AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 29, 1999
REGISTRATION NO. 333-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
FRONTIER OIL CORPORATION
(Exact name of registrant as specified in its charter)
WYOMING 74-1895085
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
10000 MEMORIAL DRIVE, SUITE 600
HOUSTON, TEXAS 77024
(Address, including zip code, of Principal Executive Offices)
FRONTIER OIL CORPORATION 1999 STOCK PLAN
(Full title of the plan)
JAMES R. GIBBS
FRONTIER OIL CORPORATION
10000 MEMORIAL DRIVE, SUITE 600
HOUSTON, TEXAS 77024
(713) 688-9600
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
copy to:
CHRISTOPHER S. COLLINS
ANDREWS & KURTH L.L.P.
600 TRAVIS, SUITE 4200
HOUSTON, TEXAS 77002
(713) 220-4200
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
TITLE OF SECURITIES TO AMOUNT PROPOSED PROPOSED AMOUNT
BE REGISTERED TO BE OFFERING MAXIMUM OF
REGISTERED(1) PRICE AGGREGATE REGISTRATION
PER SHARE (2) OFFERING FEE
PRICE (2)
- -------------------------- ------------- ------------- ----------- ------------
<S> <C> <C> <C> <C>
Common Stock, no par value 2,000,000 $6.2188 $12,437,600 $3,458
</TABLE>
(1) Pursuant to Rule 416(a), this registration statement shall cover any
additional securities issued to preventdilution resulting from stock splits,
stock dividends or similar transactions.
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(h), based upon theaverage of the high and low prices
per share for July 27, 1999 on the New York Stock Exchange as reportedin The
Wall Street Journal on July 28, 1999.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
Frontier Oil Corporation (the "Company") hereby incorporates by
reference the following documents listed below. In addition, all documents
subsequently filed by the Company pursuant to Sections 13(a), 13(c), 14 and
15(d) of the Securities Exchange Act of 1934 (the "Exchange Act") (prior to the
filing of a post-effective amendment which indicates that all the securities
offered have been sold or which deregisters all securities then remaining
unsold) shall be deemed to be incorporated by reference in this Registration
Statement and to be a part thereof from the date of filing of such documents.
(a) The Company's Annual Report on Form 10-K for the year ended
December 31, 1998.
(b) The Company's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1999.
(c) The description of the Company's common stock, no par value,
contained in the Company's Registration Statement on Form 8-A, as
filed with the Commission (File No. 1-7627).
ITEM 4. DESCRIPTION OF SECURITIES.
The information required by Item 4 is not applicable to this
Registration Statement since the class of securities to be offered is registered
under Section 12 of the Exchange Act.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
The information required by Item 5 is not applicable to this
Registration Statement.
ITEM 6. INDEMNIFICATION OF OFFICERS AND DIRECTORS.
Sections 17-16-850 through 17-16-859 of the Wyoming Business
Corporation Act provide that a corporation may indemnify any person who was, is
or is threatened to be made a party to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative and whether formal or informal, by reason of the fact that he is
or was a director, officer, employee or agent of the corporation, or is or was
serving at the corporation's request as a director, officer, partner, trustee,
employee or agent of another foreign or domestic corporation, partnership, joint
venture, trust, employee benefit plan or other entity, against judgments,
settlements, penalties, fines, including an excise tax assessed with respect to
an employee benefit plan, and reasonable expenses, including counsel fees,
incurred in respect to such action, suit or proceeding if he conducted himself
in good faith and reasonably believed that his conduct was in or at least not
opposed to the corporation's best interests and, with respect to any criminal
action, suit or proceeding, he had no reasonable cause to believe his conduct
was unlawful.
Article Eight of the Company's Articles of Incorporation, as amended,
provides for the indemnification of the Company's directors, officers, employees
and agents. Specifically, said Article Eight provides in part that:
The corporation shall indemnify, in the manner and to the full extent
authorized by law (as now in effect or later amended), any person who was,
is or may be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or
investigative, including an action by or in the right of the corporation,
by reason of the fact that he is or was a director, officer, employee
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<PAGE>
or agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, against
expenses, including attorneys' fees, actually and reasonably incurred by
him in connection with the action, suit, proceeding or investigation, and
judgments, fines and amounts paid in settlement if he acted in good faith
and in a manner he reasonably believed to be in, or not opposed to, the
best interests of the corporation and, with respect to any criminal action
or proceeding, had no reasonable cause to believe his conduct was unlawful.
