<PAGE> 1
As Filed with the Securities and Exchange Commission on August 21, 1997
File No. 333-______
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER THE
SECURITIES ACT OF 1933
(Including a Form S-8 Prospectus)
-------------------------
SABA PETROLEUM COMPANY
(Exact Name of Registrant as Specified in its Charter)
Delaware 47-0617589
(State or Other Jurisdiction of (IRS Employer ID No.)
Incorporation or Organization)
3201 AIRPARK DRIVE, SUITE 201
SANTA MARIA, CALIFORNIA 93455
(Address of Principal Executive Offices)
----------------------
Saba Petroleum Company 1996 Incentive Equity Plan
Saba Petroleum Company 1997 Stock Option Plan for Non-Employee Directors
(Full Title of the Plans)
----------------------
WALTON C. VANCE, CHIEF FINANCIAL OFFICER
SABA PETROLEUM COMPANY
3201 AIRPARK DRIVE, SUITE 201
SANTA MARIA, CALIFORNIA 93455
(Name and Address of Agent for Service)
(805) 347-8700
(Telephone Number, Including Area Code,of Agent for Service)
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------
Proposed Proposed
Title of Securities Amount Maximum Maximum Amount of
to be to be Offering Price Aggregate Registration
Registered Registered Per Share Offering Price Fee
-------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock 1,250,000 $15.3125(1) $19,140,625 $5,800.19
TOTAL 1,250,000 NA $19,140,625 $5,800.19
-------------------------------------------------------------------------------------------------
</TABLE>
(1) Calculated pursuant to Rule 457(h) under the Securities Act of 1933, as
amended.
================================================================================
<PAGE> 2
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents previously filed with the Securities and
Exchange Commission are incorporated herein by reference:
(a) The Company's Annual Report on Form 10-KSB for the fiscal year
ended December 31, 1996;
(b) The Company's Quarterly Reports on Form 10-QSB for the fiscal
quarters ended March 31, 1997 and June 30, 1997; and
(c) 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, as amended,
prior to the filing of a post-effective amendment which indicates that all
securities offered have been sold or which deregisters all securities then
remaining unsold, shall be deemed to be incorporated herein by reference and to
be part hereof from the date of filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES.
There are 150,000,000 authorized shares of Common Stock, $.001 par
value. The holders of Common Stock are entitled to one vote per share on all
matters submitted to a vote of the stockholders of the Company. In addition,
such holders are entitled to receive ratably such dividends, if any, as may be
declared from time to time by the Board of Directors out of funds legally
available therefor, subject to the payment of preferential dividends with
respect to any Preferred Stock that from time to time may be outstanding. In the
event of the dissolution, liquidation or winding-up of the Company, the holders
of Common Stock are entitled to share ratably in all assets remaining after
payment of all liabilities of the Company and subject to the prior distribution
rights of the holders of any Preferred Stock that may be outstanding at that
time. All outstanding shares of Common Stock are fully paid and nonassessable.
The Company's Amended and Restated Certificate of Incorporation and Bylaws do
not provide for preemptive rights or cumulative voting rights for stockholders.
Additionally, there are no provisions in the aforementioned documents that would
delay, defer or prevent a change in control of the Company.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Counsel rendering an opinion in this matter has previously acted in the
capacity of Assistant Secretary for the Company and is the beneficial owner of
1,700 shares of the Company's Common Stock.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the Delaware Corporation Laws generally provides that a
corporation may indemnify its directors, officers, employees, fiduciaries and
agents against liabilities and reasonable expenses incurred in connection with
any threatened, pending, or completed action, suit or proceeding whether civil,
criminal, administrative or investigative and whether formal or informal (a
"Proceeding"), by reason of being or having been a director, officer, employee,
fiduciary or agent of the corporation, if such person acted in good faith and
reasonably believed that his conduct, in his official capacity, was in the best
interests of the corporation, and in all other cases his conduct was at least
not opposed to the corporation's best interests. In the case of a criminal
proceeding, the director, officer, employee,
<PAGE> 3
fiduciary or agent must have no reasonable cause to believe his conduct was
unlawful. Under Delaware law, the corporation may not indemnify a director,
officer, employee, fiduciary or agent in connection with a Proceeding by or in
the right of the corporation if the director is adjudged liable to the
corporation, or in a Proceeding in which the director, officer, employee or
agent is adjudged liable for an improper personal benefit.
The Company's Articles of Incorporation and By-Laws provide that the
Company shall indemnify its officers and directors to the full extent permitted
by the law. The indemnification provisions in the Company's By-Laws are
substantially similar to the provisions of Section 145. The Company has entered
into agreements to provide indemnification for the Company's directors and
certain officers consistent with the Company's Articles of Incorporation and
By-Laws.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
4.1 Articles of Incorporation of the Company, as amended.
4.2 By-Laws of the Company.
4.3 Form of Indenture (filed as Exhibit 4.1 to the Company's
Registration Statement on Form SB-2 (File No. 33-94678) dated July 17, 1995).
4.4 Saba Petroleum Company 1996 Incentive Equity Plan
4.5 Saba Petroleum Company 1997 Stock Option Plan for Non-Employee
Directors
5.1 Opinion of the Law Office of David M. Griffith, a Professional
Corporation, as to the validity of the securities registered hereunder.
23.1 Consent of the Law Office of David M. Griffith, a Professional
Corporation (set forth in the opinion filed as Exhibit 5.1 to this Registration
Statement).
23.2 Consent of Coopers & Lybrand L.L.P.
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 which, individually or in the aggregate,
represent a fundamental change in the information set forth in
the registration statement; (iii) to include any additional or
changed material information on the plan of distribution,
provided, however, that paragraphs (A)(1)(i) and (A)(1)(ii) 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 Registrant pursuant to Section 13
or 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
<PAGE> 4
(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, insofar as
indemnification for liabilities arising under the Securities Act of 1933 may be
permitted to directors, officers and controlling persons of the Registrant
pursuant to the provisions described in Item 6 of this registration statement,
or otherwise, the Registrant 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 Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant 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 Registrant 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.
<PAGE> 5
SIGNATURES
In accordance with the requirements of the Securities Act of 1933,
the Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements of filing on Form S-8 and authorized this registration
statement to be signed on its behalf by the undersigned, in the City of Santa
Maria, State of California on August 15, 1997.
SABA PETROLEUM COMPANY
By: /s/ ILYAS CHAUDHARY
----------------------------
Ilyas Chaudhary
President and Chief
Executive Officer
In accordance with the requirements of the Securities Act of 1933, this
Registration Statement was signed by the following persons in the capacities and
on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ ILYAS CHAUDHARY Chairman of the Board, August 15, 1997
- -------------------------------- President and Chief
Ilyas Chaudhary Executive Officer
(Principal Executive Officer)
/s/ WALTON C. VANCE Vice President, Chief Financial August 15, 1997
- -------------------------------- Officer and Secretary (Principal
Walton C. Vance Financial and Accounting
Officer)
/s/ ALEX S. CATHCART Director August 15, 1997
- --------------------------------
Alex S. Cathcart
/s/ WALTON C. VANCE Director August 15, 1997
- --------------------------------
Walton C. Vance
/s/ WILLIAM N. HAGLER Director August 15, 1997
- --------------------------------
William N. Hagler
/s/ RODNEY C. HILL Director August 15, 1997
- --------------------------------
Rodney C. Hill
/s/ RONALD D. ORMAND Director August 15, 1997
- --------------------------------
Ronald D. Ormand
/s/ FAYSAL SOHAIL Director August 15, 1997
- --------------------------------
Faysal Sohail
</TABLE>
<PAGE> 6
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------ -----------
<S> <C>
4.1 Amended and Restated Certificate of Incorporation of the Company
4.2 By-Laws of the Company
4.3 Form of Indenture (filed as Exhibit 4.1 to the Company's
Registration Statement on Form SB-2 (File No. 33-94678) dated
July 17, 1995).
4.4 Saba Petroleum Company 1996 Incentive Equity Plan
4.5 Saba Petroleum Company 1997 Stock Option Plan for Non-Employee
Directors
5.1 Opinion of the Law Office of David M. Griffith, a Professional
Corporation, as to the validity of the securities registered
hereunder.
23.1 Consent of the Law Office of David M. Griffith, a Professional
Corporation (set forth in the opinion filed as Exhibit 5.1 to this
Registration Statement).
23.2 Consent of Coopers & Lybrand L.L.P.
</TABLE>
<PAGE> 1
EXHIBIT 4.1
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
SABA PETROLEUM COMPANY
Pursuant to Section 245 of the General Corporation Law of Delaware, Saba
Petroleum Company, a Delaware corporation (the "Corporation"), having originally
filed a Certificate of Incorporation with the Secretary of State of the State of
Delaware on July 8, 1996, under the name "Saba Petroleum of Michigan, Inc.,"
does hereby amend and restate its Certificate of Incorporation as follows:
ARTICLE I
NAME OF CORPORATION
The name of this Corporation shall hereby be changed from Saba Petroleum of
Michigan, Inc., to "Saba Petroleum Company."
ARTICLE II
REGISTERED OFFICE
The address of the registered office of the Corporation in the State of
Delaware is 9 East Loockerman Street, in the city of Dover, County of Kent, and
the name of its registered agent at that address is National Registered Agents,
Inc.
ARTICLE III
PURPOSE
The Purpose of the corporation is to engage in any lawful act or activity for
which corporations may be organized under the General Corporation Law of
Delaware.
ARTICLE IV
AUTHORIZED CAPITAL STOCK
The total number of shares of all classes of stock which the corporation
shall have the authority to issue shall be 200,000,000 shares, consisting of
150,000,000 shares common stock, with a par value of one tenth of one cent
($.001) per share and 50,000,000 shares of preferred stock, with a par value of
one tenth of one cent ($.001) per share (the "Preferred Stock").
The Preferred Stock may be issued from time to time in one or more series.
The Board of Directors is expressly authorized to fix, by resolution or
resolutions providing for the issue of any series of Preferred Stock the number
of shares included in such series and the voting power, designations,
preferences and relative participating optional qualifications, limitations or
restrictions thereof, and except as otherwise provided in respect of any such
series (but not below the number of shares thereof then outstanding). In case
the number of shares of any such series shall be so decreased, the shares
constituting such decreases shall resume the status which they had prior to the
adoption of the resolution or resolutions originally fixing the number of shares
of such series. The number of authorized shares of Preferred Stock may be
increased or decreased (but not below the number of shares thereof then
outstanding) by the affirmative vote of the holders of a majority of the stock
of the corporation entitles to vote irrespective of Section 242 of the General
Corporation Law or any successor provision requiring that such an increase or
decrease be voted upon the holders of the Preferred Stock voting as a separate
class.
<PAGE> 2
ARTICLE V
BOARD OF DIRECTORS
1. The management of the business and the conduct if the affairs of the
Corporation shall be vested in its Board of Directors. The number of directors
that shall constitute the whole Board of Directors shall be fixed by, or in the
manner provided in, the Bylaws. The phrase "whole Board" and the phrase "total
number of directors" shall be deemed to have the same meaning - to wit, the
total number of directors that the Corporation would have if there were no
vacancies. No election of directors need be by written ballot.
2. Whenever the Corporation shall be authorized to issue only one class of
stock, each outstanding share shall entitle the holder thereof to notice of, and
the right to vote at, any meeting of stockholders. Whenever the Corporation
shall be authorized to issue more than one class of stock, no outstanding share
of any class of stock that is denied voting power under the provisions of the
Certificate of Incorporation shall entitle the holder thereof to the right to
vote at any meeting of stockholders except as the provision of paragraph (c)(2)
of Section 242 of the General Corporation Law of the State of Delaware shall
otherwise require; provided, that no share of any such class that is otherwise
denied voting power shall entitle the holder thereof to vote upon the increase
or decrease in the number of authorized shares of said class.
3. To the fullest extent permitted by the Delaware General Corporation law,
as the same exists or may hereafter be amended (provided that the effect of any
such amendment shall be prospective only) (the "Delaware Law"), a director of
the corporation shall not be liable to the corporation or its stockholders for
monetary damages for breach of his or her fiduciary duty as a director. The
corporation shall indemnify, in the manner and to the fullest extent permitted
by the Delaware Law (but in the case of any such amendment, only to the extent
that such amendment permits the corporation to provide broader indemnification
rights than permitted prior thereto), any person (or the estate of any person)
who is or was a party to, or is threatened to be made a party to, any
threatened, pending or completed action, suit or proceeding, whether or not by
or in the right of the corporation, and whether civil, criminal, administrative,
investigative or otherwise, by reason of the fact that such person is or was a
director or officer of the corporation, or is or was serving at the request of
the corporation as a director or officer of another corporation, partnership,
joint venture, trust or other enterprise. The corporation may, to the fullest
extent permitted by the Delaware Law, purchase and maintain insurance on behalf
of any such person against any liability which may be asserted against such
person. The corporation may create a trust fund, grant a security interest or
use other means (including without limitation a letter of credit) to ensure the
payment of such sums as may become necessary to effect the indemnification
provided herein shall include expenses (including attorneys' fees), judgements,
fines and amounts paid in settlement and any such expenses shall be paid by the
corporation in advance of the final disposition of such action, suit or
proceeding upon receipt of an undertaking by or on behalf of the person seeking
indemnification to repay such amounts if it is ultimately determined that he or
she is not entitled to be indemnified. The indemnification provided herein shall
not be deemed to limit the right of the corporation to indemnify any other
person for any such expenses to the fullest extent permitted by the Delaware
Law, not shall it be deemed exclusive of any other rights to which any person
seeking indemnification from the corporation may be entitled under any
agreement, the corporation's Bylaws, vote of stockholders or disinterested
directors, or otherwise, both as to action in such person's official capacity
and as to action in another capacity while holding such office. The corporation
may, but only to the extent that the Board of Directors may (but shall not be
obligated to) authorize from time to time, grant rights to indemnification and
to the advancement of expenses to any employee or agent of the corporation to
the fullest extent of the provisions of this Article as they apply to the
indemnification and advancement of expenses of directors and officers of the
corporation. No repeal or modification of this Article V by the stockholders
shall adversely affect any right or protection of a director of the corporation
existing by virtue of this Article V at the time of such repeal or modification.
