As filed with the Securities and Exchange Commission on November 15, 1999.
Registration No.333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
HOME-STAKE OIL & GAS COMPANY
(Exact name of registrant as specified in its charter)
Oklahoma 73-0288030
(State or other jurisdiction (I.R.S. employer identification no.)
of incorporation or organization)
15 E. 5TH Street, Suite 2800
Tulsa, Oklahoma 74103
(Address of principal executive offices including zip code)
Home-Stake Oil & Gas Company 1997 Incentive Stock Plan
(Full title of the plan)
Chris K. Corcoran
15 E. 5th Street, Suite 2800
Tulsa, Oklahoma 74103
(Name and address of agent for service)
Telephone number, including area code, of agent for service: (918) 583-0178
CALCULATION OF REGISTRATION FEE
Proposed Proposed
Amount maximum maximum Amount of
Title of securities to be offering price aggregate registration
to be registered registered per share offering price fee
====================== ========== ============== ============== ============
1997 Incentive Stock
Plan Common Stock,
$.01 par value 451,736
(Outstanding options) shares(1) $4.70(2) $2,121,655(2) $ 590
====================== ========== ============== ============== ============
(1) Each share of Common Stock is accompanied by a purchase right pursuant to
the Registrant's Rights Agreement dated April 15, 1992, and amended February 10,
1995, with NationsBank, N.A., as Rights Agent.
(2) This amount represents the weighted average exercise price, based upon
outstanding stock options to purchase 274,050 shares of Common Stock at an
exercise price of $4.50 per share and 177,686 shares of Common Stock at an
exercise price of $5.00 per share.
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Information required by Part I of Form S-8 to be contained in the Section 10(a)
Prospectus is omitted from this Registration Statement in accordance with Rule
428 under the Securities Act of 1933, as amended (the "Securities Act"), and the
Note to Part I of Form S-8.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents and information previously filed by the Registrant
with the Securities and Exchange Commission are incorporated by reference in
this Registration Statement:
(1) The Registrant's Annual Report on Form 10-KSB for the year ended
December 31, 1998;
(2) The Registrant's Quarterly Reports on Form 10-QSB for the quarters
ended March 31, 1999, June 30, 1999 and September 30, 1999; and
(3) The description of the Registrant's Common Stock contained in the
Registration Statement on Form 10 filed with the Securities and
Exchange Commission (File No. 0-19766) and including any amendment or
report heretofore or hereafter filed for the purpose of updating the
description of the Registrant's Common Stock contained therein.
In addition, all documents subsequently filed by the Registrant pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), prior to the filing of a post-effective amendment
which indicates that all securities offered hereby have been sold or which
deregisters all securities offered hereby then remaining unsold, shall be deemed
to be incorporated by reference in this Registration Statement and to be a part
hereof from their respective dates of filing. Any statement contained in a
document incorporated by reference shall be deemed to be modified or superseded
for purposes of this Registration Statement to the extent that a statement
contained in any other subsequently filed incorporated document modifies or
supersedes such statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute a part of this
Registration Statement.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Not applicable.
Item 6. Indemnification of Directors and Officers.
As allowed under the Oklahoma General Corporation Act, the Registrant's
Amended and Restated Bylaws (the "Bylaws") provide that each person who was or
is made a party to, or is involved in, any action, suit or proceeding by reason
of the fact that he or she was a director or officer of the Registrant (or was
serving at the request of the Registrant as a director, officer, employee or
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<PAGE>
agent for another entity) will be indemnified and held harmless by the
Registrant against expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by him or her if he
or she acted in good faith and in a manner he or she reasonably believed to be
in or not opposed to the best interests of the Registrant and, with respect to
any criminal action or proceeding, had no reasonable cause to believe his or her
conduct was unlawful. In the case of an action brought by or in the right of the
Registrant, the Registrant may indemnify a director, officer, employee or agent
of the Registrant against expenses (including attorneys' fees) actually and
reasonably incurred by him or her if he or she acted in good faith and in a
manner he or she reasonably believed to be in the best interests of the
Registrant, except that no indemnification shall be made in respect of any
claim, issue or matter as to which such person shall have been adjudged to be
liable to the Registrant unless a court finds that, in view of all the
circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses as the court shall deem proper.
The Registrant's Certificate of Incorporation provides that to the fullest
extent permitted by the Oklahoma General Corporation Act as the same exists or
may hereafter be amended, a director of the Registrant shall not be liable to
the Registrant or its stockholders for monetary damages for breach of fiduciary
duty as a director. The Oklahoma General Corporation Act permits Oklahoma
corporations to include in their certificates of incorporation a provision
eliminating or limiting director liability for monetary damages arising from
breaches of their fiduciary duty. The only limitations imposed under the statute
are that the provision may not eliminate or limit a director's liability (i) for
breaches of the director's duty of loyalty to the corporation or its
stockholders, (ii) for acts or omissions not in good faith or involving
intentional misconduct or known violations of law, (iii) for the payment of
unlawful dividends or unlawful stock purchases or redemptions, or (iv) for
transactions in which the director received an improper personal benefit.
The Registrant has entered into indemnification agreements with each of its
directors providing for indemnification and expense advances in addition to
those provided for in the Registrant's Bylaws.
Item 7. Exemption from Registration Claimed.
Not applicable.
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<PAGE>
Item 8. Exhibits.
Exhibit
Number Description
4.1* Home-Stake Oil & Gas Company 1997 Incentive Stock Plan.
5.1* Opinion of Conner & Winters, A Professional Corporation.
23.1* Consent of Ernst & Young LLP.
23.2 Consent of Conner & Winters, A Professional Corporation (included in
Exhibit 5.1).
24 * Power of Attorney (included on page II-5 of this Registration Statement).
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* Filed herewith.
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;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of this Registration Statement (or
the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in this Registration
Statement;
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in this
Registration Statement or any material change to such
information in this Registration Statement;
provided, however, that the undertakings set forth in paragraphs (a)(1)(i)
and (a)(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 Section 13 or Section
15(d) of the Exchange Act that are incorporated by reference in this
Registration Statement.
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<PAGE>
(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 further undertakes that, for purposes
of determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or 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.
(h) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that, in the opinion of the Securities and Exchange Commission,
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
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<PAGE>
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 Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Tulsa, State of Oklahoma on the 15th day of November,
1999.