The termination of any action, suit, proceeding or investigation by
judgment, order, settlement, conviction or upon a plea of nolo contendere
or its equivalent, shall not, of itself, create a presumption that such
person did not act in good faith and in a manner which is reasonably
believed to be in or not opposed to the best interests of the corporation
and, with respect to any criminal action or proceeding, had reasonable
cause to believe that his conduct was unlawful.
The Company's Bylaws also contain indemnification provisions which
substantially conform to Article Eight of its Articles of Incorporation, as
amended.
The Company maintains Directors and Officers' Liability Insurance and
have entered into indemnification agreements with its directors and certain of
our officers.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
The information required by Item 7 is not applicable to this
Registration Statement because the class of securities to be offered is
registered under Section 12 of the Exchange Act.
ITEM 8. EXHIBITS.
Exhibit
Number Description
- -------
5.1 Opinion of Andrews & Kurth L.L.P.
23.1 Consent of Andrews & Kurth L.L.P. (included in Exhibit 5.1)
23.2 Consent of Arthur Andersen LLP
24.1 Power of Attorney (included in signature page of this
Registration Statement)
99.1 Frontier Oil Corporation 1999 Stock Plan
ITEM 9. UNDERTAKINGS
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most
recent post-effective amendment thereof) which, individually or
in the aggregate, represent a fundamental change in the
information set forth in this Registration Statement;
- 3 -
<PAGE>
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the Registration
Statement or any material change to such information in this
Registration Statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) above do
not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic
reports filed by the Company pursuant to Section 13 or Section 15(d)
of the Securities Exchange Act of 1934 that are incorporated by
reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to
be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Company's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 that is incorporated by reference in this Registration
Statement shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Company pursuant to the foregoing provisions, or otherwise, the
Company has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Company of expenses
incurred or paid by a director, officer or controlling person of the Company in
the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Company will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
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<PAGE>
SIGNATURES
The Registrant. Pursuant to the requirements of the Securities Act of 1933,
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Houston, State of Texas, on the 28th day of July,
1999.
FRONTIER OIL CORPORATION
By: /s/ Julie H. Edwards
---------------------
Julie H. Edwards
Senior Vice President
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each of the undersigned officers and
directors of Frontier Oil Corporation (the "Company"), hereby constitutes and
appoints James R. Gibbs and Julie H. Edwards, or either of them (with full power
to each of them to act alone), his true and lawful attorney-in-fact and agent,
with full power of substitution, for him and on his behalf and in his name,
place and stead, in any and all capacities, to sign, execute and file this
Registration Statement under the Securities Act of 1933, as amended, and any or
all amendments (including, without limitation, post-effective amendments), with
all exhibits and any and all documents required to be filed with respect
thereto, with the Securities and Exchange Commission or any regulatory
authority, granting unto such attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite and necessary to be done in and about the premises in order to
effectuate the same, as fully to all intents and purposes as he himself might or
could do, if personally present, hereby ratifying and confirming all that said
attorneys-in-fact and agents, or any of them, or their substitute or
substitutes, may lawfully do or cause to be done.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities indicated on the 28th day of July, 1999.
SIGNATURE TITLE DATE
/s/ James R. Gibbs Chairman of the Board, President, July 28, 1999
- ------------------ Chief Executive Officer and Director
James R. Gibbs (Principal Executive Officer)
/s/ Julie H. Edwards Senior Vice President July 28, 1999
- -------------------- Chief Financial Officer
Julie H. Edwards (Principal Financial Officer)
/s/ Jon D. Galvin Vice President July 28, 1999
- ----------------- (Principal Accounting Officer)
Jon D. Galvin
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<PAGE>
Director July __, 1999
- ------------------
Douglas Y. Bech
/s/ G. Clyde Buck Director July 28, 1999
- ------------------
G. Clyde Buck
Director July __, 1999
- ------------------
Paul B. Loyd, Jr.
