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2000 STOCK INCENTIVE PLAN
OF
EVERGREEN RESOURCES, INC.
1. PURPOSE
The purpose of the 2000 Stock Incentive Plan of Evergreen Resources, Inc.
(the "Plan") is to encourage and enable selected employees, directors and
independent contractors of Evergreen Resources, Inc. (the "Corporation") and its
related entities to acquire or to increase their holdings of common stock of the
Corporation (the "Common Stock") and other proprietary interests in the
Corporation in order to promote a closer identification of their interests with
those of the Corporation and its shareholders, thereby further stimulating their
efforts to enhance the efficiency, soundness, profitability, growth and
shareholder value of the Corporation. This purpose will be carried out through
the granting of benefits (collectively referred to herein as "awards") to
selected employees, independent contractors and directors, including the
granting of incentive stock options ("incentive options") intended to qualify
under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code"),
nonqualified stock options ("nonqualified options"), stock appreciation rights
("SARs"), restricted stock awards ("restricted stock awards"), and restricted
units ("restricted units") to such participants. Incentive options and
nonqualified options shall be referred to herein collectively as "options."
Restricted stock awards and restricted units shall be referred to herein
collectively as "restricted awards."
2. ADMINISTRATION OF THE PLAN
(a) The Plan shall be administered by the Board of Directors of the
Corporation (the "Board" or the "Board of Directors") or, upon its delegation,
by the Compensation Committee of the Board of Directors (the "Committee").
Unless the Board determines otherwise, the Committee shall be comprised solely
of "non-employee directors," as such term is defined in Rule 16b-3 under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), or as may
otherwise be permitted under Rule 16b-3. Further, to the extent required by
Section 162(m) of the Code or related regulations, the Plan shall be
administered by a committee comprised of "outside directors" (as such term is
defined in Section 162(m) or related regulations) or as may otherwise be
permitted under Section 162(m) and related regulations. For the purposes herein,
the term "Administrator" shall refer to the Board and, upon its delegation to
the Committee of all or part of its authority to administer the Plan, to the
Committee.
(b) Any action of the Administrator with respect to the Plan may be taken
by a written instrument signed by all of the members of the Board or Committee,
as appropriate, and any such action so taken by written consent shall be as
fully effective as if it had been taken by a majority of the members at a
meeting duly held and called. Subject to the provisions of the Plan, the
Administrator shall have full and final authority in its discretion to take any
action with respect to the Plan including, without limitation, the authority (i)
to determine all matters relating to awards, including selection of individuals
to be granted awards, the types of awards, the number of shares of the Common
Stock, if any, subject to an award, and all terms, conditions, restrictions and
limitations of an award; (ii) to prescribe the form or forms of the agreements
evidencing any awards granted under the Plan; (iii) to establish, amend and
rescind rules and regulations for the administration of the Plan; and (iv) to
construe and interpret the Plan and agreements evidencing awards granted under
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Plan, to interpret rules and regulations for administering the Plan and to make
all other determinations deemed necessary or advisable for administering the
Plan. The Administrator shall also have authority, in its sole discretion, to
accelerate the date that any award which was not otherwise exercisable or vested
shall become exercisable or vested in whole or in part without any obligation to
accelerate such date with respect to any other award granted to any recipient.
In addition, the Administrator shall have the authority and discretion to
establish terms and conditions of awards as the Administrator determines to be
necessary or appropriate to conform to the applicable requirements or practices
of jurisdictions outside of the United States.
(c) To the extent permitted by applicable law, each person who is or at
any time serves as a member of the Board or the Committee shall be indemnified
and held harmless by the Corporation against and from (i) any loss, cost,
liability, or expense that may be imposed on or reasonably incurred by such
person in connection with or resulting from any claim, action, suit, or
proceeding to which such person may be a party or in which such person may be
involved by reason of any action or failure to act under this Plan; and (ii) any
and all amounts paid by such person in satisfaction of judgment in any such
action, suit, or proceeding relating to this Plan. Each person covered by this
indemnification shall give the Corporation an opportunity, at its own expense,
to handle and defend the same before such person undertakes to handle and defend
the same on such person's own behalf. The foregoing right of indemnification
shall not be exclusive of any other rights of indemnification to which such
persons may be entitled under the charter or by-laws of the Corporation, as a
matter of law, or otherwise, or any power that the Corporation may have to
indemnify such person or hold such person harmless.
(d) Notwithstanding Section 2(a), the Administrator may delegate to the
chief executive officer of the Corporation the authority to grant awards, and to
make any or all of the determinations reserved for the Administrator in the Plan
and summarized in Section 2(b) herein with respect to such awards, to any
individual who, at the time of said grant or other determination, (i) is not
deemed to be an officer or director of the Corporation within the meaning of
Section 16 of the Exchange Act, (ii) is not deemed to be a covered employee (as
defined in Section 18(b) herein), and (iii) is otherwise eligible under Section
5. To the extent that the Administrator has delegated authority to grant awards
pursuant to this Section 2(d) to the chief executive officer, references to the
Administrator shall include references to such person, subject, however, to the
requirements of the Plan, Rule 16b-3, Section 162(m) of the Code and other
applicable law.
