) (1,248)
--------- --------- --------- ---------
Total operating income $ 685 $ 2,774 $ 5,656 $ 8,128
========= ========= ========= =========
</TABLE>
Comparison of the third quarters of 1996 and 1997 for St. Eustatius
reflect a nominal increase in revenues from terminaling services. The overall
percentage of capacity leased was 68% for the third quarter of 1996 compared to
69% for the same period in 1997. Substantially all of the facility's clean
product tankage was leased during the third quarter and first nine months of
1996 while only a small portion of such tankage was leased during the same
periods in 1997. More fuel oil tankage was leased during the third quarter of
1997 than 1996. The percentage of capacity leased and lease rates for this
facility's crude storage tanks were essentially unchanged when comparing the
results of the third quarter 1997 with the same period in 1996. Total throughput
fell from 13.3 million barrels for the third quarter of 1996 to 11.7 million
barrels for the third quarter of 1997 due to reduced throughput of crude oil
partially offset by higher throughput of fuel oil.
Caribbean bunker and bulk product sales fell $5.8 million or 22.4% in
the third quarter of 1997 as compared to the third quarter of 1996. The decrease
resulted from reduced bunker fuel deliveries due to (i) a general perception
that petroleum market prices would continue to fall or at least remain stable
during the last half of 1997 and (ii) an increase in competition within the
region. Management believes that many vessel owners and charterers opted to
purchase smaller quantities or defer purchases during the period of falling
bunker fuel prices. In addition, bunker fuel prices have been generally cheaper
in Europe, the Middle East, and the U.S. Gulf compared to the Caribbean
partially due to excess supply in these regions.
At Point Tupper, the percentage of tank capacity leased for the third
quarter of 1997 was 77%, up from 55% last year due to the signing of additional
spot storage contracts earlier this year. Total revenues more than doubled when
comparing third quarter periods. The increase is due to additional crude oil
storage leased and a four-
Page 14
<PAGE>
fold increase in crude oil throughput. Additional throughput led to higher port
charge revenues from vessels calling at the facility.
<TABLE>
<CAPTION>
CAPACITY, CAPACITY LEASED, THROUGHPUT AND VESSEL CALLS BY LOCATION
(CAPACITY AND THROUGHPUT IN THOUSANDS OF BARRELS)
QUARTER ENDED SEPTEMBER 30, YEAR TO DATE SEPTEMBER 30,
---------------------------- ---------------------------
1996 1997 1996 1997
------ ------ ------ ------
<S> <C> <C> <C> <C>
Netherlands Antilles and
the Caribbean
Total capacity 11,334 11,334 11,334 11,334
Capacity leased 68% 69% 81% 75%
Throughput 13,296 11,660 50,134 44,897
Vessel calls 198 178 684 591
Canada
Total capacity 7,404 7,404 7,404 7,404
Capacity leased 55% 77% 55% 66%
Throughput 4,242 20,148 14,178 38,814
Vessel calls 19 45 44 90
Texas
Total capacity 1,649 1,649 1,649 1,649
Capacity leased 62% 28% 39% 32%
Throughput 556 607 1,704 1,190
Vessel calls 10 31 52 72
All locations
Total capacity 20,387 20,387 20,387 20,387
Capacity leased 63% 68% 68% 68%
Throughput 18,094 32,415 66,016 84,901
Vessel calls 227 254 780 753
</TABLE>
LIQUIDITY AND CAPITAL RESOURCES
Cash flow from operations has been the Company's primary source of
liquidity during 1997. Cash provided by operations has been used to pay interest
on the Notes, purchase property and equipment and pay a dividend to the
Company's parent in accordance with agreements among the Company and its parent.
Despite net losses of $1.5 million and $4.3 million for the three and nine
months ended September 30, 1997, respectively, the Company had positive cash
flow from operations of $3.1 and $6.2 million for the respective periods.
Differences between net losses and positive operating cash flow have resulted
primarily from depreciation and amortization burdens. At December 31, 1996, the
Company had cash and cash equivalents on hand of $9.3 million compared to $9.9
million at September 30, 1997. Of this amount, $8.0 million was invested in
off-shore time deposits maturing in November 1997.
During 1997, the Company's interest expense amounting to $12.0 million
consisted of interest on the 11-3/4% First Mortgage Notes due 2003 and certain
bank charges. An interest payment related to the Notes of $7.4
Page 15
<PAGE>
million was paid during the second quarter. Subsequently interest was accrued
for expected payment during the fourth quarter of 1997.
During 1997, no significant changes have occurred in the Company's debt
and equity financing arrangements. As of September 30, 1997, the Company had not
borrowed under its $17.5 million revolving credit facility. This facility
permits the Company to borrow in accordance with its available borrowing base
which was estimated at $10.9 million ($8.8 million for STNV and $2.1 million for
Statia Canada) as of September 30, 1997 and bears interest at the prime rate
plus 50 basis points (9.0% at September 30, 1997). This facility is available
for working capital needs and letter of credit financing.
During 1997, a majority of capital expenditures were related to
sustaining the Company's existing operations including its maintenance programs.
The Company's capital expenditure budget for 1997 has been revised to $6.5
million. Additional spending is contingent upon the disposition of certain
assets held for sale and the addition of incremental terminaling business.
Because certain of the Company's computer systems may not adequately
handle changes brought about by the new millennium, the Company has developed a
master plan for dealing with potential Year 2000 issues, including upgrading
existing software applications during 1998. The 1998 capital expenditure budget
includes $0.7 million for such upgrades. The cost of addressing the Year 2000
issue is not expected to significantly impact the Company's future financial
condition or results of operations.
<TABLE>
<CAPTION>
CAPITAL EXPENDITURES BY LOCATION
(DOLLARS IN THOUSANDS)
QUARTER ENDED SEPTEMBER 30, YEAR TO DATE SEPTEMBER 30,
----------------------------------- -----------------------------------
1996 1997 1996 1997
--------------- ---------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Netherlands Antilles and the Caribbean $ 9,025 $ 1,364 $ 10,229 $ 3,121
Canada 138 197 800 576
United States 239 520 1,450 687
Eliminations -- (100) -- (100)
-------- ------- -------- ---------
$ 9,402 $ 1,981 $ 12,479 $ 4,284
======== ======= ======== =========
</TABLE>
During the first nine months of 1996, the predecessor company had term
and revolving loans guaranteed by its former parent at the London Interbank
Offer Rate (LIBOR) plus 35 or 50 basis points. In addition, the Company leased a
portion of its facilities from a third party financier under a twenty year
operating lease arrangement. Interest expense and lease payments (consisting
primarily of interest on the underlying debt obligation) for the first nine
months of 1996 amounted to $3.5 million and $4.6 million, respectively.
During the first nine months of 1996, cash provided by the Company's
former parent was used to repair damages caused by certain hurricanes which
occurred during 1995 (causing an increase in other receivables pending receipt
of insurance proceeds). In addition, cash was used to pay dividends to its
former parent, to reduce bank debt and to purchase property and equipment.
Page 16
<PAGE>
ASSETS HELD FOR SALE
The Company's Brownsville, Texas facility and the Company's emergency
response vessel, M/V MEGAN D. GAMBARELLA, are being held for sale. The following
table sets forth, for the periods indicated, consolidated income from operations
with adjustments to reflect operating loss from the Brownsville terminal
adjusted for certain on-going administrative expenses and certain expenses
related to assets to be retained. Similar levels of revenues are anticipated to
be earned and similar expenses incurred following disposition of the M/V MEGAN
D. GAMBARELLA, and therefore no adjustment has been reflected in the table for
this vessel.
<TABLE>
<CAPTION>
OPERATING INCOME FROM ON-GOING OPERATIONS
(DOLLARS IN THOUSANDS)
FOR THE QUARTERS ENDED SEPTEMBER 30, FOR THE YEAR TO DATE SEPTEMBER 30,
----------------------------------- ---------------------------------
1996 1997 1996 1997
-------------- -------------- -------------- -------------
<S> <C> <C> <C> <C>
Consolidated income from operations $ 685 $ 2,774 $ 5,656 $ 8,128
Less: Operating loss from
Statia Terminals Southwest, Inc. (59) (553) (703) (1,468)
Add: Estimated adjustment for assets to be retained
and on-going expenses (350) (185) (956) (782)
--------- --------- --------- --------
Consolidated income from on-going operations $ 394 $ 3,142 $ 5,403 $ 8,814
========= ========= ========= ========
</TABLE>
Page 17
<PAGE>
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The Company periodically purchases refined petroleum products from its
customers and others for resale as bunker fuel, for small volume sales to
commercial interests and to maintain an inventory of blend stocks for its
customers. Petroleum inventories are held for short time periods, generally not
exceeding ninety days. The Company does not presently have any derivative
positions to hedge its inventory of petroleum products. The following table
indicates the Company's aggregate carrying value of its petroleum products on
hand at September 30, 1997 at average cost, net of any lower of cost or market
valuation provisions, and the estimated fair value of such products.
ON BALANCE SHEET COMMODITY POSITION
(DOLLARS IN THOUSANDS)
AS OF SEPTEMBER 30, 1997
--------------------------
CARRYING FAIR
AMOUNT VALUE
---------- ---------
Petroleum Inventory
STNV $ 1,365 $ 1,844
Statia Canada 937 823
---------- ---------
$ 2,302 $ 2,667
========== =========
As substantially all of the Company's transactions are in U.S. dollars,
and as all of the Company's present debt obligations carry a fixed rate of
interest (except for the undrawn revolving credit facilities which vary with
changes in the lender's prime lending rate), management believes the Company's
exposures to foreign currency exchange rate fluctuation and interest rate
fluctuation are minimal.
Page 18
<PAGE>
PART II.
OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
Reference is made to "Item 3. Legal Proceedings" in the Company's
Annual Report on Form 10-K for complete discussion. There have been no material
developments in the Company's legal proceedings since December 31, 1996.
ITEM 2. CHANGES IN SECURITIES.
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES.
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Not applicable.
ITEM 5. OTHER INFORMATION.
On July 21, 1997, Statia Terminals Group N.V., the parent of Statia
Terminals, adopted a stock option plan pursuant to which options to acquire up
to 7,235.294 shares of common stock of Statia Terminals Group N.V. may be
granted to employees of the Company and directors of the parent. As of September
30, 1997, no options had been granted under such plan.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits.
4.1a Amendment, dated as of August 14, 1997, to the
Indenture, dated as of November 27, 1996, among Statia
Terminals International N.V., a Netherlands Antilles
corporation, Statia Terminals Canada, Incorporated, a
corporation organized under the laws of Nova Scotia, the
Subsidiary Guarantors named therein and Marine Midland Bank.
(for electronic filing only)
10.16 1997 Stock Option Plan with Award Agreements (for electronic
filing only)
27.1 Financial Data Schedule for Statia Terminals International
N.V. (for electronic filing only)
27.2 Financial Data Schedule for Statia Terminals Canada,
Incorporated. (for electronic filing only)
(b) Reports on Form 8-K.
None.
Page 19
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrants have duly caused this Report to be signed on their behalf by the
undersigned thereunto duly authorized.
STATIA TERMINALS INTERNATIONAL N.V.
(Registrant)
Date: November 14, 1997
By: /s/ JAMES F. BRENNER
---------------------------------
James F. Brenner
Vice President - Finance
(As Authorized Officer)
STATIA TERMINALS CANADA, INCORPORATED
(Registrant)
Date: November 14, 1997
By: /s/ JAMES F. BRENNER
---------------------------------
James F. Brenner
Vice President and Treasurer
(As Authorized Officer)
Page S-1
<PAGE>
EXHIBIT INDEX
EXHIBIT DESCRIPTION
- ------- -----------
4.1a Amendment, dated as of August 14, 1997, to the Indenture, dated
as of November 27, 1996, among Statia Terminals International
N.V., a Netherlands Antilles corporation, Statia Terminals
Canada, Incorporated, a corporation organized under the laws
of Nova Scotia, the Subsidiary Guarantors named therein and
Marine Midland Bank. (for electronic filing only)
10.16 1997 Stock Option Plan with Award Agreements (for electronic
filing only)
27.1 Financial Data Schedule for Statia Terminals International, N.V.
(for electronic filing only)
27.2 Financial Data Schedule for Statia Terminals Canada,
Incorporated. (for electronic filing only)
EXHIBIT 4-1
AMENDMENT TO INDENTURE
AMENDMENT (the "Amendment"), dated as of August 14, 1997, to the
Indenture (the "Indenture"), dated as of November 27, 1996, among Statia
Terminals International N.V., a Netherlands Antilles corporation ("Statia"),
Statia Terminals Canada, Incorporated, a corporation organized under the laws of
Nova Scotia ("Statia Canada; and together with Statia, the "Issuers") the
Subsidiary Guarantors named therein (the "Subsidiary Guarantors") and Marine
Midland Bank (the "Trustee"). All capitalized terms used herein and not
otherwise defined shall have the respective meanings provided such terms in the
Indenture.
