<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S)240.14a-11(c) or (S)240.14a-12
ENERGY VENTURES, INC.
- - --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- - -------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
[_] $500 per each party to the controversy pursuant to Exchange Act Rule 14a-
6(i)(3).
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
<PAGE>
[EVI SYMBOL]
ENERGY VENTURES, INC.
NOTICE OF 1995
ANNUAL MEETING OF
STOCKHOLDERS
AND
PROXY STATEMENT
Annual Meeting
--------------
May 19, 1995
The Ritz-Carlton Hotel
1919 Briar Oaks
Houston, Texas 77027
<PAGE>
ENERGY VENTURES, INC.
5 Post Oak Park, Suite 1760
Houston, Texas 77027-3415
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held May 19, 1995
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of Energy
Ventures, Inc. (the "Company") will be held at The Ritz-Carlton Hotel, 1919
Briar Oaks, Houston, Texas 77027 on Friday, May 19, 1995 at 10:00 a.m., Central
Daylight Savings Time, for the following purposes:
1. To vote on the election of six directors to the Board of Directors.
2. To consider for approval certain amendments to the Company's Non-Employee
Director Stock Option Plan.
3. To transact such other business as may properly come before the meeting
or any adjournment(s) thereof.
Information with respect to the above matters is set forth in the Proxy
Statement which accompanies this Notice.
The Board of Directors has fixed the close of business on March 24, 1995, as
the record date for the determination of stockholders entitled to notice of and
to vote at such meeting or any adjournment or adjournments thereof. Only
stockholders of record at the close of business on such record date are entitled
to notice of and to vote at such meeting. The transfer books will not be
closed.
You are cordially invited to attend the meeting. However, to ensure your
representation at the meeting, the Company requests that you return your signed
proxy card at your earliest convenience, whether or not you plan to attend the
meeting. Your proxy will be returned to you if you should be present at the
meeting and should request such a return.
PLEASE SIGN, DATE AND RETURN THE ENCLOSED PROXY AT YOUR EARLIEST CONVENIENCE.
THE ENCLOSED RETURN ENVELOPE MAY BE USED FOR THAT PURPOSE.
By Order of the Board of Directors
/s/ JAMES G. KILEY
April 11, 1995 James G. Kiley, Corporate Secretary
<PAGE>
ENERGY VENTURES, INC.
5 Post Oak Park, Suite 1760
Houston, Texas 77027-3415
PROXY STATEMENT FOR
ANNUAL MEETING OF STOCKHOLDERS
To Be Held May 19, 1995
The accompanying proxy is solicited by the Board of Directors of Energy
Ventures, Inc., a Delaware corporation (the "Company"), for use at the Annual
Meeting of Stockholders of the Company to be held on Friday, May 19, 1995 (the
"Annual Meeting"), at the time and place and for the purposes set forth in the
accompanying Notice of Annual Meeting and at any adjournment or adjournments
thereof. When proxies in the accompanying form are received properly executed,
the shares will be voted by the persons named therein unless contrary
instructions are given.
Unless otherwise indicated, the proxy will be voted FOR the election of all
nominees as directors and FOR the approval of the amendments to the Company's
Non-Employee Director Stock Option Plan. The proxy will not be voted for the
election as directors of any nominee if authority to do so is withheld on the
proxy.
Any stockholder of the Company has the right to revoke his proxy at any time
prior to its use by submitting a written revocation to the Corporate Secretary
of the Company prior to the Annual Meeting.
Upon request, additional proxy material will be furnished without cost to
brokers and other nominees to forward to the beneficial owners of shares held in
their names. The Company will bear all costs of preparing, printing,
assembling, delivering and mailing the Notice of Annual Meeting, Proxy
Statement, Proxy and Annual Report. Copies of the Notice, Proxy Statement,
Proxy and Annual Report will be first sent or given to stockholders on or about
April 11, 1995. In addition to the use of the mail, proxies may be solicited by
the directors, officers and employees of the Company, without additional
compensation, by personal interview, telephone, telegram or otherwise.
VOTING RIGHTS AND PRINCIPAL STOCKHOLDERS
The record date for the determination of stockholders entitled to notice of
and to vote at the Annual Meeting is the close of business on March 24, 1995
(the "Record Date"). As of the Record Date, there were 12,754,249 shares of
Common Stock, $1.00 par value ("Common Stock"), of the Company issued and
outstanding. Each share of Common Stock is entitled to one vote on each matter
to be acted upon at the meeting.
1
<PAGE>
The following table sets forth certain information with respect to each person
who at the Record Date was known by the Company to be the beneficial owner of
more than 5% of the outstanding shares of Common Stock.
<TABLE>
<CAPTION>
Number of Shares
Name and Address of Beneficially Owned Percent
Beneficial Owner as of the Record Date (1) of Class
------------------- --------------------------- ---------
<S> <C> <C>
GulfMark International, Inc. 2,535,572(2) 19.89%
5 Post Oak Park, Suite 1170
Houston, Texas 77027
Lehman Brothers Holdings Inc. 1,120,000(2) 8.78%
3 World Financial Center
New York, New York 10285
ICM Asset Management, Inc. 680,000 5.33%
601 W. Main Avenue, Suite 917
Spokane, WA 99201
</TABLE>
- - --------------
(1) Unless otherwise indicated below, the persons or group listed have sole
voting and investment power with respect to their shares of Common Stock,
and none of such shares are deemed to be owned because the holder has the
right to acquire the shares within 60 days.
(2) Lehman Brothers Holdings Inc. ("Lehman Holdings") beneficially owns 31.60%
of the common stock of GulfMark International, Inc. ("GulfMark"). The
beneficial ownership of Common Stock of Lehman Holdings indicated in the
table above does not include any of the shares of Common Stock held by
GulfMark, beneficial ownership of which is disclaimed. On May 27, 1994,
Lehman Holdings acquired 1,200 shares of Common Stock. A Form 4 for this
acquisition was required to be filed on June 10, 1994, but was filed on
October 10, 1994.
SECURITY OWNERSHIP OF DIRECTORS AND OFFICERS
The following table sets forth, as of the Record Date, the number and
percentage of Common Stock beneficially owned by each of the Company's
directors, each executive officer named in the Summary Compensation Table
herein, and all directors and officers as a group:
<TABLE>
<CAPTION>
Amount and Nature
of Beneficial Ownership
----------------------------------------------------------
Options
Sole Voting and Exercisable Percent
Name Investment Power Within 60 Days Of Class
------ --------------------- ---------------- --------------
<S> <C> <C> <C>
Bernard J. Duroc-Danner 40,000 308,333 2.73%
John C. Coble 2,500 135,666 1.08%
James G. Kiley -- -- *
Ghazi J. Hashem -- 20,000 *
Frances R. Powell 200 3,333 *
David J. Butters 4,272 15,000 *
Uriel E. Dutton -- 15,000 *
Eliot M. Fried -- 15,000 *
Robert B. Millard -- 15,000 *
Robert A. Rayne -- 15,000 *
All directors and officers as 46,972 542,332 4.62%
a group (10 persons)
</TABLE>
- - --------------
* Less than 1% of the outstanding shares of Common Stock.
2
<PAGE>
ELECTION OF DIRECTORS
Six directors are to be elected at the Annual Meeting, each to hold office
until the next Annual Meeting of Stockholders of the Company and until his
successor shall be duly elected and qualified. The persons named in the
enclosed proxy will vote the shares covered thereby in favor of the nominees
listed below unless specifically instructed to the contrary. Although the
management of the Company does not contemplate that any of the nominees will be
unable to serve, if such a situation arises prior to the Annual Meeting, the
proxies will be voted for a substitute to be named by the Board of Directors.
All of the nominees named in the following table are now serving as directors of
the Company:
<TABLE>
<CAPTION>
Year First
Became
Name Age Director
----- ---- ----------
<S> <C> <C>
David J. Butters 54 1984
Bernard J. Duroc-Danner 41 1988
Uriel E. Dutton 64 1986
Eliot M. Fried 62 1990
Robert B. Millard 44 1989
Robert A. Rayne 46 1987
</TABLE>
The nominees receiving a plurality of votes cast at the Annual Meeting will be
elected as directors. Abstentions and broker non-votes will not be treated as a
vote for or against any particular director and will not affect the outcome of
the election of directors.
David J. Butters is a Managing Director of Lehman Brothers ("Lehman
Brothers"), an investment banking firm and division of Lehman Brothers Inc.,
which is a subsidiary of Lehman Brothers Holdings, Inc., where he has been
employed for more than the past five years. Mr. Butters is currently Chairman
of the Board of Directors of GulfMark, a director of Anangel-American
Shipholdings, Ltd. and BT Shipping Ltd. and a member of the Board of Advisors of
Energy International, N.V. Mr. Butters is also Chairman of the Board of
Directors of the Company.
Bernard J. Duroc-Danner joined the Company in May 1987 upon inception of the
Company's strategic redeployment in the oilfield service and equipment industry.
He was elected President of the Company in January 1990, and Chief Executive
Officer in May 1990. In prior years, Mr. Duroc-Danner was with Arthur D. Little
Inc., a management consulting firm in Cambridge, Massachusetts. Mr. Duroc-
Danner holds a Ph.D. in economics from Wharton (University of Pennsylvania).
Uriel E. Dutton has been a Partner in Fulbright & Jaworski L.L.P., a law firm,
for more than the past five years.
Eliot M. Fried is a Managing Director of Lehman Brothers, where he has been
employed for more than the past five years. He is Co-Chairman of the firm-wide
Investment Committee and a member of the Investment Banking Commitment Committee
of Lehman Brothers. Mr. Fried is a director of American Marketing Industries,
Inc., Bridgeport Machines, Inc., Lear Seating Corporation, Sun Distributors
L.P., Walter Industries, Inc. and Vernitron Corporation.
Robert B. Millard is a Managing Director of Lehman Brothers, where he has been
employed for more than the past five years. Mr. Millard is also a director of
GulfMark.
Robert A. Rayne has been an Executive Director of London Merchant Securities
plc (property investment and development with major investments in leisure
enterprises), a United Kingdom listed public limited company, for more than the
past five years.
3
<PAGE>
COMMITTEES AND MEETINGS OF DIRECTORS
Pursuant to the Company's By-laws, the Board of Directors has established
several committees, including an Audit Committee, a Compensation Committee, an
Executive Committee and a Nominating Committee. During the year ended December
31, 1994, the Board of Directors met five times, the Audit Committee met two
times and the Compensation Committee met one time. The Executive Committee and
the Nominating Committee did not meet. Except for Mr. Rayne and Mr. Millard,
each of whom attended 71% of the Board meetings and Committee meetings of which
he was a member during 1994, each director attended all of the Board meetings
and Committee meetings of which he was a member during 1994.
Messrs. Butters, Dutton and Rayne are the current members of the Audit
Committee. The Audit Committee recommends to the Board the selection and
discharge of the Company's independent auditors, reviews the professional
services performed by the auditors, the plan and results of their auditing
engagement and the amount of fees charged for audit services by the auditors,
and evaluates the Company's system of internal accounting controls.
Messrs. Butters, Dutton and Millard are the current members of the
Compensation Committee. The Compensation Committee recommends to the Board the
compensation to be paid to the Company's directors, officers and key employees
and administers the compensation plans for the Company's executive offices.
Messrs. Butters, Dutton and Millard are the current members of the Executive
Committee, which acts on behalf of the Board between regularly scheduled
meetings of the Board of Directors.
Messrs. Butters and Millard are the current members of the Nominating
Committee, which is empowered to propose to the Board of Directors the slate of
director nominees to be voted by the stockholders of the Company. The Committee
will consider nominees for election at the next annual meeting of stockholders
who are recommended by stockholders provided any such recommendation is in
writing and has been received by the Chairman of the Nominating Committee at the
Company's executive offices prior to December 15, 1995.
DIRECTOR COMPENSATION
Each non-employee director of the Company is paid $1,000 for each meeting of
the Board of Directors and $500 for each committee meeting of the Board of
Directors he attends. In addition, each non-employee director of the Company is
paid a retainer of $2,000 for each quarter of the year in which such director
serves as a director. Mr. Butters receives an additional retainer of $6,250 per
month for serving as Chairman of the Board. Total compensation paid to the non-
employee directors for 1994, including director fees and retainers but excluding
deferred compensation, was $82,325 for Mr. Butters, $12,950 for Mr. Dutton,
$12,025 for Mr. Fried, $11,500 for Mr. Millard and $11,100 for Mr. Rayne.