3. EFFECTIVE DATE
The effective date of the Plan shall be June 16, 2000 (the "Effective
Date"). Awards may be granted under the Plan on and after the Effective Date,
but no awards may be granted after June 15, 2010.
4. SHARES OF STOCK SUBJECT TO THE PLAN; AWARD LIMITATIONS
(a) Subject to adjustments as provided in this Section 4, the maximum
number of shares of Common Stock that may be issued pursuant to awards shall be
1,000,000 shares, plus an annual increase to be added following the last day of
each calendar year during the term of the Plan equal to the lesser of (i)
150,000 shares of Common Stock or (ii) an amount determined by the Board of
Directors. Such shares shall be authorized but unissued shares or shares
purchased on the open market or by private purchase. No participant may be
granted awards in any 12-month period for more than 250,000 shares of Common
Stock (or the equivalent value thereof based on the fair market
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value per share of the Common Stock on the date of grant of an award). The share
and award limitations imposed pursuant to this Section 4(a) shall be subject to
adjustment as provided in Section 4(c) herein.
(b) The Corporation hereby reserves sufficient authorized shares of Common
Stock to meet the grant of awards hereunder. Any shares subject to an award
which is subsequently forfeited, expires or is terminated may again be the
subject of an award granted under the Plan. To the extent that any shares of
Common Stock subject to an award are not delivered to a participant (or his
beneficiary) because the award is forfeited, canceled, settled in cash or used
to satisfy applicable tax withholding obligations, such shares shall not be
deemed to have been issued for purposes of determining the maximum number of
shares of Common Stock available for issuance under the Plan. If the purchase
price of an award granted under the Plan is satisfied by tendering or
withholding shares of Common Stock, only the number of shares issued net of the
shares of Common Stock tendered or withheld shall be deemed issued for purposes
of determining the maximum number of shares of Common Stock available for
issuance under the Plan.
(c) If there is any change in the outstanding shares of Common Stock
because of a merger, consolidation or reorganization involving the Corporation
or a related entity, or if the Board of Directors of the Corporation declares a
stock dividend, stock split distributable in shares of Common Stock or reverse
stock split, or if there is a similar change in the capital stock structure of
the Corporation or a related entity affecting the Common Stock, the number of
shares of Common Stock reserved for issuance under the Plan shall be
correspondingly adjusted, and the Administrator shall make such adjustments to
awards or to any provisions of this Plan as the Administrator deems equitable to
prevent dilution or enlargement of awards or as may be otherwise advisable.
5. ELIGIBILITY
An award may be granted only to an individual who satisfies the following
eligibility requirements on the date the award is granted:
(a) The individual is either (i) an employee of the Corporation or a
related entity, (ii) a director of the Corporation or a related entity, or (iii)
an independent contractor, consultant or advisor (collectively, "independent
contractors") providing services to the Corporation or a related entity. For
this purpose, an individual shall be considered to be an "employee" only if
there exists between the individual and the Corporation or a related corporation
the legal and bona fide relationship of employer and employee.
(b) With respect to the grant of incentive options, the individual does
not own, immediately before the time that the incentive option is granted, stock
possessing more than 10% of the total combined voting power of all classes of
stock of the Corporation or a related corporation. Notwithstanding the
foregoing, an individual who owns more than 10% of the total combined voting
power of the Corporation or a related corporation may be granted an incentive
option if the option price is at least 110% of the fair market value of the
Common Stock (as defined in Section 6(c)(ii) herein), and the option period (as
defined in Section 6(d)(i) herein) does not exceed five years. For this purpose,
an individual will be deemed to own stock which is attributable to him under
Section 424(d) of the Code.
(c) With respect to the grant of substitute awards or assumption of awards
in connection with a merger, reorganization or similar business combination
involving the Corporation or a related
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entity, the recipient is otherwise eligible to receive the award and the terms
of the award are consistent with the Plan and applicable laws, rules and
regulations (including, to the extent necessary, the federal securities laws
registration provisions and Section 424(a) of the Code).
(d) The individual, being otherwise eligible under this Section 5, is
selected by the Administrator as an individual to whom an award shall be granted
(a "participant").
6. OPTIONS
(a) GRANT OF OPTIONS: Subject to the limitations of the Plan, the
Administrator may in its sole and absolute discretion grant options to such
eligible individuals in such numbers, upon such terms and at such times as the
Administrator shall determine. Both incentive options and nonqualified options
may be granted under the Plan; provided, however, that incentive options may
only be granted to employees of the Corporation or a related corporation. To the
extent that an option is designated as an incentive option but does not qualify
as such under Section 422 of the Code, the option (or portion thereof) shall be
treated as a nonqualified option.
