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As filed with the Securities and Exchange Commission on June 3, 1997
Registration No. 333-27449
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------
POST EFFECTIVE AMENDMENT NO. ONE
TO
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
--------------------
INLAND RESOURCES INC.
(Exact name of registrant as specified in its charter)
WASHINGTON 91-1307042
(State or other (I.R.S. employer
jurisdiction of identification number)
incorporation or
organization)
475 17TH STREET
SUITE 1500
DENVER, COLORADO 80202
(303) 292-0900
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
INLAND RESOURCES INC.
1997 STOCK OPTION PLAN
(Full title of the Plan)
KYLE R. MILLER
PRESIDENT AND CHIEF EXECUTIVE OFFICER
475 17TH STREET
SUITE 1500
DENVER, COLORADO 80202
(303) 292-0900
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
WITH A COPY TO:
MICHAEL D. PARSONS, ESQ.
GLAST, PHILLIPS & MURRAY, P.C.
13355 NOEL ROAD, L.B. 48
2200 GALLERIA TOWER
DALLAS, TEXAS 75240
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PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
ITEM 1. PLAN INFORMATION*
ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION*
* Information required by Part I to be contained in the Section 10(a)
prospectus is omitted from the registration statement in accordance
with Rule 428 under the Securities Act of 1933 and the Note to Part I
of Form S-8.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Commission are hereby
incorporated by reference in this Registration Statement:
(i) The Company's Annual Report on Form 10-KSB for the fiscal year
ended December 31, 1996.
(ii) The Company's Quarterly Report on Form 10-QSB for the quarter
ended March 31, 1997.
(iii) The description of the Company's Common Stock contained in the
Company's registration statement on Form 8-A, by which the Company's shares
of Common Stock were registered under Section 12(g) of the Securities
Exchange Act of 1934 (the "Exchange Act"), and any amendment or reports
filed for the purpose of updating such description.
In addition, all documents subsequently filed by the Company pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act and prior to filing of a
post-effective amendment which indicates that all securities offered have been
sold or which deregisters all securities then remaining unsold, shall be deemed
to be incorporated by reference in this Registration Statement and to be a part
hereof from the respective dates of the filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Sections 23B.08.500 - .590 of the Washington Business Corporation Act
("WBCA") provide broad authority for indemnification of directors and officers.
The Articles of Incorporation of the Company provide for indemnification of its
officers and directors to the fullest extent permitted by the WBCA.
As permitted by Section 23B.08.320 of the WBCA, the Company's Articles of
Incorporation provide that a director shall not be liable for monetary damages
for breach of his fiduciary duty as a director except in certain limited
circumstances.
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ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
ITEM 8. EXHIBITS
See Index to Exhibits on page 6.
ITEM 9. UNDERTAKINGS
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made of the securities registered hereby, a post-effective amendment
to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933 (the "Securities Act");
(ii) To reflect in the prospectus any facts or events which,
individually or together, represent a fundamental change in the
information set forth in this Registration Statement; and
notwithstanding the foregoing, any increase or decrease in volume
of securities offered (if the total dollar value of securities
offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum
offering range may be reflected in the form of a prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate,
the changes in volume and price represent no more than a 20
percent change in the maximum aggregate offering price set forth
in the "Calculation of Registration" table in the effective
registration statement; and
(iii) To include any additional or changed material
information on the plan of distribution;
provided, however, that the undertakings set forth in paragraphs
(1)(i) and (1)(ii) above do not apply if the information required
to be included in a post-effective amendment by those paragraphs
is contained in periodic reports filed by the Registrant pursuant
to the Exchange Act that are incorporated by reference in this
Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold
at the termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of
Registrant's annual report pursuant to Section 13(a) or 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in this Registration Statement shall be deemed to
be a new Registration Statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling
persons of Registrant pursuant to the foregoing provisions, or otherwise,
Registrant has been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by
Registrant of expenses incurred or paid by a director, officer or
controlling person of Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, Registrant will,
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unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final
adjudication of such issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Amendment No. One
to the Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Denver, State of Colorado, on May 28,
1997.
INLAND RESOURCES INC.
By: /s/ Kyle R. Miller
------------------------------------------
Kyle R. Miller, President,
Chief Executive Officer and Director
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed below by the following persons in the capacities and
on the dates indicated.