The Company maintains a deferred compensation plan for its non-employee
directors (the "Non-Employee Director Plan") that is intended to provide
additional long-term incentive to the directors. Under the Non-Employee
Director Plan, each non-employee director may elect to defer up to 7 1/2% of any
retainer, meeting, committee or other similar fee or compensation to which the
non-employee director is entitled for services performed for the Company. Each
election by a non-employee director to defer compensation is irrevocable and
must state the date on which distributions under the Non-Employee Director Plan
are to be made, which date may not be less than one year after the effective
date of the election. Deferred compensation under the Non-Employee Director
Plan is credited to an account for the director. In the event the director
elects to defer at least 5% of his compensation under the Non-Employee Director
Plan, the Company will make an additional allocation to the director's account
equal to the sum of (i) 7 1/2% of the director's compensation and (ii) a
percentage of the director's compensation equal to the percentage deferred by
the director.
All amounts credited to the account of a director are converted into non-
monetary units equal to the number of whole shares of Common Stock that could
have been purchased by the amounts credited to the account at the market price
of the Common Stock as of the last day of the calendar month in which the
amounts are credited. The amount of funds to be paid to a director at the time
of payment will be determined by multiplying the number of units credited to the
director's account at such time multiplied by the market price of the Common
Stock on the last business day of the month preceding the date the distribution
is to commence. Distributions under the Non-Employee Director Plan commence as
of the first day of the calendar quarter coincident with or following the date
specified by the director in his election to defer compensation and may be
either in the form of a lump sum or
4
<PAGE>
in quarterly installments not to exceed ten years. In the event a director
elects to receive deferred compensation through installments, the unpaid amounts
will accrue interest on a quarterly basis at a rate equal to an announced prime
rate. No distribution may be made to a director with respect to units relating
to amounts deferred and additional credits made by the Company within six months
prior to the proposed date of distribution except where the distribution follows
the director's death or termination of service as a director. In such case, the
director will be entitled to receive a distribution in an amount equal to the
compensation deferred during such six-month period plus interest. During 1994,
$20,025, $3,150, $2,925, and $2,700 were credited under the Non-Employee
Director Plan as deferrals and Company contributions to the accounts of Messrs.
Butters, Dutton, Fried and Rayne, respectively, with total units allocated to
their respective accounts of 1,481, 241, 222 and 209.
As described in more detail below, the Company also maintains a stock option
plan for the benefit of its non-employee directors. During 1994, 5,000 options
were granted to each non-employee director, subject to shareholder approval of
the amendments to the plan, and no options were exercised under the plan.
AMENDMENTS TO NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
On May 12, 1994, the Board of Directors of the Company approved, subject to
stockholder approval, various amendments to the Company's Non-Employee Director
Stock Option Plan (the "Director Plan") so as to provide for annual grants of
options to purchase 5,000 shares of Common Stock to non-employee directors in
lieu of the Company's prior policy of making a one time grant of options to
purchase 15,000 shares of Common Stock with a vesting period over three years.
The amendments also increase the number of shares reserved for the Plan from
300,000 to 500,000, extend the termination of the Director Plan from 2001 to
2004, provide the Company with the option to withhold shares of Common Stock to
satisfy withholding tax liability, clarify the term "retirement" for purposes of
the Director Plan and make various other clarifying and conforming changes.
The amendments are intended to further the interest of the Company's
stockholders by providing directors with a greater ownership interest in the
Company through annual grants of options as part of their compensation package.
The use of options in lieu of other forms of cash compensation is intended to
closer align the interest of the directors with those of stockholders.
The affirmative vote of the holders of a majority of the shares of Common
Stock represented in person or by proxy at the Annual Meeting is required for
approval of the proposal to amend the Director Plan. Abstentions will not be
treated as either a vote for or against a proposal, but will have the same
effect as a vote against the proposal.
The Board of Directors believes that the proposed amendments to the Director
Plan are in the interest of the Company and recommends that the stockholders
approve the proposed amendments. THE BOARD OF DIRECTORS RECOMMENDS THAT THE
STOCKHOLDERS VOTE FOR THE PROPOSED AMENDMENTS.
SUMMARY OF AMENDMENTS
The Director Plan currently provides for the granting of options to purchase
an aggregate of 300,000 shares of Common Stock, subject to adjustments for
changes in capitalization. Each non-employee director of the Company as of the
date the plan was initially adopted and any subsequent non-employee director as
of the date he or she is first elected as a director of the Company is currently
granted a ten-year option to purchase 15,000 shares of Common Stock at a
purchase price per share of Common Stock equal to the fair market value of the
Common Stock as of the date of grant. Upon the receipt by a non-employee
director of an option pursuant to the Director Plan, such non-employee director
currently is no longer eligible to receive an option under the plan. If the
proposed amendments to the Director Plan are not approved by the stockholders of
the Company, no options may be granted under the plan after March 6, 2001. If
the proposed amendments are adopted by the stockholders, no options may be
granted under the plan after the tenth anniversary of the approval of the plan
by the stockholders. Options granted under the Director Plan are currently
subject to three-year vesting in one-third increments and are subject to early
termination within a specified period following an event of death, disability or
retirement, resignation or termination from the Board of Directors of the
Company.
The description of the Director Plan as proposed to be amended is set forth
below. The proposed Amended and Restated Non-Employee Director Stock Option
Plan is attached hereto as Exhibit A. The summary of the Director Plan and the
proposed amendments thereto set forth herein are qualified in their entirety by
reference to the complete text of the plan set forth in Exhibit A.
5
<PAGE>
SHARES AND EXERCISE PRICE
The number of shares of Common Stock issuable upon the exercise of options
under the Director Plan is currently 300,000, subject to adjustment for certain
antidilution events described in the plan. As amended, the number of shares of
Common Stock issuable upon the exercise of options under the plan will be
500,000.
Each option granted under the Director Plan is exercisable at a purchase price
per share of Common Stock equal to the fair market value of the Common Stock as
of the date of grant. For purposes of the Director Plan, the "fair market
value" of a share of stock as of any particular date shall mean the closing sale
price of a share of Common Stock on that date as reported by the principal
national securities exchange on which the Common Stock is listed, if the Common
Stock is then listed on a national securities exchange, or, if the Common Stock
is not so listed, the average of the bid and asked price of a share of Common
Stock on that date as reported in the NASDAQ system. If no such closing price
or quotes are so reported on that date or if, in the discretion of the committee
of the Board of Directors administering the Director Plan, another means of
determining the fair market value of a share of stock at such date shall be
necessary or advisable, such committee may provide another means for determining
such fair market value. The Common Stock is currently listed on the New York
Stock Exchange.
The Director Plan currently provides for the satisfaction of any withholding
obligation on the part of the Company with respect to an optionee at the request
of an optionee. The amendments to the Director Plan will provide that such
withholding obligation can be made at the Company's sole option.
GRANT OF OPTIONS AND VESTING
Under the current Director Plan, each non-employee director was granted an
option to purchase 15,000 shares of Common Stock as of March 6, 1991. Each
director was no longer eligible to receive an option after such initial grant.
The amendments to the Director Plan grant an option to purchase 5,000 shares of
Common Stock to each director as of May 12, 1994. In addition, each director is
to be granted an option to purchase 5,000 shares as of each date he is
thereafter first elected or is reelected as a director of the Company.
The Director Plan currently provides for a three-year vesting period for
shares subject to each option, with one-third of the shares subject to the
option exercisable on each of the first, second and third anniversaries of the
date of the grant of the option. The amendments to the Director Plan provide
that each option shall not be exercisable for a period of one year from the date
of grant, but will be fully exercisable following such one-year anniversary.
Notwithstanding the foregoing, the amendments to the Director Plan provide that
no option granted by virtue of the amendments to the plan shall be exercisable
for a period of six months following stockholder approval of such amendments.
TERM
Options granted to non-employee directors under the Director Plan are
exercisable for a term of ten years from the date of grant, subject to early
termination within a specified period following an event of death, disability or
retirement, resignation or termination from the Board of Directors of the
Company. This period is one year in the case of retirement. The Company does
not currently have a formal retirement policy for directors for the Director
Plan. The amendments to the Director Plan defines retirement to be the
termination of service following five years of service on the Board of
Directors.
TRANSFER RESTRICTIONS
Options granted under the Director Plan are not transferrable by the optionee
other than by will or under the laws of descent and distribution, and are
exercisable during his lifetime only by the non-employee director.
6
<PAGE>
ADMINISTRATION OF PLAN
The amendments to the Director Plan are intended to satisfy the formula
provisions for plans under Rule 16b-3 promulgated under the Securities Exchange
Act of 1934. The Director Plan is administered by a committee of the Board of
Directors, the members of which consist solely of directors who are employees of
the Company. Currently, the sole member of such committee is Bernard J. Duroc-
Danner.
NEW PLAN BENEFITS
Subject to stockholder approval at the Annual Meeting, each non-employee
director of the Company was granted on May 12, 1994, an option to purchase 5,000
shares of Common Stock at an exercise price of $13.75 per share, the market
price of such stock on such date. Such options will become execisable six months
following the date of stockholder approval and will expire on May 12, 2004. The
market price of the Common Stock as reported by the New York Stock Exchange on
March 31, 1995, was $13.125 per share.
TAX CONSEQUENCES
The amendments to the Director Plan will not be a taxable event for either the
Company or any holder of options under the plan. The holder of options granted
under the Director Plan should recognize ordinary income on the date of exercise
of the options equal to the difference between the fair market value on that
date of the shares acquired and the exercise price. The tax basis of these
shares for purpose of a subsequent sale includes the exercise price paid and the
ordinary income reported on exercise of the option. The income reportable on
exercise of the option will be subject to any applicable federal and state
income and employment tax withholding. The Company will be entitled to a
deduction equal to the compensation attributable to the exercise of the options
granted under the Director Plan.
EXECUTIVE OFFICERS
In addition to Mr. Duroc-Danner, who is also a director of the Company, the
following persons are executive officers of the Company, each of whom serves at
the discretion of the Board of Directors:
<TABLE>
<CAPTION>
Name Position Age
----- --------- ---
<S> <C> <C>
John C. Coble Executive Vice President and Chief Operating Officer 52
Ghazi J. Hashem Senior Vice President, Technical Operations 60
James G. Kiley Vice President-Finance, Treasurer and Secretary 38
Frances R. Powell Vice President-Accounting and Controller 40
</TABLE>
7
<PAGE>
John C. Coble has served as Chief Operating Officer of the Company since
December 1991 and Executive Vice President since April 1990. Mr. Coble served
as Vice President of the Company from August 1989 to April 1990. He also served
as Chief Operating Officer of a wholly owned subsidiary of the Company, Grant
TFW Inc. ("Grant"), from November 1989 until April 1990, and served as Chief
Financial Officer of Grant for more than five years prior to August 1989.
Ghazi J. Hashem was elected Senior Vice President, Technical Operations of the
Company in May 1994 and Vice President-Technical Operations in November 1992.
Mr. Hashem previously served as Chairman of the Board of Grant from May 1992 to
November 1992 and as President of Grant from April 1984 to May 1992.
James G. Kiley joined the Company in May 1994 and has served as Vice
President-Finance, Treasurer and Secretary of the Company since that time. From
April 1991 to April 1994, Mr. Kiley served as Treasurer of Baroid Corporation, a
provider of oilfield services. Prior to his position at Baroid, Mr. Kiley held
various positions, including Assistant Treasurer, at NL Industries, Inc., a
manufacturer of titanium dioxide pigments and specialty chemicals.
Frances R. Powell was elected Vice President-Accounting of the Company in May
1994, Controller in November 1991 and has been employed by the Company since
1990. Ms. Powell was employed with GulfMark from 1986 to 1990, where she served
as Controller from 1988 to 1990.
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors of Energy Ventures, Inc.
(the "Committee") is pleased to present this report on the compensation policies
of the Company for its executive officers. This report sets forth the major
components of executive compensation and the basis by which 1994 compensation
determinations were made by the Committee with respect to the executive officers
of the Company, including the executive officers who are named in the
compensation tables.
COMPENSATION POLICY AND GUIDELINES
The Company's compensation policy and practices are intended to provide a
competitive compensation package designed to attract and retain key executive
officers and to offer compensation programs that align executive remuneration
levels both with the interests of stockholders and with overall Company
performance. The Company's executive compensation program includes a
combination of reasonable but competitive base salaries and various long and
short-term incentive programs linked to the financial and stock performance of
the Company. The Committee's decisions take into account the cyclical nature of
the industry and the Company's progress toward achieving strategic objectives.