(b) OPTION PRICE: The price per share at which an option may be exercised
(the "option price") shall be established by the Administrator and stated in the
agreement evidencing the grant of the option; provided, that (i) in the case of
an incentive option, the option price shall be no less than 100% of the fair
market value per share of the Common Stock (as determined in accordance with
Section 6(c)(ii) on the date the option is granted); (ii) in the case of a
nonqualified option, the option price shall be no less than 85% of the fair
market value per share of the Common Stock (as determined in accordance with
Section 6(c)(ii) on the date the option is granted); and (iii) in no event shall
the option price per share of any option be less than the par value, if any, per
share of the Common Stock.
(c) DATE OF GRANT; FAIR MARKET VALUE:
(i) An incentive option shall be considered to be granted on the date
that the Administrator acts to grant the option, or on any later date
specified by the Administrator as the effective date of the option. A
nonqualified option shall be considered to be granted on the date the
Administrator acts to grant the option or any other date specified by the
Administrator as the date of grant of the option.
(ii) For the purposes of the Plan, the "fair market value" per share
of the Common Stock shall be established in good faith by the Administrator
and, except as may otherwise be determined by the Administrator, the fair
market value shall be determined in accordance with the following
provisions: (A) if the shares of Common Stock are listed for trading on the
New York Stock Exchange or the American Stock Exchange, the fair market
value shall be the closing sales price per share of the shares on the New
York Stock Exchange or the American Stock Exchange (as applicable) on the
date immediately preceding the date the option is granted, or, if there is
no transaction on such date, then on the trading date nearest preceding the
date the option is granted for which closing price information is
available, and, provided further, if the shares are quoted on the Nasdaq
National Market or the Nasdaq SmallCap Market of the Nasdaq Stock Market
but are not listed for trading on the New York Stock Exchange or the
American Stock Exchange, the fair market value shall be the closing sales
price for such stock (or the closing bid, if no sales were reported) as
quoted on such system on the date immediately or nearest preceding the date
the option is granted for which
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such information is available; or (B) if the shares of Common Stock are not
listed or reported in any of the foregoing, then the fair market value
shall be determined by the Administrator in accordance with the applicable
provisions of Section 20.2031-2 of the Federal Estate Tax Regulations, or
in any other manner consistent with the Code and accompanying regulations.
(iii) In no event shall there first become exercisable by an employee
in any one calendar year incentive options granted by the Corporation or
any related corporation with respect to shares having an aggregate fair
market value (determined at the time an incentive option is granted)
greater than $100,000.
(d) OPTION PERIOD AND LIMITATIONS ON THE RIGHT TO EXERCISE OPTIONS:
(i) The term of an option (the "option period") shall be determined
by the Administrator at the time the option is granted and stated in the
individual agreement. With respect to incentive options, the option period
shall not extend more than 10 years from the date on which the option is
granted. Any option or portion thereof not exercised before expiration of
the option period shall terminate. The period or periods during which and
terms and conditions pursuant to which an option may become exercisable
shall be determined by the Administrator in a manner consistent with the
terms of the Plan.
(ii) An option may be exercised by giving written notice to the
Corporation at such place as the Corporation or its designee shall direct.
Such notice shall specify the number of shares to be purchased pursuant to
an option and the aggregate purchase price to be paid therefor, and shall
be accompanied by payment of such purchase price. Unless an individual
option agreement provides otherwise, such payment shall be in the form of
cash or check, and, where expressly permitted by the Administrator, payment
may also be made by (A) delivery (by either actual delivery or attestation)
of shares of Common Stock owned by the participant at the time of exercise
for a period of at least six months and otherwise acceptable to the
Administrator; (B) shares of Common Stock withheld upon exercise; (C)
delivery of written notice of exercise to the Corporation and delivery to a
broker of written notice of exercise and irrevocable instructions to
promptly deliver to the Corporation the amount of sale or loan proceeds to
pay the option price; or (D) a combination of the foregoing methods. Shares
tendered or withheld in payment on the exercise of an option shall be
valued at their fair market value on the date of exercise, as determined by
the Administrator by applying the provisions of Section 6(c)(ii).
(iii) Unless an individual option agreement provides otherwise, no
option granted to a participant who was an employee at the time of grant
shall be exercised unless the participant is, at the time of exercise, an
employee as described in Section 5(a), and has been an employee
continuously since the date the option was granted, subject to the
following:
(A) An option shall not be affected by any change in the terms,
conditions or status of the participant's employment, provided that
the participant continues to be an employee of the Corporation or a
related corporation.
(B) The employment relationship of a participant shall be
treated as continuing intact for any period that the participant is on
military or sick leave or other bona fide leave of absence, provided
that the period of such leave does not exceed 90 days, or, if longer,
as long as the participant's right to reemployment is
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guaranteed either by statute or by contract. The employment
relationship of a participant shall also be treated as continuing
intact while the participant is not in active service because of
disability. The Administrator shall have sole authority to determine
whether a participant is disabled and, if applicable, the date of a
participant's termination of employment or service for any reason (the
"termination date").