W I T N E S S E T H:
WHEREAS Section 4.07(b) of the Indenture as currently drafted, is
ambiguous as to whether the Issuers shall maintain interruption of business
insurance;
WHEREAS, (i) the Issuers believe that Section 4.07(b) was not intended
to require interruption of business insurance unless such insurance is
customarily carried by similar businesses of similar size, (ii) the Issuers
believe that business interruption insurance is not customarily carried by
companies of similar size to the Issuers in the independent terminaling industry
and (iii) statements in both the Final Offering Memorandum, dated November 22,
1996, and the Prospectus, dated February 19, 1997, of the Issuers, respectively,
indicate that such insurance is not customary and that the Issuers and their
respective subsidiaries do not carry, and do not plan to carry, business
interruption insurance; and
WHEREAS, the parties desire to amend the Indenture pursuant to Section
9.01 of the Indenture to cure this ambiguity.
NOW, THEREFORE, the parties hereto agree as follows for the benefit of
each other party and for the equal and ratable benefit of the Holders of the
Securities:
1. AMENDMENT. (a) Section 4.07(b) of the Indenture shall be deleted in
its entirety and the following clause shall be inserted in its place as the new
Section 4.07(b):
(b) The Issuers shall maintain, and shall cause their
Restricted Subsidiaries to maintain, subject to the provisions of the
applicable Security Documents, insurance with responsible carriers
against such risks and in such amounts, and with such deductibles,
retentions, self-insured amounts and co-insurance provisions, as are
customarily carried by similar businesses of similar size, including
(if so customarily carried) , but not limited to, property and casualty
loss, workers' compensation insurance and interruption of business
insurance.
2. TIA CONTROLS. If any provision of this Amendment limits or conflicts
with another provision which is required to be included in this Amendment by the
TIA, the required provision shall control.
3. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE
AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF
CONFLICTS OF LAW.
4. COUNTERPARTS. This Amendment may be executed and agreed in any
number of counterparts and by the parties hereto on separate counterparts, each
of which counterparts when executed and
<PAGE>
delivered shall be an original, but all of which shall together constitute one
and the same agreement. A complete set of counterparts shall be lodged with the
signatories hereto.
5. INDENTURE NOT OTHERWISE AMENDED. The terms and provisions of the
Indenture not amended hereby shall continue to remain in full force and effect.
6. REFERENCES. From and after the date hereof, all references in the
Indenture shall be deemed to be references to the Indenture as amended hereby.
7. THE TRUSTEE. The Trustee shall not be responsible in any manner
whatsoever for or in respect of the validity or sufficiency of this Amendment or
for or in respect of the recitals contained herein, all of which recitals are
made solely by Issuers and the Subsidiary Guarantors.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed as of this 14th day of August, 1997.
STATIA TERMINALS INTERNATIONAL N.V.
By: /s/ JAMES G. CAMERON
-------------------------------------
Name: James G. Cameron
Title: Director
By: /s/ JAMES F. BRENNER
-------------------------------------
Name: James F. Brenner
Title: Vice President
STATIA TERMINALS CANADA,
INCORPORATED
By: /s/ JAMES F. BRENNER
-------------------------------------
Name: James F. Brenner
Title: Vice President
MARINE MIDLAND BANK,
As Trustee
By: /s/ FRANK GODINO
-------------------------------------
Name: Frank Godino
Title: Assistant Vice President
STATIA TERMINALS CORPORATION N.V.
By: /s/ JAMES G. CAMERON
-------------------------------------
Name: James G. Cameron
Title: Director
<PAGE>
By: /s/ JAMES F. BRENNER
-------------------------------------
Name: James F. Brenner
Title: Vice President
STATIA TERMINALS DELAWARE, INC.
By: /s/ JAMES F. BRENNER
-------------------------------------
Name: James F. Brenner
Title: Vice President
STATIA TERMINALS, INC.
By: /s/ JAMES F. BRENNER
-------------------------------------
Name: James F. Brenner
Title: Vice President
STATIA TERMINALS N.V.
By: /s/ JAMES F. BRENNER
-------------------------------------
Name: James F. Brenner
Title: Vice President
STATIA DELAWARE HOLDCO II, INC.
By: /s/ JAMES F. BRENNER
-------------------------------------
Name: James F. Brenner
Title: Vice President
SABA TRUST COMPANY N.V.
By: /s/ JAMES F. BRENNER
-------------------------------------
Name: James F. Brenner
Title: Vice President
BICEN DEVELOPMENT CORPORATION N.V.
By: /s/ JAMES F. BRENNER
-------------------------------------
Name: James F. Brenner
Title: Vice President
<PAGE>
STATIA TERMINALS SOUTHWEST, INC.
By: /s/ JAMES F. BRENNER
-------------------------------------
Name: James F. Brenner
Title: Vice President
W.P. COMPANY, INC.
By: /s/ JAMES F. BRENNER
-------------------------------------
Name: James F. Brenner
Title: Vice President
SEVEN SEAS STEAMSHIP COMPANY, INC.
By: /s/ GREGORY W. PIETERS
-------------------------------------
Name: Gregory W. Pieters
Title: Vice President
STATIA TUGS N.V.
By: /s/ JAMES G. CAMERON
-------------------------------------
Name: James G. Cameron
Title: Director
SEVEN SEAS STEAMSHIP COMPANY
(SINT EUSTATIUS) N.V.
By: /s/ VICTOR M. LOPEZ, JR.
-------------------------------------
Name: Victor M. Lopez, Jr.
Title: Assistant Secretary and
Treasurer
POINT TUPPER MARINE SERVICES LIMITED
By: /s/ JAMES F. BRENNER
-------------------------------------
Name: James F. Brenner
Title: Vice President
STATIA LABORATORY SERVICES, N.V.
By: /s/ JAMES F. BRENNER
-------------------------------------
Name: James F. Brenner
Title: Vice President
EXHIBIT 10.16
STATIA TERMINALS GROUP N.V.
1997 STOCK OPTION PLAN
1. PURPOSES. The purposes of the Statia Terminals Group N.V. 1997 Stock
Option Plan are:
(a) To further the growth, development and success of the Company and its
Subsidiaries by enabling key salaried employees and directors of, and
consultants to, the Company and its Subsidiaries to acquire a continuing equity
interest in the Company, thereby increasing their personal interests in such
growth, development and success and motivating such employees, directors and
consultants to exert their best efforts on behalf of the Company and its
Subsidiaries; and
(b) To maintain the ability of the Company and its Subsidiaries to attract
and retain employees, directors and consultants of outstanding ability by
offering them an opportunity to acquire a continuing equity interest in the
Company and its Subsidiaries which will reflect the growth, development and
success of the Company and its Subsidiaries.
Toward these objectives, the Committee may grant Options to such employees,
directors and consultants, all pursuant to the terms and conditions of the Plan.
2. DEFINITIONS. As used in the Plan, the following capitalized terms shall
have the meanings set forth below:
a) "AGREEMENT" - an option agreement evidencing an Option.
b) "BOARD" - the Board of Directors of the Company.
c) "CODE" - the Internal Revenue Code of 1986, as it may be amended from
time to time, including regulations and rules thereunder and successor
provisions and regulations and rules thereto.
d) "COMMITTEE" - the Compensation Committee of the Board, or such other
Board committee as may be designated by the Board to administer the Plan.
e) "COMPANY" - Statia Terminals Group N.V., a Netherlands Antilles
corporation, or any successor entity.
f) "FAIR MARKET VALUE" of a share of Stock as of a given date shall be (i)
the
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average of the closing representative bid and asked prices for the Stock on
such date as reported by NASDAQ or any stock exchange on which the Stock is then
listed or, if no such prices are reported for such date, the most recent day for
which such prices are available shall be used or (ii) if the Stock is not then
publicly traded, the fair market value determined by such other reasonable
valuation method as the Committee shall, in its discretion, select and apply in
good faith as of the given date; PROVIDED, HOWEVER, that for purposes of
paragraphs (a) and (g) of Section 6, such fair market value shall be determined
subject to Section 422(c)(7) of the Code.
g) "ISO" or "INCENTIVE STOCK OPTION" - an option to purchase Stock granted
to a Participant under the Plan in accordance with the terms and conditions set
forth in Section 6 and which conforms to the applicable provisions of Section
422 of the Code.
(h) "NASDAQ" - the National Association of Securities Dealers Automated
Quotation System (or its successor quotation system).
i) "NOTICE" - written notice actually received by the Company at its
offices on the day of such receipt, if received on or before 1:30 p.m., on a day
when the Company's offices are open for business, or, if received after such
time, such notice shall be deemed received on the next such day, which notice
may be delivered in person to the Company's Chief Financial Officer or sent by
facsimile to the Company, or sent by certified or registered mail or overnight
courier, prepaid, addressed to the Company at Statia Terminals, Inc., 800
Fairway Drive, Suite 295, Deerfield Beach, Florida 33441, Attention: Chief
Financial Officer.
(j) "OPTION" - an option to purchase Stock granted to a Participant under
the Plan in accordance with the terms and conditions set forth in Section 6.
Options may be either ISOs or stock options other than ISOs.
k) "OPTIONEE" - a Participant who has been granted an Option under the Plan
in accordance with the terms and conditions set forth in Section 6.
l) "PARTICIPANT" - an individual eligible, pursuant to Section 5, to
participate in the Plan who is selected to participate in the Plan pursuant to
Section 3.
m) "PLAN" - this Statia Terminals Group N.V. 1997 Stock Option Plan.
n) "SECURITIES ACT" - the Securities Act of 1933, as it may be amended from
time to time, including regulations and rules thereunder and successor
provisions and regulations and rules thereto.
o) "STOCK" - the $0.10 par value common stock of the Company.
p) "STOCKHOLDERS AGREEMENT" - the stockholders agreement dated as of
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November 27, 1996, by and among the Company, the Management Stockholders (as
defined therein), Windward Island Investments LLC, Castle Harlan Partners II,
L.P., CBI Investments, Inc., and certain other persons that subsequently become
parties thereto.
q) "SUBSIDIARY" - (i) any present or future corporation which is or would
be a "subsidiary corporation" of the Company as the term is defined in
Section 424(f) of the Code and (ii) any unincorporated entity in which the
Company and/or one or more of its "subsidiary corporations" (as defined in
Section 424(f) of the Code) presently or in the future own an aggregate profits
interest of fifty percent (50%) or more, which the Committee in its discretion
determines will be a "Subsidiary" for purposes of the Plan.
3. ADMINISTRATION OF THE PLAN. (a) The Committee shall have exclusive
authority to operate, manage and administer the Plan in accordance with its
terms and conditions. Notwithstanding the foregoing, in its absolute discretion,
the Board may at any time and from time to time exercise any and all rights,
duties and responsibilities of the Committee under the Plan, including, but not
limited to, establishing procedures to be followed by the Committee.
(b) The Committee shall be appointed from time to time by the Board,
and the Committee shall consist of not less than two (2) members of the Board.
Appointment of Committee members shall be effective upon their acceptance in
writing of such appointment. Committee members may be removed by the Board at
any time either with or without cause, and such members may resign at any time
by delivering written notice thereof to the Board. Any vacancy on the Committee,
whether due to action of the Board or any other reason, shall be filled by the
Board.
(c) The Committee shall have all authority that may be necessary or
helpful to enable it to discharge its responsibilities with respect to the Plan.