COMPENSATION PROGRAM COMPONENTS
The compensation programs of the Company are generally administered by or
under the direction of the Committee and are reviewed on an annual basis to
ensure that remuneration levels and benefits are competitive and reasonable in
light of the overall performance of the Company. The Committee reviews and
recommends the specific base and bonus compensation of the Company's President
and Chief Executive Officer and Executive Vice President and Chief Operating
Officer (the "Principal Executives"). The Committee has delegated to the
Company's Chief Executive Officer the authority to review and adjust the base
and cash bonus compensation for the Company's other executive officers.
Decisions with regard to the granting of stock options and other long-term
incentive plans are made by the Committee after consideration of the Company's
results and discussion with and recommendations from the Company's Chief
Executive Officer as to the executive officers under his supervision. The
particular elements of the compensation programs for the Principal Executives
and other executive officers are explained in more detail below.
Base Salary - Base salary levels are primarily determined by comparisons with
companies in the same industry and of similar size and complexity as the
Company, including a number of companies in the Dow Jones Oilfield Equipment and
Services Index in the performance graph set forth herein. Salary levels are
based on individual performance and market comparisons. In 1994, in addition to
the increase in compensation for Mr. Duroc-Danner described below, Mr. Coble
received an increase in his base salary to $180,000 based on the recommendation
of the Chief Executive Officer and a review of salaries of similarly situated
officers at other oilfield service companies, including certain of the companies
included in the Dow Jones Oilfield Equipment and Services Index in the
performance graph set forth herein. Adjustments were made during 1994 to the
compensation of two of the
8
<PAGE>
Company's three other executive officers based on various factors, including
their individual scope of responsibility, tenure, and overall performance. The
Committee believes that base salary levels for the Company's executive officers
are competitive within a range that is considered to be reasonable and
necessary.
Annual Performance Compensation - Annual performance compensation is provided
to the Company's executive officers in the form of cash and non-cash bonuses
relating to financial and operational achievements. The amount and form of such
bonuses is determined by the Committee in the case of the Principal Executives
and by the Chief Executive Officer in the case of the Company's other executive
officers, subject to approval of the Committee as to grants of stock options or
other non-cash bonuses. The decision to award an annual bonus is based primarily
upon a subjective analysis of the executive officer's job performance and the
specific accomplishments of the executive officer during the preceding twelve
month period. Although the financial results of the Company are expressly
considered in connection with the decision to award an annual bonus, no specific
thresholds relating to financial performance criteria are established. Rather,
the decision to grant an annual bonus is based upon the financial results of the
Company in light of its internally projected results and the results of its
peers, market conditions and operational achievements that are expected to
affect earnings in the future. The decision making process for the granting of
bonuses has typically occurred in May of each year following the annual meeting
of stockholders and involves the consideration of the prior year's results as
well as achievements and results through such time. Accordingly, no decision has
been made with respect to bonuses that may be paid in 1995. During 1994, cash
bonuses to executive officers were kept at a minimum and were based on various
objective and subjective accomplishments by them that the Committee considered
benefitted the overall performance of the Company in 1993 and the first part of
1994.
Deferred Compensation Plan - The Company maintains an executive deferred
compensation plan adopted in 1992 that provides the Company's key employees with
long-term incentive compensation through benefits that are directly linked to
future increases in the value of the Common Stock and that may only be realized
upon the employee's retirement, termination or death. Under this plan, eligible
employees receive a tax deferred contribution under the plan equal to 7 1/2% of
their annual compensation through a credit to an account that is converted into
non-monetary units representing the number of shares of Common Stock that the
contributed funds could purchase in the market at the time of the contribution.
In addition, in an effort to provide incentive to the participants to invest in
the equity of the Company a portion of the compensation that they would
otherwise receive from the Company, the participating employees are offered the
opportunity to defer up to 7 1/2% of their compensation to their account under
the plan, in which case the Company will make a matching contribution equal to
the amount of the deferral by the employee. The Principal Executives and other
executive officers have all elected to defer 7 1/2% of their compensation under
the plan. The plan provides for a five year vesting period with respect to the
Company's contributions and the ultimate value of benefits under the plan to the
participant are wholly dependent upon the price of the Common Stock at the time
the employee retires, terminates his employment or dies. The Committee believes
that this plan provides an important incentive to management and serves the
purpose of aligning management's interest with those of the Company's
stockholders.
Stock Option Program - The Committee also believes that the use of stock
options provides incentive to its executive officers for working toward the
long-term growth of the Company by providing them with a benefit that will
increase only to the extent that the value of the Common Stock increases.
Accordingly, the Committee from time to time grants to the Company's executive
officers options to purchase shares of Common Stock. The number of shares
granted is determined based on the level and contribution of the employee and
generally takes into account stock ownership and other options held by the
employee. Stock options are generally subject to vesting over a number of years
and have exercise prices equal to the market price of the Common Stock at the
date of grant. The Committee believes that the number of stock options granted
to executive officers is consistent with industry standards.
DISCUSSION OF 1994 COMPENSATION FOR THE PRESIDENT AND CHIEF EXECUTIVE OFFICER
In fixing the compensation of Mr. Duroc-Danner for 1994, the Committee
determined that it would be appropriate to increase Mr. Duroc-Danner's base
compensation to $260,000 and award him a bonus of $40,000 in recognition of his
significant contributions to the success of the Company's development. The
increase in Mr. Duroc-Danner's base salary was intended to make his compensation
more competitive with those of similar officers in competing companies,
including a number of companies included in the Dow Jones Oilfield Equipment and
Services Index in the performance graph set forth herein, and reflected the
absence of any increases in Mr. Duroc-Danner's base salary since 1991. During
1994, options to purchase 25,000 shares of Common Stock were granted to him. In
reviewing Mr. Duroc-Danner's compensation for 1994, the Committee took into
consideration the substantial success which the Company has achieved under Mr.
Duroc-Danner's guidance and specifically the
9
<PAGE>
Company's continued expansion through strategic acquisitions and internal
development in spite of declining markets. No single factor was considered
determinative in this decision.
COMPENSATION DEDUCTION LIMITATION
Section 162(m) of the Internal Revenue Code of 1986, as amended, currently
imposes a $1 million limitation on the deductibility of certain compensation
paid to the Company's five highest paid executives. Excluded from the
limitation is compensation that is "performance based". For compensation to be
performance based, it must meet certain criteria, including being based on
predetermined objective standards approved by the stockholders of the Company.
The Company believes that compensation relating to options granted under its
option plan should be excluded from the $1 million limitation. The Committee
believes that maintaining the discretion to evaluate the performance of the
Company's management is an important part of its responsibilities and benefits
the Company's stockholders. The Committee intends to take into account the
potential application of Section 162(m) with respect to incentive compensation
awards and other compensation decisions made by it in the future. The Committee
does not currently anticipate that Section 162(m) will limit the deductibility
of any compensation paid by the Company to its executive officers during 1995.
SUMMARY
The Committee continues to believe that the Company's executive compensation
program is consistent with the compensation programs provided by other companies
which are comparable in size and complexity to the Company and with which the
Company competes, including many of the companies in the Dow Jones Oilfield
Equipment and Services Index in the performance graph set forth herein. The
Committee believes that the Company's compensation program is necessary and
appropriate to retain the services of officers and employees who are essential
to the continued success and development of the Company and to compensate those
officers and employees for their efforts and achievements. The Committee
believes that compensation paid under the annual performance plan will be
appropriately related to corporate and individual performance, yielding awards
that are reflective of the annual financial and operational results of the
Company. The Committee also believes that the Company's deferred compensation
plan and stock option program provide significant incentives to participants to
enhance stockholder value by providing financial opportunities to them that are
consistent with and dependent upon the returns that are generated on behalf of
the Company's stockholders.
COMPENSATION COMMITTEE
OF THE BOARD OF DIRECTORS
David J. Butters
Robert B. Millard
Uriel E. Dutton
COMPENSATION COMMITTEE INTERLOCKS
Messrs. Butters, Dutton and Millard are the current members of the
Compensation Committee of the Board of Directors of the Company.
Mr. Dutton, a director of the Company, is a Partner of Fulbright & Jaworski
L.L.P., a law firm that the Company retained during 1994 with respect to various
legal matters and proposes to retain in 1995. Fulbright & Jaworski L.L.P.
received customary compensation in connection with its services to the Company.
Messrs. Butters and Millard, directors of the Company, are employed by Lehman
Brothers. During 1994, Lehman Brothers received customary compensation for
services rendered in connection with a private placement of $120,000,000 of the
Company's Senior Notes. In connection with this transaction, the Company agreed
to file and maintain certain registration statements necessary to permit the
resale of notes acquired by Lehman Brothers and to allow Lehman Brothers to act
as a market marker in the notes.
10
<PAGE>
EXECUTIVE COMPENSATION
The aggregate compensation paid for the years ended December 31, 1994, 1993
and 1992 to Mr. Duroc-Danner, the Company's Chief Executive Officer, and the
three most highly compensated executive officers of the Company whose total
annual salary and bonus exceeded $100,000 (hereafter referred to as the "named
executive officers") during the year ended December 31, 1994 was as follows:
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Long-Term
Annual Compensation Compensation
---------------------------------------------- ---------------
Securities
Name Other Annual Underlying All Other
and Compen- Options Compen-
Principal Position Year Salary(1) Bonus(1) sation(2)(3) (shares) sation(4)
------------------- ---- --------- --------- -------------- --------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Bernard J. Duroc-Danner 1994 $256,250 $40,000 $28,463 25,000 $7,007
President 1993 238,501 40,000 20,308 -- 6,150
Chief Executive Officer 1992 222,402 -- 11,723 200,000 1,025
John C. Coble 1994 $176,250 $30,000 $20,363 17,000 $4,924
Executive Vice President 1993 166,667 30,000 15,398 50,000 4,602
Chief Operating Officer 1992 157,000 27,500(5) 8,886 25,000 767
Ghazi J. Hashem 1994 $132,813 $25,000 $11,363 -- $2,892
Senior Vice President, 1993 125,000 -- 6,347 -- 2,355
Technical Operations 1992 126,443 -- 1,786 -- 392
Frances R. Powell 1994 $ 99,375 $20,000 $12,069 10,000 $2,625
Vice President, Accounting 1993 72,301 10,000 6,765 -- 2,072
Controller 1992 73,750 10,000 4,609 -- 345
</TABLE>
- - -------------
(1) Salary and bonus compensation include amounts deferred by the named
executive officer pursuant to the Energy Ventures, Inc. Executive Deferred
Compensation Stock Ownership Plan (the "Executive Deferred Plan") described
in Note 4 below. For purposes of the Executive Deferred Plan, the
compensation of a participant will be the participant's total cash
compensation as reported on his or her Form W-2 for the calendar year plus
all amounts deferred under the Executive Deferred Plan and any eligible cash
or deferred arrangement under Section 401(k) of the Internal Revenue Code,
of 1986, as amended. A participant may elect a percentage (not less than 1%
nor more than 7 1/2%) of his or her compensation to be deferred under the
Executive Deferred Plan for the following calendar year. Once an election
has been made as to the percentage to be deferred, the election is
irrevocable for the subsequent Plan year.
(2) Other Annual Compensation includes (i) the vested portion of the amount
accrued by the Company under the Executive Deferred Plan for the basic
benefit of each participant equal to 7 1/2% of the participant's
compensation for each calendar year, plus (ii) the vested portion of
matching contribution under the Executive Deferred Plan provided by the
Company to each participant who elects to defer a portion of his or her
compensation in an amount equal to 100% of the amount deferred by the
participant. The Company's 7 1/2% accrual under the Executive Deferred Plan
and any matching accruals made with respect to deferrals by participants,
vest generally over a five-year period on the basis of 20% per year for each
year of service by the participant with the Company or its subsidiaries
after the later of January 1, 1992 or the date one became a participant in
the Executive Deferred Plan, subject to 100% vesting upon the participant's
retirement, death or disability while in the employment of the Company or a
subsidiary, except under certain circumstances.
11
<PAGE>
Under the Executive Deferred Plan, the compensation deferred by the employee
and the matching contributions provided by the Company are converted into
non-monetary units equal to the number of whole shares of Common Stock that
could have been purchased by the amounts credited to the account at a market
based price. Distributions are made to participants under the Executive
Deferred Plan following the time the employee retires, terminates his
employment or dies. The amount of the distribution under the Executive
Deferred Plan is based on the number of vested units in the employee's
account at such time multiplied by the market price of the Common Stock at
that time. Distributions under the Executive Deferred Plan may, at the
election of the Company, be made in cash, stock, or combination thereof. It
is the current intention of the Company that all distributions be made in
the form of shares of Common Stock. The obligations of the Company with
respect to the Executive Deferred Plan are unfunded. However, the Company
has established a grantor trust that is subject to the claims of creditors
of the Company to which funds are deposited with an independent trustee that
purchases shares of Common Stock for the Executive Deferred Plan. As of
December 31, 1994, Messrs. Duroc-Danner, Coble and Hashem and Ms. Powell had
11,967, 8,436, 4,167 and 4,274 units allocated to their respective accounts.