(C) Unless an individual option agreement provides otherwise, if
the employment of a participant is terminated because of disability,
or if the participant dies while he is an employee, the option may be
exercised only to the extent exercisable on the participant's
termination date, except that the Administrator may in its discretion
accelerate the date for exercising all or any part of the option which
was not otherwise exercisable on the termination date. The option must
be exercised, if at all, prior to the first to occur of the following,
whichever shall be applicable: (X) the close of the period of 12
months next succeeding the termination date (or such other period
stated in the applicable agreement); or (Y) the close of the option
period. In the event of the participant's death, such option shall be
exercisable by such person or persons as shall have acquired the right
to exercise the option by will or by the laws of intestate succession.
(D) Unless an individual option agreement provides otherwise, if
the employment of the participant is terminated for any reason other
than disability, death or for "cause," his option may be exercised to
the extent exercisable on his termination date, except that the
Administrator may in its discretion accelerate the date for exercising
all or any part of the option which was not otherwise exercisable on
the termination date. The option must be exercised, if at all, prior
to the first to occur of the following, whichever shall be applicable:
(X) the close of the period of 90 days next succeeding the termination
date (or such other period stated in the applicable agreement); or (Y)
the close of the option period. If the participant dies following such
termination of employment and prior to the earlier of the dates
specified in (X) or (Y) of this subparagraph (D), the participant
shall be treated as having died while employed under subparagraph (C)
immediately preceding (treating for this purpose the participant's
date of termination of employment as the termination date). In the
event of the participant's death, such option shall be exercisable by
such person or persons as shall have acquired the right to exercise
the option by will or by the laws of intestate succession.
(E) Unless an individual option agreement provides otherwise, if
the employment of the participant is terminated for "cause," his
option shall lapse and no longer be exercisable as of his termination
date, as determined by the Administrator. For purposes of the Plan, a
participant's termination shall be for "cause" if such termination
results from the participant's (W) termination for "cause" under the
participant's employment, consulting or other agreement with the
Corporation or a related entity; (X) dishonesty or conviction of a
crime; (Y) failure to perform his duties for the Corporation or a
related entity to the satisfaction of the Corporation; or (Z) engaging
in conduct that could be materially damaging to the Corporation
without a reasonable good faith belief that such conduct was in the
best interest of the Corporation. The determination of "cause" shall
be made by the Administrator and its determination shall be final and
conclusive.
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(F) Notwithstanding the foregoing, the Administrator shall have
authority, in its discretion, to extend the period during which an
option may be exercised; provided that, in the event that any such
extension shall cause an incentive option to be designated as a
nonqualified option, no such extension shall be made without the
written consent of the participant.
(iv) Unless an individual option agreement provides otherwise, an
option granted to a participant who was a non-employee director of the
Corporation or a related entity at the time of grant may be exercised only
to the extent exercisable on the date of the participant's termination of
service to the Corporation or a related entity (unless the termination was
for cause), and must be exercised, if at all, prior to the close of the
option period. If the services of such a participant are terminated for
cause (as defined in Section 6(d)(iii)(E) herein), his option shall lapse
and no longer be exercisable as of his termination date, as determined by
the Administrator. Notwithstanding the foregoing, the Administrator may in
its discretion accelerate the date for exercising all or any part of an
option which was not otherwise exercisable on the termination date or
extend the period during which an option may be exercised, or both.
(v) Unless an individual option agreement provides otherwise, an
option granted to a participant who was an independent contractor of the
Corporation or a related entity at the time of grant (and who does not
thereafter become an employee, in which case he shall be subject to the
provisions of Section 6(d)(iii) herein) may be exercised only to the extent
exercisable on the date of the participant's termination of service to the
Corporation or a related entity (unless the termination was for cause), and
must be exercised, if at all, prior to the first to occur of the following,
as applicable: (X) the close of the period of 90 days next succeeding the
termination date (or such other period stated in the applicable agreement);
or (Y) the close of the option period. If the services of such a
participant are terminated for cause (as defined in Section 6(d)(iii)(E)
herein), his option shall lapse and no longer be exercisable as of his
termination date, as determined by the Administrator. Notwithstanding the
foregoing, the Administrator may in its discretion accelerate the date for
exercising all or any part of an option which was not otherwise exercisable
on the termination date or extend the period during which an option may be
exercised, or both.
(vi) A participant or his legal representative, legatees or
distributees shall not be deemed to be the holder of any shares subject to
an option and shall not have any rights of a shareholder unless and until
certificates for such shares have been issued and delivered to him or them
under the Plan. A certificate or certificates for shares of Common Stock
acquired upon exercise of an option shall be issued in the name of the
participant (or his beneficiary) and distributed to the participant (or his
beneficiary) as soon as practicable following receipt of notice of exercise
and payment of the purchase price (except as may otherwise be determined by
the Corporation in the event of payment of the option price pursuant to
Section 6(d)(ii)(D) herein).
(e) NONTRANSFERABILITY OF OPTIONS:
(i) Incentive options shall not be transferable other than by will or
the laws of intestate succession. Nonqualified options shall not be
transferable other than by will or the laws of intestate succession, except
as may be permitted by the Administrator in a manner
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consistent with the registration provisions of the Securities Act of 1933,
as amended (the "Securities Act"). Except as may be permitted by the
preceding sentence, an option shall be exercisable during the participant's
lifetime only by him or by his guardian or legal representative. The
designation of a beneficiary does not constitute a transfer.
