Exhibit 10.7
EDGEN MURRAY II,
L.P.
2007 OPTION PLAN
Edgen Murray II, L.P., a Delaware
limited partnership, wishes to attract employees to the Company, to
induce employees to remain with the Company, to encourage them to
increase their efforts to make the Company’s business more
successful and to enhance equity holder value. In furtherance
thereof, the Edgen Murray II, L.P. 2007 Option Plan is designed to
provide employees of the Company non-qualified options to acquire
Units of the Company.
ARTICLE I.
DEFINITIONS.
Whenever used herein and unless
otherwise provided in the Holder’s Award Agreement, the
following terms shall have the meanings set forth below:
1.1. “Approved Sale”
shall have the meaning given such term in the Limited Partnership
Agreement.
1.2. “Award” means a
grant of Options under the Plan.
1.3. “Award Agreement”
means the Agreement between the Company or a Subsidiary and a
Holder pursuant to which an Award is granted and which specifies
the terms and conditions of that Award, including the vesting
requirements applicable to that Award.
1.4. “Cause” shall have
the meaning ascribed to it in the Holder’s employment
agreement, if applicable or, if no employment agreement is in
effect:
(a) a conviction of, a plea of nolo
contendere, a guilty plea or confession by the Holder to an act of
fraud, misappropriation or embezzlement or to a felony;
(b) the commission of a fraudulent
act or practice by the Holder affecting the Company or its
Subsidiaries;
(c) the willful failure by the
Holder to follow the directions of the Administrator;
(d) the Holder’s habitual
drunkenness or use of illegal substances, each as determined in the
reasonable discretion of the Administrator;
(e) the material breach by Holder of
the Holder’s employment agreement with the Company or its
Subsidiaries, if any; or
(f) an act of gross neglect or gross
or willful misconduct that relates to the affairs of the Company or
its Subsidiaries, which the General Partner, in its reasonable
discretion, deems to be good and sufficient cause.
1.5. “Code” means the
Internal Revenue Code of 1986, as amended.
1.6. “Company” means
Edgen Murray II, L.P., a Delaware limited partnership, or any
successor entity, and shall include any Subsidiary to which
Section 6.1(b) applies.
1.7. “Exchange Act”
means the Securities Exchange Act of 1934, as amended.
1.8. “Exercise Price”
means the price per Unit at which a Unit may be purchased upon
exercise of an Option, as it may be adjusted under
Section 11.1 of the Plan.
1.9. “Fair Market Value”
shall be determined by the General Partner in its sole discretion
in accordance with Article IX of the Limited Partnership Agreement
using a reasonable valuation method, as that term is defined in
Code Section 409A, selected by the General Partner from time
to time.
1.10. “General Partner”
shall have the meaning ascribed to it in the Limited Partnership
Agreement.
1.11. “Holder” means any
employee of the Company or a Subsidiary to whom an Award is made
and who holds any unexpired Options. Holder includes the Successors
of the Holder, if the context requires.
1.12. “Limited Partnership
Agreement” means the Amended and Restated Limited Partnership
Agreement of Edgen Murray II, L.P., dated May 11, 2007, as
amended from time to time.
1.13. “Option” means the
right to purchase, at Fair Market Value, subject to such
limitations and restrictions in the Plan and the applicable Award
Agreement, a number of Units determined by the General
Partner.
1.14. “Units” shall have
the meaning given such term in the Limited Partnership
Agreement.
1.15. “Person” means any
individual, partnership, corporation, company, limited liability
company, association, trust, joint venture, unincorporated
organization, entity or division, or any government, governmental
department or agency or political subdivision thereof.
1.16. “Plan” means this
Edgen Murray II, L.P. 2007 Option Plan, as amended from time to
time.
1.17. “Securities Act”
means the Securities Act of 1933, as amended.
1.18. “Subsidiary” means
any entity in an unbroken chain beginning at the top of such chain
with the Company) (or any successor to the Company) if each of the
entities other than the last entity in the unbroken chain owns
interests possessing 50% or more of the total combined voting or
economic power of all classes of such interests in one of the other
entities in such chain.
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1.19. “Successor of the
Holder” means: (i) the legal representative of the
estate of a deceased Holder or (ii) the person or persons who
shall acquire the right to an Award or to exercise an Option by
bequest or inheritance or other transfer or by reason of the death
of the Holder or (iii) persons who shall acquire the right to
an Award or to exercise an Option on behalf of the Holder as the
result of a determination by a court or other governmental agency
of the incapacity of the Holder.