/s/ Derek A. Price Director July 28, 1999
- ------------------
Derek A. Price
/s/ Carl W. Schafer Director July 28, 1999
- -------------------
Carl W. Schafer
- 6 -
EXHIBIT 5.1
July 29, 1999
Board of Directors
Frontier Oil Corporation
10000 Memorial Drive, Suite 600
Houston, Texas 77024
Ladies and Gentlemen:
We have acted as counsel to Frontier Oil Corporation (the "Company") in
connection with the Company's Registration Statement on Form S-8 (the
"Registration Statement") relating to the registration under the Securities Act
of 1933, as amended, of the issuance of up to 2,000,000 shares (the "Shares") of
the Company's common stock, no par value, pursuant to the Frontier Oil
Corporation 1999 Stock Plan (the "Plan").
In connection herewith, we have examined copies of such statutes,
regulations, corporate records and documents, certificates of public and
corporate officials and other agreements, contracts, documents and instruments
as we have deemed necessary as a basis for the opinion hereafter expressed. In
such examination, we have assumed the genuineness of all signatures, the
authenticity of all documents submitted to us as originals and the conformity
with the original documents of all documents submitted to us as copies. We have
also relied, to the extent we deem such reliance proper, upon information
supplied by officers and employees of the Company with respect to various
factual matters material to our opinion.
Based upon the foregoing and having due regard for such legal
considerations as we deem relevant, we are of the opinion that the Shares have
been duly authorized and reserved for issuance and, when issued in accordance
with the terms of the Plan, will be validly issued, fully-paid and
nonassessable.
We hereby consent to the use of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
Andrews & Kurth LLP
EXHIBIT 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this Registration Statement of our reports dated February 5, 1999
included and incorporated by reference in Frontier Oil Corporation's Form 10-K
for the year ended December 31, 1998 and to all references to our Firm included
in this Registration Statement.
ARTHUR ANDERSEN LLP
Houston, Texas
July 29 , 1999
EXHIBIT 99.1
FRONTIER OIL CORPORATION
1999 STOCK PLAN
(FIRST AMENDMENT)
SECTION 1. Purpose of the Plan.
The Frontier Oil Corporation 1999 Stock Plan (the "Plan") is intended to
promote the interests of Frontier Oil Corporation, a Wyoming corporation (the
"Company"), by encouraging officers, employees, directors and consultants of the
Company and its Affiliates to acquire or increase their equity interest in the
Company and to provide a means whereby they may develop a sense of
proprietorship and personal involvement in the development and financial success
of the Company, and to encourage them to remain with and devote their best
efforts to the business of the Company thereby advancing the interests of the
Company and its stockholders. The Plan is also contemplated to enhance the
ability of the Company and its Affiliates to attract and retain the services of
individuals who are essential for the growth and profitability of the Company.
SECTION 2. Definitions.
As used in the Plan, the following terms shall have the meanings set forth
below:
"Affiliate" shall mean (i) any entity that, directly or through one or more
intermediaries, is controlled by the Company, (ii) any entity in which the
Company has a significant equity interest, as determined by the Committee, and
(iii) any "parent corporation" of the Company (as defined in Section 424(e) of
the Code) and any "subsidiary corporation" of any such parent (as defined in
Section 424(f) of the Code) thereof.
"Award" shall mean any Option, Performance Award, Bonus Shares, Other
Stock-Based Award or Cash Award.
"Award Agreement" shall mean any written agreement, contract, or other
instrument or document evidencing any Award, which may, but need not, be
executed or acknowledged by a Participant.
"Board" shall mean the Board of Directors of the Company.
"Bonus Shares" shall mean an award of Shares granted pursuant to Section 6(c)
of the Plan.
"Cash Award" shall mean an award payable in cash granted pursuant to Section
6(d) of the Plan.
"Change in Control" shall mean a change in control of a nature that would be
required to be disclosed in a proxy statement, governed by the rules of the
Securities and Exchange Commission as in effect on the date of this Agreement;
provided that without limitation, such a change in control shall be deemed to
have occurred upon the occurrence of any one of the following:
(a) the consummation of any transaction (including without limitation, any
merger, consolidation, tender offer, or exchange offer) the result of
which is that any individual or "person" (as such term is used in
Sections 13(d)(3) and 14(d)(2), of the Securities Exchange Act of 1934
- the "Exchange Act") is or becomes the "beneficial owner" (as such
term is defined in Rule 13d-3 and Rule 13d-5 under the Exchange Act),
directly or indirectly, of securities of the Company representing 25%
or more of the combined voting power of the Company's then outstanding
securities,
(b) the first day during any period of 24 consecutive months, commencing
before or after the date of this Agreement that the individuals, who at
the beginning of such 24 month period were directors of the Company for
whom the Executive shall have voted, cease for any reason to constitute
at least a majority of the Board of Directors of the Company,
(c) the sale, lease, transfer, conveyance or other disposition (including
by merger or consolidation) in one or a series of related transactions,
of all or substantially all of the assets of the Company and its
Subsidiaries, taken as a whole,
(d) the adoption of a plan relating to the liquidation or dissolution of
the Company, or
(e) the date the Company files a report or proxy statement with the SEC
stating that a change in control has or may occur pursuant to any then
existing contract or termination.