Other Annual Compensation also includes the vested portion of the Company's
matching contribution and any refunds made pursuant to the Company's 401(k)
savings plan ("Savings Plan"). Matching contributions made by the Company
during 1994 for Messrs. Duroc-Danner, Coble and Hashem and Ms. Powell were
$1,800, $1,800, $1,774 and $1,325 respectively. All full-time employees who
have at least six months of service are eligible to participate. The Savings
Plan provides for all participating employees a 20% non-discretionary
matching contribution plus a discretionary matching contribution in an
amount determined by the Company from time to time. The Company's
contributions have a five year vesting based on years of service. The named
executive officers are fully vested.
(3) Excludes perquisites and other benefits because the aggregate amount of
such compensation was the lesser of $50,000 or 10% of the total of annual
salary and bonus reported for the named executive officer.
(4) All Other Compensation includes the total premiums paid on a life
insurance policy provided by the Company for the benefit of the named
executive officer.
(5) On June 1, 1992, the Company granted to Mr. Coble 2,500 unregistered
shares of Common Stock of the Company. For purposes of the above table only,
such shares have been valued at $11.00 per share, the market price of the
Common Stock as of the date of grant.
12
<PAGE>
PERFORMANCE GRAPH
The following performance graph sets forth the yearly cumulative return on the
Company's Common Stock to the Dow Jones Equity Market Index and the Dow Jones
Oilfield Equipment and Services Index (which consists of Baker Hughes Inc.,
Dresser Industries, Inc., Energy Service Company, Inc., Global Marine Inc.,
Halliburton Company, Helmerich & Payne Inc., McDermott International, Inc.,
Nabors Industries, Inc., Parker Drilling Company, Rowan Companies, Inc.,
Schlumberger Limited and Western Atlas Inc.) since 1988, the year in which the
Company's operations began to substantially expand. The graph assumes (i) the
reinvestment of dividends, if any, and (ii) the value of the investment in the
Company's Common Stock and each index to have been $100 at December 31, 1989.
COMPARISON OF SEVEN YEAR CUMULATIVE TOTAL RETURN
AMONG ENERGY VENTURES, INC., DOW JONES EQUITY MARKET INDEX AND DOW JONES
OILFIELD EQUIPMENT & SERVICE INDEX
FISCAL YEAR ENDING DECEMBER 31
[GRAPH APPEARS HERE]
<TABLE>
<CAPTION>
1988 1989 1990 1991 1992 1993 1994
------- ------ ------ ------ ----- ----- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Energy Ventures, Inc. 4 100 136 129 79 97 94
Dow Jones Equity Market Index 76 100 96 127 138 152 153
Dow Jones Oilfield & Equipment
Service 62 100 109 99 98 109 99
</TABLE>
EMPLOYEE STOCK OPTION PLANS
The Company currently has two stock option plans for the benefit of its
employees, the 1981 Employee Stock Option Plan (the "1981 Plan") and the 1992
Employee Stock Option Plan (the "1992 Plan"). There are currently outstanding
options to purchase 237,736 shares of Common Stock under the 1981 Plan and no
further options may be granted under this plan. The 1992 Plan provides for the
grant of options to purchase up to 600,000 shares of Common Stock to key
employees. These options may be either incentive stock option or nonstatutory
stock options. There are currently 203,000 shares of Common Stock available for
future grants of options under the 1992 Plan. No options may be granted under
the 1992 Plan after March 19, 2002.
The 1981 Plan and 1992 Plan are administered by the Compensation Committee of
the Board of Directors of the Company, which consists of three members of the
Board of Directors who are neither employees of the Company nor eligible to
participate in either the 1981 Plan or the 1992 Plan. Each option granted under
the 1981 Plan and 1992 Plan may be exercised from time to time with respect to
the number of shares of Common Stock as to which it is then exercisable in
accordance with the terms of the 1981 Plan and 1992 Plan, respectively, and an
option agreement setting forth the specific terms thereof.
13
<PAGE>
The price at which shares of Common Stock may be purchased upon the exercise
of an option is determined by the Committee at the time the option is granted.
The purchase price per share under the 1981 Plan may not be less than the
greater of (i) 50% of the fair market value as determined by the Committee of
the Common Stock and (ii) the par value of share of Common Stock. The purchase
price per share under the 1992 Plan may not be less than the fair market value
of the shares of Common Stock on the date the option is granted.
The following table shows, as to the named executive officers, the options
granted pursuant to the 1992 Plan during the year ended December 31, 1994:
<TABLE>
<CAPTION>
OPTIONS GRANTED IN LAST FISCAL YEAR
Number of % of Total
Securities Options
Underlying Granted to Grant Date
Options Granted Employees Exercise Price Expiration Present
Name (Shares) in 1994 (Per Share) Date Value(1)
------ --------------- ---------- --------------- ---------- ------------
<S> <C> <C> <C> <C> <C>
Bernard J. Duroc-Danner 25,000(2) 48% $13.75 5/12/2004 $108,250
John C. Coble 17,000(2) 33% $13.75 5/12/2004 $ 73,610
Ghazi J. Hashem -- -- -- -- --
Frances R. Powell 10,000(2) 19% $13.75 5/12/2004 $ 43,300
</TABLE>
- - -------------
(1) Based upon Black-Scholes option valuation model. The calculation assumes
volatility of 0.27, a risk free rate of 6.89%, a ten year option term, and
option grants at $13.75 per share. The actual value, if any, which may be
realized with respect to any option will depend on the amount, if any, by
which the stock price exceeds the exercise price on the date the option is
exercised. Thus, such valuation may not be a reliable indication as to value
and there is no assurance the value realized will be at or near the value
estimated by the Black-Scholes model.
(2) Stock options granted on May 12, 1994 under the Company's 1992 Plan.
Options become fully exercisable on May 12, 1997.
14
<PAGE>
The following table shows, as to the named executive officers, the aggregate
option exercises during 1994 and the values of unexercised options as of
December 31, 1994:
<TABLE>
<CAPTION>
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND DECEMBER 31, 1994 OPTION VALUES
Number of Securities
Underlying Value of Unexercised
Unexercised Options In-The-Money Options
at December 31, 1994 at December 31, 1994(1)
--------------------------------- -------------------------------
Shares Acquired
on Exercise Value Exercisable Unexercisable
Name (Number) Realized (Shares) (Shares) Exercisable Unexercisable
------- --------------- --------- ---------------- ------------- -------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Bernard J. Duroc-Danner -- N/A 233,332 91,668 $366,663 $183,337
John C. Coble -- N/A 111,666 65,334 $126,666 $ 8,334
Ghazi J. Hashem -- N/A 20,000 -- -- --
Frances R. Powell -- N/A -- 10,000 -- --
</TABLE>
- - --------------
(1) Value based on difference in market value of Common Stock on December 31,
1994, and exercise price. The actual value, if any, of the unexercised
options will be dependent upon the market price of the Common Stock at the
time of exercise. The value of unexercisable options has not been discounted
to reflect present value.
INDEPENDENT PUBLIC ACCOUNTANTS
The firm of Arthur Andersen LLP, independent public accountants, served as the
Company's auditors for the fiscal year ending December 31, 1994, and has served
as the Company's auditors since its inception in 1972. A representative of
Arthur Andersen LLP will be present at the Annual Meeting to respond to
appropriate questions and will be afforded an opportunity to make a statement if
he or she so desires.
PROPOSALS BY STOCKHOLDERS
Any stockholder wishing to present a proposal for consideration at the next
Annual Meeting of Stockholders, anticipated to be held in May 1996, must submit
the proposal in sufficient time so that it may be received by the Company at its
principal executive offices at the address set forth on the cover of this Proxy
Statement on or before December 20, 1995, in order to be included in the proxy
statement and form of proxy relating to that meeting. Such proposal must also
comply with the requirements as to form and substance established by applicable
laws and regulations in order to be included in the proxy statement.
OTHER BUSINESS
The Company's management knows of no other business that will be brought
before the meeting. If, however, any other matters are properly presented, it is
the intention of the persons named in the accompanying form of proxy to vote the
shares covered thereby as in their discretion they may deem advisable.
By Order of the Board of Directors
/s/ JAMES G. KILEY,
Houston, Texas
April 11, 1995 James G. Kiley, Corporate Secretary
15
<PAGE>
ENERGY VENTURES, INC.
AMENDED AND RESTATED
NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
1. Purpose. This Amended and Restated Non-Employee Director Stock Option
Plan (the "Plan") of Energy Ventures, Inc., a Delaware corporation (the
"Company"), is adopted for the benefit of the directors of the Company who at
the time of their service are not employees of the Company or any of its
subsidiaries ("Non-Employee Directors"), and is intended to advance the
interests of the Company by providing the Non-Employee Directors with additional
incentive to serve the Company by increasing their proprietary interest in the
success of the Company.
2. Administration. The Plan shall be administered by a committee of the
Board of Directors of the Company (the "Committee"), the members of which shall
consist solely of directors who are employees of the Company. For the purposes
of the Plan, a majority of the members of the Committee shall constitute a
quorum for the transaction of business, and the vote of a majority of those
members present at any meeting shall decide any question brought before that
meeting. In addition, the Committee may take any action otherwise proper under
the Plan by the affirmative vote, taken without a meeting, of a majority of its
members. No member of the Committee shall be liable for any act or omission of
any other member of the Committee or for any act or omission on his own part,
including but not limited to the exercise of any power or discretion given to
him under the Plan, except those resulting from his own gross negligence or
willful misconduct. Except as otherwise expressly provided for herein, all
questions of interpretation and application of the Plan, or as to options
granted hereunder (the "Options"), shall be subject to the determination, which
shall be final and binding, of a majority of the whole Committee.
Notwithstanding the above, the selection of Non-Employee Directors to whom
Options are to be granted, the number of shares subject to any Option, the
exercise price of any Option and the term of any Option shall be as hereinafter
provided and the Committee shall have no discretion as to such matters.
3. Option Shares. The stock subject to the Options and other provisions
of the Plan shall be shares of the Company's Common Stock, $1.00 par value (or
such other par value as may be designated by act of the Company's stockholders)
(the "Common Stock"). The total amount of the Common Stock with respect to
which Options may be granted shall not exceed in the aggregate 500,000 shares;
provided, that the class and aggregate number of shares which may be subject to
the Options granted hereunder shall be subject to adjustment in accordance with
the provisions of Paragraph 12 hereof. Such shares may be treasury shares or
authorized but unissued shares.
In the event that any outstanding Option for any reason shall expire or
terminate by reason of the death of the optionee or the fact that the optionee
ceases to be a director, the surrender of any such Option, or any other cause,
the shares of Common Stock allocable to the unexercised portion of such Option
may again be subject to an Option under the Plan.
4. Grant of Options. Subject to the provisions of Paragraph 16 and the
availability under the Plan of a sufficient number of shares of Common Stock
that may be issuable upon the exercise of outstanding Options, there shall be
granted the following Options:
(a) To each Non-Employee Director as the date he is first elected as a
director of the Company, an Option to purchase 5,000 shares of Common Stock at a
purchase price per share of Common Stock (the "Option Price") equal to the fair
market value of the Common Stock as defined in Paragraph 7 hereof as of the date
of grant; and
1
<PAGE>
(b) Commencing on the date of the Annual Meeting of Stockholders of the
Company held in 1994 to each Non-Employee Director as of the date he is
reelected as a director of the Company, an Option to purchase 5,000 shares of
Common Stock at an Option Price equal to the fair market value of the Common
Stock as defined in Paragraph 7 hereof as of the date of grant.
No Option shall be granted pursuant to the Plan after May 12, 2005.
5. Duration of Options. Each Option granted under the Plan shall be
exercisable for a term of ten years from the date of grant, subject to earlier
termination as provided in Paragraph 9 hereof.
6. Amount Exercisable. Each Option granted pursuant to the Plan shall not
be exercisable for a period of one year from the date of grant. After such
time, such Option shall be fully vested and exercisable throughout the term of
the Option. Notwithstanding the foregoing, no Option granted by virtue of the
amendments effected by this Plan shall be exercisable for a period of six months
following stockholder approval of such amendments.