<PAGE> 3
ARTICLE VI
CORPORATE POWER
The corporation reserves the right to amend, alter, change or repeal any
provision contained in this Certificate of Incorporation, in the manner now or
hereafter prescribed by statute, and all rights conferred on stockholders herein
are granted subject to this reservation.
ARTICLE VII
CREDITOR COMPROMISE OR ARRANGEMENT
Whenever a compromise or arrangement is proposed between this corporation and
its creditors or any class of them and/or between this corporation and its
stockholders or any class of them, any court of equitable jurisdiction within
the State of Delaware may, on the application in a summary way of this
corporation or of any creditor or stockholder thereof or on the application of
any receiver or receivers appointed for this corporation under the provisions of
Section 279 of Title 8 of the Delaware Law order a meeting of the creditors or
class of creditors, and/or of the stockholders or class of stockholders of this
corporation, as the case may be, to be summoned in such manner as the said court
directs. If a majority in the number representing three-fourths in value of the
creditors or class of creditors, and/or of the stockholders or class of
stockholders of this corporation, as the case may be, agree to any compromise or
arrangement and to any reorganization of this corporation as a consequence or
such compromise or arrangement, the said compromise or arrangement and the said
reorganization shall, if sanctioned by the court to which the said application
has been made, be binding on all the creditors or class of creditors, and/or on
all the stockholders or class of stockholders, of this corporation, as the case
may be, and also on this corporation.
I, Walton C. Vance, being the duly elected and acting Secretary of the
Corporation, do hereby certify that this Amended and Restated Certificate of
Incorporation was duly adopted on May 30, 1997, in accordance with Section 245
of the General Corporation Law of the State of Delaware, and that the facts
stated herein are true.
\s\______________________________
Walton C. Vance, Secretary
<PAGE> 1
EXHIBIT 4.2
BYLAWS OF
SABA PETROLEUM COMPANY
(A DELAWARE CORPORATION)
<TABLE>
<CAPTION>
TABLE OF CONTENTS
PAGE
----
<S> <C> <C>
ARTICLE I--CORPORATE OFFICES................................................. 1
1.1 REGISTERED OFFICE................................................. 1
1.2 OTHER OFFICES..................................................... 1
ARTICLE II--MEETINGS OF STOCKHOLDERS......................................... 1
2.1 PLACE OF MEETINGS................................................. 1
2.2 ANNUAL MEETING.................................................... 1
2.3 SPECIAL MEETING................................................... 1
2.4 NOTICE OF STOCKHOLDERS' MEETINGS.................................. 2
2.5 ADVANCE NOTICE OF STOCKHOLDER NOMINEES AND STOCKHOLDER
BUSINESS.......................................................... 2
2.6 MANNER OF GIVING NOTICE: AFFIDAVIT OF NOTICE...................... 2
2.7 QUORUM............................................................ 2
2.8 ADJOURNED MEETING; NOTICE......................................... 3
2.9 VOTING............................................................ 3
2.10 STOCKHOLDER ACTION BY WRITTEN CONSENT WITHOUT A MEETING........... 3
2.11 RECORD DATE FOR STOCKHOLDER NOTICE; VOTING........................ 3
2.12 PROXIES........................................................... 4
2.13 ORGANIZATION...................................................... 4
2.14 LIST OF STOCKHOLDERS ENTITLED TO VOTE............................. 4
ARTICLE III--DIRECTORS....................................................... 4
3.1 POWERS............................................................ 4
3.2 NUMBER OF DIRECTORS............................................... 5
3.3 ELECTION AND TERM OF OFFICE OF DIRECTORS.......................... 5
3.4 RESIGNATION AND VACANCIES......................................... 5
3.5 REMOVAL OF DIRECTORS.............................................. 6
3.6 PLACE OF MEETINGS; MEETINGS BY TELEPHONE.......................... 6
3.7 FIRST MEETINGS.................................................... 6
3.8 REGULAR MEETINGS.................................................. 7
3.9 SPECIAL MEETINGS; NOTICE.......................................... 7
3.10 QUORUM............................................................ 7
3.11 WAIVER OF NOTICE.................................................. 7
3.12 ADJOURNMENT....................................................... 7
3.13 NOTICE OF ADJOURNMENT............................................. 8
3.14 BOARD ACTION BY WRITTEN CONSENT WITHOUT A MEETING................. 8
3.15 FEES AND COMPENSATION OF DIRECTORS................................ 8
3.16 APPROVAL OF LOANS TO OFFICERS..................................... 8
3.17 SOLE DIRECTOR PROVIDED BY CERTIFICATE OF INCORPORATION............ 8
ARTICLE IV--COMMITTEES....................................................... 8
4.1 COMMITTEES OF DIRECTORS........................................... 8
4.2 MEETINGS AND ACTION OF COMMITTEES................................. 9
4.3 COMMITTEE MINUTES................................................. 9
ARTICLE V--OFFICERS.......................................................... 9
5.1 OFFICERS.......................................................... 9
5.2 ELECTION OF OFFICERS.............................................. 10
5.3 SUBORDINATE OFFICERS.............................................. 10
5.4 REMOVAL AND RESIGNATION OF OFFICERS............................... 10
5.5 VACANCIES IN OFFICES.............................................. 10
5.6 CHAIRMAN OF THE BOARD............................................. 11
5.7 PRESIDENT......................................................... 11
5.8 VICE PRESIDENT.................................................... 11
5.9 SECRETARY......................................................... 11
5.10 CHIEF FINANCIAL OFFICER........................................... 11
5.11 ASSISTANT SECRETARY............................................... 12
5.12 ADMINISTRATIVE OFFICERS........................................... 12
5.13 AUTHORITY AND DUTIES OF OFFICERS.................................. 12
</TABLE>
<PAGE> 2
<TABLE>
<CAPTION>
<S> <C> <C>
ARTICLE VI--INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES AND OTHER
AGENTS....................................................................... 13
6.1 INDEMNIFICATION OF DIRECTORS AND OFFICERS......................... 13
6.2 INDEMNIFICATION OF OTHERS......................................... 13
6.3 INSURANCE......................................................... 14
ARTICLE VII--RECORDS AND REPORTS............................................. 14
7.1 MAINTENANCE AND INSPECTION OF RECORDS............................. 14
7.2 INSPECTION BY DIRECTORS........................................... 14
7.3 ANNUAL STATEMENT TO STOCKHOLDERS.................................. 14
7.4 REPRESENTATION OF SHARES OF OTHER CORPORATIONS.................... 14
7.5 CERTIFICATION AND INSPECTION OF BYLAWS............................ 15
ARTICLE VIII--GENERAL MATTERS................................................ 15
8.1 RECORD DATE FOR PURPOSES OTHER THAN NOTICE AND VOTING............. 15
8.2 CHECKS; DRAFTS; EVIDENCES OF INDEBTEDNESS......................... 15
8.3 CORPORATE CONTRACTS AND INSTRUMENTS: HOW EXECUTED................. 15
8.4 STOCK CERTIFICATES; TRANSFER, PARTLY PAID SHARES.................. 16
8.5 SPECIAL DESIGNATION ON CERTIFICATES............................... 16
8.6 LOST CERTIFICATES................................................. 17
8.7 TRANSFER AGENTS AND REGISTRARS.................................... 17
8.8 CONSTRUCTION; DEFINITIONS......................................... 17
ARTICLE IX--AMENDMENTS....................................................... 17
</TABLE>
<PAGE> 3
BYLAWS
OF
SABA PETROLEUM COMPANY
(A DELAWARE CORPORATION)
ARTICLE I
CORPORATE OFFICES
1.1 Registered Office
The registered office of the corporation shall be fixed in the
Certificate of Incorporation of the corporation.
1.2 Other Offices
The Board of Directors may at any time establish branch or
subordinate offices at any place or places where the corporation is
qualified to do business.
ARTICLE II
MEETINGS OF STOCKHOLDERS
2.1 Place of Meetings
Meetings of stockholders shall be held at any place within or
outside the State of Delaware designated by the Board of Directors. In
the absence of any such designation, stockholders' meetings shall be
held at the principal executive office of the corporation.
2.2 Annual Meeting
The annual meeting of stockholders shall be held each year on a
date and at a time designated by the Board of Directors. In the absence
of such designation, the annual meeting of stockholders shall be held on
the first Friday in June in each year at 10:30 a.m. However, if such day
falls on a legal holiday, then the meeting shall be held at the same
time and place on the next succeeding full business day. At the meeting,
directors shall be elected, and any other proper business may be
transacted.
2.3 Special Meeting
A special meeting of the stockholders may be called at any time
by the Board of Directors, or by the chairman of the board, or by the
president, or by one or more stockholders holding shares in the
aggregate entitled to cast not less than ten percent (10%) of the votes
of all shares of stock owned by stockholders entitled to vote at that
meeting.
If a special meeting is called by any person or persons other
than the Board of Directors or the president or the chairman of the
Board, then the request shall be in writing, specifying the time of such
meeting and the general nature of the business proposed to be
transacted, and shall be delivered personally or sent by registered mail
or by telegraphic or other facsimile transmission to the chairman of the
Board, the president, any vice president or the secretary of the
corporation. The officer receiving the request shall cause notice to be
promptly given to the stockholders entitled to vote, in accordance with
the provisions of Sections 2.4 and 2.6 of these bylaws, that a meeting
will be held at the time requested by the person or persons calling the
meeting, so long
<PAGE> 4
as that time is not less than thirty-five (35) nor more than sixty (60)
days after the receipt of the request. If the notice is not given within
twenty (20) days after receipt of the request, then the person or
persons requesting the meeting may give the notice. Nothing contained in
this paragraph of this Section 2.3 shall be construed as limiting,
fixing or affecting the time when a meeting of stockholders called by
action of the Board of Directors may be held.
2.4 Notice of Stockholders' Meetings
All notices of meetings of stockholders shall be sent or
otherwise given in accordance with Section 2.5 of these bylaws not less
than ten (10) nor more than sixty (60) days before the date of the
meeting. The notice shall specify the place, date and hour of the
meeting and (i) in the case of a special meeting, the purpose or
purposes for which the meeting is called (no business other than that
specified in the notice may be transacted) or (ii) in the case of the
annual meeting, those matters which the Board of Directors, at the time
of giving the notice, intends to present for action by the stockholders
(but any proper matter may be presented at the meeting for such action).
The notice of any meeting at which directors are to be elected shall
include the name of any nominee or nominees who, at the time of the
notice, the board intends to present for election.
2.5 Advance Notice of Stockholder Nominees and Stockholder Business
To be properly brought before an annual meeting or special
meeting, nominations for the election of directors or other business
must be (a) specified in the notice of meeting (or any supplement
thereto) given by or at the direction of the Board of Directors, (b)
otherwise properly brought before the meeting by or at the direction of
the Board of Directors or (c) otherwise properly brought before the
meeting by a stockholder.
2.6 Manner of Giving Notice; Affidavit of Notice
Written notice of any meeting of stockholders shall be given
either personally or by first-class mail or by telegraphic or other
written communication. Notices not personally delivered shall be sent
charges prepaid and shall be addressed to the stockholder at the address
of that stockholder appearing on the books of the corporation or given
by the stockholder to the corporation for the purpose of notice. Notice
shall be deemed to have been given at the time when delivered personally
or deposited in the mail or sent by telegram or other means of written
communication.
An affidavit of the mailing or other means of giving any notice
of any stockholders' meeting, executed by the secretary, assistant
secretary or any transfer agent of the corporation giving the notice,
shall be prima facie evidence of the giving of such notice.
2.7 Quorum
The holders of a majority in voting power of the stock issued and
outstanding and entitled to vote thereat, present in person or
represented by proxy, shall constitute a quorum at all meetings of the
stockholders for the transaction of business except as otherwise
provided by statute or by the Certificate of Incorporation. If, however,
such quorum is not present or represented at any meeting of the
stockholders, then either (i) the chairman of the meeting or (ii) the
stockholders entitled to vote thereat, present in person or represented
by proxy, shall have power to adjourn the meeting in accordance with
Section 2.7 of these bylaws.
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When a quorum is present at any meeting, the vote of the holders
of a majority of the stock having voting power present in person or
represented by proxy shall decide any question brought before such
meeting, unless the question is one upon which, by express provision of
the laws of the State of Delaware or of the Certificate of Incorporation
or these bylaws, a different vote is required, in which case such
express provision shall govern and control the decision of the question.
If a quorum be initially present, the stockholders may continue
to transact business until adjournment, notwithstanding the withdrawal
of enough stockholders to leave less than a quorum, if any action taken
is approved by a majority of the stockholders initially constituting the
quorum.
2.8 Adjourned Meeting; Notice
When a meeting is adjourned to another time and place, unless
these bylaws otherwise require, notice need not be given of the
adjourned meeting if the time and place thereof are announced at the
meeting at which the adjournment is taken. At the adjourned meeting the
corporation may transact any business that might have been transacted at
the original meeting. If the adjournment is for more than thirty (30)
days, or if after the adjournment a new record date is fixed for the
adjourned meeting, a notice of the adjourned meeting shall be given to
each stockholder of record entitled to vote at the meeting.
2.9 Voting
The stockholders entitled to vote at any meeting of stockholders
shall be determined in accordance with the provisions of Section 2.11 of
these bylaws, subject to the provisions of Sections 217 and 218 of the
General Corporation Law of Delaware (relating to voting rights of
fiduciaries, pledgors and joint owners, and to voting trusts and other
voting agreements).
Except as may be otherwise provided in the Certificate of
Incorporation or these bylaws, each stockholder shall be entitled to one
vote for each share of capital stock held by such stockholder.
2.10 Stockholder Action by Written Consent Without a Meeting
Any action required or permitted to be taken at any annual or
special meeting of stockholders may be taken without a meeting, without
prior notice and without a vote, if a consent or consents in writing
setting forth the action so taken shall be signed by the holders of
outstanding stock having not less than the minimum number of votes that
would be necessary to authorize or take such action at a meeting at
which all shares entitled to vote thereon were present and voted. Such
consents shall be delivered to the corporation by delivery to it
registered office in the state of Delaware, its principal place of
business, or an officer or agent of the corporation having custody of
the book in which proceedings of meetings of stockholders are recorded.
Delivery made to a corporation's registered office shall be by hand or
by certified or registered mail, return receipt requested.