Home-Stake Oil & Gas Company
By: /s/ Robert C. Simpson
----------------------------------
Chairman, Chief Executive
Officer and President
KNOW ALL MEN BY THESE PRESENTS, that each individual whose signature
appears below constitutes and appoints Robert C. Simpson and Chris K. Corcoran,
each of them, his true and lawful attorneys-in-fact and agents with full power
of substitution, for him and in his name, place and stead, in any and all
capacities, to sign any and all amendments (including post-effective amendments)
to this Registration Statement, and to file the same, with all exhibits thereto,
and all documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, full power and
authority to do and perform each and every act and thing requisite and necessary
to be done in and about the premises, as fully to all intents and purposes as he
might or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, or his or their substitutes, may lawfully do or
cause to be done by virtue hereof.
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:
SIGNATURE TITLE DATE
/s/ Robert C. Simpson Chairman of the Board, November 15, 1999
- --------------------------- Chief Executive Officer,
Robert C. Simpson President and Director
(principal executive officer)
/s/ Chris K. Corcoran Executive Vice President, November 15, 1999
- --------------------------- Chief Financial Officer,
Chris K. Corcoran Secretary and Director
(principal financial officer
and principal accounting officer)
/s/ L.W. Allegood Director November 15, 1999
- ---------------------------
L.W. Allegood
/s/ Larry F. Grindstaff Director November 15, 1999
- ---------------------------
Larry F. Grindstaff
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<PAGE>
/s/ Ronald O. Gutman Director November 15, 1999
- ---------------------------
Ronald O. Gutman
/s/ James L. Houghton Director November 15, 1999
- ---------------------------
James L. Houghton
/s/ Joseph J. McCain, Jr. Director November 15, 1999
- ---------------------------
Joseph J. McCain, Jr.
/s/ I. Wistar Morris, III Director November 15, 1999
- ---------------------------
I. Wistar Morris, III
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<PAGE>
EXHIBIT 4.1
HOME-STAKE OIL & GAS COMPANY
1997 INCENTIVE STOCK PLAN
1. Preamble.
Home-Stake Oil & Gas Company, an Oklahoma corporation ("HSOG"), hereby
establishes the Home-Stake Oil & Gas Company 1997 Incentive Stock Plan (the
"Plan) as a means whereby HSOG may, through awards of stock options and
restricted stock:
(a) provide Officers, Directors and key employees who have substantial
responsibilities for the direction and management of HSOG and its
Subsidiaries, as well as consultants to HSOG, with additional incentive to
promote the success of the businesses of HSOG and its Subsidiaries;
(b) enable such employees to acquire equity interests in HSOG; and
(c) enable HSOG to attract and retain the services of key employees
upon whose judgment and effort the successful conduct of its operations is
largely dependent.
Except as specifically provided herein, the provisions of the Plan do not
apply to or affect any option, stock appreciation right, or stock heretofore or
hereafter granted under any other stock or stock option plan of HSOG or any
Subsidiary, and all such options, stock appreciation rights or stock continue to
be governed by and subject to the applicable provisions of the plan or agreement
under which they were granted.
2. Definitions.
2.01 "Administrator" shall mean that person designated by the Board from
time to time to administrator the Awards made under the Plan, which
designation shall be communicated to the Participants in writing.
2.02 "Award" shall mean a grant of an Option or the award of Restricted
Stock under the Plan.
2.03 "Award Agreement" shall mean an agreement between HSOG and a
Participant which evidences the grant of an Option and/or the award of
Restricted Stock to a Participant and sets forth the terms and conditions
of such Option and/or Restricted Stock.
<PAGE>
2.04 "Board" or "Board of Directors" means the board of directors of HSOG.
2.05 "Change in Control" means the occurrence of any one of the following
events:
(a) Any individual, entity or group (within the meaning of Section
13(d)(3) or 14(d)(7) of the Exchange Act, except the Participant, his
affiliates and associates, HSOG, or any corporation, partnership, trust or
other entity controlled by HSOG (a "Subsidiary"), or any employee benefit
plan of HSOG or of any Subsidiary (each such individual, entity or group
shall hereinafter be referred to as a "Person"))becomes the beneficial
owner (within the meaning of Rule 13d-3 promulgated under the Exchange Act)
of 20% or more of either (i) the then outstanding shares of common stock of
HSOG (the "Outstanding Company Common Stock" or (ii) the combined voting
power of the then outstanding voting securities of HSOG entitled to vote
generally in the election of directors (the "Company Voting Securities"),
in either case; or
(b) Individuals who, as of the beginning of any twenty-four month
period, constitute the Board (the "Incumbent Board") cease for any reason
to constitute at least a majority of the Board, provided that any
individual becoming a director subsequent to the beginning of such period
whose election or nomination for election by HSOG's shareholders was
approved by a vote of at least a majority of the directors then comprising
the Incumbent Board shall be considered as though such individual were a
member of the Incumbent Board, but excluding for this purpose any such
individual whose initial assumption of office is in connection with an
actual or threatened election contest relating to the election of the
directors of HSOG (as such terms are used in Rule 14a-11 of Regulation 14A
promulgated under the Exchange Act); or
(c) Consummation by HSOG of a reorganization, merger or consolidation
(a "Business Combination"), in each case, with respect to which all or
substantially all of the individuals and entities who were the respective
beneficial owners of the outstanding Company Common Stock and Company
voting securities immediately prior to such Business Combination do not,
immediately following such Business Combination, beneficially own, directly
or indirectly, more than 50% of, respectively, the then outstanding shares
of common stock and the combined voting power of the then outstanding
voting securities entitled to vote generally in the election of directors,
as the case may be, of the corporation resulting from such Business
Combination in substantially the same proportion as their ownership
immediately prior to such Business Combination of the Outstanding Company
Common Stock and Company Voting Securities, as the case may be; or
<PAGE>
(d) (i) Consummation of a complete liquidation or dissolution of HSOG
or (ii) sale or other disposition of all or substantially all of the assets
of HSOG other than to a corporation with respect to which, following such
sale or disposition, more than 50% of, respectively, the then outstanding
shares of common stock and the combined voting power of the then
outstanding voting securities entitled to vote generally in the election of
directors of such corporation is then owned beneficially, directly or
indirectly, by all or substantially all of the individuals and entities who
were the beneficial owners, respectively, of the Outstanding Company Common
Stock and Company Voting Securities, as the case may be, immediately prior
to such sale or disposition.
2.06 "Code" means the Internal Revenue Code of 1986, as it exists now and
as it may be amended from time to time.
2.07 "Common Stock" means the common stock of HSOG, $.01 par value per
share.