Name Office Date
---- ------ ----
/s/ Kyle R. Miller President, Chief May 28, 1997
- -------------------------------- Executive Officer and
Kyle R. Miller Director (Principal
Executive Officer)
/s/ Bill I. Pennington Vice President and May 28, 1997
- -------------------------------- Chief Financial Officer
Bill I. Pennington (Principal Financial
Officer)
/s/ Michael J. Stevens Secretary, Treasurer May 28, 1997
- -------------------------------- and Controller (Principal
Michael J. Stevens Accounting Officer)
/s/ Arthur J. Pasmas* Director May 28, 1997
- --------------------------------
Arthur J. Pasmas
/s/ Richard F. Conway* Director May 28, 1997
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Richard F. Conway
/s/ Thomas J. Trzanowski* Director May 28, 1997
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Thomas J. Trzanowski
/s/ Paul C. Schorr IV* Director May 28, 1997
- --------------------------------
Paul C. Schorr IV
*By: /s/ Michael J. Stevens
----------------------------
Michael J. Stevens,
Attorney-in-Fact
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INDEX TO EXHIBITS
Exhibit
Number Description of Document
- ------- -----------------------
4.1 The 1997 Stock Option Plan of Inland Resources Inc.*
5.1 Opinion of Glast, Phillips & Murray, a Professional Corporation,
concerning legality.**
23.1 Consent of Glast, Phillips & Murray, a Professional Corporation
(contained in Exhibit 5.1).
23.2 Consent of Arthur Andersen LLP.**
23.3 Consent of Coopers & Lybrand LLP**
23.4 Consent of Ryder Scott Company Petroleum Engineers.**
24.1 Power of attorney from directors and officers (see signature
pages to this Registration Statement).
_____________________________
* Filed herewith.
** Previously filed.
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EXHIBIT 4.1
1997 STOCK OPTION PLAN
OF
INLAND RESOURCES INC.
1. PURPOSE. This 1997 Stock Option Plan (the "Plan") of Inland Resources
Inc. (the "Company") is adopted effective April 30, 1997, subject to approval of
the Plan by the stockholders of the Company at the 1997 Annual Meeting of
Stockholders. The purposes of the Plan are (a) to encourage key employees,
directors and consultants of the Company, as well as key employees, directors
and consultants of any current or after-acquired subsidiary corporation, to
acquire a proprietary interest in the Company and thus share in the future
success of the Company's business; and (b) to enable the Company, by offering
comparable incentives, to attract and retain outstanding management personnel,
directors and consultants who are in a position to make important and direct
contributions to the success of the Company; and (c) to promote a closer
identity of interests between the Company's employees, directors and consultants
and its stockholders.
2. STOCK OPTIONS. Options granted under this Plan shall qualify either
as Incentive Stock Options ("ISOs") as defined in Section 422(b) of the Internal
Revenue Code of 1986 as now stated or hereafter amended (the "Code"), or
Nonstatutory Stock Options ("NSOs"), at the discretion of the Company and as
reflected in the terms of the written Option Agreements. The ISOs and NSOs are
collectively referred to herein as "Options." If an Option is not specifically
designated as an ISO at the date of grant, it shall be deemed an NSO.
3. SCOPE AND DURATION OF THE PLAN. There will be reserved for sale upon
the exercise of Options granted under this Plan Five Hundred Thousand (500,000)
shares of the Company's authorized but unissued voting common stock. If an
Option expires or terminates for any reason without having been fully exercised,
the unpurchased shares will be available for other Options under the Plan.
Unless this Plan is terminated earlier pursuant to Section 16 hereof, it shall
terminate ten (10) years from its effective date and no Option shall be granted
after that date; provided, however, that termination of this Plan will have no
effect on the Options previously granted.
4. ADMINISTRATION. The Plan shall be administered by the Board of
Directors of the Company (the "Board"). The Board may delegate administration
of the Plan from time to time to a committee of the Board that is composed
solely of two or more "Non-Employee Directors", as defined in Rule 16b-3 adopted
by the Securities and Exchange Commission (the "Commission"), or a committee
which otherwise satisfies the requirements of Rule 16b-3 if subsequently amended
by the Commission so that Options granted pursuant to the Plan will be exempt
from Section 16(b) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"). It is the express intention of the Plan that the administration
shall be performed in such a manner that Options granted under the Plan will be
exempt from Section 16(b) pursuant to the provisions of Rule 16b-3 or any
replacement Rule, and the Board is granted the express power to change the
administration of the Plan from time to time in such a manner as it may deem
appropriate to ensure that grants of Options under the Plan will be exempt from
Section 16(b) under Rule 16b-3, as subsequently amended, or any replacement Rule
adopted by the Commission. If the Board elects to appoint a committee of the
Board to administer the Plan, rather than the entire Board administering the
Plan, each member of such committee shall be a director of the Company and all
members shall be appointed by the Board. From time to time, the Board may
increase the size of any such committee and appoint additional members thereof,
remove members (with or without cause) and appoint new members in substitution
thereof; provided, however, that any such addition or substituted new members of
any such committee shall also be directors of the Company. The Board also may at
any time remove all members of any such committee and thereafter administer the
Plan.