2.11 Record Date for Stockholder Notice; Voting
For purposes of determining the stockholders entitled to notice
of any meeting or to vote thereat, the Board of Directors may fix, in
advance, a record date, which shall not precede the date upon which the
resolution fixing the record date is adopted by the Board of Directors
and which shall not be more than sixty (60) days nor less than ten (10)
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days before the date of any such meeting, and in such event only
stockholders of record on the date so fixed are entitled to notice and
to vote, notwithstanding any transfer of any shares on the books of the
corporation after the record date.
If the Board of Directors does not so fix a record date, the
record date for determining stockholders entitled to notice of or to
vote at a meeting of stockholders shall be at the close of business on
the business day next preceding the day on which notice is given, or, if
notice is waived, at the close of business on the business day next
preceding the day on which the meeting is held.
A determination of stockholders of record entitled to notice of
or to vote at a meeting of stockholders shall apply to any adjournment
of the meeting unless the Board of Directors fixes a new record date for
the adjourned meeting, but the Board of Directors shall fix a new record
date if the meeting is adjourned for more than thirty (30) days from the
date set for the original meeting.
The record date for any other purpose shall be as provided in
Section 8.1 of these bylaws.
2.12 Proxies
Every person entitled to vote for directors, or on any other
matter, shall have the right to do so either in person or by one or more
agents authorized by a written proxy signed by the person and filed with
the secretary of the corporation, but no such proxy shall be voted or
acted upon after three (3) years from its date, unless the proxy
provides for a longer period. A proxy shall be deemed signed if the
stockholder's name is placed on the proxy (whether by manual signature,
typewriting, telegraphic transmission, telefacsimile or otherwise) by
the stockholder or the stockholder's attorney-in-fact. The revocability
of a proxy that states on its face that it is irrevocable shall be
governed by the provisions of Section 212(e) of the General Corporation
Law of Delaware.
2.13 Organization
The president, or in the absence of the president, the chairman
of the Board, shall call the meeting of the stockholders to order, and
shall act as chairman of the meeting. In the absence of the president,
the chairman of the board, and all of the vice presidents, the
stockholders shall appoint a chairman for such meeting. The chairman of
any meeting of stockholders shall determine the order of business and
the procedures at the meeting, including such matters as the regulation
of the manner of voting and the conduct of business. The secretary of
the corporation shall act as secretary of all meetings of the
stockholders, but in the absence of the secretary at any meeting of the
stockholders, the chairman of the meeting may appoint any person to act
as secretary of the meeting.
2.14 List of Stockholders Entitled to Vote
The officer who has charge of the stock ledger of the corporation
shall prepare and make, at least ten (10) days before every meeting of
stockholders, a complete list of the stockholders entitled to vote at
the meeting, arranged in alphabetical order, and showing the address of
each stockholder and the number of shares registered in the name of each
stockholder. Such list shall be open to the examination of any
stockholder, for any purpose germane to the meeting, during ordinary
business hours, for a period of at least ten (10) days prior to the
meeting, either at a place within the city where the meeting is to be
held, which place shall be specified in the notice of the meeting, or,
if
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not so specified, at the place where the meeting is to be held. The list
shall also be produced and kept at the time and place of the meeting
during the whole time thereof, and may be inspected by any stockholder
who is present.
ARTICLE III
DIRECTORS
3.1 Powers
Subject to the provisions of the General Corporation Law of
Delaware and to any limitations in the Certificate of Incorporation or
these bylaws relating to action required to be approved by the
stockholders or by the outstanding shares, the business and affairs of
the corporation shall be managed and all corporate powers shall be
exercised by or under the direction of the Board of Directors.
3.2 Number of Directors
The Board of Directors shall consist of seven (7) members. The
number of Directors may be changed by an amendment to this bylaw, duly
adopted by the Board of Directors or by the stockholders, or by a duly
adopted amendment to the Certificate of Incorporation.
3.3 Election and Term of Office of Directors
Except as provided in Section 3.4 of these bylaws, directors
shall be elected at each annual meeting of stockholders to hold office
until the next annual meeting. Each director, including a director
elected or appointed to fill a vacancy, shall hold office until the
expiration of the term for which elected and until a successor has been
elected and qualified.
3.4 Resignation and Vacancies
Any director may resign effective on giving written notice to the
chairman of the board, the president, the secretary or the Board of
Directors, unless the notice specifies a later time for that resignation
to become effective. If the resignation of a director is effective at a
future time, the Board of Directors may elect a successor to take office
when the resignation becomes effective.
Vacancies in the Board of Directors may be filled by a majority
of the remaining directors, even if less than a quorum, or by a sole
remaining director; however, a vacancy created by the removal of a
director by the vote of the stockholders or by court order may be filled
only by the affirmative vote of a majority of the shares represented and
voting at a duly held meeting at which a quorum is present (which shares
voting affirmatively also constitute a majority of the required quorum).
Each director so elected shall hold office until the next annual meeting
of the stockholders and until a successor has been elected and
qualified.
Unless otherwise provided in the Certificate of Incorporation or
these bylaws:
(i) Vacancies and newly created directorships resulting from any
increase in the authorized number of directors elected by all of the
stockholders having the right to vote as a single class may be filled by
a majority of the directors then in office, although less than a quorum,
or by a sole remaining director.
(ii) Whenever the holders of any class or classes of stock or series
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thereof are entitled to elect one or more directors by the provisions of
the Certificate of Incorporation, vacancies and newly created
directorships of such class or classes or series may be filled by a
majority of the directors elected by such class or classes or series
thereof then in office, or by a sole remaining director so elected.
If at any time, by reason of death or resignation or other cause,
the corporation should have no directors in office, then any officer or
any stockholder or an executor, administrator, trustee or guardian of a
stockholder, or other fiduciary entrusted with like responsibility for
the person or estate of a stockholder, may call a special meeting of
stockholders in accordance with the provisions of the Certificate of
Incorporation or these bylaws, or may apply to the Court of Chancery for
a decree summarily ordering an election as provided in Section 211 of
the General Corporation Law of Delaware.
If, at the time of filling any vacancy or any newly created
directorship, the directors then in office constitute less than a
majority of the whole board (as constituted immediately prior to any
such increase), then the Court of Chancery may, upon application of any
stockholder or stockholders holding at least ten (10) percent of the
total number of the shares at the time outstanding having the right to
vote for such directors, summarily order an election to be held to fill
any such vacancies or newly created directorships, or to replace the
directors chosen by the directors then in office as aforesaid, which
election shall be governed by the provisions of Section 211 of the
General Corporation Law of Delaware as far as applicable.
3.5 Removal of Directors
Unless otherwise restricted by statute, by the Certificate of
Incorporation or by these bylaws, any Director or the entire Board of
Directors may be removed, with or without cause, by the holders of a
majority of the shares then entitled to vote at an election of
directors.
3.6 Place of Meetings; Meetings by Telephone
Regular meetings of the Board of Directors may be held at any
place within or outside the State of Delaware that has been designated
from time to time by resolution of the board. In the absence of such a
designation, regular meetings shall be held at the principal executive
office of the corporation. Special meetings of the board may be held at
any place within or outside the State of Delaware that has been
designated in the notice of the meeting or, if not stated in the notice
or if there is no notice, at the principal executive office of the
corporation.
Any meeting of the board, regular or special, may be held by
conference telephone or similar communication equipment, so long as all
Directors participating in the meeting can hear one another; and all
such participating Directors shall be deemed to be present in person at
the meeting.
3.7 First Meetings
The first meeting of each newly elected Board of Directors shall
be held at such time and place as shall be fixed by the vote of the
stockholders at the annual meeting. In the event of the failure of the
stockholders to fix the time or place of such first meeting of the newly
elected Board of Directors, or in the event such meeting is not held at
the time and place so fixed by the stockholders, the meeting may be held
at such time and place as shall be specified in a notice given as
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hereinafter provided for special meetings of the Board of Directors, or
as shall be specified in a written waiver signed by all of the
directors.
3.8 Regular Meetings
Regular meetings of the Board of Directors may be held without
notice at such time as shall from time to time be determined by the
Board of Directors. If any regular meeting day shall fall on a legal
holiday, then the meeting shall be held at the same time and place on
the next succeeding full business day.
3.9 Special Meetings; Notice
Special meetings of the Board of Directors for any purpose or
purposes may be called at any time by the chairman of the board, the
president, any vice president, the secretary or any two directors.
Notice of the time and place of special meetings shall be delivered
personally or by telephone to each director or sent by first-class mail,
telecopy or telegram, charges prepaid, addressed to each director at
that director's address as it is shown on the records of the
corporation. If the notice is mailed, it shall be deposited in the
United States mail at least four (4) days before the time of the holding
of the meeting. If the notice is delivered personally or by telephone,
telecopy or telegram, it shall be delivered personally or by telephone
or to the telegraph company at least forty-eight (48) hours before the
time of the holding of the meeting. Any oral notice given personally or
by telephone may be communicated either to the director or to a person
at the office of the director who the person giving the notice has
reason to believe will promptly communicate it to the director. The
notice need not specify the purpose or the place of the meeting, if the
meeting is to be held at the principal executive office of the
corporation.
3.10 Quorum
A majority of the authorized number of directors shall constitute
a quorum for the transaction of business, except to adjourn as provided
in Section 3.12 of these bylaws. Every act or decision done or made by a
majority of the directors present at a duly held meeting at which a
quorum is present shall be regarded as the act of the Board of
Directors, subject to the provisions of the Certificate of Incorporation
and applicable law.
A meeting at which a quorum is initially present may continue to
transact business notwithstanding the withdrawal of directors, if any
action taken is approved by at least a majority of the quorum for that
meeting.
3.11 Waiver of Notice
Notice of a meeting need not be given to any director (i) who
signs a waiver of notice, whether before or after the meeting, or (ii)
who attends the meeting other than for the express purposed of objecting
at the beginning of the meeting to the transaction of any business
because the meeting is not lawfully called or convened. All such waivers
shall be filed with the corporate records or made part of the minutes of
the meeting. A waiver of notice need not specify the purpose of any
regular or special meeting of the Board of Directors.
3.12 Adjournment
A majority of the directors present, whether or not constituting
a quorum, may adjourn any meeting of the board to another time and
place.
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3.13 Notice of Adjournment
Notice of the time and place of holding an adjourned meeting of
the board need not be given unless the meeting is adjourned for more
than twenty-four (24) hours. If the meeting is adjourned for more than
twenty-four (24) hours, then notice of the time and place of the
adjourned meeting shall be given before the adjourned meeting takes
place, in the manner specified in Section 3.9 of these bylaws, to the
directors who were not present at the time of the adjournment.
3.14 Board Action by Written Consent Without a Meeting
Any action required or permitted to be taken by the Board of
Directors may be taken without a meeting, provided that all members of
the board individually or collectively consent in writing to that
action. Such action by written consent shall have the same force and
effect as a unanimous vote of the board of directors. Such written
consent and any counterparts thereof shall be filed with the minutes of
the proceedings of the Board of Directors.
3.15 Fees and Compensation of Directors
Directors and members of committees may receive such
compensation, if any, for their services and such reimbursement of
expenses as may be fixed or determined by resolution of the Board of
Directors. This Section 3.15 shall not be construed to preclude any
director from serving the corporation in any other capacity as an
officer, agent, employee or otherwise and receiving compensation for
those services.
3.16 Approval of Loans to Officers
The corporation may lend money to, or guarantee any obligation
of, or otherwise assist any officer or other employee of the corporation
or any of its subsidiaries, including any officer or employee who is a
director of the corporation or any of its subsidiaries, whenever, in the
judgment of the directors, such loan, guaranty or assistance may
reasonably be expected to benefit the corporation. The loan, guaranty or
other assistance may be with or without interest and may be unsecured,
or secured in such manner as the board of directors shall approve,
including, without limitation, a pledge of shares of stock of the
corporation. Nothing contained in this section shall be deemed to deny,
limit or restrict the powers of guaranty or warranty of the corporation
at common law or under any statute.
3.17 Sole Director Provided by Certificate of Incorporation
In the event only one director is required by these bylaws or the
certificate of incorporation, then any reference herein to notices,
waivers, consents, meetings or other actions by a majority or quorum of
the directors shall be deemed to refer to such notice, waiver, etc., by
such sole director, who shall have all the rights and duties and shall
be entitled to exercise all of the powers and shall assume all the
responsibilities otherwise herein described as given to the Board of
Directors.
ARTICLE IV
COMMITTEES
4.1 Committees of Directors
The Board of Directors may, by resolution adopted by a majority
of the authorized number of Directors, designate one (1) or more
committees,
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each consisting of two or more directors, to serve at the pleasure of
the board. The board may designate one (1) or more directors as
alternate members of any committee, who may replace any absent or
disqualified member at any meeting of the committee. The appointment of
members or alternate members of a committee requires the vote of a
majority of the authorized number of directors. Any committee, to the
extent provided in the resolution of the board, shall have and may
exercise all the powers and authority of the board, but no such
committee shall have the power or authority to (i) amend the Certificate
of Incorporation (except that a committee may, to the extent authorized
in the resolution or resolutions providing for the issuance of shares of
stock adopted by the Board of Directors as provided in Section 151(a) of
the General Corporation Law of Delaware, fix the designations and any of
the preferences or rights of such shares relating to dividends,
redemption, dissolution, any distribution of assets of the corporation
or the conversion into, or the exchange of such shares for, shares of
any other class or classes or any other series of the same or any other
class or classes of stock of the corporation),(ii) adopt an agreement of
merger or consolidation under Sections 251 or 252 of the General
Corporation Law of Delaware, (iii) recommend to the stockholders the
sale, lease or exchange of all or substantially all of the corporation's
property and assets, (iv) recommend to the stockholders a dissolution of
the corporation or a revocation of a dissolution or (v) amend the bylaws
of the corporation; and, unless the board resolution establishing the
committee, the bylaws or the Certificate of Incorporation expressly so
provide, no such committee shall have the power or authority to declare
a dividend, to authorize the issuance of stock, or to adopt a
certificate of ownership and merger pursuant to Section 253 of the
General Corporation Law of Delaware.
