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EXHIBIT 99
UNIT CORPORATION
Amended and Restated
Stock Option Plan
(Restated Effective as of February 15, 2000)
SECTION 1.
Purpose
This Stock Option Plan (the "Plan") is intended as an incentive and to
encourage stock ownership by certain directors, officers and other key employees
of Unit Corporation (the "Corporation") or of its parent or its subsidiary
corporations as that term is defined in Section 3, below (the "Subsidiaries"),
so that they may acquire or increase their proprietary interest in the success
of the Corporation and Subsidiaries, and to encourage them to remain in the
employ of the Corporation or of the Subsidiaries. It is further intended that
options issued pursuant to this Plan may constitute incentive stock options
within the meaning of 422 of the Internal Revenue Code of 1986, as amended (the
"Code"), to the extent such options are embodied in an incentive stock option
agreement containing such provisions as are required by this Plan with respect
to such options.
SECTION 2.
Administration
The Plan shall be administered by the Compensation Committee appointed by
the Board of Directors of the Corporation (the "Committee"). The Committee
shall consist of not less than two members of the Corporation's Board of
Directors all of whom shall be non-employee directors. The Board of Directors
may from time to time remove members from, or add members to, the Committee.
Vacancies on the Committee, howsoever caused, shall be filled by the Board of
Directors. The Committee shall select one of its members as Chairman, and shall
hold meetings at such times and places as it may determine. Acts approved by a
majority of the Committee at which a quorum is present, or acts reduced to
or approved in writing by a majority of the members of the Committee, shall be
the valid acts of the Committee. The Committee shall from time to time at its
discretion select the key employees who shall be granted options by the
Committee which shall also determine the amount of stock to be optioned to each.
Committee shall have the power, subject to and within the limits of the
express provisions of the Plan:
(a) To determine from time to time which of the eligible persons shall be
granted options under the Plan, and the time or times when, and the number of
shares for which, an option or options shall be granted to such
persons;
(b) To prescribe the other terms and provisions (which need not be
identical) of each option granted under the Plan to eligible persons;
(c) To construe and interpret the Plan and options granted under it and to
establish, amend, and revoke rules and regulations for administration. The
Committee, in the exercise of this power, may correct any defect or supply any
omission, or reconcile any inconsistency in the Plan, or in any option
agreement, in the manner and to the extent it shall deem necessary or expedient
to make the Plan fully effective. In exercising this power, the Committee may
retain counsel at the expense of the Corporation. All decisions and
determinations by the Committee in exercising this power shall be final and
binding upon the Corporation and the optionees;
(d) To determine the duration and purposes of leaves of absence which may
be granted to an optionee without constituting a termination of his or her
employment for purposes of the Plan; and
(e) Generally, to exercise such powers and to perform such acts as are
deemed necessary or expedient to promote the best interests of the Corporation
with respect to the Plan.
No member of the Board of Directors or the Committee shall be liable for
any action or determination made in good faith with respect to the Plan or any
option granted under it.
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SECTION 3.
Eligibility To Receive Incentive Stock Options
The persons who shall be eligible to receive incentive stock options shall
be such key employees (including officers, whether or not they are directors) of
the Corporation or its parent corporation or its subsidiaries (as such terms are
defined in Section 425 of the Code) existing from time to time as the Committee
shall select from time to time. An optionee may hold more than one incentive
stock option, but only on the terms and subject to the restrictions hereafter
set forth. No person shall be eligible to receive an incentive stock option for
a larger number of shares than is recommended for him by the Committee.
SECTION 4.
Eligibility To Receive Non-Qualified Stock Options
The persons who shall be eligible to receive non-qualified stock options
shall be such directors and employees (including officers, whether or not they
are directors) of the Corporation or its parent corporation or its subsidiaries
(as such terms are defined in Section 425 of the Code) existing from time to
time as the Committee shall select from time to time. An optionee may hold more
than one non-qualified stock option, but only on the terms and subject to the
restrictions hereafter set forth. No person shall be eligible to receive a non-
qualified stock option for a larger number of shares than is recommended for him
by the Committee.