"Code" shall mean the Internal Revenue Code of 1986, as amended from time to
time, and the rules and regulations thereunder.
"Committee" shall mean the Compensation Committee of the Board.
"Consultant" shall mean any individual, other than a Director or an Employee,
who renders consulting services to the Company or an Affiliate for a fee.
"Director" shall mean a "non-employee director" of the Company, as defined in
Rule 16b-3.
"Employee" shall mean any employee of the Company or an Affiliate or any person
who has been extended an offer of employment by the Company or an Affiliate.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended.
"Fair Market Value" shall mean, with respect to Shares, the closing sales price
of a Share on the applicable date (or if there is no trading in the Shares on
such date, on the next preceding date on which there was trading) as reported in
The Wall Street Journal (or other reporting service approved by the Committee).
In the event the Shares are not publicly traded at the time a determination of
its fair market value is required to be made hereunder, the determination of
fair market value shall be made in good faith by the Committee.
"Option" shall mean an option granted under Section 6(a) of the Plan. Options
granted under the Plan shall constitute "incentive stock options" for purposes
of Section 422 of the Code or nonqualified stock option.
"Other Stock-Based Award" shall mean an award granted pursuant to Section 6(e)
of the Plan that is not otherwise specifically provided for, the value of which
is based in whole or in part upon the value of a Share.
"Participant" shall mean any Director, Employee or Consultant granted an Award
under the Plan.
"Performance Award" shall mean any right granted under Section 6(b) of the
Plan.
"Person" shall mean individual, corporation, partnership, association,
joint-stock company, trust, unincorporated organization, government or political
subdivision thereof or other entity.
"Rule 16b-3" shall mean Rule 16b-3 promulgated by the SEC under the Exchange
Act, or any successor rule or regulation thereto as in effect from time to time.
"SEC" shall mean the Securities and Exchange Commission, or any successor
thereto.
"Shares" or "Common Shares" or "Common Stock" shall mean the common stock of
the Company, no par value, and such other securities or property as may become
the subject of Awards under the Plan.
SECTION 3. Administration.
The Plan shall be administered by the Committee. A majority of the Committee
shall constitute a quorum, and the acts of the members of the Committee who are
present at any meeting thereof at which a quorum is present, or acts unanimously
approved by the members of the Committee in writing, shall be the acts of the
Committee. Subject to the following, the Committee, in its sole discretion,
may delegate any or all of its powers and duties under the Plan, including the
power to grant Awards under the Plan, to the Chief Executive Officer of the
Company, subject to such limitations on such delegated powers and duties as the
Committee may impose. Upon any such delegation all references in the Plan to
the "Committee", other than in Section 7, shall be deemed to include the Chief
Executive Officer; provided, however, that such delegation shall not limit the
Chief Executive Officer's right to receive Awards under the Plan.
Notwithstanding the foregoing, the Chief Executive Officer may not grant Awards
to, or take any action with respect to any Award previously granted to, a person
who is an officer or a member of the Board. Subject to the terms of the Plan and
applicable law, and in addition to other express powers and authorizations
conferred on the Committee by the Plan, the Committee shall have full power and
authority to: (i) designate Participants; (ii) determine the type or types of
Awards to be granted to a Participant; (iii) determine the number of Shares to
be covered by, or with respect to which payments, rights, or other matters are
to be calculated in connection with, Awards; (iv) determine the terms and
conditions of any Award; (v) determine whether, to what extent, and under what
circumstances Awards may be settled or exercised in cash, Shares, other
securities, other Awards or other property, or canceled, forfeited, or suspended
and the method or methods by which Awards may be settled, exercised, canceled,
forfeited, or suspended; (vi) determine whether, to what extent, and under what
circumstances cash, Shares, other securities, other Awards, other property, and
other amounts payable with respect to an Award shall be deferred either
automatically or at the election of the holder thereof or of the Committee;
(vii) interpret and administer the Plan and any instrument or agreement relating
to an Award made under the Plan; (viii) establish, amend, suspend, or waive such
rules and regulations and appoint such agents as it shall deem appropriate for
the proper administration of the Plan; and (ix) make any other determination and
take any other action that the Committee deems necessary or desirable for the
administration of the Plan. Unless otherwise expressly provided in the Plan,
all designations, determinations, interpretations, and other decisions under or
with respect to the Plan or any Award shall be within the sole discretion of the
Committee, may be made at any time and shall be final, conclusive, and binding
upon all Persons, including the Company, any Affiliate, any Participant, any
holder or beneficiary of any Award, any stockholder and any Employee.