7. Exercise of Options. An optionee may exercise such optionee's Option
by delivering to the Company a written notice stating (i) that such optionee
wishes to exercise such Option on the date such notice is so delivered, (ii) the
number of shares of stock with respect to which such Option is to be exercised,
(iii) the address to which the certificate representing such shares of stock
should be mailed, and (iv) the social security number of such optionee. In
order to be effective, such written notice shall be accompanied by (i) payment
of the Option Price of such shares of stock and (ii) if applicable, payment of
an amount of money necessary to satisfy any withholding tax liability that may
result from the exercise of such Option. Each such payment shall be made by
cashier's check drawn on a national banking association and payable to the order
of the Company in United States dollars.
If, at the time of receipt by the Company of such written notice, (i) the
Company has unrestricted surplus in an amount not less than the Option Price of
such shares of stock, (ii) all accrued cumulative preferential dividends and
other current preferential dividends on all outstanding shares of preferred
stock of the Company have been fully paid, (iii) the acquisition by the Company
of its own shares of stock for the purpose of enabling such optionee to exercise
such Option is otherwise permitted by applicable law and without any vote or
consent of any stockholder of the Company, and (iv) there shall have been
adopted, and there shall be in full force and effect, a resolution of the Board
of Directors of the Company authorizing the acquisition by the Company of its
own shares of stock for such purpose, then such optionee may deliver to the
Company, in payment of the Option Price of the shares of stock with respect to
which such Option is exercised, (x) certificates registered in the name of such
optionee that represent a number of shares of stock legally and beneficially
owned by such optionee (free of all liens, claims and encumbrances of every
kind) and having a fair market value on the date of receipt by the Company of
such written notice that is not greater than the Option Price of the shares of
stock with respect to which such Option is to be exercised, such certificates to
be accompanied by stock powers duly endorsed in blank by the record holder of
the shares of stock represented by such certificates, with the signature of such
record holder guaranteed by a national banking association (or, in lieu of such
certificates, other arrangements for the transfer of such shares to the Company
which are satisfactory to the Company) and (y) if the Option Price of the shares
of stock with respect to which such Options are to be exercised exceeds such
fair market value, a cashier's check drawn on a national banking association and
payable to the order of the Company in an amount, in United States dollars,
equal to the amount of such excess plus the amount of money necessary to satisfy
any withholding tax liability that may result from the exercise of such Option.
Notwithstanding the provisions of the immediately preceding sentence, the
Committee, in its sole discretion, may refuse to accept shares of stock in
payment of the Option Price of the shares of stock with respect to which such
Option is to be exercised and, in that event, any certificates representing
shares of stock that were received by the Company with such written notice shall
be returned to such optionee, together with notice by the Company to such
optionee of the refusal of the Committee to accept such shares of stock. The
2
<PAGE>
Company may, at its option and upon approval by the Board of Directors of the
Company, retain shares of Common Stock which would otherwise be issued upon
exercise of an Option to satisfy any withholding tax liability that may result
from the exercise of such Option, which shares shall be valued for such purpose
at their then fair market value. If, at the expiration of seven business days
after the delivery to such optionee of such written notice from the Company,
such optionee shall not have delivered to the Company a cashier's check drawn on
a national banking association and payable to the order of the Company in an
amount, in United States dollars, equal to the Option Price of the shares of
stock with respect to which such Option is to be exercised, such written notice
from the optionee to the Company shall be ineffective to exercise such Option.
As promptly as practicable after the receipt by the Company of (i) such
written notice from the optionee, (ii) payment, in the form required by the
foregoing provisions of this Paragraph 7, of the Option Price of the shares of
stock with respect to which such Option is to be exercised, and (iii) payment,
if required, in the form required by the foregoing provisions of this Paragraph
7, of an amount necessary to satisfy any withholding tax liability that may
result from the exercise of such Option, a certificate representing the number
of shares of stock with respect to which such Option has been so exercised,
reduced, to the extent applicable by the number of shares retained by the
Company to pay any required withholding tax, such certificate to be registered
in the name of such optionee, provided that such delivery shall be considered to
have been made when such certificate shall have been mailed, postage prepaid, to
such optionee at the address specified for such purpose in such written notice
from the optionee to the Company.
For purposes of this Paragraph 7, the "fair market value" of a share of
stock as of any particular date shall mean the closing sale price of a share of
Common Stock on that date as reported by the principal national securities
exchange on which the Common Stock is listed if the Common Stock is then listed
on a national securities exchange, or if the Common Stock is not so listed, the
average of the bid and asked price of a share of Common Stock on that date and
reported in the National Association of Securities Dealers Automated Quotation
system (the "NASDAQ System"); provided that if no such closing price or quotes
are so reported on that date or if in the discretion of the Committee another
means of determining the fair market value of a share of stock at such date
shall be necessary or advisable, the Committee may provide for another means for
determining such fair market value.
8. Transferability of Options. Options shall not be transferable by the
optionee otherwise than by will or under the laws of descent and distribution,
and shall be exercisable, during his lifetime, only by him.
9. Termination. Except as may be otherwise expressly provided herein,
each Option, to the extent it shall not previously have been exercised, shall
terminate on the earlier of the following:
(a) On the last day within the three month period commencing on the
date on which the optionee ceases to be a member of the Company's
Board of Directors, for any reason other than the death, disability or
retirement of the optionee, during which period the optionee shall be
entitled to exercise all Options fully vested as described in
Paragraph 6 by the optionee on which the optionee ceased on the date
on which the optionee ceased be a member of the Company's Board of
Directors;
(b) On the last day within the one year period commencing on the date
on which the optionee ceases to be a member of the Company's Board of
Directors because of permanent disability, during which period the
optionee shall be entitled to exercise all Options fully vested as
described in Paragraph 6 by the optionee on the date on which the
optionee ceased to be a member of the Company's Board of Directors
because of such disability;
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(c) On the last day within the one year period commencing on the date
of the optionee's death while serving as a member of the Company's
Board of Directors, during which period the executor or administrator
of the optionee's estate or the person or persons to whom the
optionee's Option shall have been transferred by will or the laws of
descent or distribution, shall be entitled to exercise all Options in
respect of the number of shares that the optionee would have been
entitled to purchase had the optionee exercised such Options on the
date of his death;
(d) On the last day within the one year period commencing on the date
an optionee who has had at least five years of service on the Board of
Directors of the Company retires from the Board of Directors of the
Company, during which period the optionee, or the executor or
administrator of the optionee's estate or the person or persons to
whom such Option shall have been transferred by the will or the laws
of descent or distribution in the event of the optionee's death within
such one year period, as the case may be, shall be entitled to
exercise all Options in respect of the number of shares that the
optionee would have been entitled to purchase had the optionee
exercised such Options on the date of such retirement; and
(e) Ten years after the date of grant of such Option.
10. Requirements of Law. The Company shall not be required to sell
or issue any shares under any Option if the issuance of such shares shall
constitute a violation by the optionee or the Company of any provisions of any
law or regulation of any governmental authority. Each Option granted under the
Plan shall be subject to the requirements that, if at any time the Board of
Directors of the Company or the Committee shall determine that the listing,
registration or qualification of the shares subject thereto upon any securities
exchange or under any state or federal law of the United States or of any other
country or governmental subdivision thereof, or the consent or approval of any
governmental regulatory body, or investment or other representations, are
necessary or desirable in connection with the issue or purchase of shares
subject thereto, no such Option may be exercised in whole or in part unless such
listing, registration, qualification, consent, approval or representation shall
have been effected or obtained free of any conditions not acceptable to the
Board of Directors. If required at any time by the Board of Directors or the
Committee, an Option may not be exercised until the optionee has delivered an
investment letter to the Company. In addition, specifically in connection with
the Securities Act of 1933 (as now in effect or hereafter amended), upon
exercise of any Option, the Company shall not be required to issue the
underlying shares unless the Committee has received evidence satisfactory to it
to the effect that the holder of such Option will not transfer such shares
except pursuant to a registration statement in effect under such Act or unless
an opinion of counsel satisfactory to the Company has been received by the
Committee to the effect that such registration is not required. Any
determination in this connection by the Committee shall be final, binding and
conclusive. In the event the shares issuable on exercise of an Option are not
registered under the Securities Act of 1933, the Company may imprint on the
certificate for such shares the following legend or any other legend which
counsel for the Company considers necessary or advisable to comply with the
Securities Act of 1933:
"The shares of stock represented by this certificate have not been
registered under the Securities Act of 1933 or under the securities laws of
any state and may not be sold or transferred except upon such registration
or upon receipt by the Corporation of an opinion of counsel satisfactory,
in form and substance to the Corporation, that registration is not required
for such sale or transfer."
The Company may, but shall in no event be obligated to, register any securities
covered hereby pursuant to the Securities Act of 1933 (as now in effect or as
hereafter amended) and, in the event any shares are so registered, the Company
may remove any legend on certificates representing such shares. The Company
shall not be obligated
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to take any other affirmative action in order to cause the exercise of an Option
or the issuance of shares pursuant thereto to comply with any law or regulation
of any governmental authority.
11. No Rights as Stockholder. No optionee shall have rights as a
stockholder with respect to shares covered by his Option until the date of
issuance of a stock certificate for such shares; and, except as otherwise
provided in Paragraph 12 hereof, no adjustment for dividends, or otherwise,
shall be made if the record date therefor is prior to the date of issuance of
such certificate.
12. Changes in the Company's Capital Structure. The existence of
outstanding Options shall not affect in any way the right or power of the
Company or its stockholders to make or authorize any or all adjustments,
recapitalizations, reorganizations or other changes in the Company's capital
structure or its business, or any merger or consolidation of the Company, or any
issue of bonds, debentures, preferred or prior preference stock ahead of or
affecting the Common Stock or the rights thereof, or the dissolution or
liquidation of the Company, or any sale or transfer of all or any part of its
assets or business, or any other corporate act or proceeding, whether of a
similar character or otherwise.
If the Company shall effect a subdivision or consolidation of shares
or other capital adjustment of, or the payment of a dividend in capital stock or
other equity securities of the Company on, its Common Stock, or other increase
or reduction of the number of shares of the Common Stock without receiving
consideration therefor in money, services, or property, or the reclassification
of its Common Stock, in whole or in part, into other equity securities of the
Company, then (a) the number, class and per share price of shares of stock
subject to outstanding Options hereunder shall be appropriately adjusted (or in
the case of the issuance of equity securities as a dividend on, or in a
reclassification of, the Common Stock, the Options shall extend to such other
securities) in such a manner as to entitle an optionee to receive, upon exercise
of an Option, for the same aggregate cash compensation, the same total number
and class or classes of shares (or in the case of a dividend of, or
reclassification into, other equity securities, such other securities) he would
have held after such adjustment if he had exercised his Option in full
immediately prior to the event requiring the adjustment, or, if applicable, the
record date for determining stockholders to be affected by such adjustment; and
(b) the number and class of shares then reserved for issuance under the Plan (or
in the case of a dividend of, or reclassification into, other equity securities,
such other securities) shall be adjusted by substituting for the total number
and class of shares of stock then received, the number and class or classes of
shares of stock (or in the case of a dividend of, or reclassification into,
other equity securities, such other securities) that would have been received by
the owner of an equal number of outstanding shares of Common Stock as the result
of the event requiring the adjustment. Comparable rights shall accrue to each
optionee in the event of successive subdivisions, consolidations, capital
adjustment, dividends or reclassifications of the character described above.
If the Company shall distribute to all holders of its shares of Common
Stock (including any such distribution made to non-dissenting stockholders in
connection with a consolidation or merger in which the Company is the surviving
corporation and in which holders of shares of Common Stock continue to hold
shares of Common Stock after such merger or consolidation) evidences of
indebtedness or cash or other assets (other than cash dividends payable out of
consolidated retained earnings not in excess of, in any one year period, the
greater of (a) $1.00 per share of Common Stock and (b) two times the aggregate
amount of dividends per share paid during the preceding calendar year and
dividends or distributions payable in shares of Common Stock or other equity
securities of the Company described in the immediately preceding paragraph),
then in each case the Option Price shall be adjusted by reducing the Option
Price in effect immediately prior to the record date for the determination of
stockholders entitled to receive such distribution by the fair market value, as
determined in good faith by the Board of Directors of the Company (whose
determination shall be described in a statement filed in the Company's corporate
records and be available for inspection by any holder of an Option) of the
portion of the evidence of indebtedness or cash or other assets so to be
distributed applicable to one share of Common Stock; provided that
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in no event shall the Option Price be less than the par value of a share of
Common Stock. Such adjustment shall be made whenever any such distribution is
made, and shall become effective on the date of the distribution retroactive to
the record date for the determination of the stockholders entitled to receive
such distribution. Comparable adjustments shall be made in the event of
successive distributions of the character described above.