Without limiting the generality of the foregoing sentence or paragraph (a) of
this Section 3, the Committee shall have the exclusive right and discretionary
authority to: (i) interpret the Plan and the Agreements; (ii) construe any
ambiguous provision of the Plan and/or the Agreements; (iii) determine
eligibility for participation in the Plan; (iv) decide all questions concerning
eligibility for and the amount of Options granted under the Plan; (v) select,
from time to time, from amongst those eligible, the employees, directors and
consultants to whom Options shall be granted under the Plan, which selection
shall be based upon information furnished to the Committee by the Company's
management; (vi) determine whether an Option shall take the form of an ISO or an
Option other than a ISO; (vii) determine the number of shares of Stock to be
included in any Option or to which any Option shall otherwise relate and the
periods for which Options will be outstanding; (viii) establish, amend, waive
and/or rescind rules and regulations and administrative guidelines for carrying
out the Plan; (ix) to the extent permitted under the Plan and the applicable
Agreement, grant waivers of Plan terms, conditions, restrictions and
limitations; (x) to the extent permitted under the Plan and the applicable
Agreement,
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permit the transfer of an Option or the exercise of an Option by one other than
the Participant who received the grant of such Option; (xi) correct any errors,
supply any omissions or reconcile any inconsistencies in the Plan and/or any
Agreement or any other instrument relating to any Option; (xii) to the extent
permitted by the Plan, amend or adjust the terms and conditions of any
outstanding Option and/or adjust the number and/or class of shares of Stock
subject to any outstanding Option; (xiii) in accordance with the Plan, establish
and administer any performance goals in connection with any Options; (xiv) at
any time and from time to time after the granting of an Option, specify such
additional terms, conditions and restrictions with respect to any such Option as
may be deemed necessary or appropriate to ensure compliance with any and all
applicable laws, including, but not limited to, (A) terms, restrictions and
conditions for compliance with Federal and state securities laws and (B) methods
of withholding or providing for the payment of required taxes (C) restrictions
regarding a Participant's ability to exercise Options under a "cashless
exercise" program established by the Committee; and (xv) take any and all such
other action it deems necessary or advisable for the proper operation and/or
administration of the Plan. The Committee shall have full discretionary
authority in all matters related to the discharge of its responsibilities and
the exercise of its authority under the Plan. Decisions and actions by the
Committee with respect to the Plan and any Agreement shall be final, conclusive
and binding on all persons having or claiming to have any right or interest in
or under the Plan and/or any Agreement. Options need not be uniform as to all
grants and recipients thereof.
(d) Each Option shall be evidenced by an Agreement, which shall be executed
by the Company and the Participant to whom such Option has been granted, unless
the Agreement provides otherwise; HOWEVER, two or more Options to a single
Participant may be combined in a single Agreement. An Agreement shall not be a
precondition to the granting of an Option; HOWEVER, no person shall have any
rights under any Option unless and until the Participant to whom the Option
shall have been granted (i) shall have executed and delivered to the Company an
Agreement or other instrument evidencing the Option, unless such Agreement
provides otherwise, and (ii) has otherwise complied with the applicable terms
and conditions of the Option. The Committee shall prescribe the form of all
Agreements, and, subject to the terms and conditions of the Plan, shall
determine the content of all Agreements. Any Agreement may be supplemented or
amended in writing from time to time as approved by the Committee; PROVIDED that
the terms and conditions of any such Agreement as supplemented or amended are
not inconsistent with the provisions of the Plan.
(e) A majority of the members of the entire Committee shall constitute a
quorum and the actions of a majority of the members of the Committee in
attendance at a meeting at which a quorum is present, or actions by a written
instrument signed by all members of the Committee, shall be the actions of the
Committee.
(f) The Committee may consult with counsel who may be counsel to the
Company. The Committee may, with the approval of the Board, employ such other
<PAGE>
attorneys or consultants, accountants, appraisers, brokers or other persons as
it deems necessary or appropriate. In accordance with Section 12, the Committee
shall not incur any liability for any action taken in good faith in reliance
upon the advice of such counsel or such other persons.
(g) In serving on the Committee, the members thereof shall be entitled to
indemnification as directors of the Company, and to any limitation of liability
and reimbursement as directors with respect to their services as members of the
Committee.
(h) The Committee may, in its discretion, delegate to appropriate officers
of the Company the "administration" of the Plan under this Section 3; PROVIDED,
HOWEVER, that no such delegation by the Committee shall be made (i) if such
delegation would not be permitted under applicable law or (ii) with respect to
the administration of the Plan as it affects executive officers and directors of
the Company, and, PROVIDED FURTHER, HOWEVER, the Committee may not delegate its
authority to correct errors, omissions or inconsistencies in the Plan. All
authority delegated by the Committee under this paragraph (h) of Section 3 shall
be exercised in accordance with the terms and conditions of the Plan and any
rules, regulations or administrative guidelines that may from time to time be
established by the Committee.
4. SHARES OF STOCK SUBJECT TO THE PLAN. (a) The shares of stock subject to
Options granted under the Plan shall be shares of Stock. Such shares of Stock
subject to the Plan may be either authorized and unissued shares (which will not
be subject to preemptive rights) or previously issued shares acquired by the
Company or any Subsidiary. The total number of shares of Stock that may be
delivered pursuant to Options granted under the Plan is 7,235.294.
(b) Notwithstanding any of the foregoing limitations set forth in this
Section 4, the numbers of shares of Stock specified in this Section 4 shall be
adjusted as provided in Section 10.
(c) Any shares of Stock subject to an Option which for any reason expires
or is terminated without having been fully exercised may again be granted
pursuant to an Option under the Plan, subject to the limitations of this Section
4.
5. ELIGIBILITY. Executive and other key salaried employees, including
officers, of the Company and its Subsidiaries, directors (whether or not also
employees) of the Company and its Subsidiaries and consultants to the Company
and its Subsidiaries, shall be eligible to become Participants and receive
Options in accordance with the terms and conditions of the Plan.
6. TERMS AND CONDITIONS OF STOCK OPTIONS. All Options to purchase Stock
granted under the Plan shall be either ISOs or Options other than ISOs. Each
Option shall be subject to all the applicable provisions of the Plan, including
the following
<PAGE>
terms and conditions, and to such other terms and conditions not inconsistent
therewith as the Committee shall determine and which are set forth in the
applicable Agreement.
(a) The option exercise price per share of shares of Stock subject to
each Option shall be determined by the Committee and stated in the
Agreement; PROVIDED, HOWEVER, that, with respect to ISOs, subject to
paragraph (g)(C) of this Section 6, such price shall not be less than 100%
of the Fair Market Value of a share of Stock at the time that the Option is
granted.
(b) Each Option shall be exercisable in whole or in such installments,
at such times and under such conditions as may be determined by the
Committee in its discretion and stated in the Agreement, and, in any event,
over a period of time ending not later than ten (10) years from the date
such Option was granted, subject to paragraph (g)(C) of this Section 6.
(c) An Option shall not be exercisable with respect to a fractional
share of Stock or the lesser of ten (10) shares or the full number of
shares of Stock then subject to the Option.
(d) Each Option may be exercised by giving Notice to the Company
specifying the number of shares of Stock to be purchased, which shall be
accompanied by payment in full including applicable taxes, if any, in
accordance with Section 9. Payment shall be in any manner permitted by
applicable law and prescribed by the Committee, in its discretion, and set
forth in the Agreement, including, in the Committee's discretion, payment
in accordance with a "cashless exercise" program established by the
Committee.
(e) No Optionee or other person shall become the beneficial owner of
any shares of Stock subject to an Option, nor have any rights to dividends
or other rights of a shareholder with respect to any such shares until he
or she has exercised his or her Option in accordance with the provisions of
the Plan and the applicable Agreement.
(f) An Option may be exercised only if at all times during the period
beginning with the date of the granting of the Option and ending on the
date of such exercise, the Optionee was an employee, director or consultant
of either the Company or of a Subsidiary or of another corporation referred
to in Section 422(a)(2) of the Code. Notwithstanding the preceding
sentence, the Committee may determine in its discretion that an Option may
be exercised following termination of such continuous employment,
directorship or consultancy, whether or not exercisable at such time, to
the extent provided in the applicable Agreement.
(g)(A) Each Agreement relating to an Option shall state whether such
<PAGE>
Option will or will not be treated as an ISO. No ISO shall be granted
unless such Option, when granted, qualifies as an "incentive stock option"
under Section 422 of the Code. No ISO shall be granted to any Participant
who is not an employee of the Company or any of its Subsidiaries on the
date of granting of such Option. Any ISO granted under the Plan shall
contain such terms and conditions, consistent with the Plan, as the
Committee may determine to be necessary to qualify such Option as an
"incentive stock option" under Section 422 of the Code. Any ISO granted
under the Plan may be modified by the Committee to disqualify such Option
from treatment as an "incentive stock option" under Section 422 of the
Code.
(B) Notwithstanding any intent to grant ISOs, an Option granted under
the Plan will not be considered an ISO to the extent that it, together with
any other "incentive stock options" (within the meaning of Section 422 of
the Code, but without regard to subsection (d) of such Section) under the
Plan or any other "incentive stock option" plans of the Company and any
Subsidiary, are exercisable for the first time by any Optionee during any
calendar year with respect to Stock having an aggregate Fair Market Value
in excess of $100,000 (or such other limit as may be required by the Code)
as of the time the Option with respect to such Stock is granted. The rule
set forth in the preceding sentence shall be applied by taking Options into
account in the order in which they were granted.
(C) No ISO shall be granted to a Participant who owns (within the
meaning of Section 424(d) of the Code), at the time the Option is granted,
more than ten percent (10%) of the total combined voting power of all
classes of stock of the Company or a Subsidiary. This restriction does not
apply if at the time such ISO is granted the Option exercise price per
share of Stock subject to the Option is at least 110% of the Fair Market
Value of a share of Stock on the date such ISO is granted, and the ISO by
its terms is not exercisable after the expiration of five (5) years from
such date of grant.
(h) An Option and any shares of Stock received upon the exercise of an
Option shall be subject to such other transfer and/or ownership restrictions
and/or legending requirements as the Committee may establish in its discretion,
including, without limitation, the requirement that a Participant become a party
to the Stockholders Agreement, and which are specified in the Agreement and may
be referred to on the certificates evidencing such shares of Stock. The
Committee may require an Optionee to give prompt Notice to the Company
concerning any disposition of shares of Stock received upon the exercise of an
ISO within: (i) two (2) years from the date of granting such ISO to such
Optionee or (ii) one (1) year from the transfer of such shares of Stock to such
Optionee or (iii) such other period as the Committee may from time to time
determine. The Committee may direct that an Optionee with respect to an ISO
<PAGE>
undertake in the applicable Agreement to give such notice described in the
preceding sentence, at such time and containing such information as the
Committee may prescribe, and/or that the certificates evidencing shares of Stock
acquired by exercise of an ISO refer to such requirement to give such notice.
(i) Options granted under the Plan shall be subject to such provisions
as the Committee deems appropriate to provide for the cancellation and
settlement by the Company of such Options. Any such provisions shall be
contained in the applicable Agreement.
7. TRANSFER, LEAVE OF ABSENCE. For purposes of the Plan, a transfer of an
employee from the Company to a Subsidiary or an affiliate of the Company,
whether or not incorporated, or vice versa, or from one Subsidiary or affiliate
of the Company to another, and a leave of absence, duly authorized in writing by
the Company or a Subsidiary or affiliate of the Company, shall not be deemed a
termination of employment of the employee.
8. RIGHTS OF EMPLOYEES AND OTHER PERSONS. (a) No person shall have any
rights or claims under the Plan except in accordance with the provisions of the
Plan and the applicable Agreement.
(b) Nothing contained in the Plan or in any Agreement shall be deemed (i)
to give any employee or director the right to be retained in the service of the
Company and/or its Subsidiaries nor restrict in any way the right of the Company
and/or any Subsidiary to terminate any employee's employment or any director's
directorship at any time with or without Substantial Cause (as defined in
Section 11.2 of the Stockholders Agreement) or (ii) to confer on any consultant
any right of continued relationship with the Company and/or its Subsidiaries, or
alter any relationship between them, including any right of the Company and/or a
Subsidiary to terminate its relationship with such consultant.
(c) The adoption of the Plan shall not be deemed to give any employee of
the Company or any Subsidiary or any other person any right to be selected as a
Participant or to be granted an Option.
(d) Nothing contained in the Plan or in any Agreement shall be deemed to
give any employee the right to receive any bonus, whether payable in cash or in
Stock, or in any combination thereof, from the Company or any Subsidiary, nor be
construed as limiting in any way the right of the Company or any Subsidiary to
determine, in its sole discretion, whether or not it shall pay any employee
bonuses, and, if so paid, the amount thereof and the manner of such payment.
9. TAX WITHHOLDING OBLIGATIONS. (a) The Company and/or any Subsidiary are
authorized to take whatever actions are necessary and proper to satisfy all
<PAGE>
obligations of Participants for the payment of all Federal, state, local and
foreign taxes in connection with any Options (including, but not limited to,
actions pursuant to the following paragraph (b) of this Section 9).