4.2 Meetings and Action of Committees
Meetings and actions of committees shall be governed by, and held
and taken in accordance with, the following provisions of Article III of
these bylaws: Section 3.6 (place of meetings; meetings by telephone),
Section 3.8 (regular meetings), Section 3.9 (special meetings; notice),
Section 3.10 (quorum), Section 3.11 (waiver of notice), Section 3.12
(adjournment), Section 3.13 (notice of adjournment) and Section 3.14
(board action by written consent without meeting), with such changes in
the context of those bylaws as are necessary to substitute the committee
and its members for the board of directors and its members; provided,
however, that the time of regular meetings of committees may be
determined either by resolution of the Board of Directors or by
resolution of the committee, that special meetings of committees may
also be called by resolution of the Board of Directors, and that notice
of special meetings of committees shall also be given to all alternate
members, who shall have the right to attend all meetings of the
committee. The Board of Directors may adopt rules for the government of
any committee not inconsistent with the provisions of these bylaws.
4.3 Committee Minutes
Each committee shall keep regular minutes of its meetings and
report the same to the Board of Directors when required.
ARTICLE V
OFFICERS
5.1 Officers
The Corporate Officers of the corporation shall be a president, a
secretary and a chief financial officer. The corporation may also have,
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at the discretion of the Board of Directors, a chairman of the board,
one or more vice presidents (however denominated), one or more assistant
secretaries, one or more assistant treasurers, and such other officers
as may be appointed in accordance with the provisions of Section 5.3 of
these bylaws. Any number of offices may be held by the same person.
In addition to the Corporate Officers of the Company described
above, there may also be such Administrative Officers of the corporation
as may be designated and appointed from time to time by the president of
the corporation in accordance with the provisions of Section 5.12 of
these bylaws.
5.2 Election of Officers
The Corporate Officers of the corporation, except such officers
as may be appointed in accordance with the provisions of Section 5.3 or
Section 5.5 of these bylaws, shall be chosen by the Board of Directors,
subject to the rights, if any, of an officer under any contract of
employment, and shall hold their respective offices for such terms as
the Board of Directors may from time to time determine.
5.3 Subordinate Officers
The Board of Directors may appoint, or may empower the president
to appoint, such other Corporate Officers as the business of the
corporation may require, each of whom shall hold office for such period,
have such power and authority, and perform such duties as are provided
in these bylaws or as the board of directors may from time to time
determine.
The president may from time to time designate and appoint
Administrative Officers of the corporation in accordance with the
provisions of Section 5.12 of these bylaws.
5.4 Removal and Resignation of Officers
Subject to the rights, if any, of a Corporate Officer under any
contract of employment, any Corporate Officer may be removed, either
with or without cause, by the Board of Directors at any regular or
special meeting of the board or, except in case of a Corporate Officer
chosen by the Board of Directors, by any Corporate Officer upon whom
such power of removal may be conferred by the Board of Directors.
Any Corporate Officer may resign at any time by giving written
notice to the corporation. Any resignation shall take effect at the date
of the receipt of that notice or at any later time specified in that
notice; and, unless otherwise specified in that notice, the acceptance
of the resignation shall not be necessary to make it effective. Any
resignation is without prejudice to the rights, if any, of the
corporation under any contract to which the Corporate Officer is a
party.
Any Administrative Officer designated and appointed by the
president may be removed, either with or without cause, at any time by
the president. Any Administrative Officer may resign at any time by
giving written notice to the president or to the secretary of the
corporation.
5.5 Vacancies in Offices
A vacancy in any office because of death, resignation, removal,
disqualification or any other cause shall be filled in the manner
prescribed in these bylaws for regular appointments to that office.
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5.6 Chairman of the Board
The chairman of the board, if such an officer be elected, shall,
if present, preside at meetings of the Board of Directors and exercise
such other powers and perform such other duties as may from time to time
be assigned to him by the Board of Directors or as may be prescribed by
these bylaws. If there is no president, then the chairman of the board
shall also be the chief executive officer of the corporation and shall
have the powers and duties prescribed in Section 5.7 of these bylaws.
5.7 President
Subject to such supervisory powers, if any, as may be given by
the board of directors to the chairman of the board, if there be such an
officer, the president shall be the chief executive officer of the
corporation and shall, subject to the control of the Board of Directors,
have general supervision, direction and control of the business and the
officers of the corporation. He or she shall preside at all meetings of
the stockholders and, in the absence or nonexistence of a chairman of
the board, at all meetings of the Board of Directors. He or she shall
have the general powers and duties of management usually vested in the
office of president of a corporation, and shall have such other powers
and perform such other duties as may be prescribed by the Board of
Directors or these bylaws.
5.8 Vice Presidents
In the absence or disability of the president, and if there is no
chairman of the board, the vice presidents, if any, in order of their
rank as fixed by the Board of Directors or, if not ranked, a vice
president designated by the board of directors, shall perform all the
duties of the president and when so acting shall have all the powers of,
and be subject to all the restrictions upon, the president. The vice
presidents shall have such other powers and perform such other duties as
from time to time may be prescribed for them respectively by the Board
of Directors, these bylaws, the president or the chairman of the board.
5.9 Secretary
The secretary shall keep or cause to be kept, at the principal
executive office of the corporation or such other place as the Board of
Directors may direct, a book of minutes of all meetings and actions of
the board of directors, committees of directors and stockholders. The
minutes shall show the time and place of each meeting, whether regular
or special (and, if special, how authorized and the notice given), the
names of those present at directors' meetings or committee meetings, the
number of shares present or represented at stockholders' meetings and
the proceedings thereof.
The secretary shall keep, or cause to be kept, at the principal
executive office of the corporation or at the office of the
corporation's transfer agent or registrar, as determined by resolution
of the Board of Directors, a share register or a duplicate share
register, showing the names of all stockholders and their addresses, the
number and classes of shares held by each, the number and date of
certificates evidencing such shares and the number and date of
cancellation of every certificate surrendered for cancellation.
The secretary shall give, or cause to be given, notice of all
meetings of the stockholders and of the Board of Directors required to
be given by law or by these bylaws. He or she shall keep the seal of the
corporation, if one be adopted, in safe custody and shall have such
other
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powers and perform such other duties as may be prescribed by the Board
of Directors or by these bylaws.
5.10 Chief Financial Officer
The chief financial officer shall keep and maintain, or cause to
be kept and maintained, adequate and correct books and records of
accounts of the properties and business transactions of the corporation,
including accounts of its assets, liabilities, receipts, disbursements,
gains, losses, capital, retained earnings and shares. The books of
account shall at all reasonable times be open to inspection by any
director for a purpose reasonably related to his position as a director.
The chief financial officer shall deposit all money and other
valuables in the name and to the credit of the corporation with such
depositaries as may be designated by the Board of Directors. He or she
shall disburse the funds of the corporation as may be ordered by the
Board of Directors, shall render to the president and directors,
whenever they request it, an account of all of his or her transactions
as chief financial officer and of the financial condition of the
corporation, and shall have such other powers and perform such other
duties as may be prescribed by the Board of Directors or these bylaws.
5.11 Assistant Secretary
The assistant secretary, if any, or, if there is more than one,
the assistant secretaries in the order determined by the Board of
Directors (or if there be no such determination, then in the order of
their election) shall, in the absence of the secretary or in the event
of his or her inability or refusal to act, perform the duties and
exercise the powers of the secretary and shall perform such other duties
and have such other powers as the board of directors may from time to
time prescribe.
5.12 Administrative Officers
In addition to the Corporate Officers of the corporation as
provided in Section 5.1 of these bylaws and such subordinate Corporate
Officers as may be appointed in accordance with Section 5.3 of these
bylaws, there may also be such Administrative Officers of the
corporation as may be designated and appointed from time to time by the
president of the corporation. Administrative Officers shall perform such
duties and have such powers as from time to time may be determined by
the president or the Board of Directors in order to assist the Corporate
Officers in the furtherance of their duties. In the performance of such
duties and the exercise of such powers, however, such Administrative
Officers shall have limited authority to act on behalf of the
corporation as the Board of Directors shall establish, including but not
limited to limitations on the dollar amount and on the scope of
agreements or commitments that may be made by such Administrative
Officers on behalf of the corporation, which limitations may not be
exceeded by such individuals or altered by the president without further
approval by the Board of Directors.
5.13 Authority and Duties of Officers
In addition to the foregoing powers, authority and duties, all
officers of the corporation shall respectively have such authority and
powers and perform such duties in the management of the business of the
corporation as may be designated from time to time by the Board of
Directors.
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ARTICLE VI
INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES
AND OTHER AGENTS
6.1 Indemnification of Directors and Officers
The corporation shall, to the maximum extent and in the manner
permitted by the General Corporation Law of Delaware as the same now
exists or may hereafter be amended, indemnify any person against
expenses (including attorneys' fees), judgments, fines, and amounts paid
in settlement actually and reasonably incurred in connection with any
threatened, pending or completed action, suit, or proceeding in which
such person was or is a party or is threatened to be made a party by
reason of the fact that such person is or was a director or officer of
the corporation. For purposes of this Section 6.1, a "director" or
"officer" of the corporation shall mean any person (i) who is or was a
director or officer of the corporation, (ii) who is or was serving at
the request of the corporation as a director or officer of another
corporation, partnership, joint venture, trust or other enterprise, or
(iii) who was a director or officer of a corporation which was a
predecessor corporation of the corporation or of another enterprise at
the request of such predecessor corporation.
The corporation shall be required to indemnify a director or
officer in connection with an action, suit, or proceeding (or part
thereof) initiated by such director or officer only if the initiation of
such action, suit, or proceeding (or part thereof) by the director or
officer was authorized by the Board of Directors of the corporation.
The corporation shall pay the expenses (including attorneys'
fees) incurred by a director or officer of the corporation entitled to
indemnification hereunder in defending any action, suit or proceeding
referred to in this Section 6.1 in advance of its final disposition;
provided, however, that payment of expenses incurred by a director or
officer of the corporation in advance of the final disposition of such
action, suit or proceeding shall be made only upon receipt of an
undertaking by the director or officer to repay all amounts advanced if
it should ultimately be determined that the director or officer is not
entitled to be indemnified under this Section 6.1 or otherwise.
The rights conferred on any person by this Article shall not be
exclusive of any other rights which such person may have or hereafter
acquire under any statute, provision of the corporation's Certificate of
Incorporation, these bylaws, agreement, vote of the stockholders or
disinterested directors or otherwise.
Any repeal or modification of the foregoing provisions of this
Article shall not adversely affect any right or protection hereunder of
any person in respect of any act or omission occurring prior to the time
of such repeal or modification.
6.2 Indemnification of Others
The corporation shall have the power, to the maximum extent and
in the manner permitted by the General Corporation Law of Delaware as
the same now exists or may hereafter be amended, to indemnify any person
(other than directors and officers) against expenses (including
attorneys' fees), judgments, fines, and amounts paid in settlement
actually and reasonably incurred in connection with any threatened,
pending or completed action, suit, or proceeding, in which such person
was or is a party or is threatened to be made a party by reason of the
fact that such person is or was an employee or agent of the corporation.
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For purposes of this Section 6.2, an "employee" or "agent" of the
corporation (other than a director or officer) shall mean any person (i)
who is or was an employee or agent of the corporation, (ii) who is or
was serving at the request of the corporation as an employee or agent of
another corporation, partnership, joint venture, trust or other
enterprise, or (iii) who was an employee or agent of a corporation which
was a predecessor corporation of the corporation or of another
enterprise at the request of such predecessor corporation.
6.3 Insurance
The corporation may purchase and maintain insurance on behalf of
any person who is or was a director, officer, employee 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 any
liability asserted against him or her and incurred by him or her in any
such capacity, or arising out of his or her status as such, whether or
not the corporation would have the power to indemnify him or her against
such liability under the provisions of the General Corporation Law of
Delaware.
ARTICLE VII
RECORDS AND REPORTS
7.1 Maintenance and Inspection of Records
The corporation shall, either at its principal executive office
or at such place or places as designated by the Board of Directors, keep
a record of its stockholders listing their names and addresses and the
number and class of shares held by each stockholder, a copy of these
bylaws as amended to date, accounting books and other records of its
business and properties. Any stockholder of record, in person or by
attorney or other agent, shall, upon written demand under oath stating
the purpose thereof, have the right during the usual hours for business
to inspect for any proper purpose the corporation's stock ledger, a list
of its stockholders, and its other books and records and to make copies
or extracts therefrom. A proper purpose shall mean a purpose reasonably
related to such person's interest as a stockholder. In every instance
where an attorney or other agent is the person who seeks the right to
inspection, the demand under oath shall be accompanied by a power of
attorney or such other writing that authorizes the attorney or other
agent to so act on behalf of the stockholder. The demand under oath
shall be directed to the corporation at its registered office in
Delaware or at its principal place of business.
7.2 Inspection by Directors
Any director shall have the right to examine the corporation's
stock ledger, a list of its stockholders and its other books and records
for a purpose reasonably related to his or her position as a director.
7.3 Annual Statement to Stockholders
The Board of Directors shall present at each annual meeting, and
at any special meeting of the stockholders when called for by vote of
the stockholders, a full and clear statement of the business and
condition of the corporation.
7.4 Representation of Shares of Other Corporations
The chairman of the board, if any, the president, any vice
president, the chief financial officer, the secretary or any assistant
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secretary of this corporation, or any other person authorized by the
Board of Directors or the president or a vice president, is authorized
to vote, represent and exercise on behalf of this corporation all rights
incident to any and all shares of the stock of any other corporation or
corporations standing in the name of this corporation. The authority
herein granted may be exercised either by such person directly or by any
other person authorized to do so by proxy or power of attorney duly
executed by such person having the authority.
7.5 Certification and Inspection of Bylaws
The original or a copy of these bylaws, as amended or otherwise
altered to date, certified by the secretary, shall be kept at the
corporation's principal executive office and shall be open to inspection
by the stockholders of the corporation, at all reasonable times during
office hours.
ARTICLE VIII
GENERAL MATTERS
8.1 Record Date for Purposes Other Than Notice and Voting
For purposes of determining the stockholders entitled to receive
payment of any dividend or other distribution or allotment of any rights
or the stockholders entitled to exercise any rights in respect of any
change, conversion or exchange of stock, or for the purpose of any other
lawful action, the Board of Directors may fix, in advance, a record
date, which shall not precede the date upon which the resolution fixing
the record date is adopted and which shall not be more than sixty (60)
days before any such action. In that case, only stockholders of record
at the close of business on the date so fixed are entitled to receive
the dividend, distribution or allotment of rights, or to exercise such
rights, as the case may be, notwithstanding any transfer of any shares
on the books of the corporation after the record date so fixed, except
as otherwise provided by law.