After the Company shall make a tender offer for, or grant to all of
its holders of its shares of Common Stock the right to require the Company to
acquire from such stockholders shares of, Common Stock, at a price in excess of
the Current Market Price (a "Put Right") or the Company shall grant to all of
its holders of its shares of Common Stock the right to acquire shares of Common
Stock for less than the Current Market Price (a "Purchase Right") then, in the
case of a Put Right, the Option Price shall be adjusted by multiplying the
Option Price in effect immediately prior to the record date for the
determination of stockholders entitled to receive such Put Right by a fraction,
the numerator of which shall be the number of shares of Common Stock then
outstanding minus the number of shares of Common Stock which could be purchased
at the Current Market Price for the aggregate amount which would be paid if all
Put Rights are exercised and the denominator of which is the number of shares of
Common Stock which would be outstanding if all Put Rights are exercised; and, in
the case of a Purchase Right, the Option Price shall be adjusted by multiplying
the Option Price in effect immediately prior to the record date for the
determination of the stockholders entitled to receive such Purchase Right by a
fraction, the numerator of which shall be the number of shares of Common Stock
then outstanding plus the number of shares of Common Stock which could be
purchased at the Current Market Price for the aggregate amount which would be
paid if all Purchase Rights are exercised and the denominator of which is the
number of shares of Common Stock which would be outstanding if all Purchase
Rights are exercised. In addition, the number of shares subject to the Option
shall be increased by multiplying the number of shares then subject to the
Option by a fraction which is the inverse of the fraction used to adjust the
Option Price. Notwithstanding the foregoing if any such Put Rights or Purchase
Rights shall terminate without being exercised, the Option Price and number of
shares subject to Option shall be appropriately readjusted to reflect the Option
Price and number of shares subject to the Option which would have been in effect
if such unexercised Rights had never existed. Comparable adjustments shall be
made in the event of successive transactions of the character described above.
After the merger of one or more corporations into the Company, after
any consolidation of the Company and one or more corporations, or after any
other corporate transaction described in Section 424(a) of the Internal Revenue
Code of 1986, as amended (the "Code") in which the Company shall be the
surviving corporation, each optionee, at no additional cost, shall be entitled
to receive, upon any exercise of his Option, in lieu of the number of shares as
to which the Option shall then be so exercised, the number and class of shares
of stock or other equity securities to which the optionee would have been
entitled pursuant to the terms of the agreement of merger or consolidation if at
the time of such merger or consolidation such optionee had been a holder of a
number of shares of Common Stock equal to the number of shares as to which the
Option shall then be so exercised and, if as a result of such merger,
consolidation or other transaction, the holders of Common Stock are not entitled
to receive any shares of Common Stock pursuant to the terms thereof, each
optionee, at no additional cost, shall be entitled to receive, upon exercise of
his Option, such other assets and property, including cash, to which he would
have been entitled if at the time of such merger, consolidation or other
transaction he had been the holder of the number of shares of Common Stock equal
to the number of shares as to which the Option shall then be so exercised.
Comparable rights shall accrue to each optionee in the event of successive
mergers or consolidations of the character described above.
After a merger of the Company into one or more corporations, after any
consolidation of the Company and any one or more corporations, or after any
other corporate transaction described in Section 424(a) of the Code in which the
Company is not the surviving corporation, each optionee shall, at no additional
cost, be entitled at the option of the surviving corporation, (i) to have his
then existing Option assumed or to have a new option substituted for the
existing Option by the surviving corporation to the transaction which is then
employing him, or a parent or
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subsidiary of such corporation, on a basis where the excess of the aggregate
fair market value of the shares subject to the option immediately after the
substitution or assumption over the aggregate option price of such option is
equal to the excess of the aggregate fair market value of all shares subject to
the option immediately before such substitution or assumption over the aggregate
option price of such shares, provided that the shares subject to the new option
must be traded on the New York Stock Exchange or the American Stock Exchange or
quoted on the NASDAQ, or (ii) to receive upon any exercise of his Option, in
lieu of the number of shares as to which the Option shall then be so exercised,
the securities, property and other assets, including cash, to which the Optionee
would have been entitled pursuant to the terms of the agreement of merger or
consolidation or the agreement giving rise to the other corporate transaction if
at the time of such merger, consolidation or other transaction such optionee had
been the holder of the number of shares of Common Stock equal to the number of
shares as to which the Option shall then be so exercised.
If a corporate transaction described in Section 424(a) of the Code
which involves the Company is to take place and there is to be no surviving
corporation while an Option remains in whole or in part unexercised, it shall be
cancelled by the Board of Directors as of the effective date of any such
corporate transaction but before the date each optionee shall be provided with a
notice of such cancellation and each optionee shall have the right to exercise
such Option in full (without regard to any limitations set forth in or imposed
pursuant to Paragraph 9 of the Plan) to the extent it is then still unexercised
during a 30-day period preceding the effective date of such corporate
transaction.
For purposes of this Paragraph 12, "Current Market Price per share of
Common Stock" shall mean the closing price of a share of Common Stock on the
principal national securities exchange on which the Common Stock is listed or,
if the Common Stock is not so listed, the average bid and asked price of a share
of Common Stock as reported in the NASDAQ System, in each case on the trading
day immediately preceding the first trading day on which, as a result of the
establishment of a record date or otherwise, the trading price reflects that an
acquiror of Common Stock in the public market will not participate in or receive
the payment of any applicable dividend or distribution.
Except a hereinbefore expressly provided, the issue by the Company of
shares of Common Stock of any class, or securities convertible into shares of
stock of any class, for cash or property, or for labor or services either upon
direct sale or upon the exercise of rights or warrants to subscribe therefor, or
upon conversion of shares or obligations of the Company convertible into such
shares or other securities, shall not affect, and no adjustment by reason
thereof shall be made with respect to, the number or price of shares of Common
Stock then subject to outstanding Options.
13. Amendment or Termination of Plan. The Board of Directors may
modify, revise or terminate the Plan at any time and from time to time;
provided, however, that without the further approval of the holders of a
majority of the outstanding shares of voting stock, or if the provisions of the
corporate charter, by-laws or applicable state law prescribes a greater degree
of stockholder approval for this action, without the degree of stockholder
approval thus required, the Board of Directors may not (a) change the aggregate
number of shares which may be issued under Options pursuant to the provisions of
the Plan; (b) reduce the option price permitted for the Options; (c) extend the
term during which an option may be exercised or the termination date of the
Plan; or (d) materially increase any other benefits accruing to directors under
the Plan or materially modify the requirements as to eligibility for
participation in the Plan unless, in each such case, the Board of Directors of
the Company shall have obtained an opinion of legal counsel to the effect that
stockholder approval of the amendment is not required (i) by law, (ii) by the
applicable rules and regulations of, or any agreement with, any national
securities exchange that the Common Stock is then listed on or if the Common
Stock is not so listed, the rules and regulations, or any agreement with, the
National Association of Securities Dealers, Inc., and (iii) in order to make
available to the optionee with respect to any option granted under the Plan, the
benefits of Rule 16b-3 of the Rules and Regulations
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under the Securities Exchange Act of 1934, or any similar or successor rule. In
addition, the terms of the Plan relating to the number of shares that may be
subject to an Option, the times at which Options shall be granted, and the means
by which the Option Price for Options granted is to be determined shall not be
amended more than once every six months, other than to comport with changes in
the Code, the Employee Retirement Income Security Act or the rules thereunder.
14. Written Agreement. Each Option granted hereunder shall be
embodied in a written option agreement, which shall be subject to the terms and
conditions prescribed above, and shall be signed by the optionee and by the
appropriate officer of the Company for and in the name and on behalf of the
Company. Such an option agreement shall contain such other provisions as the
Committee in its discretion shall deem advisable.
15. Indemnification of Committee. The Company shall indemnify each
present and future member of the Committee against, and each member of the
Committee shall be entitled without further act on his part to indemnity from
the Company for, all expenses (including the amount of judgments and the amount
of approved settlements made with a view to the curtailment of costs of
litigation, other than amounts paid to the Company itself) reasonably incurred
by him in connection with or arising out of any action, suit or proceeding in
which he may be involved by reason of his being or having been a member of the
Committee, whether or not he continues to be such member of the Committee at the
time of incurring such expenses; provided, however, that such indemnity shall
not include any expenses incurred by any such member of the Committee (a) in
respect of matters as to which he shall be finally adjudged in any such action,
suit or proceeding to have been guilty of gross negligence or willful misconduct
in the performance of his duty as such member of the Committee, or (b) in
respect of any matter in which any settlement is effected, to an amount in
excess of the amount approved by the Company on the advice of its legal counsel;
and provided further, that no right of indemnification under the provisions set
forth herein shall be available to or enforceable by any such member of the
Committee unless, within sixty (60) days after institution of any such action,
suit or proceeding, he shall have offered the Company, in writing, the
opportunity to handle and defend same at its own expense. The foregoing right
of indemnification shall inure to the benefit of the heirs, executors or
administrators of each such member of the Committee and shall be in addition to
all other rights to which such member of the Committee may be entitled to as a
matter of law, contract, or otherwise. Nothing in this Section 15 shall be
construed to limit or otherwise affect any right to indemnification, or payment
of expense, or any provisions limiting the liability of any officer or director
of the Company or any member of the Committee, provided by law, the Certificate
of Incorporation of the Company or otherwise.
16. Effective Date of Plan. The amendments effected by this Amended
and Restated Non-Employee Director Stock Option Plan shall be deemed to have
been adopted and effective on May 12, 1994, when and if approved by the holders
of a majority of the outstanding shares of voting stock of the Company at the
Company's Annual Meeting of Stockholders to be held in 1995.
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ENERGY VENTURES, INC.
AMENDED AND RESTATED
NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
1. Purpose. This Amended and Restated Non-Employee Director Stock Option
Plan (the "Plan") of Energy Ventures, Inc., a Delaware corporation (the
"Company"), is adopted for the benefit of the directors of the Company who at
the time of their service are not employees of the Company or any of its
subsidiaries ("Non-Employee Directors"), and is intended to advance the
interests of the Company by providing the Non-Employee Directors with additional
incentive to serve the Company by increasing their proprietary interest in the
success of the Company.
2. Administration. The Plan shall be administered by a committee of the
Board of Directors of the Company (the "Committee"), the members of which shall
consist solely of directors who are employees of the Company. For the purposes
of the Plan, a majority of the members of the Committee shall constitute a
quorum for the transaction of business, and the vote of a majority of those
members present at any meeting shall decide any question brought before that
meeting. In addition, the Committee may take any action otherwise proper under
the Plan by the affirmative vote, taken without a meeting, of a majority of its
members. No member of the Committee shall be liable for any act or omission of
any other member of the Committee or for any act or omission on his own part,
including but not limited to the exercise of any power or discretion given to
him under the Plan, except those resulting from his own gross negligence or
willful misconduct. Except as otherwise expressly provided for herein, all
questions of interpretation and application of the Plan, or as to options
granted hereunder (the "Options"), shall be subject to the determination, which
shall be final and binding, of a majority of the whole Committee.
Notwithstanding the above, the selection of Non-Employee Directors to whom
Options are to be granted, the number of shares subject to any Option, the
exercise price of any Option and the term of any Option shall be as hereinafter
provided and the Committee shall have no discretion as to such matters.
3. Option Shares. The stock subject to the Options and other provisions
of the Plan shall be shares of the Company's Common Stock, $1.00 par value (or
such other par value as may be designated by act of the Company's stockholders)
(the "Common Stock"). The total amount of the Common Stock with respect to
which Options may be granted shall not exceed in the aggregate 500,000 shares;
provided, that the class and aggregate number of shares which may be subject to
the Options granted hereunder shall be subject to adjustment in accordance with
the provisions of Paragraph 12 hereof. Such shares may be treasury shares or
authorized but unissued shares.
In the event that any outstanding Option for any reason shall expire or
terminate by reason of the death of the optionee or the fact that the optionee
ceases to be a director, the surrender of any such Option, or any other cause,
the shares of Common Stock allocable to the unexercised portion of such Option
may again be subject to an Option under the Plan.
4. Grant of Options. Subject to the provisions of Paragraph 16 and the
availability under the Plan of a sufficient number of shares of Common Stock
that may be issuable upon the exercise of outstanding Options, there shall be
granted the following Options:
(a) To each Non-Employee Director as the date he is first elected as a
director of the Company, an Option to purchase 5,000 shares of Common Stock at a
purchase price per share of Common Stock (the "Option Price") equal to the fair
market value of the Common Stock as defined in Paragraph 7 hereof as of the date
of grant; and
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(b) Commencing on the date of the Annual Meeting of Stockholders of the
Company held in 1994 to each Non-Employee Director as of the date he is
reelected as a director of the Company, an Option to purchase 5,000 shares of
Common Stock at an Option Price equal to the fair market value of the Common
Stock as defined in Paragraph 7 hereof as of the date of grant.