(ii) If a participant is subject to Section 16 of the Exchange Act,
shares of Common Stock acquired upon exercise of an option may not, without
the consent of the Administrator, be disposed of by the participant until
the expiration of six months after the date the option was granted.
7. STOCK APPRECIATION RIGHTS
(a) GRANT OF SARS: Subject to the limitations of the Plan, the
Administrator may in its sole and absolute discretion grant SARs to such
eligible individuals, in such numbers, upon such terms and at such times as the
Administrator shall determine. SARs may be granted to an optionee of an option
(a "related option") with respect to all or a portion of the shares of Common
Stock subject to the related option (a "tandem SAR") or may be granted
separately to an eligible individual (a "freestanding SAR").
(b) TANDEM SARS: A tandem SAR may be granted either concurrently with the
grant of the related option or (if the related option is a nonqualified option)
at any time thereafter prior to the complete exercise, termination, expiration
or cancellation of such related option. Tandem SARs shall be exercisable only at
the time and to the extent that the related option is exercisable (and may be
subject to such additional limitations on exercisability as the Administrator
may provide in the agreement), and in no event after the complete termination or
full exercise of the related option. For purposes of determining the number of
shares of Common Stock that remain subject to such related option and for
purposes of determining the number of shares of Common Stock in respect of which
other awards may be granted, a related option shall be considered to have been
surrendered upon the exercise of a tandem SAR to the extent of the number of
shares of Common Stock with respect to which such tandem SAR is exercised. Upon
the exercise or termination of a related option, the tandem SARs with respect
thereto shall be canceled automatically to the extent of the number of shares of
Common Stock with respect to which the related option was so exercised or
terminated. Subject to the limitations of the Plan, upon the exercise of a
tandem SAR, the participant shall be entitled to receive from the Corporation,
for each share of Common Stock with respect to which the tandem SAR is being
exercised, consideration equal in value to the excess of the fair market value
of a share of Common Stock on the date of exercise over the related option price
per share; provided, that the Administrator may establish a maximum value
payable for such SARs.
(c) FREESTANDING SARS: Unless an individual agreement provides otherwise,
the base price of a freestanding SAR shall be not less than 100% of the fair
market value of the Common Stock (as determined in accordance with Section
6(c)(ii) herein) on the date of grant of the freestanding SAR. Subject to the
limitations of the Plan, upon the exercise of a freestanding SAR, the
participant shall be entitled to receive from the Corporation, for each share of
Common Stock with respect to which the freestanding SAR is being exercised,
consideration equal in value to the excess of the fair market value of a share
of Common Stock on the date of exercise over the base price per share of such
freestanding SAR; provided, that the Administrator may establish a maximum value
payable for such SARs.
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(d) EXERCISE OF SARS:
(i) Subject to the terms of the Plan, SARs shall be exercisable in
whole or in part upon such terms and conditions as may be established by
the Administrator and stated in the related agreement. The period during
which an SAR may be exercisable shall not exceed 10 years from the date of
grant or, in the case of tandem SARs, such other option period as may apply
to the related option. Any SAR or portion thereof not exercised before
expiration of the exercise period established by the Administrator shall
terminate.
(ii) SARs may be exercised by giving written notice to the Corporation
at such place as the Administrator or its designee shall direct. The date
of exercise of an SAR shall mean the date on which the Corporation shall
have received proper notice from the participant of the exercise of such
SAR.
(iii) No SAR may be exercised unless the participant is, at the time
of exercise, an eligible participant, as described in Section 5, and has
been a participant continuously since the date the SAR was granted, subject
to the provisions of Sections 6(d)(iii), (iv) and (v) herein.
(e) CONSIDERATION: The consideration to be received upon the exercise of
the SAR by the participant shall be paid in cash, shares of Common Stock (valued
at fair market value on the date of exercise of such SAR in accordance with
Section 6(c)(ii) herein) or a combination of cash and shares of Common Stock, as
elected by the Administrator. The Corporation's obligation arising upon the
exercise of the SAR may be paid currently or on a deferred basis with such
interest or earnings equivalent, if any, as the Administrator may determine. A
certificate or certificates for shares of Common Stock acquired upon exercise of
an SAR for shares shall be issued in the name of the participant (or his
beneficiary) and distributed to the participant (or his beneficiary) as soon as
practicable following receipt of notice of exercise. A participant or his legal
representative, legatees or distributees shall not be deemed to be the holder of
any shares subject to an SAR and shall not have any rights as a shareholder
unless and until certificates for such shares have been issued and delivered to
him or them under the Plan. No fractional shares of Common Stock will be
issuable upon exercise of the SAR and, unless otherwise provided in the
applicable agreement, the participant will receive cash in lieu of fractional
shares.
(f) LIMITATIONS: The applicable SAR agreement shall contain such terms,
conditions and limitations consistent with the Plan as may be specified by the
Administrator. Unless otherwise provided in the applicable agreement or the
Plan, any such terms, conditions or limitations relating to a tandem SAR shall
not restrict the exercisability of the related option.