If the Board of Directors does not so fix a record date, then the
record date for determining stockholders for any such purpose shall be
at the close of business on the day on which the Board of Directors
adopts the applicable resolution.
8.2 Checks; Drafts; Evidences of Indebtedness
From time to time, the Board of Directors shall determine by
resolution which person or persons may sign or endorse all checks,
drafts, other orders for payment of money, notes or other evidences of
indebtedness that are issued in the name of or payable to the
corporation, and only the persons so authorized shall sign or endorse
those instruments.
8.3 Corporate Contracts and Instruments: How Executed
The Board of Directors, except as otherwise provided in these
bylaws, may authorize and empower any officer or officers, or agent or
agents, to enter into any contract or execute any instrument in the name
of and on behalf of the corporation; such power and authority may be
general or confined to specific instances. Unless so authorized or
ratified by the Board of Directors or within the agency power of an
officer, no officer, agent or employee shall have any power or authority
to bind the corporation by any contract or engagement or to pledge its
credit or to render it liable for any purpose or for any amount.
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8.4 Stock Certificates; Transfer; Partly Paid Shares
The shares of the corporation shall be represented by
certificates, provided that the Board of Directors of the corporation
may provide by resolution or resolutions that some or all of any or all
classes or series of its stock shall be uncertificated shares. Any such
resolution shall not apply to shares represented by a certificate until
such certificate is surrendered to the corporation. Notwithstanding the
adoption of such a resolution by the board of directors, every holder of
stock represented by certificates and, upon request, every holder of
uncertificated shares, shall be entitled to have a certificate signed
by, or in the name of the corporation by, the chairman or vice-chairman
of the Board of Directors, or the president or vice-president, and by
the treasurer or an assistant treasurer, or the secretary or an
assistant secretary of such corporation representing the number of
shares registered in certificate form. Any or all of the signatures on
the certificate may be a facsimile. In case any officer, transfer agent
or registrar who has signed or whose facsimile signature has been placed
upon a certificate has ceased to be such officer, transfer agent or
registrar before such certificate is issued, it may be issued by the
corporation with the same effect as if he or she were such officer,
transfer agent or registrar at the date of issue.
Certificates for shares shall be of such form and device as the
board of directors may designate and shall state the name of the record
holder of the shares represented thereby; its number; date of issuance;
the number of shares for which it is issued; a summary statement or
reference to the powers, designations, preferences or other special
rights of such stock and the qualifications, limitations or restrictions
of such preferences and/or rights, if any; a statement or summary of
liens, if any; a conspicuous notice of restrictions upon transfer or
registration of transfer, if any; a statement as to any applicable
voting trust agreement; if the shares be assessable, or, if assessments
are collectible by personal action, a plain statement of such facts.
Upon surrender to the secretary or transfer agent of the
corporation of a certificate for shares duly endorsed or accompanied by
proper evidence of succession, assignment or authority to transfer, it
shall be the duty of the corporation to issue a new certificate to the
person entitled thereto, cancel the old certificate and record the
transaction upon its books.
The corporation may issue the whole or any part of its shares as
partly paid and subject to call for the remainder of the consideration
to be paid therefor. Upon the face or back of each stock certificate
issued to represent any such partly paid shares, or upon the books and
records of the corporation in the case of uncertificated partly paid
shares, the total amount of the consideration to be paid therefor and
the amount paid thereon shall be stated. Upon the declaration of any
dividend on fully paid shares, the corporation shall declare a dividend
upon partly paid shares of the same class, but only upon the basis of
the percentage of the consideration actually paid thereon.
8.5 Special Designation on Certificates
If the corporation is authorized to issue more than one class of
stock or more than one series of any class, then the powers, the
designations, the preferences and the relative, participating, optional
or other special rights of each class of stock or series thereof and the
qualifications, limitations or restrictions of such preferences and/or
rights shall be set forth in full or summarized on the face or back of
the certificate that the corporation shall issue to represent such class
or series of stock; provided, however, that, except as otherwise
provided
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in Section 202 of the General Corporation Law of Delaware, in lieu of
the foregoing requirements there may be set forth on the face or back of
the certificate that the corporation shall issue to represent such class
or series of stock a statement that the corporation will furnish without
charge to each stockholder who so requests the powers, the designations,
the preferences and the relative, participating, optional or other
special rights of each class of stock or series thereof and the
qualifications, limitations or restrictions of such preferences and/or
rights.
8.6 Lost Certificates
Except as provided in this Section 8.6, no new certificates for
shares shall be issued to replace a previously issued certificate unless
the latter is surrendered to the corporation and cancelled at the same
time. The board of directors may, in case any share certificate or
certificate for any other security is lost, stolen or destroyed,
authorize the issuance of replacement certificates on such terms and
conditions as the board may require; the board may require
indemnification of the corporation secured by a bond or other adequate
security sufficient to protect the corporation against any claim that
may be made against it, including any expense or liability, on account
of the alleged loss, theft or destruction of the certificate or the
issuance of the replacement certificate.
8.7 Transfer Agents and Registrars
The Board of Directors may appoint one or more transfer agents or
transfer clerks, and one or more registrars, each of which shall be an
incorporated bank or trust company -- either domestic or foreign, who
shall be appointed at such times and places as the requirements of the
corporation may necessitate and the Board of Directors may designate.
8.8 Construction; Definitions
Unless the context requires otherwise, the general provisions,
rules of construction and definitions in the General Corporation Law of
Delaware shallgovern the construction of these bylaws. Without limiting
the generality of this provision, as used in these bylaws, the singular
number includes the plural, the plural number includes the singular, and
the term "person" includes both an entity and a natural person.
ARTICLE IX
AMENDMENTS
The original or other bylaws of the corporation may be adopted,
amended or repealed by the stockholders entitled to vote; provided,
however, that the corporation may, in its Certificate of Incorporation,
confer the power to adopt, amend or repeal bylaws upon the directors.
The fact that such power has been so conferred upon the directors shall
not divest the stockholders of the power, nor limit their power to
adopt, amend or repeal bylaws.
Whenever an amendment or new bylaw is adopted, it shall be copied
in the book of bylaws with the original bylaws, in the appropriate
place. If any bylaw is repealed, the fact of repeal with the date of the
meeting at which the repeal was enacted or the filing of the operative
written consent(s) shall be stated in said book.
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EXHIBIT 4.4
SABA PETROLEUM COMPANY
1996 INCENTIVE EQUITY PLAN
1. PURPOSE. The purpose this Plan is to attract and retain
officers and other key employees of and consultants to Saba Petroleum Company
(the "Corporation") and its Subsidiaries and to provide such persons with
incentives and rewards for superior performance.
2. DEFINITIONS. As used in this Plan,
"APPRECIATION RIGHT" means a right granted Pursuant to Section 5
of this Plan, including a Free-standing Appreciation Right and a Tandem
Appreciation Right.
"BASE PRICE" means the price to be used as the basis for
determining the Spread upon the exercise of a Free-standing Appreciation Right.
"BOARD" means the Board of Directors of the Corporation.
"CODE" means the Internal Revenue Code of 1986, as amended from
time to time.
"COMMITTEE" means the committee described in Section 14(a) of
this Plan.
"COMMON SHARES" means (i) shares of the Common Stock, no par
value, of the Corporation and (ii) any security into which Common Shares may be
converted by reason of any transaction or event of the type referred to in
Section 10 of this Plan.
"DATE OF GRANT" means the date specified by the Committee on
which a grant of Option Rights, Appreciation Rights, Performance Shares or
Performance Units or a grant or sale of Restricted Shares or Deferred Shares
shall become effective, which shall not be earlier than the date on which the
Committee takes action with respect thereto.
"DEFERRAL PERIOD" means the period of time during which Deferred
Shares are subject to deferral limitations under Section 7 of this Plan.
"DEFERRED SHARES" means an award pursuant to Section 7 of this
Plan of the right to receive Common Shares at the end of a specified Deferral
Period.
"EFFECTIVE DATE" shall have the meaning set forth in Section 17.
"FREE-STANDING APPRECIATION RIGHT" means an Appreciation Right
granted pursuant to Section 5 of this Plan that is not granted in tandem with an
Option Right or similar right.
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"INCENTIVE STOCK OPTION" means an Option Right that is intended
to qualify as an "incentive stock option" under Section 422 of the Code or any
successor provision thereto.
"MANAGEMENT OBJECTIVES" means the achievement of performance
objectives established pursuant to this Plan, which may be described in terms of
Corporation-wide objectives or objectives that are related to the performance of
the individual Participant, or the Subsidiary, division, department or function
within the corporation or Subsidiary in which the Participant is employed or
with respect to which the Participant provides consulting services. The
Committee may adjust Management Objectives and the related minimum acceptable
level of achievement if, in the sole judgment of the Committee, events or
transactions have occurred after the Date of Grant that are unrelated to the
performance of the Participant and result in distortion of the Management
Objectives or the related minimum acceptable level of achievement.
"MARKET VALUE PER SHARE" means the fair market value of the
Common Shares as determined by the Committee from time to time.
"NONQUALIFIED OPTION" means an Option Right that is not intended
to qualify as an Incentive Stock Option.
"OPTIONEE" means the person so designated in an agreement
evidencing an outstanding Option Right or the Successor of an Optionee, as the
context so requires.
"OPTION PRICE" means the purchase price payable upon the exercise
of an Option Right.
"OPTION RIGHT" means the right to purchase Common Shares from the
Corporation upon the exercise of a Nonqualified Option or an Incentive Stock
Option granted pursuant to Section 4 of this Plan.
"PARTICIPANT" means a person who is selected by the Committee to
receive benefits under this Plan and (i) is at that time an officer, including
without limitation an officer who may also be a member of the Board, or other
key employee of or a consultant to the Corporation or any Subsidiary or (ii) has
agreed to commence serving in any such capacity, or the Successor of a
Participant, as the context requires.
"PERFORMANCE PERIOD" means, in respect of a Performance Share or
Performance Unit, a period of time established pursuant to Section 8 of this
Plan within which the Management Objectives relating thereto are to be achieved.
"PERFORMANCE SHARE" means a bookkeeping entry that records the
equivalent of one Common Share awarded pursuant to Section 8 of this Plan.
"PERFORMANCE UNIT" means a bookkeeping entry that records a unit
equivalent to $1.00 awarded pursuant to Section 8 of this Plan.
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"RELOAD OPTION RIGHTS" means additional Option Rights
automatically granted to an Optionee upon the exercise of Option Rights pursuant
to Section 4(f) of this Plan.
"RESTRICTED SHARES" means Common Shares granted or sold pursuant
to Section 6 of this Plan as to which neither the substantial risk of forfeiture
nor the restrictions on transfer referred to in Section 6 hereof has expired.
"RULE 16B-3" means Rule 16b-3, as promulgated and amended from
time to time by the Securities and Exchange Commission under the Securities
Exchange Act of 1934, as amended, or any successor rule to the same effect.
"SPREAD" means, in the case of a Free-standing Appreciation
Right, the amount by which the Market Value per Share on the date when the
Appreciation Right is exercised exceeds the Base Price specified therein or, in
the case of a Tandem Appreciation Right, the amount by which the Market Value
per Share on the date when the Appreciation Right is exercised exceeds the
Option Price specified in the related Option Right.
"SUBSIDIARY" means any corporation in which the Corporation owns
or controls directly or indirectly more than 50 percent of the total combined
voting power represented by all classes of stock issued by such corporation at
the time of the grant.
"SUCCESSOR" of a Participant means the legal representative of
the estate of a deceased Participant or the person or persons who shall acquire
the right to exercise an award hereunder by bequest or inheritance or by reason
of death of the Participant.
"TANDEM APPRECIATION RIGHT" means an Appreciation Right granted
pursuant to Section 5 of this Plan that is granted in tandem with an Option
Right or any similar right granted under any other plan of the Corporation.
3. SHARES AND PERFORMANCE UNITS AVAILABLE UNDER THE PLAN.
(a) Subject to adjustment as provided in Section 10 of this Plan, the number of
Common Shares issued or transferred, plus the number of Common Shares covered by
outstanding awards granted under this Plan, shall not in the aggregate exceed
500,000 Common Shares, which may be Common Shares of original issuance or Common
Shares held in treasury or a combination thereof. For the purposes of this
Section 3(a):
(i) Upon payment in cash of the benefit provided by
any award granted under this Plan, any Common Shares that were
covered by that award shall again be available for issuance or
transfer hereunder.
(ii) Common Shares covered by any award granted under
this Plan shall be deemed to have been issued or transferred,
and shall cease to be available for future issuance or transfer
in respect of any other award granted hereunder, at the earlier
of the time when they are actually issued or transferred or the
time when dividends or
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dividend equivalents are paid thereon; provided, however, that
Restricted Shares shall be deemed to have been issued or
transferred at the earlier of the time when they cease to be
subject to a substantial risk of forfeiture or the time when
dividends are paid thereon.
(b) The number of Performance Units that may be granted under
this Plan shall not in the aggregate exceed 100,000. Performance Units
that are granted under this Plan, but are paid in Common Shares or are
not earned by the Participant at the end of the Performance Period,
shall be available for future grants of Performance Units hereunder.
4. OPTION RIGHTS. The Committee may from time to time
authorize grants to Participants of options to purchase Common Shares upon such
terms and conditions as the Committee may determine in accordance with the
following provisions:
(a) Each grant shall specify the number of Common Shares to
which it pertains; provided, however, that no participant shall be
granted Option Rights for more than 100,000 Common Shares in any one
fiscal year of the Corporation, subject to adjustment as provided in
Section 10 of this Plan.
(b) Each grant shall specify an Option Price per Common Share,
which may be less than, equal to or greater than the Market Value per
Share on the Date of Grant; provided, however, (i) the Option Price
shall equal at least 85% of the Market Value per Share on the Date of
Grant, or (ii) the Option Price with respect to each Incentive Stock
Option shall not be less than 100% (or 110%, in the case of an
individual described in Section 422(b)(6) of the Code (relating to
certain 10% owners)) of the Market Value per Share on the Date of Grant.