No Option shall be granted pursuant to the Plan after May 12, 2005.
5. Duration of Options. Each Option granted under the Plan shall be
exercisable for a term of ten years from the date of grant, subject to earlier
termination as provided in Paragraph 9 hereof.
6. Amount Exercisable. Each Option granted pursuant to the Plan shall not
be exercisable for a period of one year from the date of grant. After such
time, such Option shall be fully vested and exercisable throughout the term of
the Option. Notwithstanding the foregoing, no Option granted by virtue of the
amendments effected by this Plan shall be exercisable for a period of six months
following stockholder approval of such amendments.
7. Exercise of Options. An optionee may exercise such optionee's Option
by delivering to the Company a written notice stating (i) that such optionee
wishes to exercise such Option on the date such notice is so delivered, (ii) the
number of shares of stock with respect to which such Option is to be exercised,
(iii) the address to which the certificate representing such shares of stock
should be mailed, and (iv) the social security number of such optionee. In
order to be effective, such written notice shall be accompanied by (i) payment
of the Option Price of such shares of stock and (ii) if applicable, payment of
an amount of money necessary to satisfy any withholding tax liability that may
result from the exercise of such Option. Each such payment shall be made by
cashier's check drawn on a national banking association and payable to the order
of the Company in United States dollars.
If, at the time of receipt by the Company of such written notice, (i) the
Company has unrestricted surplus in an amount not less than the Option Price of
such shares of stock, (ii) all accrued cumulative preferential dividends and
other current preferential dividends on all outstanding shares of preferred
stock of the Company have been fully paid, (iii) the acquisition by the Company
of its own shares of stock for the purpose of enabling such optionee to exercise
such Option is otherwise permitted by applicable law and without any vote or
consent of any stockholder of the Company, and (iv) there shall have been
adopted, and there shall be in full force and effect, a resolution of the Board
of Directors of the Company authorizing the acquisition by the Company of its
own shares of stock for such purpose, then such optionee may deliver to the
Company, in payment of the Option Price of the shares of stock with respect to
which such Option is exercised, (x) certificates registered in the name of such
optionee that represent a number of shares of stock legally and beneficially
owned by such optionee (free of all liens, claims and encumbrances of every
kind) and having a fair market value on the date of receipt by the Company of
such written notice that is not greater than the Option Price of the shares of
stock with respect to which such Option is to be exercised, such certificates to
be accompanied by stock powers duly endorsed in blank by the record holder of
the shares of stock represented by such certificates, with the signature of such
record holder guaranteed by a national banking association (or, in lieu of such
certificates, other arrangements for the transfer of such shares to the Company
which are satisfactory to the Company) and (y) if the Option Price of the shares
of stock with respect to which such Options are to be exercised exceeds such
fair market value, a cashier's check drawn on a national banking association and
payable to the order of the Company in an amount, in United States dollars,
equal to the amount of such excess plus the amount of money necessary to satisfy
any withholding tax liability that may result from the exercise of such Option.
Notwithstanding the provisions of the immediately preceding sentence, the
Committee, in its sole discretion, may refuse to accept shares of stock in
payment of the Option Price of the shares of stock with respect to which such
Option is to be exercised and, in that event, any certificates representing
shares of stock that were received by the Company with such written notice shall
be returned to such optionee, together with notice by the Company to such
optionee of the refusal of the Committee to accept such shares of stock. The
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Company may, at its option and upon approval by the Board of Directors of the
Company, retain shares of Common Stock which would otherwise be issued upon
exercise of an Option to satisfy any withholding tax liability that may result
from the exercise of such Option, which shares shall be valued for such purpose
at their then fair market value. If, at the expiration of seven business days
after the delivery to such optionee of such written notice from the Company,
such optionee shall not have delivered to the Company a cashier's check drawn on
a national banking association and payable to the order of the Company in an
amount, in United States dollars, equal to the Option Price of the shares of
stock with respect to which such Option is to be exercised, such written notice
from the optionee to the Company shall be ineffective to exercise such Option.
As promptly as practicable after the receipt by the Company of (i) such
written notice from the optionee, (ii) payment, in the form required by the
foregoing provisions of this Paragraph 7, of the Option Price of the shares of
stock with respect to which such Option is to be exercised, and (iii) payment,
if required, in the form required by the foregoing provisions of this Paragraph
7, of an amount necessary to satisfy any withholding tax liability that may
result from the exercise of such Option, a certificate representing the number
of shares of stock with respect to which such Option has been so exercised,
reduced, to the extent applicable by the number of shares retained by the
Company to pay any required withholding tax, such certificate to be registered
in the name of such optionee, provided that such delivery shall be considered to
have been made when such certificate shall have been mailed, postage prepaid, to
such optionee at the address specified for such purpose in such written notice
from the optionee to the Company.
For purposes of this Paragraph 7, the "fair market value" of a share of
stock as of any particular date shall mean the closing sale price of a share of
Common Stock on that date as reported by the principal national securities
exchange on which the Common Stock is listed if the Common Stock is then listed
on a national securities exchange, or if the Common Stock is not so listed, the
average of the bid and asked price of a share of Common Stock on that date and
reported in the National Association of Securities Dealers Automated Quotation
system (the "NASDAQ System"); provided that if no such closing price or quotes
are so reported on that date or if in the discretion of the Committee another
means of determining the fair market value of a share of stock at such date
shall be necessary or advisable, the Committee may provide for another means for
determining such fair market value.
8. Transferability of Options. Options shall not be transferable by the
optionee otherwise than by will or under the laws of descent and distribution,
and shall be exercisable, during his lifetime, only by him.
9. Termination. Except as may be otherwise expressly provided herein,
each Option, to the extent it shall not previously have been exercised, shall
terminate on the earlier of the following:
(a) On the last day within the three month period commencing on the
date on which the optionee ceases to be a member of the Company's
Board of Directors, for any reason other than the death, disability or
retirement of the optionee, during which period the optionee shall be
entitled to exercise all Options fully vested as described in
Paragraph 6 by the optionee on which the optionee ceased on the date
on which the optionee ceased be a member of the Company's Board of
Directors;
(b) On the last day within the one year period commencing on the date
on which the optionee ceases to be a member of the Company's Board of
Directors because of permanent disability, during which period the
optionee shall be entitled to exercise all Options fully vested as
described in Paragraph 6 by the optionee on the date on which the
optionee ceased to be a member of the Company's Board of Directors
because of such disability;
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(c) On the last day within the one year period commencing on the date
of the optionee's death while serving as a member of the Company's
Board of Directors, during which period the executor or administrator
of the optionee's estate or the person or persons to whom the
optionee's Option shall have been transferred by will or the laws of
descent or distribution, shall be entitled to exercise all Options in
respect of the number of shares that the optionee would have been
entitled to purchase had the optionee exercised such Options on the
date of his death;
(d) On the last day within the one year period commencing on the date
an optionee who has had at least five years of service on the Board of
Directors of the Company retires from the Board of Directors of the
Company, during which period the optionee, or the executor or
administrator of the optionee's estate or the person or persons to
whom such Option shall have been transferred by the will or the laws
of descent or distribution in the event of the optionee's death within
such one year period, as the case may be, shall be entitled to
exercise all Options in respect of the number of shares that the
optionee would have been entitled to purchase had the optionee
exercised such Options on the date of such retirement; and
(e) Ten years after the date of grant of such Option.
10. Requirements of Law. The Company shall not be required to sell
or issue any shares under any Option if the issuance of such shares shall
constitute a violation by the optionee or the Company of any provisions of any
law or regulation of any governmental authority. Each Option granted under the
Plan shall be subject to the requirements that, if at any time the Board of
Directors of the Company or the Committee shall determine that the listing,
registration or qualification of the shares subject thereto upon any securities
exchange or under any state or federal law of the United States or of any other
country or governmental subdivision thereof, or the consent or approval of any
governmental regulatory body, or investment or other representations, are
necessary or desirable in connection with the issue or purchase of shares
subject thereto, no such Option may be exercised in whole or in part unless such
listing, registration, qualification, consent, approval or representation shall
have been effected or obtained free of any conditions not acceptable to the
Board of Directors. If required at any time by the Board of Directors or the
Committee, an Option may not be exercised until the optionee has delivered an
investment letter to the Company. In addition, specifically in connection with
the Securities Act of 1933 (as now in effect or hereafter amended), upon
exercise of any Option, the Company shall not be required to issue the
underlying shares unless the Committee has received evidence satisfactory to it
to the effect that the holder of such Option will not transfer such shares
except pursuant to a registration statement in effect under such Act or unless
an opinion of counsel satisfactory to the Company has been received by the
Committee to the effect that such registration is not required. Any
determination in this connection by the Committee shall be final, binding and
conclusive. In the event the shares issuable on exercise of an Option are not
registered under the Securities Act of 1933, the Company may imprint on the
certificate for such shares the following legend or any other legend which
counsel for the Company considers necessary or advisable to comply with the
Securities Act of 1933:
"The shares of stock represented by this certificate have not been
registered under the Securities Act of 1933 or under the securities laws of
any state and may not be sold or transferred except upon such registration
or upon receipt by the Corporation of an opinion of counsel satisfactory,
in form and substance to the Corporation, that registration is not required
for such sale or transfer."
The Company may, but shall in no event be obligated to, register any securities
covered hereby pursuant to the Securities Act of 1933 (as now in effect or as
hereafter amended) and, in the event any shares are so registered, the Company
may remove any legend on certificates representing such shares. The Company
shall not be obligated
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to take any other affirmative action in order to cause the exercise of an Option
or the issuance of shares pursuant thereto to comply with any law or regulation
of any governmental authority.
11. No Rights as Stockholder. No optionee shall have rights as a
stockholder with respect to shares covered by his Option until the date of
issuance of a stock certificate for such shares; and, except as otherwise
provided in Paragraph 12 hereof, no adjustment for dividends, or otherwise,
shall be made if the record date therefor is prior to the date of issuance of
such certificate.
12. Changes in the Company's Capital Structure. The existence of
outstanding Options shall not affect in any way the right or power of the
Company or its stockholders to make or authorize any or all adjustments,
recapitalizations, reorganizations or other changes in the Company's capital
structure or its business, or any merger or consolidation of the Company, or any
issue of bonds, debentures, preferred or prior preference stock ahead of or
affecting the Common Stock or the rights thereof, or the dissolution or
liquidation of the Company, or any sale or transfer of all or any part of its
assets or business, or any other corporate act or proceeding, whether of a
similar character or otherwise.
If the Company shall effect a subdivision or consolidation of shares
or other capital adjustment of, or the payment of a dividend in capital stock or
other equity securities of the Company on, its Common Stock, or other increase
or reduction of the number of shares of the Common Stock without receiving
consideration therefor in money, services, or property, or the reclassification
of its Common Stock, in whole or in part, into other equity securities of the
Company, then (a) the number, class and per share price of shares of stock
subject to outstanding Options hereunder shall be appropriately adjusted (or in
the case of the issuance of equity securities as a dividend on, or in a
reclassification of, the Common Stock, the Options shall extend to such other
securities) in such a manner as to entitle an optionee to receive, upon exercise
of an Option, for the same aggregate cash compensation, the same total number
and class or classes of shares (or in the case of a dividend of, or
reclassification into, other equity securities, such other securities) he would
have held after such adjustment if he had exercised his Option in full
immediately prior to the event requiring the adjustment, or, if applicable, the
record date for determining stockholders to be affected by such adjustment; and
(b) the number and class of shares then reserved for issuance under the Plan (or
in the case of a dividend of, or reclassification into, other equity securities,
such other securities) shall be adjusted by substituting for the total number
and class of shares of stock then received, the number and class or classes of
shares of stock (or in the case of a dividend of, or reclassification into,
other equity securities, such other securities) that would have been received by
the owner of an equal number of outstanding shares of Common Stock as the result
of the event requiring the adjustment. Comparable rights shall accrue to each
optionee in the event of successive subdivisions, consolidations, capital
adjustment, dividends or reclassifications of the character described above.