SECTION 4. Shares Available for Awards.
(a) Shares Available. Subject to adjustment as provided in Section 4(c), the
number of Shares with respect to which Awards may be granted under the Plan
shall be 2.0 million. If any Award is exercised, paid, forfeited, terminated or
canceled without the delivery of Shares or other consideration, then the Shares
covered by such Award, to the extent of such payment, exercise, forfeiture,
termination or cancellation, shall again be Shares with respect to which Awards
may be granted.
(b) Sources of Shares Deliverable Under Awards. Any Shares delivered pursuant
to an Award may consist, in whole or in part, of authorized and unissued Shares
or of treasury Shares.
(c) Adjustments. In the event that the Committee determines that any dividend
or other distribution (whether in the form of cash, Shares, other securities, or
other property), recapitalization, stock split, reverse stock split,
reorganization, merger, consolidation, split-up, spin- off, combination,
repurchase, or exchange of Shares or other securities of the Company, issuance
of warrants or other rights to purchase Shares or other securities of the
Company, or other similar corporate transaction or event affects the Shares such
that an adjustment is determined by the Committee to be appropriate in order to
prevent dilution or enlargement of the benefits or potential benefits intended
to be made available under the Plan, then the Committee shall, in such manner as
it may deem equitable, adjust any or all of (i) the number and type of Shares
(or other securities or property) with respect to which Awards may be granted,
(ii) the number and type of Shares (or other securities or property) subject to
outstanding Awards, and (iii) the grant or exercise price with respect to any
Award or, if deemed appropriate, make provision for a cash payment to the holder
of an outstanding Award.
SECTION 5. Eligibility.
Any Employee, Director or Consultant shall be eligible to be designated a
Participant.
SECTION 6. Awards.
(a) Options. Subject to the provisions of the Plan, the Committee shall have
the authority to determine the Participants to whom Options shall be granted,
the number of Shares to be covered by each Option, the purchase price therefor
and the conditions and limitations applicable to the exercise of the Option,
including the following terms and conditions and such additional terms and
conditions, as the Committee shall determine, that are not inconsistent with the
provisions of the Plan.
(i) Exercise Price. The purchase price per Share purchasable under an
Option shall be determined by the Committee at the time the Option is
granted, but shall not be less than the Fair Market Value per Share on
such grant date.
(ii) Time and Method of Exercise. The Committee shall determine the time
or times at which an Option may be exercised in whole or in part, and
the method or methods by which, and the form or forms (which may
include, without limitation, cash, check acceptable to the Company,
Shares already-owned for more than six months, outstanding Awards,
Shares that would otherwise be acquired upon exercise of the Option, a
"cashless- broker" exercise (through procedures approved by the
Company), other securities or other property, loans, notes approved by
the Committee, or any combination thereof, having a Fair Market Value
on the exercise date equal to the relevant exercise price) in which
payment of the exercise price with respect thereto may be made or
deemed to have been made.
(iii) Incentive Stock Options. The terms of any Option granted under the
Plan intended to be an incentive stock option shall comply in all
respects with the provisions of Section 422 of the Code, or any
successor provision, and any regulations promulgated thereunder.
Incentive stock options may be granted only to employees of the
Company and its parent corporation and subsidiary corporations, within
the meaning of Section 424 of the Code. To the extent the aggregate
Fair Market Value of the Shares (determined as of the date of grant)
of an Option to the extent exercisable for the first time during any
calendar year (under all plans of the Company and its parent and
subsidiary corporations) exceeds $100,000, such Option Shares in
excess of $100,000 shall not be incentive stock options.