SECTION 5.
Stock Subject To Options
The stock subject to the options shall be shares of the Corporation's
authorized but unissued or reacquired Twenty Cents ($00.20) par value common
stock hereafter sometimes called Common Stock. The aggregate number of shares,
which may be issued under options pursuant to the Plan, shall not exceed
2,700,000 shares of Common Stock.
SECTION 6.
Limitations On Incentive Stock Options
In no event may the aggregate fair market value (determined as of the date
the option is granted) of the Common Stock for which any person may be granted
incentive stock options in any calendar year beginning prior to January 1, 1987,
under the Plan and under all other incentive stock option plans of his employer
corporation and its parent and subsidiary corporations, exceed $100,000 plus any
unused limit carry over (as defined by 422A(c)(4) of the Code) to such year.
With respect to incentive stock options issued on or after January 1, 1987,
the aggregate fair market value (determined at the time such incentive stock
option is granted) of the Common Stock with respect to which such incentive
stock options are exercisable for the first time by such individual during any
calendar year (under all such plans of the individual's employer corporation and
its parent and subsidiary corporations) shall not exceed
$100,000.
SECTION 7.
Stock Under Expired Option
In the event that any outstanding option under the Plan for any reason
expires or is terminated, the shares of Common Stock allocable to the
unexercised portion of such option may again be subject to an option under the
Plan.
SECTION 8.
Terms And Conditions Of Incentive Stock Options
Incentive stock options granted pursuant to the Plan shall be authorized
and granted by the Committee and shall be evidenced by agreements in such form
as the Committee shall from time to time deem appropriate. Incentive stock
option agreements need not be identical, but each incentive stock option
agreement shall comply with and be subject to the following terms and
conditions:
(a) Number of Shares. Each incentive stock option shall state the number
of shares to which it pertains.
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(b) Option Price. Each incentive stock option shall state the option
price, which shall be not less than 100% (110% in the case of an optionee who,
at the time the option is granted, is considered for purposes of 422 of the Code
to own more than 10% of the total combined voting power of all classes of stock
of the Corporation or its parent or subsidiary corporation as determined under
Section 425 of the Code (herein referred to as a "10% Shareholder")) of the fair
market value of a share of Common Stock of the Corporation on the date of the
granting of the option. During such time as such stock is not listed upon an
established stock exchange, the fair market value per share shall be the mean
between dealer "bid" and "ask" prices of the Common Stock in the New York over-
the-counter market on the day the option is granted, as reported by the National
Association of Securities Dealers, Inc. If the stock is listed upon an
established stock exchange or exchanges, such fair market value shall be deemed
to be the closing price of the Common Stock on such stock exchange or exchanges
on the day the option is granted or if no sale of the Corporation's Common Stock
shall have been made on any stock exchange on that day, on the next preceding
day on which there was a sale of such stock. Subject to the foregoing, the
Board of Directors and the Committee in fixing the incentive stock option price
shall have full authority and discretion and shall be fully protected in doing
so.
(c) Method of Exercise and Payment. An incentive stock option may be
exercised by the optionee delivering to the Committee on any business day a
written notice specifying the number of shares of Common Stock the optionee then
desires to purchase. The option price shall be paid in full in cash (by
certified or bank check or such other instrument as the Company may accept) or,
if and to the extent set forth in the option agreement or as otherwise permitted
by the Committee, may also be paid by one or more of the following: (i) in the
form of unrestricted Common Stock or the Attestation of Ownership of Common
Stock already owned by the optionee for such minimum period of time as may be
prescribed by the Committee and based in any such instance on the fair market
value of the Common Stock on the date the Stock Option is exercised; provided,
however, that, in the case of an Incentive Stock Option, the right to make a
payment in the form of already owned shares of Common Stock may be authorized
only at the time the Stock Option is granted; (ii) by a combination thereof;
provided however, that any payment made in the manner set forth in (i), (ii) or
(iii) above shall, at all times, be subject to the approval of the Committee.