2.08 "Company" means Home-Stake Oil & Gas Company, an Oklahoma corporation,
and any successor thereto.
2.09 "Director(s)" means a member or members of the Board.
2.10 "Disability" means being unable to engage in any substantial gainful
activity by reason of any medically determinable physical or mental
impairment which can be expected to result in death or which has lasted or
can be expected to last for a continuous period of not less than 12 months.
2.11 "Exchange Act" means the Securities Exchange Act of 1934, as it exists
now or from time to time may hereafter be amended.
2.12 "Fair Market Value" means for the relevant day:
(a) If shares of Common Stock are listed or admitted to unlisted
trading privileges on any national or regional securities exchange, the
last reported sale price, regular way, on the composite tape of that
exchange on the day Fair Market Value is to be determined;
(b) If the Common Stock is not listed or admitted to unlisted trading
privileges as provided in paragraph (a), and if sales prices for shares of
Common Stock are reported by the National Market System of the National
Association of Securities Dealers Automated Quotation System ("NASDAQ"),
<PAGE>
then the last sale price for Common Stock reported as of the close of
business on the day Fair Market Value is to be determined, or if no such
sale takes place on that day, the last sale price for the Common Stock
reported as of the close of business on the next preceding day on which
such stock was traded; or
(c) If trading of the Common Stock is not reported by the NASDAQ
System or on a stock exchange, Fair Market Value will be determined by the
Board in its discretion based upon the best available data.
2.13 "Incentive Stock Option" or "ISO" means an Option that complies with
the terms and conditions set forth in Section 422 of the Code and is
designated as an ISO at the time of its grant.
2.14 "Officer" means a corporate officer of HSOG or any Subsidiary or
affiliate of HSOG.
2.15 "Option" means the right of a Participant to purchase a specified
number of shares of Common Stock, subject to the terms and conditions of
the Plan.
2.16 "Option Date" means the date upon which an Option is granted, or
Restricted Stock is awarded, to a Participant under the Plan.
2.17 "Option Price" means the price per share at which an Option may be
exercised.
2.18 "Participant" means an individual, or to the extent permitted as
contemplated at Section 5 hereof, the account of an individual, to whom an
Option or Restricted Stock has been granted under the Plan.
2.19 "Plan" means the Home-Stake Oil & Gas Company 1997 Incentive Stock
Plan herein and as from time to time amended.
2.20 "Restricted Stock" means Common Stock awarded to a Participant
pursuant to the Plan and subject to the restrictions contained or
authorized in Section 7 hereof.
2.21 "Securities Act" means the Securities Act of 1933, as it exists now or
from time to time may hereinafter be amended.
2.22 "Stock Split" means the 30-for-1 split of the issued and outstanding
shares of Common Stock to be effected pursuant to amendments to HSOG's
Certificate of Incorporation in connection with the proposed merger of The
Home-Stake Royalty Corporation into HSOG, which amendments also provide for
<PAGE>
an increase in the number of HSOG's authorized shares of Common Stock. Such
merger has been approved by the Board of Directors on the same date as this
Plan, and such Stock Split and increase in authorized shares will become
effective upon the effective date of such merger.
2.23 "Subsidiary" means any corporation or other entity of which the
majority voting power or equity interest is owned directly or indirectly by
HSOG.
2.24 "Termination of Employment" means:
(a) with respect to an employee, when the employee's employment
relationship with HSOG and all of its Subsidiaries is terminated,
regardless of any severance arrangements. A transfer from HSOG to a
Subsidiary or affiliate of HSOG or a Subsidiary, or vice versa is not a
termination of employment for purposes of the Plan;
(b) with respect to a consultant, when the consultant's consulting
relationship with HSOG is terminated either due to the termination of any
consulting agreement, or otherwise, regardless of the fact that no
employment relationship exists; or
(c) with respect to an Officer or Director, when such individual is no
longer serving as an Officer or Director of HSOG, as a consultant to or
employee of HSOG and any of its Subsidiaries.
2.25 Rules of Construction.
(a) Governing Law. The construction and operation of the Plan are
governed by the laws of the State of Oklahoma.
(b) Undefined Terms. Unless the context requires another meaning, any
term not specifically defined in the Plan has the meaning given to it by
the Code.
(c) Headings. All headings in the Plan are for reference only and are
not to be utilized in construing the Plan.
(d) Gender. Unless clearly appropriate, all nouns of either gender
refer indifferently to persons of either gender.
(e) Singular and Plural. Unless clearly inappropriate, singular terms
refer also to the plural and vice versa.
<PAGE>
(f) Severability. If any provision of the Plan is determined to be
illegal or invalid for any reason, the remaining provisions shall continue
in full force and effect and shall be construed and enforced as if the
illegal or invalid provision did not exist, unless the continuance of the
Plan in such circumstances is not consistent with its purposes.
3. Stock Subject to the Plan.
Four Hundred Fifty-One Thousand Seven Hundred and Thirty-Six (451,736) shares of
HSOG's Common Stock (or such greater or lesser number of shares that equals ten
percent (10%) of the issued and outstanding shares of Common Stock after giving
effect to the Stock Split and the merger of The Home-Stake Royalty Corporation
with the Company) have been reserved for issuance under this Plan. Such shares
of Common Stock may be newly issued shares or shares from the Company's
Treasury. Such number of shares available under this Plan shall be increased
automatically without further action by the Board of Directors or shareholders
of the Company to that number which, when added to the number of shares subject
to Options granted under this Plan and any other stock plan(s) of the Company
equals ten percent (10%) of the issued and outstanding shares of Common Stock at
such time(s) after the effective date of the Stock Split as the Company issues
additional shares of Common Stock (excluding for purposes of determining the
number of shares available under this Plan and the time(s) of such automatic
increases all shares of Common Stock issued pursuant to this Plan and any other
stock plan(s) of the Company and all shares of Common Stock in the Company's
Treasury). Options may be: (a) Incentive Stock Options, (b) other forms of
statutory stock options, or (c) nonstatutory (non-qualified) options.