(iv) No Repricings. The Committee may not amend an Option to lower its
exercise price nor cancel an Option and grant a replacement Option
with a lower exercise price.
(b) Performance Awards. The Committee shall have the authority to determine
the Participants who shall receive a Performance Award, which shall be
denominated as a cash amount at the time of grant and confer on the Participant
the right to receive payment of such Award, in whole or in part, upon the
achievement of such performance goals during such performance periods as the
Committee shall establish with respect to the Award.
(i) Terms and Conditions. Subject to the terms of the Plan and any
applicable Award Agreement, the Committee shall determine the
performance goals to be achieved during any performance period, the
length of any performance period, the amount of any Performance Award
and the amount of any payment or transfer to be made pursuant to any
Performance Award.
(ii) Payment of Performance Awards. Performance Awards may be paid (in
cash and/or in Shares, in the sole discretion of the Committee) in a
lump sum or in installments following the close of the performance
period, in accordance with procedures established by the Committee
with respect to such Award.
(c) Bonus Shares. The Committee shall have the authority, in its discretion,
to grant Bonus Shares to Participants. Each Bonus Share shall constitute a
transfer of an unrestricted Share to the Participant, without other payment
therefor, as additional compensation for the Participant's services to the
Company.
(d) Cash Awards. The Committee shall have the authority to determine the
Participants to whom Cash Awards shall be granted, the amount, and the terms or
conditions, if any, as additional compensation for the Participant's services to
the Company or its Affiliates. A Cash Award may be granted (simultaneously or
subsequently) separately or in tandem with another Award and may entitle a
Participant to receive a specified amount of cash from the Company upon such
other Award becoming taxable to the Participant, which cash amount may be based
on a formula relating to the anticipated taxable income associated with such
other Award and the payment of the Cash Award.
(e) Other Stock-Based Awards. The Committee may also grant to Participants an
Other Stock-Based Award, which shall consist of a right which is an Award
denominated or payable in, valued in whole or in part by reference to, or
otherwise based on or related to, Shares as is deemed by the Committee to be
consistent with the purposes of the Plan. Subject to the terms of the Plan, the
Committee shall determine the terms and conditions of any such Other Stock-Based
Award.
(f) General.
(i) Awards May Be Granted Separately or Together. Awards may, in the
discretion of the Committee, be granted either alone or in addition to, in
tandem with, or in substitution for any other Award granted under the Plan
or any award granted under any other plan of the Company or any Affiliate.
Awards granted in addition to or in tandem with other Awards or awards
granted under any other plan of the Company or any Affiliate may be granted
either at the same time as or at a different time from the grant of such
other Awards or awards.
(ii) Forms of Payment by Company Under Awards. Subject to the terms of
the Plan and of any applicable Award Agreement, payments or transfers to be
made by the Company or an Affiliate upon the grant, exercise or payment of
an Award may be made in such form or forms as the Committee shall
determine, including, without limitation, cash, Shares, other securities,
other Awards or other property, or any combination thereof, and may be made
in a single payment or transfer, in installments, or on a deferred basis,
in each case in accordance with rules and procedures established by the
Committee. Such rules and procedures may include, without limitation,
provisions for the payment or crediting of reasonable interest on
installment or deferred payments.
(iii) Limits on Transfer of Awards.
(A) Except as provided in (C) below, each Award, and each right under
any Award, shall be exercisable only by the Participant during the
Participant's lifetime, or by the person to whom the Participant's
rights shall pass by will or the laws of descent and distribution.
(B) Except as provided in (C) below, no Award and no right under any
such Award may be assigned, alienated, pledged, attached, sold or
otherwise transferred or encumbered by a Participant otherwise than by
will or by the laws of descent and distribution and any such purported
assignment, alienation, pledge, attachment, sale, transfer or
encumbrance shall be void and unenforceable against the Company or any
Affiliate.
(C) Notwithstanding anything in the Plan to the contrary, to the
extent specifically provided by the Committee with respect to a grant,
an Option (other than an incentive stock option) may be transferred to
immediate family members or related family trusts, limited
partnerships or similar entities on such terms and conditions as the
Committee may establish.
(iv) Term of Awards. The term of each Award shall be for such period as
may be determined by the Committee; provided, that in no event shall the
term of any Award exceed a period of 10 years from the date of its grant.