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The Board (or any committee of the Board if one has been appointed and is
in place) has the responsibility to adopt such rules and regulations as it deems
necessary or desirable for the proper administration of this Plan. Any decision
or action taken or to be taken by the Board (or any committee of the Board if
one has been appointed and is in place), arising out of or in connection with
the construction, interpretation, and administration of this Plan shall, to the
extent permitted by law, be within its absolute discretion, but subject to the
express provisions of this Plan. Decisions of the Board (or any committee of
the Board if one has been appointed and is in place) shall be conclusive and
binding upon all recipients of Options and any person claiming under or through
any recipient of an Option.
5. CLASSES OF AWARD: ELIGIBLE PERSONS. Options may be granted to
directors, key employees and consultants of the Company and current or future
subsidiary corporations who otherwise comply with the requirements of this Plan.
The Board (or any committee of the Board if one has been appointed and is in
place) has the authority to grant Options pursuant to the following two classes
of award:
(a) Discretionary Awards. The Board (or any committee of the Board if
--------------------
one has been appointed and is in place) has the authority, subject to the
terms of this Plan, to determine key employees, directors and consultants
to whom Options shall be granted, the number of shares to be covered by
each Option, whether such Option shall be an ISO or NSO, the form of
payment, the time or times at which Options shall be granted, and the terms
and provisions of the instruments evidencing Options. The term "key
employee" shall include officers, executives and supervisory personnel of
the Company or any subsidiary. In determining the key employees, directors
and consultants to whom Options shall be granted and the number of shares
to be issued on the exercise of an Option, the Board (or any committee of
the Board if one has been appointed and is in place) shall take into
account the duties of the key employees, directors and consultants, their
present and potential contributions to the success of the Company and its
subsidiary corporations, and such other factors as the Board (or any
committee of the Board if one has been appointed and is in place) deems
relevant to accomplish the purpose of this Plan. A director of the Company
may be granted discretionary Options notwithstanding the fact such person
is also eligible to receive Options pursuant to the formula award provided
by this Plan. Consultants shall not receive ISOs, but may be eligible to
receive NSOs.
(b) Formula Awards to Directors. Directors of the Company who are not
---------------------------
employees of the Company shall be awarded Options to purchase 1,000 shares
of common stock upon the date of initial election to the Board and upon the
date of each reelection to the Board, with the exercise price to be equal
to the Fair Market Value (as defined in Section 6) of such shares on the
business day preceding the date of election or reelection.
For purposes of this Plan, subsidiary corporations have the same meaning as
contained in Section 424(f) of the Code. Notwithstanding the foregoing
provisions, an ISO shall not be granted to an employee who, at the time such ISO
is granted, owns directly or indirectly within the meaning of Section 424(d) of
the Code (e.g., an individual shall be considered as owning the stock owned,
----
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directly or indirectly by or for his brothers and sisters, spouse, ancestors,
and lineal descendants; and stock owned by a corporation shall be considered as
being owned proportionately by its shareholders), more then ten percent (10%) of
the total combined voting power of all classes of stock of the Company;
provided, however, that said ten percent (10%) limitation shall not apply if at
the time such ISO is granted the ISO price (as otherwise specified in Section 6
below) is at least equal to one hundred ten percent (110%) of the Fair Market
Value of the stock subject to the ISO and such ISO by its terms is not
exercisable after the expiration of five (5) years following the date such ISO
is granted.
6. EXERCISE PRICE. Subject to the provisions of Section 5 above, the
price of the shares of common stock to be issued on exercise of Options shall be
not less than (a) the Fair Market Value of such shares on the date an ISO is
granted, or (b) eighty-five percent (85%) of the Fair Market Value on the date a
NSO is granted. "Fair Market Value" of a share of common stock shall be
determined as of any specified date as follows: (i) if the Company's common
stock is traded on any United States securities exchange (including the National
Market System of the National Association of Securities Dealers, Inc.) the price
per share shall be the closing price on such exchange on the business day
immediately preceding such date; (ii) if the Company's common stock is not
traded on any United States securities exchange, but is traded on any formal
over-the-counter quotation system in general use in the United States, the price
per share shall be the mean between the closing high bid and low asked
quotations on such system at the close of the business day immediately preceding
such date; and (iii) if neither subparagraph (i) nor (ii) applies, the Fair
Market Value shall be as determined solely by the Board (or any committee of the
Board if one has been appointed and is in place) in good faith in accordance
with uniform principles consistently applied. Subject to the foregoing, the
Board (or any committee of the Board if one has been appointed and is in place),
in fixing the Option price, shall have full authority and discretion and their
good faith judgment in establishing Fair Market Value and in establishing the
purchase price shall be conclusive.