(d) Terms and Exercise of Incentive Stock Options. Except as otherwise
expressly provided in this Plan, each incentive stock option granted pursuant to
this Plan shall contain provisions established by the Committee setting
forth the manner of exercise of such incentive stock option, and may, at the
sole discretion of the Committee, provide such restrictions on exercise as the
Committee may deem appropriate. Each incentive stock option granted under this
Plan shall terminate as set forth therein; provided, that no incentive stock
option shall be exercisable after the expiration of ten years from the date of
the granting of the option (five years in the case of an optionee who, at the
time the option is granted, is a 10% Shareholder). Each incentive stock option
granted under this Plan shall contain provisions making such option
nontransferable by the optionee, except upon death, and exercisable during the
optionee's lifetime only by the optionee.
(e) Prior Outstanding Incentive Stock Option. No incentive stock option
granted hereunder prior to January 1, 1987 (for purposes of this Section (e)
called "New Option") shall be exercisable while there is outstanding (within the
meaning of 422A(c)(7) of the Internal Revenue Code as in effect prior to 1986)
any other incentive stock option, which incentive stock option was granted
before the granting of the New Option to the optionee to purchase stock in the
Corporation or in a corporation which, at the time the New Option is granted, is
a parent or subsidiary corporation of the Corporation, or a predecessor
corporation referred to in such 422A(b)(7). An incentive stock option shall be
treated as outstanding until such option is exercised in full or expires by
reason of a lapse of time.
SECTION 9.
Terms And Conditions Of Non-Qualified Stock Options
Non-qualified stock options granted pursuant to the Plan shall be
authorized and granted by the Committee and shall be evidenced by agreements in
such form as the Committee shall from time to time deem appropriate. Non-
qualified stock option agreements need not be identical, but each non-qualified
stock option agreement shall comply with and be subject to the following terms
and conditions:
(a) Number of Shares. Each non-qualified stock option shall state the
number of shares to which it pertains.
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(b) Option Price. Each non-qualified stock option shall state the option
price, which shall be determined by the Committee and which shall not be less
than 100% of the fair market value of the shares of Common Stock of the
Corporation on the date of the granting of the non-qualified stock option.
Subject to the foregoing, the Committee, in fixing the option price, shall have
full authority and discretion and shall be fully protected in doing so.
(c) Method of Exercise and Payment. A non-qualified stock option may be
exercised by the optionee delivering to the Committee on any business day a
written notice specifying the number of shares of Common Stock the optionee then
desires to purchase. The option price shall be paid in full in cash (by
certified or bank check or such other instrument as the Company may accept) or,
if and to the extent set forth in the option agreement or as otherwise permitted
by the Committee, may also be paid by one or more of the following: (i) through
the delivery of or the Attestation of Ownership of shares of Common Stock held
by the optionee for at least six months and having a fair market value as
determined under Section 8(b) hereof at the time of exercise equal to the full
amount of the option price on the date the Stock Option is exercised; (ii) by
requesting the Company to withhold from the number of shares of Common Stock
otherwise issuable upon exercise of the Stock Option that number of shares
having an aggregate fair market value on the date of exercise equal to the
exercise price for all of the shares of Common Stock subject to such exercise;
or (iii) by a combination thereof; provided however, that any payment made in
the manner set forth in (i), (ii) or (iii) above shall, at all times, be subject
to the approval of the Committee.