(g) NONTRANSFERABILITY:
(i) SARs shall not be transferable other than by will or the laws of
intestate succession (except to the extent, if any, that a related option
is a nonqualified option and is transferable pursuant to Section 6(e)(i)
herein). SARs may be exercised during the participant's lifetime only by
him or by his guardian or legal representative (except in the event of a
permitted transfer in accordance with the preceding sentence). The
designation of a beneficiary does not constitute a transfer.
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(ii) If the participant is subject to Section 16 of the Exchange Act,
shares of Common Stock acquired upon exercise of an SAR may not, without
the consent of the Administrator, be disposed of by the participant until
the expiration of six months after the date the SAR was granted.
8. RESTRICTED AWARDS
(a) GRANT AND EARNING OF RESTRICTED AWARDS: Subject to the limitations of
the Plan, the Administrator may in its sole and absolute discretion grant
restricted awards to such individuals in such numbers, upon such terms and at
such times as the Administrator shall determine. A restricted award may consist
of a restricted stock award or a restricted unit, or both. Restricted awards
shall be payable in cash or whole shares of Common Stock (including restricted
stock), or partly in cash and partly in whole shares of Common Stock, in
accordance with the terms of the Plan and the sole and absolute discretion of
the Administrator. The Administrator shall determine the nature, length and
starting date of the period, if any, during which a restricted award may be
earned (the "restriction period"), and shall determine the conditions which must
be met in order for a restricted award to be granted or to vest or be earned (in
whole or in part), which conditions may include, but are not limited to,
attainment of performance objectives, completion of the restriction period (or a
combination of attainment of performance objectives and completion of the
restriction period), retirement, displacement, disability or death, or any
combination of such conditions. In the case of restricted awards based upon
performance criteria, or a combination of performance criteria and continued
service, the Administrator shall determine the performance objectives to be used
in valuing restricted awards and determine the extent to which such awards have
been earned. Performance objectives may vary from participant to participant and
between groups of participants and shall be based upon such Corporation,
business unit and/or individual performance factors and criteria as the
Administrator in its sole discretion may deem appropriate, which factors may
include but are not limited to production, reserves, cash flow, earnings per
share, return on equity, return on assets, total return to shareholders, or any
combination of the foregoing. The Administrator shall have sole authority to
determine whether and to what degree restricted awards have been earned and are
payable and to interpret the terms and conditions of restricted awards and the
provisions herein. The Administrator shall also determine the form and terms of
payment of awards. The Administrator, in its sole and absolute discretion, may
accelerate the date that any restricted award granted to a participant shall be
deemed to be earned in whole or in part, without any obligation to accelerate
such date with respect to other restricted awards.
(b) FORFEITURE OF RESTRICTED AWARDS: Unless an individual agreement
provides otherwise, if the employment or service of a participant shall be
terminated for any reason and the participant has not yet earned all or part of
a restricted award pursuant to the terms of the Plan and the individual
agreement, such award to the extent not then earned shall be forfeited
immediately upon such termination and the participant shall have no further
rights with respect thereto.
(c) DIVIDEND AND VOTING RIGHTS; SHARE CERTIFICATES: Unless an individual
agreement provides otherwise, (i) a participant shall have no dividend rights or
voting rights or other rights as a shareholder with respect to shares subject to
a restricted award that has not yet vested; and (ii) a certificate or
certificates for shares representing a restricted award payable in shares shall
be issued in the name of the participant (or his beneficiary) and distributed to
the participant (or his beneficiary) as soon as practicable after the shares
subject to the award shall be earned.
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(d) NONTRANSFERABILITY:
(i) The recipient of a restricted award shall not sell, transfer,
assign, pledge or otherwise encumber shares subject to the award until all
conditions to vesting have been met and shares have been issued and
delivered to him.
(ii) Restricted awards shall not be transferable other than by will or
the laws of intestate succession. The designation of a beneficiary does not
constitute a transfer.
(iii) If a participant of a restricted award is subject to Section 16
of the Exchange Act, shares of Common Stock subject to such award may not,
without the consent of the Administrator, be sold or otherwise disposed of
within six months following the date of grant of such award.
9. WITHHOLDING
The Corporation shall withhold all required local, state and federal taxes
from any amount payable in cash with respect to an award. The Corporation shall
require any recipient of an award payable in shares of the Common Stock to pay
to the Corporation in cash the amount of any tax or other amount required by any
governmental authority to be withheld and paid over by the Corporation to such
authority for the account of such recipient. Notwithstanding the foregoing, the
Corporation may establish procedures to permit a recipient to satisfy such
obligation in whole or in part, and any other local, state or federal income tax
obligations relating to such an award, by electing (the "election") to have the
Corporation withhold shares of Common Stock from the shares to which the
recipient is entitled. The number of shares to be withheld shall have a fair
market value as of the date that the amount of tax to be withheld is determined
as nearly equal as possible to (but not exceeding) the amount of such
obligations being satisfied. Each election must be made in writing to the
Administrator in accordance with election procedures established by the
Administrator.