(v) Share Certificates. All certificates for Shares or other securities
of the Company or any Affiliate delivered under the Plan pursuant to any
Award or the exercise thereof shall be subject to such stop transfer orders
and other restrictions as the Committee may deem advisable under the Plan
or the rules, regulations, and other requirements of the SEC, any stock
exchange upon which such Shares or other securities are then listed, and
any applicable federal or state laws, and the Committee may cause a legend
or legends to be put on any such certificates to make appropriate reference
to such restrictions.
(vi) Consideration for Grants. Awards may be granted for no cash
consideration or for such consideration as the Committee determines
including, without limitation, such minimal cash consideration as may be
required by applicable law.
(vii) Delivery of Shares or other Securities and Payment by Participant
of Consideration. No Shares or other securities shall be delivered
pursuant to any Award until payment in full of any amount required to be
paid pursuant to the Plan or the applicable Award Agreement (including,
without limitation, any exercise price, tax payment or tax withholding) is
received by the Company. Such payment may be made by such method or
methods and in such form or forms as the Committee shall determine,
including, without limitation, cash, Shares, other securities, other Awards
or other property, withholding of Shares, cashless exercise with
simultaneous sale, or any combination thereof; provided that the combined
value, as determined by the Committee, of all cash and cash equivalents and
the Fair Market Value of any such Shares or other property so tendered to
the Company, as of the date of such tender, is at least equal to the full
amount required to be paid pursuant to the Plan or the applicable Award
Agreement to the Company.
SECTION 7. Amendment and Termination.
Except to the extent prohibited by applicable law and unless otherwise
expressly provided in an Award Agreement or in the Plan:
(i) Amendments to the Plan. Except as required by applicable law or the
rules of the principal securities market on which the shares are traded and
subject to Section 7(ii) below, the Board or the Committee may amend,
alter, suspend, discontinue, or terminate the Plan without the consent of
any stockholder, Participant, other holder or beneficiary of an Award, or
other Person; provided, however, no such amendment may be made without
stockholder approval, if such amendment would (i) materially increase the
benefits accruing to Participants, (ii) materially increase the number of
Shares authorized under the Plan, or (iii) materially increase the Persons
eligible for Awards under the Plan.
(ii) Amendments to Awards. The Committee may waive any conditions or
rights under, amend any terms of, or alter any Award theretofore granted,
provided no change, other than pursuant to Section 7(iii), in any Award
shall reduce the benefit to Participant without the consent of such
Participant.
(iii) Adjustment of Awards Upon the Occurrence of Certain Unusual or
Nonrecurring Events. The Committee is hereby authorized to make
adjustments in the terms and conditions of, and the criteria included in,
Awards in recognition of unusual or nonrecurring events (including, without
limitation, the events described in Section 4(c) of the Plan) affecting the
Company, any Affiliate, or the financial statements of the Company or any
Affiliate, or of changes in applicable laws, regulations, or accounting
principles, whenever the Committee determines that such adjustments are
appropriate in order to prevent dilution or enlargement of the benefits or
potential benefits intended to be made available under the Plan.
SECTION 8. Change in Control.
Notwithstanding any other provision of this Plan to the contrary, in the event
of a Change in Control of the Company all outstanding Awards automatically shall
become fully vested immediately prior to such Change in Control (or such earlier
time as set by the Committee), all restrictions, if any, with respect to such
Awards shall lapse, all performance criteria, if any, with respect to such
Awards shall be deemed to have been met in full (at the highest level), and
unless the Company survives as an independent publicly traded company, all
Options outstanding at the time of the event or transaction shall terminate,
except to the extent provision is made in writing in connection with such event
or transaction for the continuation of the Plan and/or the assumption of the
Options theretofore granted, or for the substitution for such Options of new
options covering the stock of a successor entity, or the parent or subsidiary
thereof, with appropriate adjustments as to the number and kinds of shares and
exercise prices, in which event the Plan and Options theretofore granted shall
continue in the manner and under the terms so provided.
SECTION 9. General Provisions.
(a) No Rights to Awards. No Director, Employee, Consultant or other Person
shall have any claim to be granted any Award, and there is no obligation for
uniformity of treatment of Employees, Consultants, or holders or beneficiaries
of Awards. The terms and conditions of Awards need not be the same with respect
to each recipient.