(c) Each grant shall specify the form of consideration to be
paid in satisfaction of the Option Price and the manner of payment of
such consideration, which may include (i) cash in the form of currency
or check or other cash equivalents acceptable to the Committee, (ii)
subject to Section 4(d), nonforfeitable, unrestricted Common Shares,
which are already owned by the Optionee and have a value at the time of
exercise that is equal to the Option Price, (iii) any other legal
consideration that the Committee may deem appropriate, including without
limitation any form of consideration authorized under Section 4(d)
below, on such basis as the Committee may determine in accordance with
this Plan and (iv) any combination of the foregoing.
(d) On or after the Date of Grant of any Nonqualified Option,
the Committee may determine that payment of the Option Price may also be
made in whole or in part in the form of Restricted Shares or other
Common Shares that are subject to risk of forfeiture or restrictions on
transfer. Unless otherwise determined by the Committee on or after the
Date of Grant, whenever any Option Price is paid in whole or in part by
means of any of the forms of consideration specified in this Section
4(d), the Common Shares received by the Optionee upon the exercise of
the Nonqualified Option shall be subject to the same risks of forfeiture
or restrictions on transfer as those that applied to the consideration
surrendered by the Optionee; provided, however, that such risks of
forfeiture and restrictions on transfer shall
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apply only to the same number of Common Shares received by the Optionee
as applied to the forfeitable or restricted Common Shares surrendered by
the Optionee.
(e) Any grant may provide for deferred payment of the Option
Price from the proceeds of sale through a broker on the date of exercise
of some or all of the Common Shares to which the exercise relates.
(f) On or after the Date of Grant of any Option Rights, the
Committee may provide for the automatic grant to the Optionee of Reload
Option Rights upon the exercise of Option Rights, including Reload
Option Rights for Common Shares or any other noncash consideration
authorized under Sections 4(c) and (d) above.
(g) Successive grants may be made to the same Participant
regardless of whether any Option Rights previously granted to the
Participant remain unexercised.
(h) Each grant shall specify the conditions, including as and to
the extent determined by the Committee, the period or periods of
continuous employment, or continuous engagement of the consulting
services, of the Optionee by the Corporation or any Subsidiary, or the
achievement of Management Objectives, that are necessary before the
Option Rights or installments thereof shall become exercisable, and any
grant may provide for the earlier exercise of the Option Rights,
including, without limitation, in the event of a change in control of
the Corporation or other similar transaction or event.
(i) Option Rights granted pursuant to this Section 4 may be
Nonqualified Options or Incentive Stock Options or combinations thereof,
as set forth in the award agreement.
(j) On or after the Date of Grant of any Nonqualified Option, the
Committee may provide for the payment to the Optionee of dividend
equivalents thereon in cash or Common Shares on a current, deferred or
contingent basis, or the Committee may provide that any dividend
equivalents shall be credited against the Option Price.
(k) No Option Right granted pursuant to this Section 4 may be
exercised more than 10 years from the Date of Grant (except that, in the
case of an individual described in Section 422(b)(6) of the Code
(relating to certain 10% owners) who is granted an Incentive Stock
Option, the term of such Option Right shall be no more than five years
from the Date of Grant).
(l) Each grant shall be evidenced by an agreement, which shall be
executed on behalf of the Corporation by any officer thereof and
delivered to and accepted by the Optionee and shall contain such terms
and provisions as the Committee may determine consistent with this Plan.
(m) The aggregate Market Value per Share, determined as of the
Date of Grant, of the Common Shares for which any Optionee may be
awarded Incentive Stock Options which are first exercisable by the
Optionee during any calendar year under this Plan (or any other
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stock option plan required to be taken into account under Section 422(d)
of the Code) shall not exceed $100,000.
(n) If and to the extent otherwise advisable herein or under the
applicable option agreement, upon and after the death of an Optionee,
such Optionee's Option Rights, to the extent exercisable after death may
be exercised by the Successors of the Optionee. An Option Right may be
exercised, and payment in full of the aggregate Option Price made, by
the Successors of an Optionee only by written notice (in the form
prescribed by the Committee) to the Corporation specifying the number of
Common Shares to be purchased. Such notice shall state that the
aggregate Option Price will be paid in full, or that the Option Right
will be exercised as otherwise provided hereunder, in the discretion of
the Corporation or the Committee, if and as applicable.
5. APPRECIATION RIGHTS. The Committee may also authorize grants
to Participants of Appreciation Rights. An Appreciation Right shall be a right
of the Participant to receive from the Corporation an amount, which shall be
determined by the Committee and shall be expressed as a percentage (not
exceeding 100 percent) of the Spread at the time of the exercise of an
Appreciation Right. Any grant of Appreciation Rights under this Plan shall be
upon such terms and conditions as the Committee may determine in accordance with
the following provisions:
(a) Any grant may specify that the amount payable upon the
exercise of an Appreciation Right may be paid by the Corporation in
cash, Common Shares or any combination thereof and may (i) either grant
to the Participant or reserve to the Committee the right to elect among
those alternatives or (ii) preclude the right of the Participant to
receive and the Corporation to issue Common Shares or other equity
securities in lieu of cash; provided, however, that no form of
consideration or manner of payment that would cause Rule 16b-3 to cease
to apply to this Plan shall be permitted.
(b) Any grant may specify that the amount payable upon the
exercise of an Appreciation Right shall not exceed a maximum specified
by the Committee on the Date of Grant.
(c) Any grant may specify (i) a waiting period or periods before
Appreciation Rights shall become exercisable and (ii) permissible dates
or periods on or during which Appreciation Rights shall be exercisable.
(d) Any grant may specify that an Appreciation Right may be
exercised only in the event of a change in control of the Corporation or
other similar transaction or event.
(e) On or after the Date of Grant of any Appreciation Rights,
the Committee may provide for the payment to the Participant of dividend
equivalents thereon in cash or Common Shares on a current, deferred or
contingent basis.
(f) Each grant shall be evidenced by an agreement, which shall
be executed on behalf of the Corporation by any officer thereof and
delivered to and accepted by the Optionee
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and shall contain such other terms and provisions as the Committee may
determine consistent with this Plan.
(g) Regarding Tandem Appreciation Rights only: Each grant
shall provide that a Tandem Appreciation Right may be exercised only (i)
at a time when the related Option Right (or any similar right granted
under any other plan of the Corporation) is also exercisable and the
Spread is positive and (ii) by surrender of the related Option Right (or
such other right) for cancellation.
(h) Regarding Free-standing Appreciation Rights only:
(i) Each grant shall specify in respect of each
Free-standing Appreciation Right a Base Price per Common Share,
which shall be equal to or greater than the Market Value per
Share on the Date of Grant;
(ii) Successive grants may be made to the same
Participant regardless of whether any Free-standing Appreciation
Rights previously granted to the Participant remain unexercised;
provided, however, that no participant shall be granted more
than 100,000 Freestanding Appreciation Rights in any one fiscal
year of the Corporation, subject to adjustment as provided in
Section 10 of this Plan;
(iii) Each grant shall specify the conditions, including
as and to the extent determined by the Committee, the period or
periods of continuous employment, or continuous engagement of the
consulting services, of the Participant by the Corporation or any
Subsidiary, or the achievement of Management Objectives, that are
necessary before the Free-standing Appreciation Rights or
installments thereof shall become exercisable, and any grant may
provide for the earlier exercise of the Free-standing
Appreciation Rights, including, without limitation, in the event
of a change in control of the Corporation or other similar
transaction or event; and
(iv) No Free-standing Appreciation Right granted under
this Plan may be exercised more than 10 years from the Date of
Grant.
6. RESTRICTED SHARES. The Committee may also authorize
grants or sales to Participants of Restricted Shares upon such terms and
conditions as the Committee may determine in accordance with the following
provisions:
(a) Each grant or sale shall constitute an immediate transfer
of the ownership of Common Shares to the Participant in consideration of
the performance of services, or as and to the extent determined by the
Committee, the achievement of Management Objectives, entitling such
Participant to dividend, voting and other ownership rights, subject to
the substantial risk of forfeiture and restrictions on transfer
hereinafter referred to.
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<PAGE> 8
(b) Each grant or sale may be made without additional
consideration from the Participant or in consideration of a payment by
the Participant that is less than the Market Value per Share on the Date
of Grant.
(c) Each grant or sale shall provide that the Restricted
Shares covered thereby shall be subject to a "substantial risk of
forfeiture" within the meaning of Section 83 of the Code for a period to
be determined by the Committee on the Date of Grant, and any grant or
sale may provide for the earlier termination of such period, including
without limitation, in the event of a change in control of the
Corporation or other similar transaction or event.
(d) Each grant or sale shall provide that, during the period
for which such substantial risk of forfeiture is to continue, the
transferability of the Restricted Shares shall be prohibited or
restricted in the manner and to the extent prescribed by the Committee
on the Date of Grant. Such restrictions may include, without limitation,
rights of repurchase or first refusal in the Corporation or provisions
subjecting the Restricted Shares to a continuing substantial risk of
forfeiture in the hands of any transferee.
(e) Any grant or sale may require that any or all dividends or
other distributions paid on the Restricted Shares during the period of
such restrictions be automatically sequestered and reinvested on an
immediate or deferred basis in additional Common Shares, which may be
subject to the same restrictions as the underlying award or such other
restrictions as the Committee may determine.
(f) Each grant or sale shall be evidenced by an agreement,
which shall be executed an behalf of the Corporation by any officer
thereof and delivered to and accepted by the Participant and shall
contain such terms and provisions as the Committee may determine
consistent with this Plan. Unless otherwise directed by the Committee,
all certificates representing Restricted Shares, together with a stock
power that shall be endorsed in blank by the Participant with respect to
the Restricted Shares, shall be held in custody by the Corporation until
all restrictions thereon lapse.
7. DEFERRED SHARES. The Committee may also authorize
grants or sales of Deferred Shares to Participants upon such terms and
conditions as the Committee may determine in accordance with the following
provisions:
(a) Each grant or sale shall constitute the agreement by the
Corporation to issue or transfer Common Shares to the Participant in the
future in consideration of the performance of services rendered, subject
to the fulfillment during the Deferral Period of such conditions as the
Committee may specify.
(b) Each grant or sale may be made without additional
consideration from the Participant or in consideration of a payment by
the Participant that is less than the Market value per Share on the Date
of Grant.
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<PAGE> 9
(c) Each grant or sale shall provide that the Deferred Shares
covered thereby shall be subject to a Deferral Period, which shall be
fixed by the Committee on the Date of Grant, and any grant or sale may
provide for the earlier termination of the Deferral Period, including
without limitation, in the event of a change in control of the
Corporation or other similar transaction or event.
(d) During the Deferral Period, the Participant shall not have
any right to transfer any rights under the subject award, shall not have
any rights of ownership in the Deferred Shares and shall not have any
right to vote the Deferred Shares, but the Committee may on or after the
Date of Grant authorize the payment of dividend equivalents on the
Deferred Shares in cash or additional Common Shares on a current,
deferred or contingent basis.
(e) Each grant or sale shall be evidenced by an agreement,
which shall be executed on behalf of the Corporation by any officer
thereof and delivered to and accepted by the Participant and shall
contain such terms and provisions as the Committee may determine
consistent with this Plan.
8. PERFORMANCE SHARES AND PERFORMANCE UNITS. The Committee
may also authorize grants of Performance Shares and Performance Units, which
shall become payable to the Participant upon the achievement of specified
Management Objectives, upon such terms and conditions as the Committee may
determine in accordance with the following provisions:
(a) Each grant shall specify the number of Performance Shares
or Performance Units to which it pertains, which may be subject to
adjustment to reflect changes in compensation or other factors.
(b) The Performance Period with respect to each Performance
Share or Performance Unit shall be determined by the Committee on the
Date of Grant and may be subject to earlier termination, including,
without limitation, in the event of a change in control of the
Corporation or other similar transaction or event.
(c) Each grant shall specify the Management Objectives that
are to be achieved by the Participant.
(d) Each grant shall specify in respect of the specified
Management Objectives a minimum acceptable level of achievement below
which no payment will be made and shall set forth a formula for
determining the amount of any payment to be made if performance is at or
above the minimum acceptable level but falls short of full achievement
of the specified Management Objectives.
(e) Each grant shall specify the time and manner of payment of
Performance Shares or Performance Units that shall have been earned, and
any grant may specify that any such amount may be paid by the
Corporation in cash, Common Shares or any combination thereof and may
either grant to the Participant or reserve to the Committee the right to
elect
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<PAGE> 10
among those alternatives; provided, however, that no form of
consideration or manner of payment that would cause Rule 16b-3 to cease
to apply to this Plan shall be permitted.
(f) Any grant of Performance Shares may specify that the amount
payable with respect thereto may not exceed a maximum specified by the
Committee on the Date of Grant. Any grant of Performance Units may
specify that the amount payable, or the number of Common Shares issued,
with respect thereto may not exceed maximums specified by the Committee
on the Date of Grant.
(g) On or after the Date of Grant of Performance Shares, the
Committee may provide for the payment to the Participant of dividend
equivalents thereon in cash or additional Common Shares on a current,
deferred or contingent basis.
(h) Each grant shall be evidenced by an agreement, which shall be
executed on behalf of the Corporation by any officer thereof and
delivered to and accepted by the Participant and shall contain such
terms and provisions as the Committee may determine consistent with this
Plan.
9. TRANSFERABILITY. (a) No Option Right or other derivative
security (as that term is used in Rule 16b-3) granted under this Plan may be
transferred by a Participant except by will or the laws of descent and
distribution. Option Rights and Appreciation Rights granted under this Plan may
not be exercised during a Participant's lifetime except by the Participant or,
in the event of the Participant's legal incapacity, by his guardian or legal
representative acting in a fiduciary capacity on behalf of the Participant under
state law and court supervision.
(b) Any grant made under this Plan may provide that all or any
part of the Common Shares that are to be issued or transferred by the
Corporation upon the exercise of Option Rights or Appreciation Rights or upon
the termination of the Deferral Period applicable to Deferred Shares or in
payment of Performance Shares or Performance Units, or are no longer subject to
the substantial risk of forfeiture and restrictions on transfer referred to in
Section 6 of this Plan, shall be subject to further restrictions upon transfer.