1.20. “Termination of
Service” means a Holder’s termination of employment or
other service, as applicable, with the Company and its Subsidiaries
for any reason, including death, disability, termination by the
Company with or without Cause and resignation by the
Holder.
1.21. “Termination
Notice” means a written notice delivered by the Company or
any Subsidiary to any employee terminating the employee’s
employment.
ARTICLE II.
EFFECTIVE DATE AND TERMINATION OF
PLAN.
2.1. “Effective Date” of
this Plan is October 1, 2007. The Plan shall terminate five
years after its Effective Date and no Award shall be granted
hereunder on or after, the fifth anniversary of the Effective Date
of the Plan; provided, however, that the General Partner may at any
time prior to that date terminate the Plan.
ARTICLE III.
ADMINISTRATION OF
PLAN.
3.1. The Plan shall be administered
by the General Partner, who shall have full responsibility and
authority to administer the Plan. The General Partner, or if
Section 6.1(b) applies, the Board of Directors of the relevant
Subsidiary shall have full authority to determine to whom Awards
will be granted, the type and amount of Awards to be granted, the
terms and conditions of Awards granted under the Plan and the terms
of Award Agreements to be entered into with Holders.
3.2. An Award Agreement shall
contain such terms, provisions and conditions not inconsistent
herewith as determined by the General Partner. The Holder shall
take whatever additional actions and execute whatever additional
documents the General Partner may in its reasonable judgment deem
necessary or advisable in order to carry out or effect one or more
of the obligations or restrictions imposed on the Holder pursuant
to the express provisions of the Plan and the Award
Agreement.
ARTICLE IV.
ELIGIBILITY.
4.1. Any employee of the Company or
of a Subsidiary who is designated by the General Partner (or if
Section 6.1(b) applies, the Board of Directors of the relevant
Subsidiary) as eligible to participate in the Plan shall be
eligible to receive an Award under the Plan.
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ARTICLE V.
UNITS SUBJECT TO THE
PLAN.
5.1. Subject to adjustments as
provided in Section 11.1, as of the effective date of the
Plan, the maximum number of Units available for grant under the
Plan as Options shall be 11,050, of which no more than 1,000
Options may be issued to any one Person in any one year. Any Units
that have been reserved for issue upon exercise of Options that are
later forfeited or for any other reason are not subject to being
issued under the Plan may again be made the subject of Awards under
the Plan.
5.2. Limited Partnership Agreement:
Upon grant of an Award under the Plan, the Holder and any Successor
of the Holder shall be bound as a Limited Partner by the Limited
Partnership Agreement and, if requested, shall execute a Joinder to
the Limited Partnership Agreement. Without limiting the generality
of the foregoing, each Holder agrees to any transfer restrictions,
repurchase rights and obligations delineated in the Limited
Partnership Agreement. Additionally, any amendment to the Limited
Partnership Agreement that effects a provision contained herein
shall be deemed to be an amendment to the Plan.
5.3. The certificates (if any) for
Units issued hereunder upon exercise of an Option may include any
legend which the General Partner deems appropriate to reflect any
restrictions on transfer hereunder, under the Limited Partnership
Agreement or under the Award Agreement, or as the General Partner
may otherwise deem appropriate.
ARTICLE VI.
OPTIONS.
6.1. Grant of Option
.
(a) Grant by General Partner
. Subject to the other terms of the Plan, the General Partner (or
if Section 6.1(b) applies, the Board of Directors of the
relevant Subsidiary) shall, in its discretion as reflected by the
terms of the applicable Award Agreement: (i) determine and
designate from time to time those eligible employees of the Company
and its Subsidiaries to whom Options are to be granted subject to
Section 4.1 hereof, and the number of Units to be covered
under any Award Agreement granted to each such employee,
considering the position and responsibilities of the employee, the
nature and value to the Company of the employee’s present and
potential contribution to the success of the Company whether
directly or through a Subsidiary and such other factors as the
General Partner may deem relevant; (ii) determine the time or
times when and the manner and conditions under which each Option
shall be exercisable and the duration of the exercise period; and
(iii) determine or impose other conditions to the grant or
exercise of Options under the Plan as it may deem
appropriate.
(b) Delegation of Authority to
Grant Options . The General Partner may, at its sole
discretion, delega