(b) Each Participant shall (and in no event shall Stock be delivered to
such Participant with respect to an Option until), no later than the date as of
which the value of the Option first becomes includible in the gross income of
the Participant for income tax purposes, pay to the Company in cash, or make
arrangements satisfactory to the Company, as determined in the Committee's
discretion, regarding payment to the Company of, any taxes of any kind required
by law to be withheld with respect to the Stock subject to such Option, and the
Company and any Subsidiary shall, to the extent permitted by law, have the right
to deduct any such taxes from any payment of any kind otherwise due to such
Participant. Notwithstanding the above, the Committee may, in its discretion and
pursuant to procedures approved by the Committee, permit the Participant (i) to
elect withholding by the Company of Stock otherwise deliverable to such
Participant pursuant to such Option (PROVIDED, HOWEVER, that the amount of any
Stock so withheld shall not exceed the minimum required withholding obligation
taking into account the Participant's effective tax rate and all applicable
taxes) and/or (ii) to tender to the Company Stock owned by such Participant (or
by such Participant and his or her spouse jointly) and acquired more than six
(6) months prior to such tender in full or partial satisfaction of such tax
obligations.
10. CHANGES IN CAPITAL. (a) Upon changes in the outstanding Stock by reason
of a stock dividend, stock split, reverse stock split, subdivision,
recapitalization, merger, consolidation (whether or not the Company is a
surviving corporation), an extraordinary dividend payable in cash or property,
combination or exchange of shares of Stock, separation, reorganization or
liquidation, the aggregate number and class of shares of Stock available under
the Plan as to which Options may be granted, the number and class of shares
under each Option and the option exercise price per share under each outstanding
Option shall, in each case, be correspondingly adjusted by the Committee. Such
adjustments shall be made in the case of outstanding Options without change in
the total price applicable to such Options. In the event of an extraordinary
dividend, "spin-off," liquidation or other substantial distribution of assets of
the Company, the number and class of shares under each outstanding Option and/or
the option exercise price per share applicable to any such Options may be
correspondingly adjusted by the Committee in its discretion.
(b) In the event of (i) a merger, consolidation, combination,
reorganization or other transaction resulting in less than fifty percent (50%)
of the combined voting power of the surviving or resulting entity being owned by
the former shareholders of the Company, (ii) the liquidation or dissolution of
the Company or the sale or other disposition of all or substantially all of the
assets or business of the Company (other than, in the case of either clause (i)
or (ii) above, in connection with any employee benefit plan of the Company or a
Subsidiary), or (iii) an initial public
<PAGE>
offering of common stock of the Company pursuant to a registration statement
declared effective under the Securities Act:
(1) In its discretion and on such terms and conditions as it deems
appropriate, the Committee may provide, either by the terms of the
Agreement applicable to any Option or by a resolution adopted prior to the
occurrence of such event, that such Option shall be accelerated and become
immediately exercisable as to all shares of Stock covered thereby,
notwithstanding anything to the contrary in the Plan or the Agreement.
(2) In its discretion, and on such terms and conditions as it deems
appropriate, the Committee may provide, either by the terms of the
Agreement applicable to any Option or by resolution adopted prior to the
occurrence of such event, that such Option shall be adjusted by
substituting for Stock subject to such Option stock or other securities of
any successor corporation to the Company, or a parent or subsidiary
thereof, or that may be issuable by another corporation that is a party to
the transaction whether or not such stock or other securities are publicly
traded, in which event the aggregate exercise price (as applicable) shall
remain the same and the amount of shares or other securities subject to
option or other rights under an Option shall be the amount of shares or
other securities which could have been purchased on the closing date or
expiration date of such transaction with the proceeds which would have been
received by the Participant if the Option had been exercised in full prior
to such transaction or expiration date and the Participant exchanged all of
such shares in the transaction.
(3) In its discretion, and on such terms and conditions as it deems
appropriate, the Committee may provide either by the terms of the Agreement
applicable to any Option or by resolution adopted prior to the occurrence
of such event, any outstanding Option shall, in each case, be converted
into a right to receive in cash, as soon as practicable following the
closing date or expiration date of the transaction, an amount equal to the
value of the consideration to be received in connection with such
transaction for one share of Stock, less the per share exercise price of
such Option, multiplied by the number of shares of Stock subject to such
Option.
(4) At the discretion of the Committee, the Agreement applicable to any
Option may provide that such an Option cannot be exercised after such an
event, to the extent that such Option becomes subject to any acceleration,
adjustment or conversion in accordance with the foregoing paragraphs (1),
(2), or (3) of this subsection 10(b).
No Participant shall have any right to prevent the consummation of any of
the foregoing acts affecting the number of shares of Stock available to such
Participant. Any actions or determinations of the Committee under this
Subsection
<PAGE>
10(b) need not be uniform as to all outstanding Options, nor treat all
Participants identically. Notwithstanding the foregoing adjustments, in no event
may any Option be exercised after ten (10) years from the date it was originally
granted, and any changes to ISOs pursuant to this Section 10 shall, unless the
Committee determines otherwise, only be effective to the extent such adjustments
or changes do not cause a "modification" (within the meaning of Section
424(h)(3) of the Code) of such ISOs or adversely affect the tax status of such
ISOs.
11. MISCELLANEOUS PROVISIONS. (a) The Plan shall be unfunded. The Company
shall not be required to establish any special or separate fund or to make any
other segregation of assets to assure the issuance of shares of Stock or the
payment of cash upon exercise or payment of any Option. Proceeds from the sale
of shares of Stock pursuant to Options granted under the Plan shall constitute
general funds of the Company. The expenses of the Plan shall be borne by the
Company.
(b) Except as otherwise provided in this paragraph (b) of Section 11, an
Option by its terms shall be personal and may not be sold, transferred, pledged,
assigned, encumbered or otherwise alienated or hypothecated otherwise than by
will or by the laws of descent and distribution and shall be exercisable during
the lifetime of a Participant only by him or her. At the Committee's discretion,
an Agreement may permit the receipt or exercise of a Participant's Option (or
any portion thereof) after his or her death by the beneficiary most recently
named by such Participant in a written designation thereof filed with the
Company, or, in lieu of any such surviving beneficiary, by the legatee of the
Participant under the Participant's last will or by the legal representatives of
such Participant's estate. The Committee may, in its discretion, authorize any
Option which is not an ISO granted to a Participant to be on terms which permit
transfer of all or a portion of such Option to members of such Participant's
immediate family or a trust or partnership, or similar vehicle, established
solely for the benefit of, or the partners or members of which are solely, any
such family member or members; PROVIDED, that the Option expressly permits such
transferability and any transfer of such Option shall be in accordance with any
other terms, conditions, rules and limitations prescribed by the Committee
and/or set forth in the applicable Agreement. Following the valid transfer of
any such Option, the transferred Option shall continue to be subject to the same
terms and conditions as were applicable to such Option immediately prior to such
transfer; PROVIDED, that the transferee of such Option shall be treated under
the Plan and the applicable Agreement as the Participant who transferred the
Option, EXCEPT that the terms of Section 6(f) hereof (and any similar provisions
of the applicable Agreement, dealing with exercisability and termination of a
Participant's relationship with the Company or a Subsidiary, or his or her
death), shall continue to be applied with respect to the original Participant,
so that following a Participant's termination of employment, or other
relationship as a consultant or director, with the Company or a Subsidiary or
the death of a Participant, any transferee of such original Participant's Option
may only exercise such Option to the extent provided, and for the period
specified, in such Section 6(f) (and any similar provisions
<PAGE>
of the applicable Agreement). In the event any Option is exercised by the
executors, administrators, heirs or distributees of the estate of a deceased
Participant, or such Participant's beneficiary, pursuant to the terms and
conditions of the Plan and the applicable Agreement, the Company shall be under
no obligation to issue Stock thereunder unless and until the Committee is
satisfied that the person or persons exercising such Option are the duly
appointed legal representative of the deceased Participant's estate or the
proper legatees or distributees thereof or the named beneficiary of such
Participant.
(c) If at any time the Committee shall determine, in its discretion, that
the listing, registration and/or qualification of shares of Stock 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 sale or purchase of shares of Stock
hereunder, no Option may be exercised in whole or in part unless and until such
listing, registration, qualification, consent and/or approval shall have been
effected or obtained, or otherwise provided for, free of any conditions not
acceptable to the Committee.
(d) The Committee may require each person receiving Stock in connection
with any Option under the Plan to represent and agree with the Company in
writing that such person is acquiring the shares of Stock for investment without
a view to the distribution thereof. The Committee, in its absolute discretion,
may impose such restrictions on the ownership and transferability of the shares
of Stock purchasable or otherwise receivable by any person under any Option as
it deems appropriate. Any such restrictions shall be set forth in the applicable
Agreement, and the certificates evidencing such shares may include any legend
that the Committee deems appropriate to reflect any such restrictions.
(e) The Committee may, in its discretion, extend one or more loans to
Participants who are key employees of the Company or a Subsidiary in connection
with the exercise or receipt of an Option granted to any such employees. The
terms and conditions of any such loan shall be set by the Committee.
(f) By accepting any benefit under the Plan, each Participant and each
person claiming under or through such Participant shall be conclusively deemed
to have indicated their acceptance and ratification of, and consent to, all of
the terms and conditions of the Plan and any action taken under the Plan by the
Committee, the Company or the Board.
(g) Neither the adoption of the Plan nor anything contained herein shall
affect any other compensation or incentive plans or arrangements of the Company
or any Subsidiary, or prevent or limit the right of the Company or any
Subsidiary to establish any other forms of incentives or compensation for their
employees or consultants or directors, or grant or assume options or other
rights otherwise than under
<PAGE>
the Plan.
(h) The Plan shall be governed by and construed in accordance with the
laws of the State of New York, except as superseded by applicable Federal law or
the laws of the Netherlands Antilles.
12. LIMITS OF LIABILITY. (a) Any liability of the Company or a Subsidiary
to any Participant with respect to any Option shall be based solely upon
contractual obligations created by the Plan and the Agreement.
(b) Neither the Company nor a Subsidiary nor any member of the
Committee or the Board, nor any other person participating in any determination
of any question under the Plan, or in the interpretation, administration or
application of the Plan, shall have any liability, in the absence of bad faith,
to any party for any action taken or not taken in connection with the Plan,
except as may expressly be provided by statute.
13. AMENDMENTS AND TERMINATION. The Board may, at any time and with or
without prior notice, amend, alter, suspend, or terminate the Plan; PROVIDED,
HOWEVER, no amendment, alteration, suspension, or termination shall be made
which would impair the previously accrued rights of any holder of an Option
theretofore granted without his or her written consent or which, without first
obtaining approval of the stockholders of the Company (where such approval is
necessary to satisfy (i) any requirements under the Code relating to ISOs or
(ii) applicable law), would:
(a) except as is provided in Section 10, increase the maximum number of
shares of Stock which may be sold or awarded under the Plan;
(b) except as is provided in Section 10, decrease the minimum option
exercise price requirements of Section 6(a);
(c) change the class of persons eligible to receive Options under the
Plan; or
(d) extend the duration of the Plan or the period during which Options
may be exercised under Section 6(b).
The Committee may amend the terms of any Option theretofore granted,
including any Agreement, retroactively or prospectively, but no such amendment
shall impair the previously accrued rights of any Participant without his or her
written consent.
14. DURATION. Following the adoption of the Plan by the Board, the Plan
shall become effective as of the date on which it is approved by the holders of
a majority
<PAGE>
of the Company's outstanding Stock which is present and voted at a meeting, or
by written consent in lieu of a meeting, which approval must occur within the
period ending twelve (12) months after the date the Plan is adopted by the
Board. The Plan shall terminate upon the earliest to occur of:
(a) the effective date of a resolution adopted by the Board terminating
the Plan;
(b) the date all shares of Stock subject to the Plan are delivered
pursuant to the Plan's provisions; or
(c) ten (10) years from the date the Plan is approved by the Company's
shareholders.
No Option may be granted under the Plan after the earliest to occur of the
events or dates described in the foregoing paragraphs (a) through (c) of this
Section 14; PROVIDED, HOWEVER, Options theretofore granted may extend beyond
such date.
No such termination of the Plan shall affect the previously accrued rights
of any Participant hereunder, and all Options previously granted hereunder shall
continue in force and in operation after the termination of the Plan, except as
they may be otherwise terminated in accordance with the terms of the Plan or the
Agreement.
<PAGE>
STATIA TERMINALS GROUP N.V.
1997 STOCK OPTION PLAN
INCENTIVE STOCK OPTION AWARD AGREEMENT
This Incentive Stock Option Award Agreement (the "Agreement"), dated ______
__, 1997, is made between Statia Terminals Group N.V. (the "Company") and
_____________ (the "Optionee"). All capitalized terms that are not defined
herein shall have the meaning as defined in the Statia Terminals Group N.V. 1997
Stock Option Plan (the "Plan"). References to "he," "him," and "his" shall mean
the feminine form of such terms, when applicable.