(d) Deferral of Receipt of Shares. An optionee may elect to defer the
receipt of the shares of Common Stock deliverable upon the exercise of a non-
qualified stock option provided such optionee (i) delivers to the chairperson of
the Committee a written election (a "Deferral Election") to defer the receipt of
shares of Common Stock in such form and with such terms as the Committee
determines no later than six months before the date of exercise of an option as
to which the receipt of a portion of the shares of Common Stock is to be
deferred, (ii) pays the option price payable upon such exercise by delivery to
the Corporation of shares of Common Stock as provided at Section 9(c) hereof,
and (iii) is employed by the Corporation or one of the Subsidiaries at the time
of exercise of such option. Only the number of shares otherwise deliverable
upon exercise of a non-qualified stock option in excess of the number of
shares of Common Stock delivered in payment of the option price upon any
exercise of such option shall be Deferred Shares. Any such Deferral Election
shall be revocable only upon the delivery of a superseding Deferral Election for
the option shares subject to a Deferral Election. Upon the exercise of an
option subject to a Deferral Election, that number of shares of Common Stock
which, but for such Deferral Election, would be deliverable upon such exercise
shall be issued to the Corporation for the benefit of the optionee and credited
to a bookkeeping account (a "Unit Account") in the name of the optionee. Each
optionee's Unit Account will be credited with all noncash property either
distributed in respect of any Deferred Shares credited to such account or into
which any Deferred Shares credited to such Unit Account are converted. All cash
distributed in respect of an optionee's Deferred Shares or into which an
optionee's Deferred Shares are converted shall be delivered to such optionee as
soon as is reasonably practical after such distribution or conversion. No
optionee shall be entitled to vote the Deferred Shares and instead such shares
shall be voted by the Secretary of the Corporation on behalf of such optionee on
all matters on which the holders of Common Stock are entitled to vote in the
same manner as a majority of the Shares of Common Stock are voted.
(e) Terms and Exercise of Non-Qualified Stock Options. Except as
otherwise expressly provided in this Plan, each non-qualified stock option
granted pursuant to this Plan shall contain provisions established by the
Committee setting forth the manner of exercise of such non-qualified stock
option, and may, at the sole discretion of the Committee, provide such
restrictions on exercise as the Committee may deem appropriate. Each non-
qualified stock option granted under this Plan shall terminate as set forth
therein; provided, that no non-qualified stock option shall be exercisable after
the expiration of 10 years and one day from the date of the granting of the non-
qualified stock option. Each non-qualified stock option granted under this Plan
shall contain provisions making such non-qualified stock option nontransferable
by the optionee, except upon death, and exercisable during the optionee's
lifetime only by the optionee.
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SECTION 10.
Terms And Conditions Of Incentive And Non-Qualified Stock Options
(a) Recapitalization. If the shares of Common Stock as a whole are
increased, decreased or changed into, or exchanged for, a different number or
kind of shares or securities of the Corporation, whether through merger,
consolidation, reorganization, recapitalization, reclassification, stock
dividend, stock split, combination of shares, exchange of shares, change in
corporate structure or the like, an appropriate and proportionate adjustment may
be made by the Committee in the number and kinds of shares subject to the Plan,
and the number, kinds, and per share exercise price of shares subject to
unexercised options or portions thereof granted prior to any such change. Any
such adjustment in an outstanding option, however, shall be made without a
change in the total price applicable to the unexercised portion of the option,
but with a corresponding adjustment in the price for each share of Common stock
covered by the option.
(b) Reorganization or Liquidation. Each option agreement may contain such
provisions relating to the dissolution, liquidation, reorganization,
consolidation or merger of the Corporation, or the sale or disposition by the
Corporation of substantially all of its assets, as the Committee may deem
appropriate.
(c) Adjustments. To the extent that the adjustments described in (a)
above relate to stock or securities of the Corporation, such adjustments shall
be made by the Committee, whose determination in that respect shall be
final, binding and conclusive; provided that each incentive stock option granted
pursuant to this Plan shall not be adjusted in a manner that causes the
incentive stock option to fail to continue to qualify as an incentive stock
option within the meaning of 422 of the Code.
SECTION 11.
Rights As A Stockholder
An optionee or a transferee of an option shall not have rights as a
stockholder with respect to any shares covered by his option until the date of
the issuance of a stock certificate to him for such shares. No adjustment shall
be made for dividends (ordinary or extraordinary, whether in cash, securities or
other property) or distributions of other rights for which the record date is
prior to the date such stock certificate is issued, except as provided in
Section 10(a) hereof.
SECTION 12.