4. Administration.
The Plan shall be administered by the Board. In addition to any other
powers set forth in the Plan, the Board has the exclusive authority:
(a) to construe and interpret the Plan, and to remedy any ambiguities
or inconsistencies therein;
(b) to establish, amend and rescind appropriate rules and regulations
relating to the Plan;
(c) subject to the express provisions of the Plan, to determine the
individuals who will receive Awards of Options and/or Restricted Stock, the
times when they will receive them, the number of shares to be subject to
each Award and the Option Price, payment terms, payment method, and
expiration date applicable to each Award;
<PAGE>
(d) to contest on behalf of HSOG or Participants, at the expense of
HSOG, any ruling or decision on any matter relating to the Plan or to any
Awards of Options and/or Restricted Stock;
(e) generally, to administer the Plan, and to take all such steps and
make all such determinations in connection with the Plan and the Awards of
Options and/or Restricted Stock as it may deem necessary or advisable;
(f) to determine the form in which tax withholding under Section 14 of
the Plan will be made; and
(g) to amend the Plan or any Option or Restricted Stock granted or
awarded hereunder as may be necessary in order for any business combination
involving HSOG to qualify for pooling-of-interest treatment under APB No.
16.
5. Eligible Participants.
Subject to the provisions of the Plan, the persons who shall be eligible to
participate in the Plan and be granted Awards shall be those persons who are
Officers, Directors, key employees and consultants of HSOG or any Subsidiary who
shall be in a position, in the opinion of the Board, to make contributions to
the growth, management, protection, and success of HSOG and its Subsidiaries. Of
those persons described in the preceding sentence, the Board may, from time to
time, select persons to be granted Awards and shall determine the terms and
conditions with respect thereto. In making any such selection and in determining
the form of the Award, the Board may give consideration to the functions and
responsibilities of the person, to the person's contributions to HSOG and its
Subsidiaries, the value of the individual's service to HSOG and its Subsidiaries
and such other factors deemed relevant by the Board. In the event and to the
extent authorized by the United States Departments of Treasury and Labor, the
HSOG 401(k) Plan account of an employee of HSOG or a Subsidiary may also be a
Participant, the Board may grant Options to such account and, to the extent such
account is a Participant, the Options in such an account shall be subject to all
of the terms and provisions of the Plan as if the Options had been granted to
the individual for whom the account is maintained.
6. Terms and Conditions of Options.
The Board may, in its discretion, grant Options to any Participant under
the Plan. Each Option shall be evidenced by a written agreement between HSOG and
the Participant. Unless the Board at the time of grant specifically designates
Options granted under the Plan as Incentive Stock Options, all Options granted
under the Plan shall be non-statutory options. Each Option agreement, in such
<PAGE>
form as is approved by the Board, shall be subject to the following express
terms and conditions and to such other terms and conditions, not inconsistent
with the Plan as the Board may deem appropriate:
(a) Option Period. Each Option granted under the Plan shall be for
such period as is established by the Board, except that each ISO shall
expire no later than ten years after the Option Date. Where Options are
exercisable in installments, the right to purchase any shares shall be
cumulative, so that when the right to purchase any shares has matured, such
shares may be purchased thereafter until the expiration of the Option. The
Board shall have the power to accelerate the exercisability of installments
for any Option granted under the Plan.
(b) Option Price. At the time when the Option is granted, the Board
will fix the Option Price; provided, however, that except as provided
herein at Section 6(c)(i), the Option Price shall be no less than the Fair
Market Value on the Option Date.
(c) Other Option Provisions. The form of Option authorized by the Plan
may contain such other provisions as the Board may from time to time
determine, including:
(i) "Discounted Options" which may be granted to any Participant.
A "Discounted Option" is an Option having an Option Price per
share (i) less than the Fair Market Value at the Option Date
provided such Option Price shall not be less than 50% of the Fair
Market Value at the Option Date, or (ii) in the case of
Directors, equal to the Fair Market Value at the Option Date,
less the amount of salary or Director's fees elected (at least
six months before the commencement of the calendar or fiscal year
with respect to which such fees will be earned) by a Director to
be received in the form of Options (the "deferred amount")
divided by the number of shares subject to the Option. Discounted
Options shall not be forfeitable under any provision of the Plan
and shall be exercisable until the third anniversary of the
Participant's Termination of Employment;
(ii) "Reload Options" which may be granted only to Directors and
employees of HSOG or a Subsidiary. A "Reload Option" is an Option
automatically granted to a Participant pursuant to the terms of
an Award Agreement upon the delivery (actual, constructive or by
attestation) of shares of Common Stock to pay any required
withholding tax in respect of the exercise of an Option (the
"delivered shares"). Such Reload Option entitles the Participant
to purchase (at an option price equal to the Fair Market Value at
the time of such delivery) a number of shares of Common Stock
equal to the number of delivered shares. Reload Options shall be
subject to all of the terms of the Plan and the Award Agreement
in respect to which they are granted, including the Option Period
<PAGE>
for the Option exercised by delivery of the delivered shares, and
shall not be exercisable before the earlier of one year after
their grant or the day before the expiration of such Option
Period. In the discretion of the Board, Reload Options granted on
the exercise of ISO's may be ISO's or non-qualified options.
(d) Incentive Stock Options. ISO's may only be granted to
employees of HSOG or of a Subsidiary. No more than Four Hundred
Fifty-One Thousand Seven Hundred and Thirty-Six (451,736) shares of
HSOG's Common Stock (as adjusted to reflect the Stock Split) may be
issued upon the exercise of ISO's granted under this Plan and no ISO
may be granted under the Plan after the tenth anniversary of the date
the Plan is approved by the shareholders of HSOG. The aggregate Fair
Market Value (determined as of the Option Date of the ISO) of the
Common Stock with respect to which ISO's are first exercisable by a
Company or Subsidiary employee during any calendar year under all
Option plans of HSOG shall not exceed $100,000. An ISO granted to an
employee who, at the time the ISO is granted, owns Common Stock
possessing more than ten percent (10%) of the total combined voting
power of all classes of capital stock of HSOG or a Subsidiary thereof
shall have an exercise price equal to not less than 110 percent (110%)
of the Fair Market Value on the Option Date. Notwithstanding any other
provision of this Plan, an ISO shall not be transferable or assignable
otherwise than by will or the laws of descent and distribution. Any
Participant who disposes of shares acquired upon the exercise of an
ISO either (i) within two years after the Option Date of the Option
under which the shares were acquired or (ii) within one year after the
acquisition of such shares shall notify HSOG of such disposition and
of the amount realized. Failure by a Participant to so notify HSOG of
such a disposition of shares shall entitle HSOG to treat the shares of
Common Stock issued to such Participant as void ab initio or to
recover from the Participant the greater of the value of the shares
disposed of as of the date of disposition or the value of the shares
disposed of as of the date HSOG learns of such disposition from either
(ii) any amounts due to such Participant from HSOG or a Subsidiary, or
(ii) otherwise. HSOG may, at its discretion, place a legend noting the
possible consequences of a Participant's failure to provide such
disposition notice on shares of Common Stock delivered upon the
exercise of an ISO.