W I T N E S S E T H :
1. GRANT OF OPTION. Pursuant to the provisions of the Plan, the Company
hereby grants to the Optionee, subject to the terms and conditions of the Plan
and subject further to the terms and conditions herein set forth, the right and
option to purchase from the Company, all or any part of an aggregate of ________
shares of $0.10 par value common stock of the Company ("Stock") at a per share
purchase price equal to $_________ (the "Option"), such Option to be exercisable
as hereinafter provided. The Option shall be treated as an "incentive stock
option" as defined in Section 422 of the Code.
2. TERMS AND CONDITIONS. It is understood and agreed that the Option
evidenced hereby is subject to the following terms and conditions:
(a) EXPIRATION DATE. The Option shall expire ten (10) years after the date
indicated above, or such earlier date as (i) all shares of Stock covered by the
Option shall have been purchased or (ii) the Option expires pursuant to Section
2(b)(iv) below.
(b) EXERCISE OF OPTION. (i) Subject to the other terms of this Agreement
and the Plan, the Option may be exercised on or after the date hereof in
accordance with the following schedule:
-1-
<PAGE>
YEARS OF EMPLOYMENT PERCENT OF
SINCE OPTION GRANT OPTION EXERCISABLE
------------------- ------------------
less than 2 years 0
2 years and less than 3 years 25%
3 years and less than 4 years 50%
4 years and less than 5 years 75%
5 or more years 100%
Notwithstanding the preceding clause, upon the occurrence of a Liquidation Event
(as hereinafter defined), the Option shall become fully exercisable as to all
shares of Stock covered by the Option as to which the Option was not exercised
prior to such Liquidation Event. Notwithstanding any other provision of this
Agreement to the contrary, no portion of the Option that is not exercisable as
of the date on which the Optionee ceases to be employed by the Company or any
Subsidiary shall thereafter become exercisable. For purposes of this Agreement,
"Liquidation Event" shall mean (i) a merger, consolidation, combination,
reorganization or other transaction resulting in less than 50% of the combined
voting power of the surviving or resulting entity being owned by the former
shareholders of the Company, (ii) the liquidation or dissolution of the Company
or the sale or other disposition of all or substantially all of the assets or
business of the Company (other than, in the case of either clause (i) or (ii)
above, in connection with an employee benefit plan of the Company or a
Subsidiary), or (iii) an initial public offering of the common stock of the
Company pursuant to a registration statement declared effective under the
Securities Act.
(ii) Any exercisable portion of the Option or the entire Option, if then
wholly exercisable, may be exercised at any time, subject to the terms and
conditions of this Agreement and the Plan, prior to the expiration of the Option
under Section 2(a); PROVIDED, HOWEVER, that the Option shall not be exercisable
for the lesser of ten (10) shares of Stock or the full number of shares of Stock
then subject to the Option which are then exercisable. Any exercise of all or
any part of the Option shall be accompanied by: (A) payment in full of the
purchase price of the shares of Stock as to which the Option is exercised in
accordance with Section 2(b)(iii), including applicable taxes, if any, in
accordance with Section 2(d) and (B) a written notice to the Company specifying
the number of shares of Stock as to which the Option is being exercised.
Notation of any partial exercise shall be made by the Company on Schedule I
attached hereto.
(iii) At the time of any exercise of the Option, the purchase price of the
shares of Stock as to which the Option shall be exercised shall be paid to the
Company: (A) in United States dollars by personal check (subject to collection),
bank draft or money
-2-
<PAGE>
order; (B) if permitted by applicable law, by tendering to the Company shares of
Stock, duly endorsed for transfer to the Company, already owned by the Optionee
(or by the Optionee and the Optionee's spouse) for at least six (6) months prior
to such tender, which may include shares received as a result of a prior
exercise of this Option, and having a total Fair Market Value on the date of
such exercise of the Option, equal to the aggregate cash purchase price of such
shares of Stock; (C) by delivering a promissory note in a form satisfactory to
the Company for the full exercise price of the Option or the portion thereof
which the Optionee intends to exercise; or (D) by any combination of the
consideration provided for in the foregoing clauses (A), (B) and (C).
(iv) The Option shall terminate upon the termination, for any reason, of
the Optionee's employment with the Company or a Subsidiary, and no shares of
Stock may thereafter be purchased under the Option, except as follows:
(A) In the event of the death of the Optionee while an employee of the
Company or a Subsidiary, the Option, to the extent not previously
exercised, may be immediately exercised after the Optionee's death by his
heir, the legal representative of the Optionee's estate or by the legatee
of the Optionee under his last will for a period of one (1) year from the
date of his death or until the expiration of the stated period of the
Option, whichever period is the shorter.
(B) If the Optionee's employment with the Company or a Subsidiary shall
terminate by reason of permanent disability (as defined in Section 22(e)(3)
of the Code), the Option, to the extent not previously exercised, may be
immediately exercised after such termination but may not be exercised after
the expiration of the period of one (1) year from the date of such
termination or of the stated period of the Option, whichever period is the
shorter.
(C) If the Company or a Subsidiary terminates the Optionee's employment
with the Company or such Subsidiary and such termination is not for
"Substantial Cause" (as defined in Section 11.2 of the Stockholders
Agreement), the Optionee's Option, to the extent not previously exercised,
may thereafter be immediately exercised but may not be exercised after the
expiration of the period of three (3) months from the date of such
termination of employment or of the stated period of the Option, whichever
period is the shorter.
(D) If the Optionee dies after termination of his employment with the
Company and/or a Subsidiary under paragraphs (B) or (C) of this Section
2(b)(iv) above during the one-year or three-month period specified,
respectively, in such paragraphs, the Option, to the extent not previously
exercised, may be
-3-
<PAGE>
exercised after the Optionee's death by the Optionee's heir, the legal
representative of his estate or by the legatee of the Optionee under his
last will until the expiration of the period of one (1) year from the date
of his death or the stated period of the Option, whichever period is the
shorter.
(E) If the Optionee's employment is terminated by the Company or a
Subsidiary for "Substantial Cause" (as defined in Section 11.2 of the
Stockholders Agreement) or if the Optionee's employment is terminated under
circumstances not described in this Section 2(b)(iv), the Optionee's Option
shall automatically terminate, without any further action required by the
Company, on the date of such termination of employment and shall cease to
thereafter be exercisable with respect to any shares of Stock.
(v) Notwithstanding anything contained herein to the contrary, upon the
occurrence of a "Management Call" (as defined in Section 11.2 of the
Stockholders Agreement and interpreted, for purposes of this Agreement, to apply
to the Optionee whether or not the Optionee is a signatory to the Stockholders
Agreement on the date of such Management Call), no portion of the Option,
whether exercisable on the date of such Management Call or not, may thereafter
be exercised for the purchase of shares of Stock. In lieu thereof, the Optionee
shall be entitled, in cancellation and settlement for the portion of the Option
which is exercisable on the date of such Management Call, to a payment in cash
(subject to any applicable withholding taxes, the "Cash Payment") equal to (i)
the amount which would have been paid to the Optionee by the Company for the
Stock to which such exercisable portion of the Option applied as if such portion
of the Option had been exercised and such Stock had been subject to such a
Management Call, less (ii) the Option exercise price for such exercisable
portion of the Option. The Cash Payment will be paid to the Optionee in
accordance with Section 11.2(e) of the Stockholders Agreement.
(c) NONTRANSFERABILITY. Except as provided below, the Option shall not be
transferable otherwise than by will or the laws of descent and distribution, and
is exercisable, during the lifetime of the Optionee, only by him.
Notwithstanding the foregoing, all or a portion of the Option may be transferred
to members of the Optionee's immediate family or a trust or partnership, or
similar vehicle, established solely for the benefit of, or the partners or
members of which are solely, any such family member or members. Following any
such transfer, the Option, or portion thereof so transferred, shall continue to
be subject to the same terms and conditions as were applicable to such Option
immediately prior to the transfer, PROVIDED, that the transferee of the Option,
or portion thereof so transferred, shall be treated under the Plan and this
Agreement, EXCEPT that the provisions of Section 2(b)(iv) shall continue to be
applied with respect to the Optionee, so that following the Optionee's
termination of
-4-
<PAGE>
employment with the Company or a Subsidiary or the death of the Optionee, any
transferee of the Option (or any portion thereof) may only affect an exercise
thereof to the extent provided, and for the period specified in Section
2(b)(iv).
(d) WITHHOLDING TAXES. At the time of receipt of Stock upon the exercise of
all or any part of the Option, the Optionee shall be required to pay to the
Company in cash any taxes of any kind required by law to be withheld with
respect to such Stock. Notwithstanding the foregoing, such tax withholding
obligations may be met, in whole or in part, by the withholding of Stock
otherwise deliverable to the Optionee with a fair Market Value on the date of
such exercise equal to such tax liability, pursuant to procedures approved by
the Committee; PROVIDED, HOWEVER, that the amount of any Stock so withheld shall
not exceed the minimum required withholding obligation taking into account the
Optionee's effective tax rate and all applicable taxes. In no event shall Stock
be delivered to any person exercising the Option until such person has paid to
the Company in cash, or made arrangements satisfactory to the Company regarding
the payment of the amount of any taxes of any kind required by law to be
withheld with respect to the Stock subject to the Option, and the Company shall
have the right to deduct any such taxes from any payment of any kind otherwise
due to the Optionee.
(e) NO RIGHTS AS STOCKHOLDER. Neither the Optionee nor any other person
shall become the beneficial owner of the shares of Stock subject to the Option,
nor have any rights to dividends or other rights as a shareholder with respect
to any such shares until the Optionee has exercised the Option in accordance
with the provisions hereof and of the Plan.
(f) NO RIGHT TO CONTINUED EMPLOYMENT. The Option shall not confer upon the
Optionee any right to be retained in the service of the Company and/or a
Subsidiary, nor restrict in any way the right of the Company and/or any
Subsidiary, which right is hereby expressly reserved, to terminate his
employment at any time with or without Substantial Cause (as defined in Section
11.2 of the Stockholders Agreement).
(g) INCONSISTENCY WITH PLAN. Notwithstanding any provision herein to the
contrary, the Option provides the Optionee with no greater rights or claims than
are specifically provided for under the Plan. If and to the extent that any
provision contained herein is inconsistent with the Plan, the terms of the Plan
shall govern.
(h) COMPLIANCE WITH LAWS, REGULATIONS, STOCKHOLDERS AGREEMENT, ETC. The
Option and the obligation of the Company to sell and deliver shares of Stock
hereunder and any Stock delivered hereunder shall be subject in all respects to:
(i) all applicable Federal, Netherlands Antilles and state laws, rules and
regulations, (ii) any registration, qualification, approvals or other
requirements imposed by any governmental or
-5-
<PAGE>
regulatory agency or body which the Committee shall, in its sole discretion,
determine to be necessary or applicable and (iii) the terms of the Stockholders
Agreement in all respects. If at any time the Committee shall determine that the
listing, registration and/or qualification of shares of Stock upon any
securities exchange or under any Federal, Netherlands Antilles or state law, or
the consent or approval of any governmental regulatory body is necessary or
desirable as a condition of, or in connection with, the sale or purchase of
shares of Stock hereunder, the Option may not be exercised, in whole or in part,
and the Company shall not be required to issue or deliver any certificates for
shares of Stock hereunder unless and until such listing, registration,
qualification, consent and/or approval shall have been effected or obtained, or
otherwise provided for, free of any conditions not acceptable to the Committee.
Moreover, the Option may not be exercised if its exercise, or the receipt of
shares of Stock pursuant thereto, would be contrary to applicable law. Any
shares of Stock deliverable under the Option upon exercise hereof shall be
subject to such transfer and/or ownership restrictions and/or legending
requirements in accordance with the Stockholders Agreement and/or as the
Committee may establish or determine, which may be referred to on the
certificates evidencing such shares.