(b) Withholding. The Company or any Affiliate is authorized to withhold
from any Award, from any payment due or transfer made under any Award or under
the Plan or from any compensation or other amount owing to a Participant the
amount (in cash, Shares, other securities, Shares that would otherwise be issued
pursuant to such Award, other Awards or other property) of any applicable taxes
required to be withheld by the Company in respect of an Award, its exercise, the
lapse of restrictions thereon, or any payment or transfer under an Award or
under the Plan and to take such other action as may be necessary in the opinion
of the Company to satisfy all obligations for the payment of such taxes. In
addition, the Committee may provide, in an Award Agreement, that the Participant
may direct the Company to satisfy such Participant's tax obligation through the
"constructive" tender of already-owned Shares or the withholding of Shares
otherwise to be acquired upon the exercise or payment of such Award.
(c) No Right to Employment. The grant of an Award shall not be construed as
giving a Participant the right to be retained in the employ of the Company or
any Affiliate. Further, the Company or an Affiliate may at any time dismiss a
Participant from employment, free from any liability or any claim under the
Plan, unless otherwise expressly provided in the Plan or in any Award Agreement.
(d) Governing Law. The validity, construction, and effect of the Plan and
any rules and regulations relating to the Plan shall be determined in accordance
with the laws of the State of Wyoming and applicable federal law.
(e) Severability. If any provision of the Plan or any Award is or becomes
or is deemed to be invalid, illegal, or unenforceable in any jurisdiction or as
to any Person or Award, or would disqualify the Plan or any Award under any law
deemed applicable by the Committee, such provision shall be construed or deemed
amended to conform to the applicable laws, or if it cannot be construed or
deemed amended without, in the determination of the Committee, materially
altering the intent of the Plan or the Award, such provision shall be stricken
as to such jurisdiction, Person or Award and the remainder of the Plan and any
such Award shall remain in full force and effect.
(f) Other Laws. The Committee may refuse to issue or transfer any Shares or
other consideration under an Award if, acting in its sole discretion, it
determines that the issuance of transfer or such Shares or such other
consideration might violate any applicable law or regulation or entitle the
Company to recover the same under Section 16(b) of the Exchange Act, and any
payment tendered to the Company by a Participant, other holder or beneficiary in
connection with the exercise of such Award shall be promptly refunded to the
relevant Participant, holder or beneficiary.
(g) No Trust or Fund Created. Neither the Plan nor the Award shall create
or be construed to create a trust or separate fund of any kind or a fiduciary
relationship between the Company or any Affiliate and a Participant or any other
Person. To the extent that any Person acquires a right to receive payments from
the Company or any Affiliate pursuant to an Award, such right shall be no
greater than the right of any general unsecured creditor of the Company or any
Affiliate.
(h) No Fractional Shares. No fractional Shares shall be issued or delivered
pursuant to the Plan or any Award, and the Committee shall determine whether
cash, other securities, or other property shall be paid or transferred in lieu
of any fractional Shares or whether such fractional Shares or any rights thereto
shall be canceled, terminated, or otherwise eliminated.
(i) Headings. Headings are given to the Sections and subsections of the
Plan solely as a convenience to facilitate reference. Such headings shall not
be deemed in any way material or relevant to the construction or interpretation
of the Plan or any provision thereof.
(j) Parachute Tax Gross-Up. If it shall be finally determined that the
grant, payment or acceleration of vesting or payment, whether in cash or stock,
of any Award made to a Participant under the Plan is subject to the excise tax
imposed by Section 4999 of the Code, the Company shall pay such person an amount
of cash (the "Additional Amount") such that the net amount received by such
person after paying all applicable taxes (and any interest and penalties imposed
with respect thereto) on such Additional Amount shall be equal to the amount
that such person would have received if Section 4999 were not applicable.
SECTION 10. Effective Date of the Plan and First Amendment.
The Plan was approved by the stockholders at the Company's annual
stockholders' meeting on April 29, 1999. Immediately after such stockholder
approval, the Plan was amended on the same date by this First Amendment,
effective for all purposes as of April 29, 1999.
SECTION 11. Term of the Plan.
No Award shall be granted under the Plan after the 10th anniversary of the
date the Plan is adopted by the Board. However, unless otherwise expressly
provided in the Plan or in an applicable Award Agreement, any Award granted
prior to such termination, and the authority of the Board or the Committee to
amend, alter, adjust, suspend, discontinue, or terminate any such Award or to
waive any conditions or rights under such Award, shall extend beyond such
termination date.