10. SECTION 16(b) COMPLIANCE
It is the general intent of the Corporation that transactions under the
Plan which are subject to Section 16 of the Exchange Act shall comply with Rule
16b-3 under the Exchange Act. Notwithstanding anything in the Plan to the
contrary, the Administrator, in its sole and absolute discretion, may bifurcate
the Plan so as to restrict, limit or condition the use of any provision of the
Plan to participants who are officers or directors subject to Section 16 of the
Exchange Act without so restricting, limiting or conditioning the Plan with
respect to other participants.
11. NO RIGHT OR OBLIGATION OF CONTINUED EMPLOYMENT
Nothing in the Plan shall confer upon the participant any right to continue
in the service of the Corporation or a related entity as an employee, director,
or independent contractor or to interfere in any way with the right of the
Corporation or a related entity to terminate the participant's employment or
service at any time. Except as otherwise provided in the Plan or an individual
agreement, (i) all rights of a participant with respect to an award shall
terminate upon the termination of the participant's employment or service; and
(ii) awards granted under the Plan shall not be affected by any change in the
duties or position of the participant, as long as such individual remains an
employee of, or in service to, the Corporation or a related entity.
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12. UNFUNDED PLAN; RETIREMENT PLANS
(a) Neither a participant nor any other person shall, by reason of the
Plan, acquire any right in or title to any assets, funds or property of the
Corporation or any related entity, including, without limitation, any specific
funds, assets or other property which the Corporation or any related entity, in
their discretion, may set aside in anticipation of a liability under the Plan. A
participant shall have only a contractual right to the Common Stock or amounts,
if any, payable under the Plan, unsecured by any assets of the Corporation or
any related entity. Nothing contained in the Plan shall constitute a guarantee
that the assets of such corporations shall be sufficient to pay any benefits to
any person.
(b) In no event shall any amounts accrued, distributable or payable under
the Plan be treated as compensation for the purpose of determining the amount of
contributions or benefits to which any person shall be entitled under any
retirement plan sponsored by the Corporation or a related entity that is
intended to be a qualified plan within the meaning of Section 401(a) of the
Code.
13. AMENDMENT AND TERMINATION OF THE PLAN
The Plan and any award granted under the Plan may be amended or terminated
at any time by the Board of Directors of the Corporation; provided, that (i)
approval of an amendment to the Plan by the shareholders of the Corporation
shall be required to the extent, if any, that shareholder approval of such
amendment is required by applicable law, rule or regulation; and (ii) amendment
or termination of an award shall not, without the consent of a recipient of an
award, adversely affect the rights of the recipient with respect to an
outstanding award.
14. RESTRICTIONS ON AWARDS AND SHARES
The Corporation may impose such restrictions on awards and shares
representing awards hereunder as it may deem advisable, including without
limitation restrictions under the federal securities laws, the requirements of
any stock exchange or similar organization and any blue sky or state securities
laws applicable to such shares. Notwithstanding any other Plan provision to the
contrary, the Corporation shall not be obligated to issue, deliver or transfer
shares of Common Stock under the Plan, make any other distribution of benefits
under the Plan, or take any other action, unless such delivery, distribution or
action is in compliance with all applicable laws, rules and regulations
(including but not limited to the requirements of the Securities Act). The
Corporation may cause a restrictive legend to be placed on any certificate
issued pursuant to an award hereunder in such form as may be prescribed from
time to time by applicable laws and regulations or as may be advised by legal
counsel.
15. APPLICABLE LAW
The Plan shall be governed by and construed in accordance with the laws of
the State of Colorado, without regard to the conflict of laws provisions of any
state.
16. SHAREHOLDER APPROVAL
The Plan is subject to approval by the shareholders of the Corporation,
which approval must occur, if at all, within 12 months of the effective date of
the Plan. Awards granted prior to such
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shareholder approval shall be conditioned upon and shall be effective only upon
approval of the Plan by such shareholders on or before such date.
17. CHANGE OF CONTROL
(a) Notwithstanding any other provision of the Plan to the contrary, in
the event of a change of control (as defined in Section 17(b) herein):
(i) All options and SARs outstanding as of the date of such change of
control shall become fully exercisable, whether or not then otherwise
exercisable.
(ii) Any restrictions including but not limited to the restriction
period applicable to any restricted award shall be deemed to have expired,
and such restricted awards shall become fully vested and payable to the
fullest extent of the original grant of the applicable award.
(iii) Notwithstanding the foregoing, in the event of a merger, share
exchange, reorganization or other business combination affecting the
Corporation or a related entity, the Administrator may, in its sole and
absolute discretion, determine that any or all awards granted pursuant to
the Plan shall not vest or become exercisable on an accelerated basis, if
the Corporation or the board of directors of the surviving or acquiring
corporation, as the case may be, shall have taken such action, including
but not limited to the assumption of awards granted under the Plan or the
grant of substitute awards (in either case, with substantially similar
terms as awards granted under the Plan), as in the opinion of the
Administrator is equitable or appropriate to protect the rights and
interests of participants under the Plan. For the purposes herein, if the
Committee is acting as the Administrator authorized to make the
determinations provided for in this Section 17(a)(iii), the Committee shall
be appointed by the Board of Directors, two-thirds of the members of which
shall have been directors of the Corporation prior to the merger, share
exchange, reorganization or other business combinations affecting the
Corporation or a related entity.