3. INVESTMENT REPRESENTATION. The Optionee (which, for purposes of this
Section 3, shall include any other person entitled to exercise the Option, or
any part thereof, at any time) hereby represents and warrants that any purchase
or acquisition of shares of Stock under this Agreement shall be for the
Optionee's own account, for investment only and not with a view to the resale or
distribution thereof, and the Optionee represents and agrees that any subsequent
offer for sale or distribution of any of such shares shall be made only pursuant
to either (i) a registration statement on an appropriate form under the
Securities Act, which registration statement has become effective and is current
with regard to the shares of Stock being offered or sold, or (ii) a specific
exemption from the registration requirements of the Securities Act, but in
claiming such exemption the Optionee shall, prior to any offer for sale or sale
of such shares, obtain a prior favorable written opinion, in form and substance
satisfactory to the Company, from counsel for or approved by the Company, as to
the applicability of such exemption thereto, and the Optionee will indemnify the
Company and hold it harmless from any loss, damage, expense or liability
resulting to the Company or any Subsidiary if any sale or distribution of shares
of Stock purchased or acquired hereunder by the Optionee is contrary to the
representation and agreement made by the Optionee in this Section 3. The
foregoing restriction shall not apply to (a) issuances by the Company so long as
the shares being issued are registered under the Securities Act and a prospectus
in respect thereof is current or (b) reofferings of shares by affiliates of the
Company (as defined in Rule 405 or any successor rule or regulation promulgated
under the Securities Act) if the shares being reoffered are registered under the
Securities Act and a prospectus in respect thereof is current. The Optionee
further represents and warrants that the
-6-
<PAGE>
Optionee has knowledge and experience in financial and business matters, that
the Optionee is capable of evaluating the merits and risks of owning any shares
of Stock purchased or acquired under this Agreement and has the information
necessary to do so, and that the Optionee is a person who is able to bear the
economic risk of such ownership. Each representation, warranty and agreement
contained in this Section 3 shall be deemed to be re-made by the Optionee upon
any exercise of the Option, or any part thereof.
4. DISPOSITION OF STOCK. Any shares of Stock received by the Optionee or
any other person upon exercise of the Option, or any part thereof (or any
interest or right in such shares) cannot be sold, assigned, pledged or
transferred in any manner except as permitted by the Stockholders Agreement.
5. NOTICES. Any notice hereunder to the Company shall be addressed to it in
care of Statia Terminals, Inc., 800 Fairway Drive, Suite 295, Deerfield Beach,
Florida 33441, Attention: Chief Financial Officer, and any notice hereunder to
the Optionee shall be addressed to him at ____________, ___________, subject to
the right of either party to designate at any time hereafter in writing some
other address.
6. GOVERNING LAW. The validity, interpretation, construction and
performance of this Agreement shall be governed by and construed in accordance
with the laws of the State of New York, except as superseded by applicable
Federal law or the laws of the Netherlands Antilles.
7. OPTIONEE BOUND BY PLAN. The Optionee hereby acknowledges receipt of a
copy of the Plan and agrees to be bound by all of the terms and provisions
thereof and the terms and provisions adopted after the granting of the Option
but prior to the complete exercise hereof, subject to the last paragraph of
Section 13 of the Plan as in effect on the date hereof.
8. SEVERABILITY. If any of the provisions of this Agreement should be
deemed unenforceable, the remaining provisions shall remain in full force and
effect.
9. COUNTERPARTS. This Agreement has been executed in two counterparts each
of which shall constitute one and the same instrument.
-7-
<PAGE>
10. MODIFICATION. This Agreement may not be modified or amended, nor may
any provision hereof be waived, in any way except in writing signed by the
parties hereto.
IN WITNESS WHEREOF, Statia Terminals Group N.V. has caused this
Agreement to be executed by its appropriate officers and/or directors, and the
Optionee has executed this Agreement, both as of the day and year first above
written.
STATIA TERMINALS GROUP N.V.
Date:_______________ By__________________________
Name:
Title:
Date:_______________ By__________________________
Name:
Title:
The undersigned (who, for purposes of this affirmation, shall also be deemed to
include each person claiming any rights or benefits with respect to the Plan or
the Agreement under or through the undersigned) hereby acknowledges receipt of a
copy of the Plan and acknowledges that he is familiar with the terms and
conditions thereof. The undersigned furthermore hereby accepts, ratifies and
consents to all of the terms and conditions of this Agreement and of the Plan,
including the terms and conditions of the Plan adopted after the granting of
this Option but prior to the complete exercise hereof (subject to Section 13 of
the Plan as in effect on the date hereof), and any action taken under the Plan
by the Committee, the Company and/or the Board, and the undersigned further
agrees to be bound by all such terms and conditions of this Agreement and the
Plan and actions of the Committee, the Company and/or the Board.
Date:_______________ _________________(L.S.)
-8-
<PAGE>
<TABLE>
<CAPTION>
SCHEDULE 1
NOTATIONS AS TO PARTIAL EXERCISE
--------------------------------
NUMBER OF BALANCE OF
DATE OF PURCHASED SHARES ON AUTHORIZED NOTATION
EXERCISE SHARES OPTION SIGNATURE DATE
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------
</TABLE>
-9-
<PAGE>
STATIA TERMINALS GROUP N.V.
1997 STOCK OPTION PLAN
STOCK OPTION AWARD AGREEMENT
FOR EMPLOYEES
This Stock Option Award Agreement (the "Agreement"), dated ______ __, 1997,
is made between Statia Terminals Group N.V. (the "Company") and ________________
(the "Optionee"). All capitalized terms that are not defined herein shall have
the meaning as defined in the Statia Terminals Group N.V. 1997 Stock Option Plan
(the "Plan"). References to "he," "him," and "his" shall mean the feminine form
of such terms, when applicable.
W I T N E S S E T H :
1. GRANT OF OPTION. Pursuant to the provisions of the Plan, the Company
hereby grants to the Optionee, subject to the terms and conditions of the Plan
and subject further to the terms and conditions herein set forth, the right and
option to purchase from the Company, all or any part of an aggregate of ________
shares of $0.10 par value common stock of the Company ("Stock") at a per share
purchase price equal to $_________ (the "Option"), such Option to be exercisable
as hereinafter provided. The Option shall not be treated as an "incentive stock
option," as defined in Section 422 of the Code.
2. TERMS AND CONDITIONS. It is understood and agreed that the Option
evidenced hereby is subject to the following terms and conditions:
(a) EXPIRATION DATE. The Option shall expire ten (10) years after the date
indicated above, or such earlier date as (i) all shares of Stock covered by the
Option shall have been purchased or (ii) the Option expires pursuant to Section
2(b)(iv) below.
(b) EXERCISE OF OPTION. (i) Subject to the other terms of this Agreement
and the Plan, the Option may be exercised on or after the date hereof in
accordance with the following schedule:
<PAGE>
YEARS OF EMPLOYMENT PERCENT OF
SINCE OPTION GRANT OPTION EXERCISABLE
------------------- ------------------
less than 2 years 0
2 years and less than 3 years 25%
3 years and less than 4 years 50%
4 years and less than 5 years 75%
5 or more years 100%
Notwithstanding the preceding clause, upon the occurrence of a Liquidation Event
(as hereinafter defined), the Option shall become fully exercisable as to all
shares of Stock covered by the Option as to which the Option was not exercised
prior to such Liquidation Event. Notwithstanding any other provision of this
Agreement to the contrary, no portion of the Option that is not exercisable as
of the date on which the Optionee ceases to be employed by the Company or any
Subsidiary shall thereafter become exercisable. For purposes of this Agreement,
"Liquidation Event" shall mean (i) a merger, consolidation, combination,
reorganization or other transaction resulting in less than 50% of the combined
voting power of the surviving or resulting entity being owned by the former
shareholders of the Company, (ii) the liquidation or dissolution of the Company
or the sale or other disposition of all or substantially all of the assets or
business of the Company (other than, in the case of either clause (i) or (ii)
above, in connection with an employee benefit plan of the Company or a
Subsidiary), or (iii) an initial public offering of the common stock of the
Company pursuant to a registration statement declared effective under the
Securities Act.
(ii) Any exercisable portion of the Option or the entire Option, if then
wholly exercisable, may be exercised at any time, subject to the terms and
conditions of this Agreement and the Plan, prior to the expiration of the Option
under Section 2(a); PROVIDED, HOWEVER, that the Option shall not be exercisable
for the lesser of ten (10) shares of Stock or the full number of shares of Stock
then subject to the Option which are then exercisable. Any exercise of all or
any part of the Option shall be accompanied by: (A) payment in full of the
purchase price of the shares of Stock as to which the Option is exercised in
accordance with Section 2(b)(iii), including applicable taxes, if any, in
accordance with Section 2(d) and (B) a written notice to the Company specifying
the number of shares of Stock as to which the Option is being exercised.
Notation of any partial exercise shall be made by the Company on Schedule I
attached hereto.
(iii) At the time of any exercise of the Option, the purchase price of the
shares of Stock as to which the Option shall be exercised shall be paid to the
Company: (A) in United States dollars by personal check (subject to collection),
bank draft or money
-2-
<PAGE>
order; (B) if permitted by applicable law, by tendering to the Company shares of
Stock, duly endorsed for transfer to the Company, already owned by the Optionee
(or by the Optionee and the Optionee's spouse) for at least six (6) months prior
to such tender, which may include shares received as a result of a prior
exercise of this Option, and having a total Fair Market Value on the date of
such exercise of the Option, equal to the aggregate cash purchase price of such
shares of Stock; (C) by delivering a promissory note in a form satisfactory to
the Company for the full exercise price of the Option or the portion thereof
which the Optionee intends to exercise; or (D) by any combination of the
consideration provided for in the foregoing clauses (A), (B) and (C).
(iv) The Option shall terminate upon the termination, for any reason, of
the Optionee's employment with the Company or a Subsidiary, and no shares of
Stock may thereafter be purchased under the Option, except as follows:
(A) In the event of the death of the Optionee while an employee of the
Company or a Subsidiary, the Option, to the extent not previously
exercised, may be immediately exercised after the Optionee's death by his
heir, the legal representative of the Optionee's estate or by the legatee
of the Optionee under his last will for a period of two (2) years from the
date of his death or until the expiration of the stated period of the
Option, whichever period is the shorter.
(B) If the Optionee's employment with the Company or a Subsidiary shall
terminate by reason of permanent disability (as defined in Section 22(e)(3)
of the Code), the Option, to the extent not previously exercised, may be
immediately exercised after such termination but may not be exercised after
the expiration of the period of one (1) year from the date of such
termination or of the stated period of the Option, whichever period is the
shorter.
(C) If the Company or a Subsidiary terminates the Optionee's employment
with the Company or such Subsidiary and such termination is not for
"Substantial Cause" (as defined in Section 11.2 of the Stockholders
Agreement), the Optionee's Option, to the extent not previously exercised,
may thereafter be immediately exercised but may not be exercised after the
expiration of the period of one (1) year from the date of such termination
of employment or of the stated period of the Option, whichever period is
the shorter.
(D) If the Optionee's employment with the Company or a Subsidiary is
terminated by reason of the Optionee's retirement after attaining 59 1/2
years of age, the Option, to the extent not previously exercised, may be
immediately exercised after such retirement but may not be exercised after
the expiration of the period of two (2) years from the date of such
retirement or of the stated
-3-
<PAGE>
period of the Option, whichever period is the shorter.
(E) If the Optionee dies after termination of his employment with the
Company and/or a Subsidiary under paragraphs (B), (C) or (D) of this
Section 2(b)(iv) above during the one-year or two-year period specified,
respectively, in such paragraphs, the Option, to the extent not previously
exercised, may be exercised after the Optionee's death by the Optionee's
heir, the legal representative of his estate or by the legatee of the
Optionee under his last will until the expiration of the period of two (2)
years from the date of his death or the stated period of the Option,
whichever period is the shorter.
(F) If the Optionee's employment is terminated by the Company or a
Subsidiary for "Substantial Cause" (as defined in Section 11.2 of the
Stockholders Agreement) or if the Optionee's employment is terminated under
circumstances not described in this Section 2(b)(iv), the Optionee's Option
shall automatically terminate, without any further action required by the
Company, on the date of such termination of employment and shall cease to
thereafter be exercisable with respect to any shares of Stock.
(v) Notwithstanding anything contained herein to the contrary, upon the
occurrence of a "Management Call" (as defined in Section 11.2 of the
Stockholders Agreement and interpreted, for purposes of this Agreement, to apply
to the Optionee whether or not the Optionee is a signatory to the Stockholders
Agreement on the date of such Management Call), no portion of the Option,
whether exercisable on the date of such Management Call or not, may thereafter
be exercised for the purchase of shares of Stock. In lieu thereof, the Optionee
shall be entitled, in cancellation and settlement for the portion of the Option
which is exercisable on the date of such Management Call, to a payment in cash
(subject to any applicable withholding taxes, the "Cash Payment") equal to (i)
the amount which would have been paid to the Optionee by the Company for the
Stock to which such exercisable portion of the Option applied as if such portion
of the Option had been exercised and such Stock had been subject to such a
Management Call, less (ii) the Option exercise price for such exercisable
portion of the Option. The Cash Payment will be paid to the Optionee in
accordance with Section 11.2(e) of the Stockholders Agreement.
(c) NONTRANSFERABILITY. Except as provided below, the Option shall not be
transferable otherwise than by will or the laws of descent and distribution, and
is exercisable, during the lifetime of the Optionee, only by him.