7. TERM OF OPTIONS. Except as otherwise provided in Section 5, the term
of each Option shall be determined by the Board (or any committee of the Board
if one has been appointed and is in place), but shall not be for more than ten
(10) years from the date the Option is granted.
8. LIMITATION ON FAIR MARKET VALUE OF INCENTIVE STOCK OPTIONS EXERCISABLE
IN ANY CALENDAR YEAR. No ISO may be granted to an optionee which, when
aggregated with all other ISO's granted to such optionee, would result in shares
having an aggregate Fair Market Value (determined for each share as of the date
of granting of the Option covering such shares) in excess of One Hundred
Thousand Dollars ($100,000.00) becoming first available for purchase upon
exercise of one or more ISOs during any calendar year.
9. EXERCISE OF OPTIONS. An Option may be exercised on such terms and
conditions as the Board (or any committee of the Board if one has been appointed
and is in place) shall determine, subject to the requirements of this Plan.
Unless otherwise determined by the Board (or any committee of the Board if one
has been appointed and is in place), the price of the shares purchased pursuant
to an Option shall be paid in full at the time of exercise in cash or in such
other consideration as the Board (or any committee of the Board if one has been
appointed and is in place) deems appropriate, including, without limitation,
shares of common stock of the Company valued at Fair Market Value (in the manner
prescribed in Section 6 above) as of the date of exercise of the Option. No
Option may be exercised during the optionee's lifetime unless the optionee is
then an employee, director or consultant of the Company or a subsidiary
corporation; provided that, in the event the optionee's employment, term as a
director or consulting relationship terminates for reasons other than death or
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disability, the Option may be exercised during the three (3) month period
following such termination. Thereafter, the Option shall terminate and be at an
end. In the case of disability, the Board (or any committee of the Board if one
has been appointed and is in place) may extend the Option for up to one (1)
year; and in the event of death, the Option shall be extended for one (1) year
as provided in Section 11. Whether an authorized leave of absence, disability,
or temporary absence for any other reason constitutes termination for the
purposes of this Plan shall be determined by the Board (or any committee of the
Board if one has been appointed and is in place).
10. ADDITIONAL RESTRICTIONS UPON EXERCISE OF OPTIONS. Options may be
exercisable either in whole or in part. No less than one hundred (100) shares
of common stock may be purchased at any one time unless the number purchased is
the total number of shares at that time purchasable under the Option. The Board
(or any committee of the Board if one has been appointed and is in place) may
impose such other restrictions upon the exercise of the Option or the transfer
shares of common stock acquired upon the exercise of the Option as the Board (or
any committee of the Board if one has been appointed and is in place) deems
necessary to comply with federal and state securities law.
11. NONTRANSFERABILITY OF OPTIONS. During the lifetime of the optionee,
the Option shall be exercised only by the optionee. An Option granted under
this Plan is not transferable by the optionee by operation of law or otherwise,
except that in the event of death of the optionee while in the employ, or while
serving as a director or consultant, of the Company or a subsidiary, an Option
granted hereunder may be exercised (subject to the time restrictions set forth
in Sections 5 and 7 hereof) at any time within one (1) year after death, by the
duly appointed personal representative of the optionee, or by any person or
persons who shall acquire such Option directly from the optionee by bequest or
inheritance.
12. ADJUSTMENTS FOR CHANGES IN CAPITALIZATION. Notwithstanding any other
provision of this Plan, each instrument evidencing an Option may contain such
provision as the Board (or any committee of the Board if one has been appointed
and is in place) determines to be appropriate for the adjustment of the number
and class of shares of common stock covered by the Option, the Option price, and
the number of shares of common stock as to which the Option shall be exercisable
at any time, in the event of changes in the outstanding shares of common stock
of the Company by reason of stock dividends, split-ups, recapitalizations,
mergers, consolidations, reorganizations, or liquidations. In the event of any
such change in the outstanding shares of common stock of the Company, the
aggregate number of shares available under this Plan shall be appropriately
adjusted.