10. ADJUSTMENTS. The Committee may make or provide for such
adjustments in the number of Common Shares covered by outstanding awards granted
hereunder, the Option Prices per Common Share or Base Prices per Common Share
applicable to any such awards, and the kind of shares (including shares of
another issuer) covered thereby, as the Committee may in good faith determine to
be equitably required in order to prevent dilution or expansion of the rights of
Participants that otherwise would result from (a) any stock dividend, stock
split, combination of shares, recapitalization or other change in the capital
structure of the Corporation or (b) any merger, consolidation, spin-off,
spin-out, split-off, split-up, reorganization, partial or complete liquidation
or other distribution of assets, issuance of warrants or other rights to
purchase securities or any other corporate transaction or event having an effect
similar to any of the foregoing. In the event of any such transaction or event,
the Committee may provide in substitution for any or all outstanding awards
under this Plan such alternative consideration as it may in good faith determine
to be equitable under the circumstances and may require in connection therewith
the surrender of all awards so replaced.
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<PAGE> 11
Moreover, the Committee may on or after the Date of Grant provide in the
agreement evidencing any award under this Plan that the holder of the award may
elect to receive an equivalent award in respect of securities of the surviving
entity of any merger, consolidation or other transaction or event having a
similar effect, or the Committee may provide that the holder will automatically
be entitled to receive such an equivalent award. The Committee may also make or
provide for such adjustments in the maximum number of Common Shares specified in
Section 3(a) of this Plan, the maximum number of Performance Units specified in
Section 3(b), and the maximum number of Common Shares and Free-standing
Appreciation Rights specified in Sections 4(a) and 5(h)(ii) of this Plan as the
Committee may in good faith determine to be appropriate in order to reflect any
transaction or event described in this Section 10.
11. FRACTIONAL SHARES. The Corporation shall not be required
to issue any fractional Common Shares pursuant to this Plan. The Committee may
provide for the elimination of fractions or for the settlement thereof in cash.
12. WITHHOLDING TAXES. To the extent that the Corporation is
required to withhold federal, state, local or foreign taxes in connection with
any payment made or benefit realized by a Participant or other person under this
Plan, and the amounts available to the Corporation for the withholding are
insufficient, it shall be a condition to the receipt of any such payment or the
realization of any such benefit that the Participant or such other person make
arrangements satisfactory to the Corporation for payment of the balance of any
taxes required to be withheld. At the discretion of the Committee and subject to
the provisions of Rule 16b-3, any such arrangements may include relinquishment
of a portion of any such payment or benefit. The Corporation and any Participant
or such other person may also make similar arrangements with respect to the
payment of any taxes with respect to which withholding is not required.
13. CERTAIN TERMINATIONS OF EMPLOYMENT OR CONSULTING SERVICES,
HARDSHIP AND APPROVED LEAVES OF ABSENCE. Notwithstanding any other provision of
this Plan to the contrary, in the event of termination of employment or
consulting services by reason of death, disability, normal retirement, early
retirement, with the consent of the Corporation, termination of employment or
consulting services to enter public service with the consent of the Corporation
or leave of absence approved by the Corporation, or in the event of hardship or
other special circumstances, of a Participant who holds an Option Right or
Appreciation Right that is not immediately and fully exercisable, any Restricted
Shares as to which the substantial risk of forfeiture or the prohibition or
restriction on transfer has not lapsed, any Deferred Shares as to which the
Deferral Period is not complete, any Performance Shares or Performance Units
that have not been fully earned, or any Common Shares that are subject to any
transfer restriction pursuant to Section 9(b) of this Plan, the Committee may
take any action that it deems to be equitable under the circumstances or in the
best interests of the Corporation, including without limitation, waiving or
modifying any limitation or requirement with respect to any award under this
Plan.
14. ADMINISTRATION OF THE PLAN. (a) This Plan shall be
administered by a Committee of the Board, which shall be composed of not less
than two members of the Board, each of whom shall be a "disinterested person"
within the meaning of Rule 16b-3.
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<PAGE> 12
(b) The interpretation and construction by the Committee of
any provision of this Plan or any agreement, notification or document evidencing
the grant of Option Rights, Appreciation Rights, Restricted Shares, Deferred
Shares, Performance Shares or Performance Units, and any determination by the
Committee pursuant to any provision of this Plan or any such agreement,
notification or document, shall be final and conclusive. No member of the
Committee shall be liable for any such action taken or determination made in
good faith.
15. AMENDMENTS AND OTHER MATTERS. (a) This Plan may be amended
from time to time by the Committee; provided, however, that except as expressly
authorized by this Plan, no such amendment shall increase the number of Common
Shares specified in Section 3(a) hereof, increase the number of Performance
Units specified in Section 3(b) hereof, or otherwise cause this Plan to cease to
satisfy any applicable condition of Rule 16b-3, without further approval of the
stockholders of the Corporation.
(b) With the concurrence of the affected Participant, the
Committee may cancel any agreement evidencing Option Rights or any other award
granted under this Plan. In the event of any such cancellation, the Committee
may authorize the granting of new Option Rights or other awards hereunder, which
may or may not cover the same number of Common Shares or Performance Units as
had been covered by the cancelled Option Rights or other award, at such Option
Price, in such manner and subject to such other terms, conditions and discretion
as would have been permitted under this Plan had the cancelled Option Rights or
other award not been granted.
(c) The Committee may grant under this Plan any award or
combination of awards authorized under this Plan in exchange for the
cancellation of an award that was not granted under this Plan, including without
limitation any award that was granted prior to the adoption of this Plan by the
Board, and any such award or combination of awards so granted under this Plan
may or may not cover the same number of Common Shares as had been covered by the
cancelled award and shall be subject to such other terms, conditions and
discretion as would have been permitted under this Plan had the cancelled award
not been granted.
(d) This Plan shall not confer upon any Participant any right
with respect to continuance of employment or other service with the Corporation
or any Subsidiary and shall not interfere in any way with any right that the
Corporation or any Subsidiary would otherwise have to terminate any
Participant's employment or other service at any time.
(e) (i) To the extent that any provision of this Plan
would prevent any Option Right that was intended to
qualify as an Incentive Stock Option from so qualifying,
any such provision shall be null and void with respect to
any such Option Right: provided, however, that any such
provision shall remain in effect with respect to other
Option Rights, and there shall be no further effect on any
provision of this Plan.
(ii) Any award that may be made pursuant to an
amendment to this Plan that shall have been adopted
without the approval of the stockholders of the
Corporation shall be null and void if it is subsequently
determined that such
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<PAGE> 13
approval was required in order for this Plan to continue
to satisfy the applicable conditions of Rule 16b-3.
16. TERMINATION OF THE PLAN. No further awards shall be
granted under this Plan after the passage of 10 years from the date on which
this Plan is first approved by the stockholders of the Corporation.
17. EFFECTIVE DATE. The effective date of this Plan (the
Effective Date") shall be April 6, 1996, provided, however, that this Plan and
each award granted hereunder shall be void and of no force or effect until and
unless this Plan shall have been approved by a vote of the holders of the
majority of the Common Shares of the Corporation present, or represented, and
entitled to vote at a meeting duly held in accordance with Colorado law.
18. NONTRANSFERABILITY. Each award granted under this Plan
shall by its terms be nontransferable by the Participant except by will or the
laws of decent and distribution of the state wherein the Participant is
domiciled at the time of his death; provided, however, that the Committee may
(but need not) permit other transfers, to the extent consistent with Rule 16b-3;
where the Committee concludes that such transferability does not result in
accelerated taxation and is otherwise appropriate and desirable.
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<PAGE> 1
EXHIBIT 4.5
SABA PETROLEUM COMPANY
1997 STOCK OPTION PLAN FOR
NON-EMPLOYEE DIRECTORS
<PAGE> 2
SABA PETROLEUM COMPANY
1997 STOCK OPTION PLAN FOR NON-EMPLOYEE DIRECTORS
<TABLE>
<CAPTION>
TABLE OF CONTENTS
-----------------
PAGE
----
<S> <C> <C>
1. Purposes ......................................................................... 1
2. Definitions ...................................................................... 1
3. Shares Available under the Plan .................................................. 2
4. Automatic Grants of Nonqualified Options to Nonemployee Directors................. 3
5. Adjustments ...................................................................... 4
6. Fractional Shares ................................................................ 4
7. Administration of the Plan ....................................................... 5
8. Amendments and Other Matters ..................................................... 5
9. No Additional Rights ............................................................. 5
10. Securities Law Matters ........................................................... 6
11. Change in Control ................................................................ 6
12. Termination of the Plan .......................................................... 7
</TABLE>
<PAGE> 3
SABA PETROLEUM COMPANY
1997 STOCK OPTION PLAN FOR NON-EMPLOYEE DIRECTORS
1. Purposes. The purposes of this Plan are to encourage
outside Directors of Saba Petroleum Company ("Corporation") to own shares of the
Corporation's stock and thereby to align their interests more closely with the
interests of the other stockholders of the Corporation, to encourage the highest
level of Director performance by providing the Directors with a direct interest
in the Corporation's attainment of its financial goals, and to provide financial
incentives that will help attract and retain the most qualified Directors.
2. Definitions. As used in this Plan:
"BOARD" means the Board of Directors of the Corporation.
"CHANGE IN CONTROL" has the meaning set forth in Section 11.
"CODE" means the Internal Revenue Code of 1986, as amended from
time to time.
"COMMITTEE" means the Committee described in Section 7 of this
Plan.
"COMMON SHARES" means (i) shares of the Common Stock, no par
value, of the Corporation and (ii) any security into which Common Shares may be
converted by reason of any transaction or event of the type referred to in
Section 5 of this Plan.
"DATE OF GRANT" means the date on which a grant of Nonqualified
Options shall become effective as provided in Section 4(a).
"DIRECTOR" means a member of the Board who is not an employee of
the Corporation. For purposes of this Plan, an employee is an individual whose
wages are subject to the withholding of federal income tax under Section 3401
and 3402 of the Code. A Director who becomes an employee (within the meaning of
this Section) shall not forfeit any Option Right granted hereunder solely by
reason of assuming employee status.
"DISABILITY" means the inability to engage in any substantial
gainful activity by reason of any medically determinable physical or mental
impairment which can be expected to result in death or which has lasted or can
be expected to last for a continuous period of not less than 12 months. A
Director shall not be considered to be subject to a Disability until he
furnishes a certification from a practicing physician in good standing to the
effect that such Director meets the criteria described in this Section.
"EFFECTIVE DATE" means _____________________,1997.
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<PAGE> 4
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
"MARKET VALUE" as of a given date means (a) the closing sale
price of the Common Shares on the American Stock Exchange (the "AMEX"), or (b)
if the price of the Common Shares is not reported on the AMEX, the closing sale
price of the Common Shares on the principal securities exchange on which such
Common Shares are then trading on such date, or (c) if the Common Shares are not
listed on a securities exchange, the closing sale price of the Common Shares as
reported on the National Association of Securities Dealers Automated Quotation
System ("NASDAQ") on such date. If there are no Common Share transactions on
such date, the Market Value per Common Share shall be determined as of the
immediately preceding date on which there were Common Share transactions.
"NONQUALIFIED OPTION" means an option to purchase shares of
Common Stock that is not intended to qualify as an incentive stock option under
Section 422 of the Code.
"OPTIONEE" means the Director so designated in an agreement
evidencing an outstanding Option Right.
"OPTION PRICE" means the purchase price payable upon the exercise
of an Option Right.
"OPTION RIGHT" means the right to purchase Common Shares from the
Corporation upon the exercise of a Nonqualified Option granted pursuant to this
Plan. Option Rights shall be evidenced by written agreements containing terms
and conditions not inconsistent with this Plan.
"PLAN" means the Saba Petroleum Company 1997 Stock Option Plan
for Non-Employee Directors, as the same may be amended from time to time.
"RULE 16B-3" means Rule 16b-3, as promulgated and amended from
time to time by the Securities and Exchange Commission under the Exchange Act.
"TERMINATION OF SERVICE" means the time at which the Optionee
ceases to serve as a member of the Board for any reason, with or without cause,
which includes termination by resignation, removal, death or retirement.
"VOTING STOCK" has the meaning set forth in Section 1(a).
3. SHARES AVAILABLE UNDER THE PLAN. (a) Subject to Sections
3(b) and 5 of this Plan, the number of Common Shares issued or transferred, plus
the number of Common Shares covered by outstanding awards granted under this
Plan, shall not in the aggregate exceed 250,000 Common Shares, which may be
Common Shares of original issuance or Common Shares held in treasury or a
combination thereof.
(b) For the purposes of this Section 3, any Common Shares
subject to an Option
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<PAGE> 5
Right that has been cancelled or terminated shall again be available for the
grant of Option Rights under this Plan.
4. AUTOMATIC GRANTS OF NONQUALIFIED OPTIONS TO NONEMPLOYEE
DIRECTORS.
(a) The following Nonqualified Options shall be granted under
this Plan:
(i) As of the Effective Date of this Plan, an option
to purchase 3,000 Common Shares is granted to each person who on
such date is an incumbent Director of the Corporation, and a
Nonqualified Option to purchase 3,000 Common Shares shall be
automatically granted to each such person on the first day of
each year thereafter for so long as he continues to serve as a
Non-Employee Director.
(ii) With respect to each person who first becomes a
Director of the Corporation after the Effective Date of this
Plan, an option to purchase 3,000 Common Shares shall be
automatically granted as of the date such person first becomes a
Director, and a Nonqualified Option to purchase 3,000 Common
Shares shall be automatically granted to each such person on the
first day of each year thereafter for so long as he or she
continues to serve as a Non-Employee Director and provided that
he or she has served as a Non-Employee Director for at least six
months prior thereto.
(b) The Option Price per share of each Nonqualified Option shall
be the Market Value per Common Share as of the Date of Grant.
(c) (i) Subject to subsection (ii) of this Section 4(c) and
Section 12 of this Plan, each Nonqualified Options, until terminated as provided
in Section 4(d), shall become exercisable to the extent of 20% of the Common
Shares subject thereto on the first anniversary of Date of Grant and to the
extent of an additional 20% of the Common Shares subject thereto after each of
the first four anniversaries of such date, for so long as the Optionee continues
to serve as a member of the Board of Directors. To the extent exercisable, each
Nonqualified Option shall be exercisable in whole or in part from time to time.