Notwithstanding the foregoing, all or a portion of the Option may be transferred
to members of the Optionee's immediate family or a trust or partnership, or
similar vehicle, established solely for the benefit of, or the partners or
members of which are solely, any such
-4-
<PAGE>
family member or members. Following any such transfer, the Option, or portion
thereof so transferred, shall continue to be subject to the same terms and
conditions as were applicable to such Option immediately prior to the transfer,
PROVIDED, that the transferee of the Option, or portion thereof so transferred,
shall be treated under the Plan and this Agreement, EXCEPT that the provisions
of Section 2(b)(iv) shall continue to be applied with respect to the Optionee,
so that following the Optionee's termination of employment with the Company or a
Subsidiary or the death of the Optionee, any transferee of the Option (or any
portion thereof) may only affect an exercise thereof to the extent provided, and
for the period specified in Section 2(b)(iv).
(d) WITHHOLDING TAXES. At the time of receipt of Stock upon the exercise of
all or any part of the Option, the Optionee shall be required to pay to the
Company in cash any taxes of any kind required by law to be withheld with
respect to such Stock. Notwithstanding the foregoing, such tax withholding
obligations may be met, in whole or in part, by the withholding of Stock
otherwise deliverable to the Optionee with a fair Market Value on the date of
such exercise equal to such tax liability, pursuant to procedures approved by
the Committee; PROVIDED, HOWEVER, that the amount of any Stock so withheld shall
not exceed the minimum required withholding obligation taking into account the
Optionee's effective tax rate and all applicable taxes. In no event shall Stock
be delivered to any person exercising the Option until such person has paid to
the Company in cash, or made arrangements satisfactory to the Company regarding
the payment of the amount of any taxes of any kind required by law to be
withheld with respect to the Stock subject to the Option, and the Company shall
have the right to deduct any such taxes from any payment of any kind otherwise
due to the Optionee.
(e) NO RIGHTS AS STOCKHOLDER. Neither the Optionee nor any other person
shall become the beneficial owner of the shares of Stock subject to the Option,
nor have any rights to dividends or other rights as a shareholder with respect
to any such shares until the Optionee has exercised the Option in accordance
with the provisions hereof and of the Plan.
(f) NO RIGHT TO CONTINUED EMPLOYMENT. The Option shall not confer upon the
Optionee any right to be retained in the service of the Company and/or a
Subsidiary, nor restrict in any way the right of the Company and/or any
Subsidiary, which right is hereby expressly reserved, to terminate his
employment at any time with or without Substantial Cause (as defined in Section
11.2 of the Stockholders Agreement).
(g) INCONSISTENCY WITH PLAN. Notwithstanding any provision herein to the
contrary, the Option provides the Optionee with no greater rights or claims than
are specifically provided for under the Plan. If and to the extent that any
provision contained herein is inconsistent with the Plan, the terms of the Plan
shall govern.
-5-
<PAGE>
(h) COMPLIANCE WITH LAWS, REGULATIONS, STOCKHOLDERS AGREEMENT, ETC. The
Option and the obligation of the Company to sell and deliver shares of Stock
hereunder and any Stock delivered hereunder shall be subject in all respects to:
(i) all applicable Federal, Netherlands Antilles and state laws, rules and
regulations, (ii) any registration, qualification, approvals or other
requirements imposed by any governmental or regulatory agency or body which the
Committee shall, in its sole discretion, determine to be necessary or applicable
and (iii) the terms of the Stockholders Agreement in all respects. If at any
time the Committee shall determine that the listing, registration and/or
qualification of shares of Stock upon any securities exchange or under any
Federal, Netherlands Antilles or state law, or the consent or approval of any
governmental regulatory body is necessary or desirable as a condition of, or in
connection with, the sale or purchase of shares of Stock hereunder, the Option
may not be exercised, in whole or in part, and the Company shall not be required
to issue or deliver any certificates for shares of Stock hereunder unless and
until such listing, registration, qualification, consent and/or approval shall
have been effected or obtained, or otherwise provided for, free of any
conditions not acceptable to the Committee. Moreover, the Option may not be
exercised if its exercise, or the receipt of shares of Stock pursuant thereto,
would be contrary to applicable law. Any shares of Stock deliverable under the
Option upon exercise hereof shall be subject to such transfer and/or ownership
restrictions and/or legending requirements in accordance with the Stockholders
Agreement and/or as the Committee may establish or determine, which may be
referred to on the certificates evidencing such shares.
3. INVESTMENT REPRESENTATION. The Optionee (which, for purposes of this
Section 3, shall include any other person entitled to exercise the Option, or
any part thereof, at any time) hereby represents and warrants that any purchase
or acquisition of shares of Stock under this Agreement shall be for the
Optionee's own account, for investment only and not with a view to the resale or
distribution thereof, and the Optionee represents and agrees that any subsequent
offer for sale or distribution of any of such shares shall be made only pursuant
to either (i) a registration statement on an appropriate form under the
Securities Act, which registration statement has become effective and is current
with regard to the shares of Stock being offered or sold, or (ii) a specific
exemption from the registration requirements of the Securities Act, but in
claiming such exemption the Optionee shall, prior to any offer for sale or sale
of such shares, obtain a prior favorable written opinion, in form and substance
satisfactory to the Company, from counsel for or approved by the Company, as to
the applicability of such exemption thereto, and the Optionee will indemnify the
Company and hold it harmless from any loss, damage, expense or liability
resulting to the Company or any Subsidiary if any sale or distribution of shares
of Stock purchased or acquired hereunder by the Optionee is contrary to the
representation and agreement made by the Optionee in this Section 3.
-6-
<PAGE>
The foregoing restriction shall not apply to (a) issuances by the Company
so long as the shares being issued are registered under the Securities Act and a
prospectus in respect thereof is current or (b) reofferings of shares by
affiliates of the Company (as defined in Rule 405 or any successor rule or
regulation promulgated under the Securities Act) if the shares being reoffered
are registered under the Securities Act and a prospectus in respect thereof is
current. The Optionee further represents and warrants that the Optionee has
knowledge and experience in financial and business matters, that the Optionee is
capable of evaluating the merits and risks of owning any shares of Stock
purchased or acquired under this Agreement and has the information necessary to
do so, and that the Optionee is a person who is able to bear the economic risk
of such ownership. Each representation, warranty and agreement contained in this
Section 3 shall be deemed to be re-made by the Optionee upon any exercise of the
Option, or any part thereof.
4. DISPOSITION OF STOCK. Any shares of Stock received by the Optionee or
any other person upon exercise of the Option, or any part thereof (or any
interest or right in such shares) cannot be sold, assigned, pledged or
transferred in any manner except as permitted by the Stockholders Agreement.
5. NOTICES. Any notice hereunder to the Company shall be addressed to it in
care of Statia Terminals, Inc., 800 Fairway Drive, Suite 295, Deerfield Beach,
Florida 33441, Attention: Chief Financial Officer, and any notice hereunder to
the Optionee shall be addressed to him at ____________, ___________, subject to
the right of either party to designate at any time hereafter in writing some
other address.
6. GOVERNING LAW. The validity, interpretation, construction and
performance of this Agreement shall be governed by and construed in accordance
with the laws of the State of New York, except as superseded by applicable
Federal law or the laws of the Netherlands Antilles.
7. OPTIONEE BOUND BY PLAN. The Optionee hereby acknowledges receipt of a
copy of the Plan and agrees to be bound by all of the terms and provisions
thereof and the terms and provisions adopted after the granting of the Option
but prior to the complete exercise hereof, subject to the last paragraph of
Section 13 of the Plan as in effect on the date hereof.
8. SEVERABILITY. If any of the provisions of this Agreement should be
deemed unenforceable, the remaining provisions shall remain in full force and
effect.
9. COUNTERPARTS. This Agreement has been executed in two counterparts each
of which shall constitute one and the same instrument.
-7-
<PAGE>
10. MODIFICATION. This Agreement may not be modified or amended, nor may
any provision hereof be waived, in any way except in writing signed by the
parties hereto.
IN WITNESS WHEREOF, Statia Terminals Group N.V. has caused this Agreement
to be executed by its appropriate officers and/or directors, and the Optionee
has executed this Agreement, both as of the day and year first above written.
STATIA TERMINALS GROUP N.V.
Date:_______________ By__________________________
Name:
Title:
Date:_______________ By__________________________
Name:
Title:
The undersigned (who, for purposes of this affirmation, shall also be deemed to
include each person claiming any rights or benefits with respect to the Plan or
the Agreement under or through the undersigned) hereby acknowledges receipt of a
copy of the Plan and acknowledges that he is familiar with the terms and
conditions thereof. The undersigned furthermore hereby accepts, ratifies and
consents to all of the terms and conditions of this Agreement and of the Plan,
including the terms and conditions of the Plan adopted after the granting of
this Option but prior to the complete exercise hereof (subject to Section 13 of
the Plan as in effect on the date hereof), and any action taken under the Plan
by the Committee, the Company and/or the Board, and the undersigned further
agrees to be bound by all such terms and conditions of this Agreement and the
Plan and actions of the Committee, the Company and/or the Board.
Date:_______________ _________________(L.S.)
-8-
<PAGE>
<TABLE>
<CAPTION>
SCHEDULE 1
NOTATIONS AS TO PARTIAL EXERCISE
--------------------------------
NUMBER OF BALANCE OF
DATE OF PURCHASED SHARES ON AUTHORIZED NOTATION
EXERCISE SHARES OPTION SIGNATURE DATE
<S> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
</TABLE>
-9-
<PAGE>
STATIA TERMINALS GROUP N.V.
1997 STOCK OPTION PLAN
STOCK OPTION AWARD AGREEMENT
FOR NONEMPLOYEE DIRECTORS
This Stock Option Award Agreement (the "Agreement"), dated ______ __, 1997,
is made between Statia Terminals Group N.V. (the "Company") and ________________
(the "Optionee"). All capitalized terms that are not defined herein shall have
the meaning as defined in the Statia Terminals Group N.V. 1997 Stock Option Plan
(the "Plan"). References to "he," "him," and "his" shall mean the feminine form
of such terms, when applicable.
W I T N E S S E T H :
1. GRANT OF OPTION. Pursuant to the provisions of the Plan, the Company
hereby grants to the Optionee, subject to the terms and conditions of the Plan
and subject further to the terms and conditions herein set forth, the right and
option to purchase from the Company, all or any part of an aggregate of ________
shares of $0.10 par value common stock of the Company ("Stock") at a per share
purchase price equal to $_________ (the "Option"), such Option to be exercisable
as hereinafter provided. The Option shall not be treated as an "incentive stock
option," as defined in Section 422 of the Code.
2. TERMS AND CONDITIONS. It is understood and agreed that the Option
evidenced hereby is subject to the following terms and conditions:
(a) EXPIRATION DATE. The Option shall expire ten (10) years after the date
indicated above, or such earlier date as (i) all shares of Stock covered by the
Option shall have been purchased or (ii) the Option expires pursuant to Section
2(b)(iv) below.
(b) EXERCISE OF OPTION. (i) Subject to the other terms of this Agreement
and the Plan, the Option may be exercised on or after the date hereof as to the
total number of shares of Stock subject to the Option, or any portion thereof,
for which the Option was not previously exercised; PROVIDED, HOWEVER, that the
Option shall not be exercisable for the lesser of ten (10) shares of Stock or
the full number of shares of Stock then subject to the Option.
-1-
<PAGE>
(ii) Any exercise of all or any part of the Option shall be accompanied by:
(A) payment in full of the purchase price of the shares of Stock as to which the
Option is exercised in accordance with Section 2(b)(iii), including applicable
taxes, if any, in accordance with Section 2(d) and (B) a written notice to the
Company specifying the number of shares of Stock as to which the Option is being
exercised. Notation of any partial exercise shall be made by the Company on
Schedule I attached hereto.
(iii) At the time of any exercise of the Option, the purchase price of the
shares of Stock as to which the Option shall be exercised shall be paid to the
Company: (A) in United States dollars by personal check (subject to collection),
bank draft or money order; (B) if permitted by applicable law, by tendering to
the Company shares of Stock, duly endorsed for transfer to the Company, already
owned by the Optionee (or by the Optionee and the Optionee's spouse) for at
least six (6) months prior to such tender, which may include shares received as
a result of a prior exercise of this Option, and having a total Fair Market
Value on the date of such exercise of the Option, equal to the aggregate cash
purchase price of such shares of Stock; (C) by delivering a promissory note in a
form satisfactory to the Company for the full exercise price of the Option or
the portion thereof which the Optionee intends to exercise; or (D) by any
combination of the consideration provided for in the foregoing clauses (A), (B)
and (C).