(e) No person shall have any rights of a shareholder with respect
to any shares to be delivered upon the exercise of an Option until
such time as such Option is validly exercised.
7. Terms and Conditions of Restricted Stock Awards.
The Board, in its discretion, may grant Restricted Stock to any Participant
under the Plan, the purchase price of which shall be established by the Board,
which purchase price may be financed by HSOG on terms established by the Board.
<PAGE>
Each grant of Restricted Stock shall be evidenced by an Award Agreement between
HSOG and the Participant. All shares of Common Stock awarded to Participants
under the Plan as Restricted Stock shall be subject to the following express
terms and conditions and to such other terms and conditions, not inconsistent
with the Plan, as the Board shall deem appropriate:
(a) Restrictions on Transfer. Shares of Restricted Stock awarded to
Participants shall contain such restrictions on transfer as the Board may
determine in its sole discretion. Except as permitted under Section 12 of
the Plan, shares of Restricted Stock awarded to Participants may not be
sold or transferred before such restrictions on transfer lapse, and may
only be pledged to HSOG or any Subsidiary to satisfy any obligations that
the Participant may have to HSOG or the Subsidiary with respect to the
acquisition of such shares of Restricted Stock. Subject to the provisions
of subparagraphs (b) and (c) below and any other restrictions imposed by
law, the certificates for any shares of Restricted Stock the restrictions
on which have lapsed will be transferred to the Participant or, in the
event of his death, to the beneficiary or beneficiaries designated by
writing filed by the Participant with the Board for such purpose or, if
none, to his estate. Delivery of shares in accordance with the preceding
sentence shall be made within the 30-day period after such restrictions
shall lapse.
(b) Certificates Deposited With Company. Each certificate issued in
respect of shares of Restricted Stock awarded under the Plan shall be
registered in the name of the Participant and deposited with HSOG. Each
such certificate shall bear the following (or a similar) legend:
"The transferability of this certificate and the shares of stock
represented hereby are subject to the terms and conditions (including
forfeiture) relating to Restricted Stock contained in the Home-Stake
Oil & Gas Company 1997 Incentive Stock Plan and an agreement entered
into between the registered owner and Home-Stake Oil & Gas Company.
Copies of such Plan and agreement are on file at the principal office
of Home-Stake Oil & Gas Company."
(c) Shareholder Rights. Subject to the foregoing restrictions, each
Participant shall have all the rights of a shareholder with respect to his
shares of Restricted Stock including, but not limited to, the right to vote
such shares.
(d) Dividends. On each Common Stock dividend payment date, each
Participant shall receive an amount equal to the dividend paid on that date
on a share of Common Stock, multiplied by his number of shares of
Restricted Stock.
<PAGE>
8. Manner of Exercise of Options; Deferral of Receipt of Shares.
(a) To exercise an Option in whole or in part, a Participant (or,
after his death, his executor or administrator) or his assignee (as
contemplated at Section 12 hereof) must give written notice to the
Administrator, stating the number of shares with respect to which he
intends to exercise the Option. HSOG will issue the shares with respect to
which the Option is exercised upon payment in full of the Option Price. The
Option Price may be paid (i) in cash, (ii) in shares of Common Stock held
by the Participant, his executor, administrator, or assignee, and having an
aggregate Fair Market Value, as determined as of the close of business on
the day on which such Option is exercised, equal to the Option Price, (iii)
if permitted by the Board, a promissory note in the amount of the Option
Price, which note shall provide for full personal liability of the maker
and shall contain such other terms and provisions as the Board may
determine, including without limitation the right to repay the note
partially or wholly with Common Stock, (iv) if authorized by the Board in
the Award Agreement for the Option being exercised, by delivery of
irrevocable instructions to a broker to promptly deliver to HSOG the amount
of sale or loan proceeds necessary to pay for all Common Stock acquired
through such exercise and any tax withholding obligations resulting from
such exercise, (v) if authorized by the Board in the Award Agreement for
the Option being exercised, by the withholding by HSOG, pursuant to a
written election delivered by the Participant, his executor, administrator,
or assignee, to the Administrator on or prior to the date of exercise, from
the shares of Common Stock issuable upon any exercise of the Option that
number of shares having a Fair Market Value as of the close of business on
the day on which such Option is exercised equal to such Option Price, (vi)
by constructive delivery ("attestation") of shares of Common Stock held by
the Participant, his executor, administrator, or assignee, and having an
aggregate Fair Market Value, as determined as of the close of business on
the day of exercise, equal to the Option Price effected through providing
HSOG with a notarized statement on or before the day of exercise attesting
to the number of shares owned by the Participant, his executor,
administrator, or assignee, that will serve as the Option Price payment
shares, or (vii) as authorized by the Board in the Award Agreement for the
Option being exercised, by a combination of such methods. The Option Price
may also be paid in shares of Common Stock which were received by the
Participant, his executor, administrator, or assignee, upon the exercise of
one or more Options or as an award of Restricted Stock under the Plan;
provided, however, that in the event shares of Restricted Stock are
tendered as consideration for the exercise of an Option, a number of the
shares issued upon the exercise of said Option, equal to the number of
shares of Restricted Stock used as consideration therefor, shall be subject
to the same restrictions as the Restricted Stock so submitted were at the
time of their submission plus any additional restrictions that may be
imposed by the Board.
<PAGE>
(b) A Participant (but not his executor, administrator or assignee)
may elect to defer the receipt of a portion of the shares of Common Stock
(the "Deferred Shares") deliverable upon the exercise of a non-qualified
Option provided such Participant (i) delivers to the Board a written
election (a "Deferral Election") to defer the receipt of shares of Common
Stock, in such form and with such terms as the Board 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, or by
attestation, to HSOG of shares of Common Stock as provided at Section 8(a)
hereof, and (iii) is employed by HSOG or a Subsidiary at the time of
exercise of such Option. Only the number of shares otherwise deliverable
upon exercise of a non-qualified 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 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 HSOG for the benefit of the Participant and
credited to a bookkeeping account (a "Unit Account") in the name of the
Participant. Each Participant's Unit Account will be credited with all
non-cash 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 a
Participant's Deferred Shares or into which a Participant's Deferred Shares
are converted shall be delivered to such Participant as soon as is
reasonably practical after such distribution or conversion. No Participant
shall be entitled to vote the Deferred Shares and instead such shares shall
be voted by the Secretary of HSOG on behalf of such Participant 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.