Modification, Extension And Renewal Of Options
Subject to the terms and conditions and within the limitations of the Plan,
the Board of Directors or the Committee may modify, extend or renew outstanding
options granted under the Plan, or accept the surrender of outstanding options
(to the extent not theretofore exercised) and authorize the granting of new
options in substitution therefore (to the extent not theretofore exercised).
The Board of Directors or the Committee shall not, however, modify any
outstanding stock options so as to specify a lower option price or with respect
to an outstanding incentive stock option, accept the surrender of outstanding
options and authorize the granting of new incentive stock options in
substitution therefore specifying a lower price. Notwithstanding the foregoing
however no modification of an option shall, without the consent of the optionee,
alter or impair any rights or obligations under any option theretofore granted
under the Plan.
SECTION 13.
Investment Purpose
Each option under the Plan shall be granted on the condition that the
purchases of stock there under shall be for investment purposes, and not with a
view to resale or distribution except that in the event the stock subject to
such option is registered under the Securities Act of 1933, as amended, or in
the event a resale of such stock without such registration would otherwise be
permissible, such condition shall be inoperative if in the opinion of counsel
for the Corporation such condition is not required under the Securities Act of
1933 or any other applicable law, regulation, or rule of any governmental
Agency.
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SECTION 14.
Other Provisions
The option agreements authorized under the Plan shall contain such other
provisions, including, without limitation, restrictions upon the exercise of the
option, which are not inconsistent with this Plan and which the Committee or the
Board of Directors of the Corporation shall deem advisable. Any incentive stock
option agreement shall contain such provisions as shall be necessary in order
that such option will be an "incentive stock option" as defined in 422 of the
Code as amended, or to conform to any change
in the law.
SECTION 15.
Term Of Plan
The term of the Plan shall commence May 2, 1985, and end May 30, 2010,
unless the Plan is terminated prior thereto by the Committee.
SECTION 16.
Indemnification Of Committee
In addition to such other rights of indemnification as they may have as
directors or as members of the Committee, the members of the Committee shall be
indemnified by the Corporation against the reasonable expenses, including
attorneys' 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 the Plan or any option granted there
under, and against all amounts paid by them in settlement thereof (provided such
settlement is approved by independent legal counsel selected by the Corporation)
or paid by them in satisfaction of a judgment in any such action, suit or
proceeding that such Committee member is liable for negligence or misconduct in
the performance of his duties; provided that within 60 days after institution of
any such action, suit or proceeding a Committee member shall in writing offer
the Corporation the opportunity, at its own expense, to handle and defend the
same.
SECTION 17.
Amendment Of The Plan
The Board of Directors of the Corporation may, insofar as permitted by law,
from time to time, with respect to any shares at the time not subject to
options, suspend or discontinue the Plan or revise or amend it in any respect
whatsoever except that, without approval of the stockholders within twelve
months before or after the date of such amendment's adoption, no such revision
or amendment shall change the number of shares subject to the Plan, change the
designation of the class or employees eligible to receive options, decrease the
price at which options may be granted, increase the maximum term of options as
provided herein or remove the administration of the Plan from the Committee.
Furthermore, the Plan may not, without the approval of the stockholders, be
amended in any manner that will cause incentive stock options issued under it to
fail to meet the requirements of incentive stock options as set forth in 422
of the Code.
SECTION 18.
Approval Of Stockholders
The Plan shall become effective upon adoption by the Board of Directors,
and shall be submitted for approval by the holders of a majority of the
outstanding shares of Common Stock of the Corporation within twelve months after
the date the Plan is adopted by the Board of Directors. Options may be granted
hereunder prior to stockholder approval.
SECTION 19.
Non-Exclusivity Of Plan
Neither the adoption of the Plan by the Board of Directors, nor the
submission of the Plan to the shareholders of the Corporation for approval,
shall be construed as creating any limitation on the power of the Board of
Directors to adopt such other incentive arrangements as it may deem desirable,
including, without limitation, the granting of stock options otherwise than
under the Plan, and such arrangements may be either applicable generally or only
specific cases.
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