If the Company shall distribute to all holders of its shares of Common
Stock (including any such distribution made to non-dissenting stockholders in
connection with a consolidation or merger in which the Company is the surviving
corporation and in which holders of shares of Common Stock continue to hold
shares of Common Stock after such merger or consolidation) evidences of
indebtedness or cash or other assets (other than cash dividends payable out of
consolidated retained earnings not in excess of, in any one year period, the
greater of (a) $1.00 per share of Common Stock and (b) two times the aggregate
amount of dividends per share paid during the preceding calendar year and
dividends or distributions payable in shares of Common Stock or other equity
securities of the Company described in the immediately preceding paragraph),
then in each case the Option Price shall be adjusted by reducing the Option
Price in effect immediately prior to the record date for the determination of
stockholders entitled to receive such distribution by the fair market value, as
determined in good faith by the Board of Directors of the Company (whose
determination shall be described in a statement filed in the Company's corporate
records and be available for inspection by any holder of an Option) of the
portion of the evidence of indebtedness or cash or other assets so to be
distributed applicable to one share of Common Stock; provided that
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<PAGE>
in no event shall the Option Price be less than the par value of a share of
Common Stock. Such adjustment shall be made whenever any such distribution is
made, and shall become effective on the date of the distribution retroactive to
the record date for the determination of the stockholders entitled to receive
such distribution. Comparable adjustments shall be made in the event of
successive distributions of the character described above.
After the Company shall make a tender offer for, or grant to all of
its holders of its shares of Common Stock the right to require the Company to
acquire from such stockholders shares of, Common Stock, at a price in excess of
the Current Market Price (a "Put Right") or the Company shall grant to all of
its holders of its shares of Common Stock the right to acquire shares of Common
Stock for less than the Current Market Price (a "Purchase Right") then, in the
case of a Put Right, the Option Price shall be adjusted by multiplying the
Option Price in effect immediately prior to the record date for the
determination of stockholders entitled to receive such Put Right by a fraction,
the numerator of which shall be the number of shares of Common Stock then
outstanding minus the number of shares of Common Stock which could be purchased
at the Current Market Price for the aggregate amount which would be paid if all
Put Rights are exercised and the denominator of which is the number of shares of
Common Stock which would be outstanding if all Put Rights are exercised; and, in
the case of a Purchase Right, the Option Price shall be adjusted by multiplying
the Option Price in effect immediately prior to the record date for the
determination of the stockholders entitled to receive such Purchase Right by a
fraction, the numerator of which shall be the number of shares of Common Stock
then outstanding plus the number of shares of Common Stock which could be
purchased at the Current Market Price for the aggregate amount which would be
paid if all Purchase Rights are exercised and the denominator of which is the
number of shares of Common Stock which would be outstanding if all Purchase
Rights are exercised. In addition, the number of shares subject to the Option
shall be increased by multiplying the number of shares then subject to the
Option by a fraction which is the inverse of the fraction used to adjust the
Option Price. Notwithstanding the foregoing if any such Put Rights or Purchase
Rights shall terminate without being exercised, the Option Price and number of
shares subject to Option shall be appropriately readjusted to reflect the Option
Price and number of shares subject to the Option which would have been in effect
if such unexercised Rights had never existed. Comparable adjustments shall be
made in the event of successive transactions of the character described above.
After the merger of one or more corporations into the Company, after
any consolidation of the Company and one or more corporations, or after any
other corporate transaction described in Section 424(a) of the Internal Revenue
Code of 1986, as amended (the "Code") in which the Company shall be the
surviving corporation, each optionee, at no additional cost, shall be entitled
to receive, upon any exercise of his Option, in lieu of the number of shares as
to which the Option shall then be so exercised, the number and class of shares
of stock or other equity securities to which the optionee would have been
entitled pursuant to the terms of the agreement of merger or consolidation if at
the time of such merger or consolidation such optionee had been a holder of a
number of shares of Common Stock equal to the number of shares as to which the
Option shall then be so exercised and, if as a result of such merger,
consolidation or other transaction, the holders of Common Stock are not entitled
to receive any shares of Common Stock pursuant to the terms thereof, each
optionee, at no additional cost, shall be entitled to receive, upon exercise of
his Option, such other assets and property, including cash, to which he would
have been entitled if at the time of such merger, consolidation or other
transaction he had been the holder of the number of shares of Common Stock equal
to the number of shares as to which the Option shall then be so exercised.
Comparable rights shall accrue to each optionee in the event of successive
mergers or consolidations of the character described above.
After a merger of the Company into one or more corporations, after any
consolidation of the Company and any one or more corporations, or after any
other corporate transaction described in Section 424(a) of the Code in which the
Company is not the surviving corporation, each optionee shall, at no additional
cost, be entitled at the option of the surviving corporation, (i) to have his
then existing Option assumed or to have a new option substituted for the
existing Option by the surviving corporation to the transaction which is then
employing him, or a parent or
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<PAGE>
subsidiary of such corporation, on a basis where the excess of the aggregate
fair market value of the shares subject to the option immediately after the
substitution or assumption over the aggregate option price of such option is
equal to the excess of the aggregate fair market value of all shares subject to
the option immediately before such substitution or assumption over the aggregate
option price of such shares, provided that the shares subject to the new option
must be traded on the New York Stock Exchange or the American Stock Exchange or
quoted on the NASDAQ, or (ii) to receive upon any exercise of his Option, in
lieu of the number of shares as to which the Option shall then be so exercised,
the securities, property and other assets, including cash, to which the Optionee
would have been entitled pursuant to the terms of the agreement of merger or
consolidation or the agreement giving rise to the other corporate transaction if
at the time of such merger, consolidation or other transaction such optionee had
been the holder of the number of shares of Common Stock equal to the number of
shares as to which the Option shall then be so exercised.
If a corporate transaction described in Section 424(a) of the Code
which involves the Company is to take place and there is to be no surviving
corporation while an Option remains in whole or in part unexercised, it shall be
cancelled by the Board of Directors as of the effective date of any such
corporate transaction but before the date each optionee shall be provided with a
notice of such cancellation and each optionee shall have the right to exercise
such Option in full (without regard to any limitations set forth in or imposed
pursuant to Paragraph 9 of the Plan) to the extent it is then still unexercised
during a 30-day period preceding the effective date of such corporate
transaction.
For purposes of this Paragraph 12, "Current Market Price per share of
Common Stock" shall mean the closing price of a share of Common Stock on the
principal national securities exchange on which the Common Stock is listed or,
if the Common Stock is not so listed, the average bid and asked price of a share
of Common Stock as reported in the NASDAQ System, in each case on the trading
day immediately preceding the first trading day on which, as a result of the
establishment of a record date or otherwise, the trading price reflects that an
acquiror of Common Stock in the public market will not participate in or receive
the payment of any applicable dividend or distribution.
Except a hereinbefore expressly provided, the issue by the Company of
shares of Common Stock of any class, or securities convertible into shares of
stock of any class, for cash or property, or for labor or services either upon
direct sale or upon the exercise of rights or warrants to subscribe therefor, or
upon conversion of shares or obligations of the Company convertible into such
shares or other securities, shall not affect, and no adjustment by reason
thereof shall be made with respect to, the number or price of shares of Common
Stock then subject to outstanding Options.
13. Amendment or Termination of Plan. The Board of Directors may
modify, revise or terminate the Plan at any time and from time to time;
provided, however, that without the further approval of the holders of a
majority of the outstanding shares of voting stock, or if the provisions of the
corporate charter, by-laws or applicable state law prescribes a greater degree
of stockholder approval for this action, without the degree of stockholder
approval thus required, the Board of Directors may not (a) change the aggregate
number of shares which may be issued under Options pursuant to the provisions of
the Plan; (b) reduce the option price permitted for the Options; (c) extend the
term during which an option may be exercised or the termination date of the
Plan; or (d) materially increase any other benefits accruing to directors under
the Plan or materially modify the requirements as to eligibility for
participation in the Plan unless, in each such case, the Board of Directors of
the Company shall have obtained an opinion of legal counsel to the effect that
stockholder approval of the amendment is not required (i) by law, (ii) by the
applicable rules and regulations of, or any agreement with, any national
securities exchange that the Common Stock is then listed on or if the Common
Stock is not so listed, the rules and regulations, or any agreement with, the
National Association of Securities Dealers, Inc., and (iii) in order to make
available to the optionee with respect to any option granted under the Plan, the
benefits of Rule 16b-3 of the Rules and Regulations
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<PAGE>
under the Securities Exchange Act of 1934, or any similar or successor rule. In
addition, the terms of the Plan relating to the number of shares that may be
subject to an Option, the times at which Options shall be granted, and the means
by which the Option Price for Options granted is to be determined shall not be
amended more than once every six months, other than to comport with changes in
the Code, the Employee Retirement Income Security Act or the rules thereunder.
14. Written Agreement. Each Option granted hereunder shall be
embodied in a written option agreement, which shall be subject to the terms and
conditions prescribed above, and shall be signed by the optionee and by the
appropriate officer of the Company for and in the name and on behalf of the
Company. Such an option agreement shall contain such other provisions as the
Committee in its discretion shall deem advisable.
15. Indemnification of Committee. The Company shall indemnify each
present and future member of the Committee against, and each member of the
Committee shall be entitled without further act on his part to indemnity from
the Company for, all expenses (including the amount of judgments and the amount
of approved settlements made with a view to the curtailment of costs of
litigation, other than amounts paid to the Company itself) reasonably incurred
by him in connection with or arising out of any action, suit or proceeding in
which he may be involved by reason of his being or having been a member of the
Committee, whether or not he continues to be such member of the Committee at the
time of incurring such expenses; provided, however, that such indemnity shall
not include any expenses incurred by any such member of the Committee (a) in
respect of matters as to which he shall be finally adjudged in any such action,
suit or proceeding to have been guilty of gross negligence or willful misconduct
in the performance of his duty as such member of the Committee, or (b) in
respect of any matter in which any settlement is effected, to an amount in
excess of the amount approved by the Company on the advice of its legal counsel;
and provided further, that no right of indemnification under the provisions set
forth herein shall be available to or enforceable by any such member of the
Committee unless, within sixty (60) days after institution of any such action,
suit or proceeding, he shall have offered the Company, in writing, the
opportunity to handle and defend same at its own expense. The foregoing right
of indemnification shall inure to the benefit of the heirs, executors or
administrators of each such member of the Committee and shall be in addition to
all other rights to which such member of the Committee may be entitled to as a
matter of law, contract, or otherwise. Nothing in this Section 15 shall be
construed to limit or otherwise affect any right to indemnification, or payment
of expense, or any provisions limiting the liability of any officer or director
of the Company or any member of the Committee, provided by law, the Certificate
of Incorporation of the Company or otherwise.
16. Effective Date of Plan. The amendments effected by this Amended
and Restated Non-Employee Director Stock Option Plan shall be deemed to have
been adopted and effective on May 12, 1994, when and if approved by the holders
of a majority of the outstanding shares of voting stock of the Company at the
Company's Annual Meeting of Stockholders to be held in 1995.
8
<PAGE>
ENERGY VENTURES, INC.
PROXY FOR ANNUAL MEETING
MAY 19, 1995
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS. The undersigned
stockholder of Energy Ventures, Inc. (the "Company") hereby appoints BERNARD J.
DUROC-DANNER and JAMES G. KILEY as Proxies, each with power to act without the
other and with full power of substitution, for the undersigned to vote all
shares of Common Stock of the Company of undersigned at the Annual Meeting of
Stockholders of the Company to be held on May 19, 1995, or at any adjournment(s)
thereof, on the following matters more particularly described in the Proxy
Statement dated April 11, 1995:
1. ELECTION OF THE FOLLOWING NOMINEES, AS SET FORTH IN THE PROXY STATEMENT:
/ / FOR all nominees listed / / WITHHOLD all nominees
(except as marked to the listed
contrary below)
DAVID J. BUTTERS, BERNARD J. DUROC-DANNER, URIEL E. DUTTON, ELIOT M. FRIED,
ROBERT B. MILLARD AND ROBERT A. RAYNE.
INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY NOMINEE, WRITE THAT
NOMINEE'S NAME IN THE SPACE PROVIDED BELOW.
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2. Amendments to the Company's Non-Employee Director Stock Option Plan:
/ / FOR / / AGAINST / / ABSTAIN
3. In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the meeting.
This Proxy, when properly executed, will be voted in the manner directed herein
by the undersigned. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR ALL OF
THE NOMINEES LISTED ABOVE AND FOR approval of the amendments to the Company's
Non-Employee Director Stock Option Plan.
Receipt is hereby acknowledged of the Notice of Annual Meeting of Stockholders
and Proxy Statement, each dated April 11, 1995 and the Annual Report of Energy
Ventures, Inc. for the year ended December 31, 1994.
DATED: , 1995
--------------------------
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--------------------------------------
(Note: Please sign exactly as your name
appears hereon. Executors,
administrators, trustees, etc. should so
indicate when signing, giving full title
as such. If signer is a corporation,
execute in full corporate name by
authorized officer. If shares are held
in the name of two or more persons, all
should sign.)
PLEASE MARK, SIGN, DATE AND RETURN THIS
PROXY USING THE ENCLOSED ENVELOPE.