(ii) If an Optionee ceases to be a Director by reason of
death or Disability, all Nonqualified Options held by such
Optionee that would have otherwise become exercisable had such
Director continuously served as a Director through the date of
the Corporation's annual meeting of stockholders immediately
following such death or Disability shall, notwithstanding
subsection (i) of this Section 4(c), become immediately
exercisable in full.
(d) Each Nonqualified Option shall terminate on the earliest
of the following dates:
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<PAGE> 6
(i) Three (3) months following the effective date of
the Optionee's Termination of Service, if such Termination of
Service results other than from Optionee's death or Disability;
(ii) One (1) year following the effective date of the
optionee's Termination of service, if such Termination of Service
results from Optionee's death or Disability; or
(iii) Ten (10) years from the Date of Grant.
(e) The Option Price shall be payable (a) in cash or by check
acceptable to the Corporation, (b) by transfer to the Corporation of Common
Shares which have been owned by the Optionee for more than six months prior to
the date of exercise and which have a Market Value on the date of exercise equal
to the Option Price, or (c) by a combination of such methods of payment. The
requirement of payment in cash shall be deemed satisfied if the Optionee shall
have made arrangements satisfactory to the Corporation with a broker who is a
member of the National Association of Securities Dealers, Inc. to sell on the
exercise date a sufficient number of the shares being purchased so that the net
proceeds of the sale transaction will at least equal the option exercise price
and pursuant to which the broker undertakes to deliver the full option exercise
price to the Corporation not later than the date on which the sale transaction
will settle in the ordinary course of business.
(f) Nonqualified Options granted pursuant to this Section 4
shall be options that are not intended to qualify under any particular provision
of the Code.
5. ADJUSTMENTS. The Committee shall make or provide for such
adjustments in the number of Common Shares covered by awards made hereunder, the
Option Prices per Common Share applicable to any such awards, and the kind of
shares (including shares of another issuer) covered thereby, as the Committee
shall in good faith determine to be equitably required in order to prevent
dilution or expansion of the rights of Optionees that otherwise would result
from (a) any stock dividend, stock split, combination of shares,
recapitalization or other change in the capital structure of the Corporation, or
(b) any merger, consolidation, spin-off, spin-out, split-off, split-up,
reorganization, partial or complete liquidation or other distribution of assets,
issuance of warrants or other rights to purchase securities or any other
corporate transaction or event having an effect similar to any of the foregoing.
The Committee shall also make or provide for such adjustments in the maximum
number of Common Shares specified in Section 3(a) of this Plan as the Committee
may in good faith determine to be appropriate in order to reflect any
transaction or event described in this Section 5.
6. FRACTIONAL SHARES. The Corporation shall not be required
to issue any fractional Common Shares pursuant to this Plan. Whenever under the
terms of this Plan a fractional Common Share would otherwise be required to be
issued, an amount in lieu thereof shall be paid in cash based upon the Market
Value of such fractional Common Share.
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<PAGE> 7
7. ADMINISTRATION OF THE PLAN. (a) This Plan shall be
administered by a committee of the Board, which shall be composed of not less
than two members of the Board ("Committee"). Notwithstanding the foregoing,
grants of Option Rights under this Plan shall be automatic as described in
Section 4, and the Committee shall have no authority, discretion or power to
determine the terms of the Option Rights to be granted pursuant to the Plan, the
number of Common Shares to be issued thereunder or the time at which such Option
Rights are to be granted, or establish the duration and nature of Option Rights,
except in the sense of administering the Plan subject to the provisions of the
Plan.
(b) Subject to subsection (a) of this Section 7, the
interpretation and construction by the Committee of any provision of this Plan
or any agreement, notification or document evidencing the grant of Option
Rights, and any determination by the Committee pursuant to any provision of this
Plan or any such agreement, notification or document, shall be final and
conclusive. No member of the Committee shall be liable for any such action taken
or determination made in good faith.
8. AMENDMENTS AND OTHER MATTERS. (a) This Plan may be terminated,
and from time to time amended, by the Board; provided, however, that except as
expressly authorized by this Plan, no such amendment shall (i) increase the
number of Common Shares specified in Section 3(a) hereof, materially modify the
requirements as to eligibility for participation in this Plan, or otherwise
cause this Plan or any grant, award or election made pursuant to this Plan to
cease to satisfy any applicable condition of Rule 16b-3, without further
approval of the stockholders of the Corporation, or (ii) cause any Optionee to
fail to qualify as a "disinterested person" within the meaning of Rule 16b-3;
provided, further, that Plan provisions relating to the amount and price of
securities to be awarded and the timing of awards under the Plan shall not be
amended more than once every six months, other than to comport with changes in
the Code, the Employment Retirement Income Security Act, or the rules
promulgated thereunder. No amendment or termination of the Plan shall adversely
affect any outstanding award theretofore granted under the Plan without the
consent of the Director holding such award.
(b) Any grant, award or election that may be made pursuant to an
amendment to this Plan shall be null and void if it is subsequently determined
that (i) stockholder approval of such amendment was required in order for this
Plan to continue to satisfy the applicable conditions of Rule 16b-3, or (ii)
such grant, award, election or amendment disqualified any optionee as a
"disinterested person" within the meaning of Rule 16b-3.
9. NO ADDITIONAL RIGHTS. Nothing contained in this Plan or in any
award granted under this Plan shall interfere with or limit in any way the right
of the stockholders of the Corporation to remove any Director from the Board
pursuant to state law or the Bylaws or Articles of Incorporation of the
Corporation, nor confer upon any Director any right to continue in the service
of the Corporation.
10. SECURITIES LAW MATTERS. (a) The Corporation may require any
Optionee, as a condition of receiving option Rights, to give written assurances
in substance and form
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<PAGE> 8
satisfactory to the Corporation and its counsel to the effect that such person
is acquiring the Common Shares subject to the Option Rights for his own account
for investment and not with any present intention of selling or otherwise
distributing the same, and to such other effects as the Corporation deems
necessary or appropriate in order to comply with federal and applicable state
securities laws.
(b) Each award of Option Rights shall be subject to the
requirement that, if at any time counsel to the Corporation shall determine that
the listing, registration or qualification of the Common Shares subject to such
Option Rights upon any securities exchange or under any state or federal law, or
the consent or approval of any governmental or regulatory body, is necessary as
a condition of, or in connection with, the issuance of shares thereunder, such
award of Option Rights may not be accepted or exercised in whole or in part
unless such listing, registration, qualification, consent or approval shall have
been effected or obtained on conditions acceptable to such counsel. Nothing
herein shall be deemed to require the Corporation to apply for or to obtain such
listing, registration or qualification.
(c) To the extent necessary for an Option Right, its exercise or
the sale of Common Shares acquired thereunder to be exempt from Section 16(b) of
the Exchange Act, such Option Right shall be held six months from the Date of
Grant, or at least six months shall elapse from the Date of Grant to the date of
disposition of the Common Shares acquired upon exercise of such Option Right.
11. CHANGE IN CONTROL. Upon a Change in Control (as hereinafter
defined), all Nonqualified Options held by an Optionee that would become
exercisable with respect to such Optionee's service as a Director through the
date of the Corporation's annual meeting of stockholders immediately following
such Change in Control shall, notwithstanding Section 4(c) of this Plan, become
immediately exercisable in full. If any event or series of events constituting a
change in control shall be abandoned, the effect thereof shall be null and of no
further force and effect and the provisions of section 4(c) shall be reinstated
but without prejudice to any exercise of any Option Right that may have occurred
prior to such nullification. For purposes of this Plan, "Change in Control"
means the occurrence of any of the following events:
(a) The execution by the Corporation of an agreement for the
merger, consolidation or reorganization into or with another corporation or
other legal person; provided, however, that no such merger, consolidation or
reorganization shall constitute a Change in Control if as a result of such
merger, consolidation or reorganization not less than a majority of the combined
voting power of the then-outstanding securities of such corporation or person
immediately after such transaction are held in the aggregate by the holders of
securities entitled to vote generally in the election of directors of the
Corporation ("Voting Stock") immediately prior to such transaction;
(b) The execution by the Corporation of an agreement for the sale
or other transfer of all or substantially all of its assets to another
corporation or other legal person; provided, however, that no such sale or other
transfer shall constitute a Change in Control if as a
6
<PAGE> 9
result of such sale or transfer not less than a majority of the combined voting
power of the then-outstanding securities of such corporation or person
immediately after such sale or transfer is held in the aggregate by the holders
of Voting Stock of the Corporation immediately prior to such sale or transfer.
(c) There is a report filed on Schedule 13D or Schedule 14D-1 (or
any successor schedule, form or report), each as promulgated pursuant to the
Exchange Act disclosing that any person (as the term "person" is used in Section
13(d)(3) or Section 14(d)(2) of the Exchange Act) (other than any person (or any
of their affiliates) that owns beneficially or of record more than ten percent
of the Common Shares on the Effective Date) has or intends to become the
beneficial owner (as the term "beneficial owner" is defined under Rule 13d-3 or
any successor rule or regulation promulgated under the Exchange Act) of
securities representing a majority or more of the combined voting power of the
then-outstanding Voting Stock, including, without limitation, pursuant to a
tender offer or exchange offer;
(d) If, during any period of two consecutive years, individuals
who at the beginning of any such period constitute the directors of the
Corporation cease for any reason to constitute at least a majority thereof;
provided, however, that for purposes of this subsection (d) each director who is
first elected, or first nominated for election by the Corporation's
stockholders, by a vote of at least two-thirds of the directors of the
Corporation (or a committee thereof) then still in office who were directors of
the Corporation at the beginning of any such period shall be deemed to have been
a director of the Corporation at the beginning of such period; or
(e) except pursuant to a transaction described in the proviso to
subsection (a) of this Section 11, the Corporation adopts a plan for the
liquidation or dissolution of the Corporation.
Notwithstanding the foregoing, to the extent necessary for an
Option Right, its exercise or the sale of Common Shares acquired thereunder to
be exempt from Section 16(b) of the Exchange Act (i) except in the case of death
or Disability, an Optionee shall not be entitled to exercise any Option Rights
granted within six months prior to the occurrence of a Change in Control until
the expiration of the six-month period following the Date of Grant of such
Option Rights, or (ii) at least six months shall elapse from the Date of Grant
of such Option Rights to the date of disposition of the Common Shares acquired
upon exercise of such Option Rights.
12. TERMINATION OF THE PLAN. No further awards shall be granted
under this Plan after the passage of ten years from the date on which this Plan
is first approved by the stockholders of the Corporation.
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<PAGE> 1
LAW OFFICE OF DAVID M. GRIFFITH, EXHIBIT 5.1
A PROFESSIONAL CORPORATION
ONE WORLD TRADE CENTER, SUITE 800
LONG BEACH, CA 90831-0800
TELEPHONE: 310-983-8017
FACSIMILE: 310-983-8122
August 15, 1997
Saba Petroleum Company
3201 Airpark Drive, Suite 201
Santa Maria, CA 93455
RE: Saba Petroleum Company
Registration Statement on Form S-8
Ladies & Gentlemen:
Saba Petroleum Company, a Delaware corporation (the "Company"), proposes to
issue under a Form S-8 Registration Statement (the "Registration Statement") up
to 1,250,000 shares of Common Stock (the "Shares"), pursuant to the Saba
Petroleum Company 1996 Incentive Equity Plan and the Saba Petroleum Company 1997
Stock Option Plan for Non-Employee Directors (the "Plans").
In rendering the following opinion, we have examined and relied only upon the
documents and certificates of officers of the Company as are specifically
described below. In our examination, we have assumed the genuineness of all
signatures, the authenticity, accuracy and completeness of the documents
submitted to us as originals, and the conformity with the original documents of
all documents submitted to us as copies. Our examination was limited to the
following documents and no others:
1. Certificate of Incorporation of the Company, as amended to date;
2. By-Laws of the Company;
3. Resolutions adopted by the Board of Directors of the Company authorizing
the Plans and the issuance of the Shares;
4. The Registration Statement, together with all amendments thereto,
exhibits filed in connection therewith and incorporated therein by
reference and form of prospectus contained therein including all
documents incorporated therein by reference; and
5. The Plans.
We have not undertaken, nor do we intend to undertake, any independent
investigation beyond such documents and records, or to verify the adequacy or
accuracy of such documents and records.
Based upon and subject to the foregoing, it is our opinion that the Shares,
subject to effectiveness of the Registration Statement and compliance with
applicable Blue Sky laws, and subject to the proper execution and delivery of
stock certificates evidencing the Shares, when issued and delivered against
payment therefor in accordance with the terms of the Plans, and as set forth in
the Registration Statement, will constitute legally issued, fully paid and
nonassessable shares of common stock of the Company.
<PAGE> 2
August 15, 1997
Saba Petroleum Company
Registration Statement on Form S-8
Page 2
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement; and to the filing of this opinion in connection with
such filings of applications as may be necessary to register, qualify or
establish eligibility for an exemption from registration or qualification of the
Shares under the blue sky laws of any state or other jurisdiction although we
express no opinion as to state securities laws herein. In giving this consent,
we do not admit that we are in the category of persons whose consent is required
under Section 7 of the Act or the rules and regulations of the Commission
promulgated thereunder.
The opinions set forth herein are based upon the federal laws of the United
States of America, and the corporate laws of the State of Delaware all as now in
effect. We express no opinion as to whether the laws of any particular
jurisdiction apply, and no opinion to the extent that the laws of any
jurisdiction other than those identified above are applicable to the subject
matter hereof.
The information set forth herein is as of the date of this letter. We disclaim
any undertaking to advise you of changes which may be brought to our attention
after the effective date of the Registration Statement.
Sincerely,
/s/ DAVID M. GRIFFITH
- --------------------------------
Law Office of David M. Griffith,
a Professional Corporation
<PAGE> 1
EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this registration statement on
Form S-8 (File No. 33-___) of our report dated March 26, 1997, on our audits of
the consolidated financial statements of Saba Petroleum Company and subsidiaries
as of December 31, 1996 and 1995 and for the years then ended.
/s/ COOPERS & LYBRAND L.L.P.
COOPERS & LYBRAND L.L.P.
Los Angeles, California
August 18, 1997
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