9. Vesting.
A Participant may not exercise an Option until it has become vested. The
portion of an Option Award that is vested depends upon the vesting restrictions,
if any, established by the Board for such Option at the time of its grant and
the period that has elapsed since the Option Date.
10. Change in Control.
Notwithstanding the provisions of Sections 6 and 7 or anything contained in
a Participant's agreement to the contrary, upon a Change in Control, all Options
and/or Restricted Stock shall be subject to the following:
<PAGE>
(a) The restrictions and limitations applicable to any Options shall
lapse, and such Options shall become free of all restrictions and become
fully vested to the full extent of the original grant.
(b) HSOG shall have the right to acquire from Participants their
vested Options for which the value, as established in the Change in
Control, of the Common Stock issuable upon exercise thereof is greater than
the Option Price by payment of the amount by which the price per share of
Common Stock, as established in the Change in Control, exceeds the Option
Price; and
(c) All Restricted Stock shall become free of all restrictions and be
fully vested and transferable.
11. Adjustments to Reflect Changes in Capital Structure.
If there is any change in the corporate structure or shares of HSOG, the
Board of Directors may, in its discretion, make any adjustments necessary to
prevent accretion, or to protect against dilution, in the number and kind of
shares authorized by the Plan and, with respect to outstanding Options and/or
Restricted Stock, in the number and kind of shares covered thereby and in the
applicable Option Price. For the purpose of this Section 11, a change in the
corporate structure or shares of HSOG includes, without limitation, any change
resulting from a recapitalization, stock split, stock dividend, consolidation,
rights offering, spin-off, reorganization, or liquidation and any transaction in
which shares of Common Stock are changed into or exchanged for a different
number or kind of shares of stock or other securities of HSOG or another
corporation.
12. Non-Transferability of Options and Restricted Stock; Limited Exception to
Transfer Restrictions.
(a) Unless otherwise expressly provided in this Section 12, by
applicable law or by any Award Agreement, as the same may be amended,
evidencing the grant or award of Restricted Stock or Options: Awards are
non-transferable and shall not be subject in any manner to sale, transfer,
anticipation, alienation, assignment, pledge, encumbrance or charge; Awards
shall be exercised only by the person to whom such Awards were granted or
awarded (a "Recipient"); and amounts payable or shares issuable pursuant to
Awards shall be delivered only to or for the account of a Recipient.
(b) Except as precluded by any applicable law, the Board may permit
Awards to be transferred to and exercised by and paid to certain persons or
entities related to the Recipient, including, but not limited to members of
the Recipient's immediate family (parents, grandparents, children,
grandchildren, spouse, siblings), charitable institutions, or trusts or
other entities whose beneficiaries or beneficial owners are members of the
Recipient's immediate family and/or charitable institutions, or to such
other persons or entities as may be approved by the Board, pursuant to such
conditions and procedures as the Board may establish. Any permitted
transfer shall be subject to the condition that the Board receive evidence
satisfactory to it that the transfer is being made for estate and/or tax
planning purposes on a gratuitous or donative basis and without
consideration other than nominal consideration.
<PAGE>
(c) The exercise and transfer restrictions in this Section 12 shall
not apply to:
(i) transfers to HSOG;
(ii) the designation of a beneficiary to receive benefits in the
event of the Recipient's death or, if the Recipient has died,
transfers to or exercise by the Recipient's beneficiary, or, in the
absence of a validly designated beneficiary, transfers by will or the
laws of descent and distribution;
(iii) transfers pursuant to a domestic relations order;
(iv) if the Recipient has suffered a disability, permitted
transfers or exercises on behalf of the Recipient by his or her legal
representative; or
(v) the authorization by the Board of "cashless exercise"
procedures with third parties who provide financing for the purpose of
(or who otherwise facilitate) the exercise of Awards consistent with
applicable laws and the express authorization of the Board.
(d) In the event of a transfer of an Award pursuant to Subsection (b)
or (c) of this Section 12, the Recipient will remain liable for any taxes
(including withholding and social security taxes) due upon or as a
consequence of the exercise of or lapse of any restrictions in respect of
an Award and neither HSOG nor the Board shall have any obligation to
provide notice to a transferee of any event or information that has, will
or could in any way affect an Award or its exercise.
13. Rights as Shareholder.
No person shall have any rights of a shareholder as to shares of Common
Stock subject to an Award under the Plan until, after proper exercise of the
Award or other action required, such shares shall have been recorded on HSOG's
<PAGE>
official shareholder records as having been issued or transferred. Upon exercise
of the Award or any portion thereof, HSOG will have thirty (30) days in which to
issue the shares, and the Participant will not be treated as a shareholder for
any purpose whatsoever prior to such issuance. No adjustment shall be made for
cash dividends or other rights for which the record date is prior to the date
such shares are recorded as issued or transferred in HSOG's official shareholder
records, except as provided herein or in an Agreement.
14. Withholding Tax.
Upon the exercise of an Option, or the lapse of restrictions on Restricted
Stock, requiring tax withholding, the Participant will be required to pay to
HSOG for remittance to the appropriate taxing authorities an amount necessary to
satisfy the employee's portion of federal, state and local taxes, if any,
incurred by reason of the exercise of an Option or the lapse of such
restrictions. A Participant may elect to have any tax withholding obligation
incurred upon the exercise of or lapse of restrictions in respect of an Award
satisfied by payment of cash by the Participant, by the withholding of cash
otherwise due the Participant, or, except in the case of ISO's, by the
withholding of shares of Common Stock issuable upon such occurrence and having
an aggregate Fair Market Value on the day prior to the day of exercise or lapse
sufficient to satisfy the applicable tax withholding requirement; provided,
however, that if the Participant elects to have shares of Common Stock withheld
from the shares deliverable upon such exercise or lapse, a Participant's
election must be delivered to the Administrator in writing on or prior to the
date of exercise of the Options or lapse of restrictions with respect to
Restricted Stock.