(iv) The provisions of this Section 17(a) shall not in any way affect
or impair the right or obligation of a successor corporation of the
Corporation to assume outstanding awards granted under the Plan or to grant
substitute awards in replacement of outstanding awards granted under the
Plan; provided, however, that such substitute awards or assumed awards
shall in no way diminish such rights of participants as may be provided in
Section 17(a) herein with respect to outstanding awards granted under the
Plan.
(b) For the purposes herein, a "change of control" shall be deemed to have
occurred on the earliest of the following dates:
(i) The date any entity or person shall have become the beneficial
owner of, or shall have obtained voting control over, thirty percent (30%)
or more of the outstanding Common Stock of the Corporation;
(ii) The date the shareholders of the Corporation approve a definitive
agreement (A) to merge or consolidate the Corporation with or into another
corporation or other business entity (each, a "corporation"), in which the
Corporation is not the continuing or surviving corporation or pursuant to
which any shares of Common Stock of the Corporation
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would be converted into cash, securities or other property of another
corporation, other than a merger or consolidation of the Corporation in
which holders of Common Stock immediately prior to the merger or
consolidation have the same proportionate ownership of Common Stock of the
surviving corporation immediately after the merger as immediately before,
or (B) to sell or otherwise dispose of all or substantially all the assets
of the Corporation; or
(iii) The date there shall have been a change in a majority of the
Board of Directors of the Corporation within a 12-month period unless the
nomination for election by the Corporation's shareholders of each new
director was approved by the vote of two-thirds of the directors then still
in office who were in office at the beginning of the 12-month period.
(For the purposes herein, the term "person" shall mean any individual,
corporation, partnership, group, association or other person, as such term
is defined in Section 13(d)(3) or Section 14(d)(2) of the Exchange Act,
other than the Corporation, a subsidiary of the Corporation or any employee
benefit plan(s) sponsored or maintained by the Corporation or any
subsidiary thereof, and the term "beneficial owner" shall have the meaning
given the term in Rule 13d-3 under the Exchange Act.)
18. CERTAIN DEFINITIONS
In addition to other terms defined in the Plan, the following terms shall
have the meanings indicated:
(a) "Agreement" means any written agreement or agreements between the
Corporation and the recipient of an award pursuant to the Plan relating to the
terms, conditions and restrictions of awards and such other terms, conditions
and restrictions as the Administrator shall determine which are not inconsistent
with the provisions of the Plan.
(b) "Covered employee" shall have the meaning given the term in Section
162(m) of the Code or the regulations thereunder.
(c) "Disability" shall mean the inability to engage in any substantial
gainful activity by reason of any medically determinable physical or mental
impairment which can be expected to result in death, or which has lasted or can
be expected to last for a continuous period of not less than twelve months.
(d) "Displacement" shall mean the termination of a participant's
employment or service due to the elimination of the participant's job or
position without fault on the part of the participant.
(e) "Parent" or "parent corporation" shall mean any corporation (other
than the Corporation) in an unbroken chain of corporations ending with the
Corporation if each corporation other than the Corporation owns stock possessing
50% or more of the total combined voting power of all classes of stock in
another corporation in the chain.
(f) "Predecessor" or "predecessor corporation" means a corporation which
was a party to a transaction described in Section 424(a) of the Code (or which
would be so described if a substitution or assumption under Section 424(a) had
occurred) with the Corporation, or a corporation which is a parent or subsidiary
of the Corporation, or a predecessor of any such corporation.
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(g) "Related corporation" means any parent, subsidiary or predecessor
of the Corporation, and "related entity" means any related corporation or any
other business entity which is an affiliate controlled by the Corporation.
(h) "Retirement" shall mean retirement in accordance with the retirement
policies and procedures established by the Corporation, unless an individual
agreement establishes a different meaning for such term.
(i) "Subsidiary" or "subsidiary corporation" means any corporation (other
than the Corporation) in an unbroken chain of corporations beginning with the
Corporation if each corporation other than the last corporation in the unbroken
chain owns stock possessing 50% or more of the total combined voting power of
all classes of stock in another corporation in the chain.
19. GENDER AND NUMBER
Where the context admits, words in any gender shall include any other
gender, words in the singular shall include the plural and the plural shall
include the singular.
IN WITNESS WHEREOF, this 2000 Stock Incentive Plan of Evergreen Resources,
Inc., is, by the authority of the Board of Directors of the Corporation,
executed in behalf of the Corporation, effective this 16th day of June, 2000.
EVERGREEN RESOURCES, INC.
By:
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Name:
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Title:
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ATTEST:
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Secretary
[Corporate Seal]
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