Nonemployee Director Stock Option Plan - Boots & Coots International Well Control Inc.
BOOTS & COOTS INTERNATIONAL WELL CONTROL, INC.
NONEMPLOYEE DIRECTOR STOCK OPTION PLAN
Section 1. Purpose. It is the purpose of the Plan to promote the
interests of Boots & Coots International Well Control, Inc., a Delaware
corporation (the "Company"), and its stockholders by attracting and retaining
qualified Nonemployee Directors by giving them the opportunity to acquire a
proprietary interest in the Company and an increased personal interest in its
continued success and progress. The Options granted under the Plan will not be
treated as "incentive stock options" within the meaning of Section 422 of the
Internal Revenue Code of 1986, as amended (the "Code").
Section 2. Definitions. As used herein the following terms have the
(a) "Affiliate" means any parent or subsidiary corporation of the
Company within the meaning of Rule 12b-2 under the Securities Exchange Act
of 1934, as amended; provided, however, that an entity shall not be deemed
a parent of the Company unless such entity owns at least 50% of the
outstanding voting securities of the Company.
(b) "Board" means the Board of Directors of the Company.
(c) "Committee" means the Nonemployee Directors Stock Option Committee
described in Section 4 hereof.
(d) "Common Stock" means the Common Stock, par value $.00001 per
share, of the Company.
(e) "Effective Date" shall have the meaning given to that term in
(f) The "Fair Market Value" of a share of Common Stock on any date
shall be (i) the closing sale price on the immediately preceding business
day of a share of Common Stock as reported on the principal securities
exchange on which shares of Common Stock are then listed or admitted to
trading or (ii) if not so reported, the average of the closing bid and
asked prices for a share of Common Stock on the immediately preceding
business day as quoted on the National Association of Securities Dealers
Automated Quotation System ("NASDAQ"), or (iii) if not quoted on NASDAQ,
the average of the closing bid and asked prices for a share of Common Stock
as quoted by the National Quotation Bureau's "Pink Sheets" or the National
Association of Securities Dealers' OTC Bulletin Board System. If the price
of a share of Common Stock shall not be so reported, the Fair Market Value
of a share of Common Stock shall be determined by the Committee in its
(g) "Grant Date" means, with respect to any Option granted under the
Plan, the date of grant of such Option as provided in Section 5(a).
(h) "Nonemployee Director" means an individual who (i) is now, or
hereafter becomes, a member of the Board of Directors of the Company, and
(ii) is neither an employee nor an officer of the Company or of an
Affiliate of the Company. For purposes of this Plan, "employee" shall mean
an individual whose wages are subject to the withholding of federal income
tax under Section 3401 of the Code, and "officer" shall mean an individual
elected or appointed by the Board of Directors or chosen in such other
manner as may be prescribed in the Bylaws of the Company or an Affiliate to
serve as such.
(i) "Option" means any option to purchase shares of Common Stock
granted pursuant to the provisions of the Plan.
(j) "Optionee" means a Nonemployee Director who has been granted an
Option under the Plan.
(k) "Plan" means this Boots & Coots International Well Control, Inc.
Nonemployee Director Stock Option Plan.
Section 3. Number of Shares. Options may be granted by the Company under
the Plan to purchase an aggregate of 150,000 shares of Common Stock. If an
Option expires or terminates for any reason without having been exercised in
full, the unpurchased shares subject to such expired or terminated Option shall
again be available for purposes of the Plan. The shares may be authorized but
unissued or reacquired shares of Common Stock.
Section 4. Administration of the Plan. The Plan shall be administered by
a Nonemployee Directors Stock Option Committee which shall consist of two or
more members of the Board, a majority of which shall not be Nonemployee
Directors. Each member of the Committee shall be appointed by and shall serve
at the pleasure of the Board. The Board shall have the sole continuing
authority to appoint members of the Committee both in substitution for members
previously appointed and to fill vacancies however caused. The following
provisions shall apply to the administration of the Plan:
(a) The Committee shall designate one of its members as Chairman and
shall hold meetings at such times and places as it may determine. Each
member of the Committee shall be notified in writing of the time and place
of any meeting of the Committee at least two days prior to such meeting,
provided that such notice may be waived by a Committee member. A majority
of the members of the Committee shall constitute a quorum and any action
taken by a majority of the members of the Committee present at any duly
called meeting at which a quorum is present (as well as any action
unanimously approved in writing) shall constitute action by the Committee.