15. Termination of Employment.
In the event of a Participant's Termination of Employment, the following
rules shall apply:
(a) Resignation in order to assume employment, approved by HSOG's
Chief Executive Officer, with a governmental, charitable or educational
institution, or business entity affiliated with HSOG:
When a Participant resigns to assume employment, approved by HSOG's
Chief Executive Officer, with a governmental, charitable or educational
institution, or business entity in which HSOG has an equity interest, the
Board may (i) authorize the continuation of Options granted or Restricted
Stock awarded prior to termination as if the Participant were still
employed by HSOG and (ii) permit the exercise of such Options or lapse of
restrictions in respect of Restricted Stock during periods after such
Termination of Employment, but not beyond the original expiration date of
the Option. Such actions will not be authorized to the extent they would
<PAGE>
cause outstanding ISOs to be considered to have been modified for purposes
of Section 424(h) of the Code. Unless the Board determines otherwise,
termination of such approved employment, except to rejoin HSOG or accept
other employment which would qualify under this paragraph (a), or
divestiture by HSOG of its equity interest in such business entity, shall
be treated as a termination of employment pursuant to paragraph (b), (c) or
(d) of this Section 15.
(b) Termination of Employment for any reason other than death,
disability or resignation for approved employment pursuant to paragraph (a)
above:
Any Option or Restricted Stock shall expire forthwith; provided,
however, that with the approval of the Board evidenced by a writing signed
by an executive officer of HSOG other than the Participant, unvested
Options may be accelerated to vest immediately, any Options exercisable at
the time of such termination may be exercised up to a date after such
termination that is determined by the Board, but not exceeding five years
from the date of such termination and not beyond the date the Option
otherwise would have expired in accordance with the Award Agreement
evidencing such Option and/or the restrictions on Restricted Stock may be
eliminated so that such Restricted Stock is free of such restrictions at
the time of Termination of Employment and not forfeited upon such
Termination of Employment.
(c) Death of a Participant:
A Participant's estate or beneficiaries shall have a period up to the
later of one year after the Participant's death or the expiration date
specified in the Award Agreement within which to exercise the Option;
provided, however, in the case of ISO's, the Participant's estate or
beneficiaries may exercise an Option only until the expiration date
specified in the Award Agreement. Any Option may be immediately exercised
in full by the Participant's estate or beneficiaries. In the event the
Participant's estate is closed with exercisable Options then unexercised,
the rights under this paragraph shall pass by will or the laws of descent
and distribution. In the case of Restricted Stock, the restrictions on such
Restricted Stock shall be deemed to have lapsed immediately before such
Participant's death.
(d) Disability of a Participant:
In the event of a Participant's Disability during employment, the
Participant, or his or her guardian or legal representative shall have a
period up to the expiration date specified in the Award Agreement within
which to exercise the Option; provided, however, in the case of ISO's, the
Participant, or his or her guardian or legal representative shall have a
period up to the earlier of the expiration date or one year after the
<PAGE>
Participant's Termination of Employment within which to exercise the
Option. In the case of Restricted Stock, the restrictions on such
Restricted Stock shall be deemed to have lapsed immediately before the
Termination of Employment of such Participant.
16. Cancellation of Option Grants and Restricted Stock.
(a) After Termination of Employment. If there is a Termination of
Employment with respect to a Participant for any reason other than death,
and, pursuant to paragraph (a), (b) or (d) of Section 15, one or more
Options have not yet expired or the restrictions pertain ing to Restricted
Stock have not lapsed, the Board, in its sole discretion, which may be dele
gated to the Chief Executive Officer of HSOG or to the Chairman of the
Board, may cancel any such Options at any time prior to the exercise
thereof or declare forfeited any such Restricted Stock before the related
restrictions lapse unless the following conditions are met:
(i) The Participant shall not render services for any
organization or engage directly or indirectly in any business which,
in the judgment of the Chief Executive Officer of HSOG, is or becomes
competitive with HSOG, or which is or becomes otherwise prejudicial to
or in conflict with the interests of HSOG. The judgment of the Chief
Executive Officer shall be based on the Participant's positions and
responsibilities while employed by HSOG, the Participant's
post-employment responsibilities and position with the other
organization or business, the extent of past, current and potential
competition or conflict between HSOG and the other organization or
business, the effect on HSOG's customers, suppliers and competitors of
the Participant's assuming the post-employment position, and such
other considerations as are deemed relevant given the applicable facts
and circumstances. The Participant shall be free, however, to purchase
as an investment or otherwise, stock or other securities of such
organization or business so long as such stock or securities are
listed upon a recognized securities exchange or traded
over-the-counter, and such investment does not represent a substantial
investment to the Participant or a greater than five percent (5%)
equity interest in the organization or business.
(ii) The Participant shall not, without prior written
authorization from HSOG, disclose to anyone outside HSOG, or use in
other than HSOG's business, any confidential information or material
relating to the business of HSOG, acquired by the Participant either
prior to or after such Participant's Termination of Employment.
<PAGE>
(b) Before Termination of Employment. The Board, in its sole
discretion, which may be delegated to the Chief Executive Officer of HSOG
or to the Chairman of the Board, may cancel any Options held by a person or
reduce the number thereof at any time prior to the exercise thereof or
declare forfeited a part or all of any shares of Restricted Stock awarded
to a Participant under the following circumstances:
(i) The Participant's conduct either in connection with his or
her employment by HSOG or otherwise is deemed inimical to the
interests of HSOG.
(ii) The Participant's employment responsibilities with HSOG are
reduced or altered and the Board determines that the Participant would
not have been granted the Options or awarded the shares of Restricted
Stock, or such number of Options or shares of Restricted Stock, had
the Participant's employment responsibilities been at the reduced or
altered level at the time of the grant or award of such Options or
shares of Restricted Stock.
17. No Right To Employment.
Participation in the Plan will not give any Participant a right to be
retained as an employee of HSOG or any Subsidiary, or any right or claim to any
benefit under the Plan, unless the right or claim has specifically accrued under
the Plan.
18. Amendment of the Plan.
Except as provided in this Section 18, the Board of Directors may amend,
modify, suspend or discontinue this Plan for the purpose of meeting any changes
in legal requirements or for any other purpose permitted by law. Except for any
adjustments pursuant to Section 11, the Board of Directors may not (a) increase
the maximum number of shares that may be issued under the Plan, except with the
approval of the shareholders of HSOG, (b) decrease the exercise price with
respect to any Option previously granted, or (c) delegate the administration of
this Plan to any committee.The Board may from time to time amend or revise the
terms of the Plan in whole or in part and may without limitation, adopt any
amendment deemed necessary.
19. Notice.
Any written notice to HSOG required by any of the provisions of the Plan
shall be addressed to the Administrator, if so required under the Plan, and
otherwise to the Chairman of the Board or to the Chief Executive Officer of
HSOG, and shall become effective when it is received by the office of such
Administrator, Chairman or the Chief Executive Officer.