13. EVENTS ACCELERATING EXERCISE OF OPTIONS. If the shares of common
stock of the Company are changed into or exchanged for shares of stock of
another unrelated corporation or are converted to cash pursuant to a plan of
merger, partial or complete liquidation or dissolution, each Option then
outstanding (to the extent this Plan is not continued, as adjusted in the manner
specified in Section 12 by the successor entity) shall be exercisable, with
respect to all the shares of common stock covered thereby and without regard to
the time the Option has been outstanding, beginning with the date the Board of
Directors approves or authorizes such change or conversion, and ending two (2)
days prior to the effective date of such change or conversion.
14. LOANS TO HOLDERS OF OPTIONS. The Company may, in the sole discretion
of the Board of Directors, directly or indirectly, lend money or credit to any
employee for the purpose of assisting an optionee in purchasing shares of common
stock to be issued upon the exercise of an Option granted under this Plan.
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15. EMPLOYMENT RIGHTS. Nothing in this Plan or any instrument evidencing
an Option shall confer upon any employee any right to continue in the employment
of the Company or a subsidiary corporation, nor be construed to interfere in any
way with the right otherwise available to the Company or a subsidiary
corporation to terminate the employee's employment at any time for any reason.
16. AMENDMENT/TERMINATION. The Board of Directors may amend or terminate
this Plan from time to time in such respects as it may deem advisable; provided
that any increase in the number of shares subject to the Plan, other than in
connection with an adjustment under Section 12, shall require approval at a duly
held stockholders' meeting of the holders of a majority of the voting power of
the outstanding shares of the Company entitled to vote.
17. RIGHTS AS A SHAREHOLDER. An optionee, or permitted transferee of an
Option upon the death of an optionee, shall have no rights as a stockholder with
respect to any shares of common stock covered by an Option until the date of the
issuance of a stock certificate to and for such shares. No adjustment shall be
made for dividends (ordinary or extraordinary, whether in cash, securities, or
other property) or distributions or other rights for which the record date is
prior to the date such stock certificate is issued, except as provided in
Section 12 above.
18. INVESTMENT PURPOSE. Common stock acquired upon the exercise of an
Option granted under this Plan may only be resold in the event such stock is
registered under the Securities Act of 1933, as amended, or if, in the opinion
of responsible counsel for the Company, such stock can be resold without such
registration. Unless a registration statement with respect to such stock
covering the holder of such Option is then in effect, each certificate issued
pursuant to the exercise of such Option shall contain a legend to this effect.
19. OTHER PROVISIONS. As soon as possible after the adoption of this Plan
by the stockholders, Option Agreements for the ISOs and NSOs shall be completed
and attached to this Plan as exhibits. The Option Agreements authorized under
this Plan may contain such other provisions, including without limitation,
restrictions upon the exercise of Options, as the Board (or any committee of the
Board if one has been appointed and is in place) shall deem advisable. The ISO
Option Agreement shall contain such limitations and restrictions upon the
exercise of an ISO as shall be necessary or permitted in order that the ISO will
be an "incentive stock option" as defined in Section 422(b) of the Code, or to
conform to any change in the law.
20. COMPLIANCE WITH EXCHANGE ACT. Notwithstanding anything herein to the
contrary, Options shall always be granted in such a manner as to conform to the
provisions of Rule 16b-3, as subsequently amended, or any replacement Rule
adopted under the provisions of Section 16 of the Exchange Act as the same now
exists or may, from time to time, be amended, and the Board is granted the
express authority to make any such changes or modifications to the Plan, without
stockholder approval, as it may determine to be necessary to conform to the
provisions of Rule 16b-3, as subsequently amended, or any replacement Rule.
21. INDEMNIFICATION. In addition to such other rights of indemnification
as they may have as Directors, the members of the Board (or any committee of the
Board if one has been appointed and is in place) administering this Plan shall
be indemnified by the Company against the reasonable expenses, including
attorney fees actually and necessarily incurred in connection with the defense
of any action, suit or proceeding, or in connection with any appeal therein, to
which they or any of them may be a party by reason of any action taken or
failure to act under or in connection with this Plan
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or any Option granted hereunder, and against all amounts paid by them in
settlement thereof (provided such settlement is approved by independent legal
counsel selected by the Company), or paid by them in satisfaction of a judgment
in any such action, suit or proceeding, except in relation to matters as to
which it shall be adjudged in such action, suit, or proceeding that such
Director is liable for negligence or misconduct in the performance of his
duties; provided that within sixty (60) days after the institution of any such
action, suit or proceeding, the Director shall, in writing, offer the Company
the opportunity, at its own expense, to defend the same.
This Plan is executed this 30th day of April, 1997.
INLAND RESOURCES INC.
By: /s/ Kyle R. Miller
-------------------------------------
Kyle R. Miller, President
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