(iv) The Option shall terminate upon the termination, for any reason, of
the Optionee's directorship with the Company or a Subsidiary, and no shares of
Stock may thereafter be purchased under the Option, except as follows:
(A) In the event of the death of the Optionee while a director of the
Company or a Subsidiary, the Option, to the extent not previously
exercised, may be immediately exercised after the Optionee's death by his
heir, the legal representative of the Optionee's estate or by the legatee
of the Optionee under his last will for a period of two (2) years from the
date of his death or until the expiration of the stated period of the
Option, whichever period is the shorter.
(B) If the Optionee's directorship with the Company or a Subsidiary
shall terminate by reason of permanent disability (as defined in Section
22(e)(3) of the Code), the Option, to the extent not previously exercised,
may be immediately exercised after such termination but may not be
exercised after the expiration of the period of one (1) year from the date
of such termination or of the stated period of the Option, whichever period
is the shorter.
(C) If the Optionee is removed as a director of the Company and/or a
Subsidiary (in accordance with Section 5.1 of the Stockholders Agreement)
and
-2-
<PAGE>
such termination is not for "Substantial Cause" (as defined in Section
11.2 of the Stockholders Agreement), the Optionee's Option, to the extent
not previously exercised, may thereafter be immediately exercised but may
not be exercised after the expiration of the period of one (1) year from
the date of such removal or of the stated period of the Option, whichever
period is the shorter.
(D) If the Optionee dies after termination of his directorship with the
Company and/or a Subsidiary under paragraphs (B) or (C) of this Section
2(b)(iv) during the one-year period specified in such paragraphs, the
Option, to the extent not previously exercised, may be exercised after the
Optionee's death by the Optionee's heir, the legal representative of his
estate or by the legatee of the Optionee under his last will until the
expiration of the period of two (2) years from the date of his death or the
stated period of the Option, whichever period is the shorter.
(E) If the Optionee is removed as a director of the Company and/or a
Subsidiary for "Substantial Cause" (as defined in Section 11.2 of the
Stockholders Agreement), the Optionee's Option shall automatically
terminate, without any further action required by the Company, on the date
of such termination and shall cease to thereafter be exercisable with
respect to any shares of Stock.
(v) Notwithstanding anything contained herein to the contrary, upon the
occurrence of a "Management Call" (as defined in Section 11.2 of the
Stockholders Agreement but interpreted, for purposes of this Agreement, (i) as
if the Optionee were an employee of the Company and (ii) to apply to the
Optionee whether or not the Optionee is a signatory to the Stockholders
Agreement on the date of such Management Call), no portion of the Option may
thereafter be exercised for the purchase of shares of Stock. In lieu thereof,
the Optionee shall be entitled, in cancellation and settlement for the portion
of the Option which has not been exercised as of the date of such Management
Call, to a payment in cash (the "Cash Payment") equal to (i) the amount which
would have been paid to the Optionee by the Company for the Stock to which such
unexercised portion of the Option applied as if such portion of the Option had
been exercised and such Stock had been subject to such a Management Call, less
(ii) the Option exercise price for such unexercised portion of the Option. The
Cash Payment will be paid to the Optionee in accordance with Section 11.2(e) of
the Stockholders Agreement.
(c) NONTRANSFERABILITY. Except as provided below, the Option shall not be
transferable otherwise than by will or the laws of descent and distribution, and
is exercisable, during the lifetime of the Optionee, only by him.
Notwithstanding the
-3-
<PAGE>
foregoing, all or a portion of the Option may be transferred to members of the
Optionee's immediate family or a trust or partnership, or similar vehicle,
established solely for the benefit of, or the partners or members of which are
solely, any such family member or members. Following any such transfer, the
Option, or portion thereof so transferred, shall continue to be subject to the
same terms and conditions as were applicable to such Option immediately prior to
the transfer; PROVIDED, that the transferee of the Option, or portion thereof so
transferred, shall be treated under the Plan and this Agreement, EXCEPT that the
provisions of Section 2(b)(iv) shall continue to be applied with respect to the
Optionee, so that following the Optionee's termination as a director with the
Company or a Subsidiary or the death of the Optionee, any transferee of the
Option (or any portion thereof) may only affect an exercise thereof to the
extent provided, and for the period specified in Section 2(b)(iv).
(d) NO RIGHTS AS STOCKHOLDER. Neither the Optionee nor any other person
shall become the beneficial owner of the shares of Stock subject to the Option,
nor have any rights to dividends or other rights as a shareholder with respect
to any such shares until the Optionee has exercised the Option in accordance
with the provisions hereof and of the Plan.
(e) NO RIGHT TO CONTINUED SERVICE. The Option shall not confer upon the
Optionee any right to be retained as a director of the Company and/or a
Subsidiary, nor restrict in any way the right of the stockholders of the Company
and/or any Subsidiary (subject to the terms of the Stockholders Agreement) to
remove a director at any time, with or without Substantial Cause (as defined in
Section 11.2 of the Stockholders Agreement).
(f) INCONSISTENCY WITH PLAN. Notwithstanding any provision herein to the
contrary, the Option provides the Optionee with no greater rights or claims than
are specifically provided for under the Plan. If and to the extent that any
provision contained herein is inconsistent with the Plan, the terms of the Plan
shall govern.
(g) COMPLIANCE WITH LAWS, REGULATIONS, STOCKHOLDERS AGREEMENT, ETC. The
Option and the obligation of the Company to sell and deliver shares of Stock
hereunder and any Stock delivered hereunder shall be subject in all respects to:
(i) all applicable Federal, Netherlands Antilles and state laws, rules and
regulations, (ii) any registration, qualification, approvals or other
requirements imposed by any governmental or regulatory agency or body which the
Committee shall, in its sole discretion, determine to be necessary or applicable
and (iii) the terms of the Stockholders Agreement in all respects. If at any
time the Committee shall determine that the listing, registration and/or
qualification of shares of Stock upon any securities exchange or under any
Federal, Netherlands Antilles or state law, or the consent or approval of any
-4-
<PAGE>
governmental regulatory body is necessary or desirable as a condition of, or in
connection with, the sale or purchase of shares of Stock hereunder, the Option
may not be exercised, in whole or in part, and the Company shall not be required
to issue or deliver any certificates for shares of Stock hereunder unless and
until such listing, registration, qualification, consent and/or approval shall
have been effected or obtained, or otherwise provided for, free of any
conditions not acceptable to the Committee. Moreover, the Option may not be
exercised if its exercise, or the receipt of shares of Stock pursuant thereto,
would be contrary to applicable law. Any shares of Stock deliverable under the
Option upon exercise hereof shall be subject to such transfer and/or ownership
restrictions and/or legending requirements in accordance with the Stockholders
Agreement and/or as the Committee may establish or determine, which may be
referred to on the certificates evidencing such shares.
3. INVESTMENT REPRESENTATION. The Optionee (which, for purposes of this
Section 3, shall include any other person entitled to exercise the Option, or
any part thereof, at any time) hereby represents and warrants that any purchase
or acquisition of shares of Stock under this Agreement shall be for the
Optionee's own account, for investment only and not with a view to the resale or
distribution thereof, and the Optionee represents and agrees that any subsequent
offer for sale or distribution of any of such shares shall be made only pursuant
to either (i) a registration statement on an appropriate form under the
Securities Act, which registration statement has become effective and is current
with regard to the shares of Stock being offered or sold, or (ii) a specific
exemption from the registration requirements of the Securities Act, but in
claiming such exemption the Optionee shall, prior to any offer for sale or sale
of such shares, obtain a prior favorable written opinion, in form and substance
satisfactory to the Company, from counsel for or approved by the Company, as to
the applicability of such exemption thereto, and the Optionee will indemnify the
Company and hold it harmless from any loss, damage, expense or liability
resulting to the Company or any Subsidiary if any sale or distribution of shares
of Stock purchased or acquired hereunder by the Optionee is contrary to the
representation and agreement made by the Optionee in this Section 3. The
foregoing restriction shall not apply to (a) issuances by the Company so long as
the shares being issued are registered under the Securities Act and a prospectus
in respect thereof is current or (b) reofferings of shares by affiliates of the
Company (as defined in Rule 405 or any successor rule or regulation promulgated
under the Securities Act) if the shares being reoffered are registered under the
Securities Act and a prospectus in respect thereof is current. The Optionee
further represents and warrants that the Optionee has knowledge and experience
in financial and business matters, that the Optionee is capable of evaluating
the merits and risks of owning any shares of Stock purchased or acquired under
this Agreement and has the information necessary to do so, and that the Optionee
is a person who is able to bear the economic risk of such ownership. Each
representation, warranty and agreement contained in this Section 3
-5-
<PAGE>
shall be deemed to be re-made by the Optionee upon any exercise of the Option,
or any part thereof.
4. DISPOSITION OF STOCK. Any shares of Stock received by the Optionee or
any other person upon exercise of the Option, or any part thereof (or any
interest or right in such shares) cannot be sold, assigned, pledged or
transferred in any manner except as permitted by the Stockholders Agreement.
5. NOTICES. Any notice hereunder to the Company shall be addressed to it in
care of Statia Terminals, Inc., 800 Fairway Drive, Suite 295, Deerfield Beach,
Florida 33441, Attention: Chief Financial Officer, and any notice hereunder to
the Optionee shall be addressed to him at ____________, ___________, subject to
the right of either party to designate at any time hereafter in writing some
other address.
6. GOVERNING LAW. The validity, interpretation, construction and
performance of this Agreement shall be governed by and construed in accordance
with the laws of the State of New York, except as superseded by Federal law or
the laws of the Netherlands Antilles.
7. OPTIONEE BOUND BY PLAN. The Optionee hereby acknowledges receipt of a
copy of the Plan and agrees to be bound by all of the terms and provisions
thereof and the terms and provisions adopted after the granting of the Option
but prior to the complete exercise hereof, subject to the last paragraph of
Section 13 of the Plan as in effect on the date hereof.
8. SEVERABILITY. If any of the provisions of this Agreement should be
deemed unenforceable, the remaining provisions shall remain in full force and
effect.
9. COUNTERPARTS. This Agreement has been executed in two counterparts each
of which shall constitute one and the same instrument.
-6-
<PAGE>
10. MODIFICATION. This Agreement may not be modified or amended, nor may
any provision hereof be waived, in any way except in writing signed by the
parties hereto.
IN WITNESS WHEREOF, Statia Terminals Group N.V. has caused this Agreement
to be executed by its appropriate officers and/or directors, and the Optionee
has executed this Agreement, both as of the day and year first above written.
STATIA TERMINALS GROUP N.V.
Date:_______________ By__________________________
Name:
Title:
Date:_______________ By__________________________
Name:
Title:
The undersigned (who, for purposes of this affirmation, shall also be deemed to
include each person claiming any rights or benefits with respect to the Plan or
the Agreement under or through the undersigned) hereby acknowledges receipt of a
copy of the Plan and acknowledges that he is familiar with the terms and
conditions thereof. The undersigned furthermore hereby accepts, ratifies and
consents to all of the terms and conditions of this Agreement and of the Plan,
including the terms and conditions of the Plan adopted after the granting of
this Option but prior to the complete exercise hereof (subject to Section 13 of
the Plan as in effect on the date hereof), and any action taken under the Plan
by the Committee, the Company and/or the Board, and the undersigned further
agrees to be bound by all such terms and conditions of this Agreement and the
Plan and actions of the Committee, the Company and/or the Board.
Date:_______________ _________________(L.S.)
-7-
<PAGE>
<TABLE>
<CAPTION>
SCHEDULE 1
NOTATIONS AS TO PARTIAL EXERCISE
--------------------------------
NUMBER OF BALANCE OF
DATE OF PURCHASED SHARES ON AUTHORIZED NOTATION
EXERCISE SHARES OPTION SIGNATURE DATE
<S> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------
</TABLE>
-8-
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0001029101
<NAME> STATIA TERMINALS INTERNATIONAL N.V.
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1997
<PERIOD-END> SEP-30-1997
<CASH> 9,946
<SECURITIES> 0
<RECEIVABLES> 14,708
<ALLOWANCES> (775)
<INVENTORY> 2,302
<CURRENT-ASSETS> 47,262
<PP&E> 208,380
<DEPRECIATION> (8,362)
<TOTAL-ASSETS> 253,170
<CURRENT-LIABILITIES> 25,429
<BONDS> 135,000
0
0
<COMMON> 6
<OTHER-SE> 98,494
<TOTAL-LIABILITY-AND-EQUITY> 253,170
<SALES> 63,439
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<NAME> STATIA TERMINALS CANADA INCORPORATED
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