(b) The Committee may appoint a Secretary (who need not be a member of
the Committee) who shall keep minutes of its meetings. The Committee may
make such rules and regulations for the conduct of its business as it may
(c) The Committee shall have no authority, discretion or power to
select the participants who will receive Options, to set the number of
shares to be covered by any Option, to set the exercise price of any Option
or to set the period within which Options may be exercised, or to alter any
other terms or conditions specified herein, except in the sense of
administering the Plan. Subject to the foregoing limitations, the Committee
shall have full authority subject to the express provisions of the Plan to
interpret the Plan and any Option granted hereunder, to provide, modify and
rescind rules and regulations relating to the Plan and to make all other
determinations and perform such actions as the Committee deems necessary or
advisable to administer the Plan. In making such determinations, the
Committee may take into account such facts as the Committee in its
discretion shall deem appropriate to carry out the purposes of the Plan.
(d) No member of the Committee or the Board shall be liable for any
action taken or determination made in good faith with respect to the Plan
or any Option granted hereunder.
Section 5. Terms and Conditions of Options.
(a) Automatic Option Grants. Commencing on the Effective Date of the
(i) An Option shall be granted automatically under the Plan
to each individual who is a Nonemployee Director as of the
Effective Date. The Grant Date of such an Option shall be the
Effective Date. An Option shall be granted automatically under
the Plan to each Nonemployee Director who is newly elected to the
Board after the Effective Date. The Grant Date of such an Option
shall be the date of such person's initial election as a director
of the Company. For purposes of this Section, the term "newly
elected to the Board" shall mean that the Nonemployee Director
was not serving as a director of the Company immediately prior to
the time of his or her election in respect of which such Option
(ii) Each Nonemployee Director to whom an Option has been
granted under (i) above shall, for so long as such person remains
a Nonemployee Director, automatically be granted an additional
Option under the Plan on each anniversary of the Grant Date of
his or her initial Option under (i) above.
(b) Number of Shares. Each Option granted under the Plan shall entitle
the Optionee to purchase, in accordance with the terms of such Option and
the Plan, 15,000 shares of Common Stock, subject to adjustment in
accordance with Section 6 hereof.
(c) Price. The price at which each share of Common Stock covered by an
Option may be purchased pursuant to the Plan shall be 100% of the Fair
Market Value of a share of Common Stock on the Grant Date of the Option.
(d) Option Period. The period within which each Option may be
exercised shall commence on the first anniversary of the Grant Date of the
Option and shall expire on the fifth anniversary of such Grant Date (the
"Option Period"), unless terminated sooner pursuant to Section 5(e) hereof.
(e) Termination of Service, Death, Etc. The following provisions shall
apply with respect to the exercise of an Option granted hereunder in the
event that the Optionee thereof ceases to be a director of the Company for
the reasons described in this Section 5(e):
(i) If the directorship of the Optionee is terminated prior
to the beginning of the Option Period, the Option shall
automatically terminate as of the date of such termination;
(ii) If the Optionee dies during the Option Period while he
is a director of the Company (or during the additional one-year
period provided by paragraph (iii) of this Section 5(e)), the
Option may be exercised within one year after such death (if
within the Option Period), but not thereafter, by the executor or
administrator of the estate of the Optionee, or by the person or
persons who shall have acquired the Option directly from the
Optionee by bequest or inheritance; or
(iii) If the directorship of the Optionee is terminated for
any reason (other than the circumstances specified in paragraphs
(i) and (ii) of this Section 5(e)) within the Option Period,
including a failure by the stockholders of the Company to reelect
the Optionee as a director, the Option may be exercised within
one year after such termination (if within the Option Period),
but not thereafter.
(f) Transferability. An Option granted under the Plan shall not be
transferable by the Optionee, otherwise than by will or pursuant to the
laws of descent and distribution, and during the lifetime of the Optionee,
the Option shall be exercisable only by the Optionee or his or her guardian
or legal representative.
(g) Requirement of Directorship. Except as provided in Section 5(e)
hereof, an Option may not be exercised unless the Optionee is at the time
of exercise serving as a director of the Company, and, except as provided
in Section 5(e) hereof, such Option shall terminate upon termination of the
Optionee's service as a director of the Company.