<PAGE>
20. Company Benefit and Compensation Plans.
Nothing contained in the Plan shall prevent any Participant prior to death,
or the Participant's dependents or beneficiaries after the Participant's death,
from receiving, in addition to any Options or Restricted Stock provided for
under the Plan, any salary, incentive or performance plan Awards, payments under
a Company retirement plan or other benefits that may be otherwise payable or
distributable to such Participant, or to the Participant's dependents or
beneficiaries under any other plan or policy of HSOG or otherwise. To the extent
permitted by law, grants of Options or awards of Restricted Stock under the Plan
may be made in combination with, or as alternatives to, grants, awards or
payments under other Company plans.
21. Representations and Warranties.
No person shall at any time have a right to be selected as a Participant in
the Plan, nor having been selected as a Participant for one Award to be selected
as a Participant for any other Award, and no person shall have any authority to
enter into any agreement assuring such selection or making any warranty or
representation with respect thereto. A Participant shall have no rights to or
interest in any Option or Restricted Stock except as set forth herein.
22. Unfunded Plan.
Insofar as it provides for grants of Options and awards of Restricted
Stock, the Plan shall be unfunded. Although bookkeeping accounts may be
established with respect to Participants who are or may become entitled to
Common Stock under the Plan, any such accounts shall be used merely as a
bookkeeping convenience. HSOG shall not be required to segregate any assets that
may at any time be represented by Common Stock, nor shall the Plan be construed
as providing for such segregation, nor shall HSOG nor the Board be deemed to be
a trustee of any Common Stock issuable or deliverable under the Plan. Any
liability of HSOG to a Participant with respect to a grant of Options or award
of Restricted Stock under the Plan shall be based solely upon any contractual
obligations that may be created by the Plan or an Award Agreement; no such
obligation of HSOG shall be deemed to be secured by any pledge or other
encumbrance on any property of HSOG. Neither HSOG nor the Board shall be
required to give any security or bond for the performance of any obligation that
may be created by the Plan.
23. Shareholder Approval.
Continuance of the Plan, and the validity of any Options granted or
Restricted Stock awarded under the Plan, shall be subject to approval by the
shareholders of HSOG of the Plan within 12 months after the date the Plan is
adopted by the Board.
<PAGE>
24. Conditions Upon Issuance of Shares.
An Option shall not be exercisable, a share of Common Stock shall not be
issued pursuant to the exercise of an Option, and restrictions on Restricted
Stock awarded shall not lapse until such time as the Plan has been approved by
the shareholders of HSOG and unless the Award of Restricted Stock, exercise of
such Option and the issuance and delivery of such share pursuant thereto shall
comply with all relevant provisions of law, including, without limitation, the
Securities Act, the Exchange Act, the rules and regulations promulgated
thereunder, and the requirements of any stock exchange upon which the shares of
Common Stock may then be listed, and shall be further subject to the approval of
counsel for HSOG with respect to such compliance. As a condition to the exercise
of an Option, HSOG may require the person exercising such Option to represent
and warrant at the time of any such exercise that the Common Stock is being
purchased only for investment and without any present intention to sell or
distribute such shares if, in the opinion of counsel for HSOG, such a
representation is required by any of the aforementioned relevant provisions of
law.
25. Effective Date and Termination of Plan.
25.1 Effective Date. The Plan is effective as of the of the date of
its adoption by the Board of Directors, subject to its approval by the
shareholders of HSOG, pursuant to Section 23.
25.2 Termination of the Plan. The Board may terminate the Plan at any
time with respect to any shares that are not then subject to Options or
Restricted Stock. Termination of the Plan will not affect the rights and
obligations of any Participant with respect to Options or Restricted Stock
awarded before termination.
<PAGE>
EXHIBIT 5.1
CONNER & WINTERS
A PROFESSIONAL CORPORATION
LAWYERS
3700 FIRST PLACE TOWER
15 EAST FIFTH STREET
TULSA, OKLAHOMA 74103-4344
(918) 586-5711
FAX (918) 586-8982
November 15, 1999
Home-Stake Oil & Gas Company
15 E. 5th Street
Suite 2800
Tulsa, Oklahoma 74103
Re: Home-Stake Oil & Gas Company
Registration Statement on Form S-8
Gentlemen:
We have acted as counsel for Home-Stake Oil & Gas Company, an Oklahoma
corporation (the "Company"), in connection with the registration under the
Securities Act of 1933, as amended (the "Securities Act"), of an aggregate of
451,736 shares of the Company's Common Stock, $.01 par value per share (the
"Shares"), issuable pursuant to the Company's 1997 Incentive Stock Plan (the
"Plan"). A Registration Statement on Form S-8 (the "Registration Statement")
covering the issuance and sale of the Shares from time to time upon their
purchase or upon exercise of stock options to be granted under the Plan has been
filed under the Securities Act with the Securities and Exchange Commission.
In reaching the conclusions expressed in this opinion, we have (a) examined
such certificates of public officials and of corporate officers and directors
and such other documents and matters as we have deemed necessary or appropriate,
(b) relied upon the accuracy of facts and information set forth in all such
documents, and (c) assumed the genuineness of all signatures, the authenticity
of all documents submitted to us as originals, the conformity to original
documents of all documents submitted to us as copies, and the authenticity of
the originals from which all such copies were made.
Based on the foregoing, we are of the opinion that the Shares have been
duly authorized and, when sold, issued and delivered in the manner and for the
consideration described in the Plan, will be validly issued, fully paid and
nonassessable shares of Common Stock of the Company.
<PAGE>
Home-Stake Oil & Gas Company
November 15, 1999
Page 2
We are members of the bar of the State of Oklahoma. Our opinion expressed
above is limited to the laws of the State of Oklahoma and the federal laws of
the United States of America, and we do not express any opinion herein
concerning the laws of any other jurisdiction.
We consent to the filing of this opinion as an exhibit to the Registration
Statement.
Yours very truly,
CONNER & WINTERS,
A Professional Corporation
/s/ CONNER & WINTERS
<PAGE>
EXHIBIT 23.1
Consent of Independent Auditors
We consent to the incorporation by reference in the Registration Statement on
Form S-8 pertaining to the Home-Stake Oil & Gas Company 1997 Incentive Stock
Plan of our report dated March 22, 1999, with respect to the financial
statements of Home-Stake Oil & Gas Company included in its Annual Report (Form
10-KSB) for the year ended December 31, 1998, filed with the Securities and
Exchange Commission.
/s/ Ernst & Young LLP
Tulsa, Oklahoma
November 11, 1999