(h) Manner of Exercise. Each Option granted hereunder may be
exercised, in whole or in part, by the Optionee thereof at any time or
(with respect to partial exercises) from time to time during the Option
Period, subject to the provisions of the Plan and the stock option
agreement evidencing such Option, and the method for exercising an Option
shall be by the personal delivery to the Secretary of the Company of, or by
the sending by United States registered or certified mail, postage prepaid,
addressed to the Company (to the attention of its Secretary), of, written
notice signed by the Optionee specifying the number of shares of Common
Stock with respect to which such Option is being exercised. Such notice
shall be accompanied by the full amount of the purchase price of such
shares as provided in Section 5(i) hereof. Any such notice shall be deemed
to have been given on the date of receipt thereof (in the case of personal
delivery as above-stated). In addition to the foregoing, promptly after
demand by the Company, the exercising Optionee shall pay to the Company an
amount equal to applicable withholding taxes, if any, due in connection
with such exercise. No shares of Common Stock shall be issued upon exercise
of an Option until full payment therefor and for all applicable withholding
taxes has been made, and a Optionee shall have none of the rights of a
stockholder until shares of Common Stock are issued to such Optionee.
(i) Payment of Purchase Price. The purchase price of an Option
shall be paid in full in cash or by the following methods: (i) by personal
check of the Optionee; (ii) by means of a broker-assisted exercise whereby
the Optionee delivers to the Company, together with a properly executed
exercise notice, such other documentation as the Committee and the broker
assisting in the transaction shall require to effect an exercise of the
Option, a sale of the shares of Common Stock acquired upon exercise and the
delivery to the Company of the proceeds of such sale in full payment of the
exercise price; or (iii) any combination of the foregoing methods of
payment. The proceeds of a sale of Common Stock upon exercise of an Option
shall constitute general funds of the Company.
Section 6. Adjustments Upon Changes in Common Stock. In the event the
Company shall effect a split of the Common Stock or dividend payable in Common
Stock, or in the event the outstanding Common Stock shall be combined into a
smaller number of shares, the maximum number of shares as to which Options may
be granted under the Plan shall be decreased or increased proportionately. In
the event that before delivery by the Company of all of the shares of Common
Stock for which any Option has been granted under the Plan, the Company shall
have effected such a split, dividend or combination, the shares still subject to
such Option shall be increased or decreased proportionately and the purchase
price per share shall be decreased or increased proportionately so that the
aggregate purchase price for all of the shares then subject to such Option shall
remain the same as immediately prior to such split, dividend or combination.
In the event of a reclassification of Common Stock not covered by the
foregoing, or in the event of a liquidation or reorganization (including a
merger, consolidation, spinoff or sale of assets) of the Company, including a
transaction in which the Company is not the survivor, the Board shall make such
adjustments, if any, as it may deem appropriate in the number, purchase price
and kind of shares covered by the unexercised portions of Options theretofore
granted under the Plan. The provisions of this Section shall only be applicable
if, and only to the extent that, the application thereof does not conflict with
any valid governmental statute, regulation or rule.
Section 7. Amendment and Termination of the Plan. Subject to the right of
the Board to terminate the Plan prior thereto, the Plan shall terminate at the
expiration of ten years from November 12, 1997, the date of adoption of the Plan
by the Board. No Options may be granted after termination of the Plan. The
Board may alter or amend the Plan in any respect, except that no termination or
amendment of the Plan shall adversely affect the rights of an Optionee under a
previously granted Option, except with the consent of such Optionee.
Section 8. Requirements of Law. The granting of Options and the issuance
of Common Stock upon the exercise of an Option shall be subject to all
applicable laws, rules and regulations and to such approval by governmental
agencies as may be required.
Section 9. Investment Letter. If the Company so elects, the Company's
obligation to deliver Common Stock with respect to an Option shall be
conditioned upon its receipt from the Optionee to whom such Common Stock is to
be delivered of an executed investment letter containing such representations
and agreements as the Committee may determine to be necessary or advisable in
order to enable the Company to issue and deliver such Common Stock to such
compliance with the Securities Act of 1933 and other applicable federal, state
or local securities laws or regulations.
Section 10. Effective Date of the Plan. The Plan shall become effective
on the date (the "Effective Date") of its approval and adoption by the holders
of a majority of the shares of Common Stock present, or represented, and
entitled to vote at the 1997 annual meeting of stockholders of the Company. If
not so approved, the Plan shall terminate, all actions hereunder shall be null
IN WITNESS WHEREOF, this Plan has been executed to be effective as provided
in Section 10.
BOOTS & COOTS INTERNATIONAL
WELL CONTROL, INC.
By: /s/ Larry H. Ramming
Name: Larry H. Ramming
Title: Chairman and CEO