EXHIBIT 10.3
NEWPARK RESOURCES, INC.
NON-STATUTORY STOCK OPTION AGREEMENT
This Non-statutory Stock Option
Agreement (the “Agreement” ) is made and entered
into as of March 22, 2006 (hereinafter referred to as
the “ Date of Grant”) , by and between NEWPARK
RESOURCES, INC., a Delaware corporation (the
“Company” ), and PAUL L. HOWES,
(“Optionee”), with reference to the following
facts:
A. On March 22, 2006,
Optionee and the Company entered into an employment agreement (the
“Employment Agreement” ), under which Optionee
was elected and accepted employment as the Chief Executive Officer
of the Company. Terms used in this Agreement that are defined in
the Employment Agreement and not otherwise defined herein shall
have the meanings attributed to them in the Employment
Agreement.
B. As an inducement for Optionee
to accept employment with the Company, the Company agreed in the
Employment Agreement, among other things, to grant to Optionee,
without further payment, the right and option (the
“Option” ) to purchase from the Company all or
any part of an aggregate of 375,000 shares of its common stock,
subject to vesting over a three-year period. This Agreement and the
Employment Agreement set forth the agreement between the Company
and Optionee with respect to the issuance, vesting and exercise of
the Option.
NOW, THEREFORE, the parties agree as
follows:
1. Grant of
Option .
The
Company hereby grants to Optionee the Option to purchase all or any
part of an aggregate 375,000 shares of Common Stock (each an
“Option Share” ) of the Company on the terms and
conditions set forth in this Agreement.
2. Purchase
Price .
The
purchase price (the “Exercise Price”) of each
Option Share shall be $8.08 .
3. Option
Period .
The
Option shall commence on the Date of Grant and shall expire, and
all rights to purchase the Option Shares shall terminate at the
close of business on the day immediately preceding the tenth
anniversary of the Date of Grant, unless terminated earlier as
provided in this Agreement. The Option shall not be exercisable
until all legal requirements in connection with the Option have
been fully complied with. Subject to the foregoing, the Option
shall be exercisable during its term as to one-third of the Option
Shares during the twelve months beginning on the first anniversary
of the Date of Grant; (b) as to an additional one-third of the
Option Shares on the second anniversary of the Date of Grant; and
(c) as to the remaining one-third of the Option Shares on the
third anniversary of the Date of Grant; provided ,
however , that, if Optionee shall not in any one exercise
period purchase all of the Option Shares which Optionee is entitled
to purchase in such period, Optionee may purchase all or any part
of such Option Shares at any time after the end of such period and
prior to the expiration of the Option. Notwithstanding the
foregoing, if Optionee is subject to the reporting requirements of
Section
16(a) of
the Securities Exchange Act of 1934 (the “Exchange
Act” ), the Option shall not be exercisable until at
least six months and one day from the Date of Grant.
4. Exercise of
Option .
4.1 The
Option shall be exercised by delivering this Agreement for
endorsement to the Company, at its principal office, attention of
the Corporate Secretary, together with a Notice and Agreement of
Exercise in the form attached hereto indicating the number of
Option Shares Optionee wishes to purchase and full payment of the
Exercise Price of such shares. In no event shall the Company be
required to issue or transfer fractional shares.
4.2
Payment for Option Shares may be made in cash, by cashier’s
or certified check or by delivery to the Company of shares of
Common Stock, duly assigned to the Company by a stock power with
signatures guaranteed as provided on the back of the stock
certificate. The value of each share delivered in payment of the
Exercise Price of Option Shares shall be the fair market value (
“Fair Market Value” ) of the Common Stock on the
date such shares are delivered. The Fair Market Value of a share of
the Common Stock on any date shall be equal to the closing price of
the Common Stock for the last preceding day on which the
Company’s shares were traded, and the method for determining
the closing price shall be determined by the Board of Directors
(the “Board”) of the Company or a duly authorized
committee thereof, and the Board or such committee are sometimes
referred to herein as the “Committee.”
5. Employment of
Optionee .
5.1
Except as otherwise provided in paragraph 6 of this Agreement,
Optionee may not exercise the Option unless, at the time of
exercise, Optionee is an employee of the Company or a parent or a
subsidiary thereof and has been in the employ of the Company or a
parent or a subsidiary thereof continuously since the Date of
Grant.
5.2
Nothing contained herein shall be construed to impose upon the
Company or upon any parent or subsidiary thereof any obligation to
employ Optionee for any period or to supersede or in any way alter,
increase or diminish the respective rights and obligations of the
Company or any parent or subsidiary thereof and Optionee under any
employment contract now or hereafter existing between them.
6. Termination of
Employment .
6.1 If
the employment of Optionee with the Company or a subsidiary shall
terminate because of Total Disability or death, unless otherwise
provided by the Committee, (a) the Option, to the extent then
presently exercisable, shall remain in full force and effect and
may be exercised pursuant to the provisions hereof, including
expiration at the end of the fixed term hereof, and (b) the
Option, to the extent not then presently exercisable, shall
terminate as of the date of such termination of employment and
shall not be exercisable thereafter.
6.2 If
the employment of Optionee with the Company or a subsidiary is
terminated by the Company without Cause or by the Optionee for Good
Reason, in either case occurring during the Employment Term or
within twenty-four (24) months after a Change in Control, if
the Executive is in the employ of the Company or a subsidiary when
the Change in Control occurs, the Option, whether or not then
exercisable, shall become exercisable to purchase all of the Option
Shares underlying the Option and shall remain in full force and
effect and may be exercised pursuant to the provisions hereof,
including expiration at the end of the fixed term hereof.
6.3 If
the employment of Optionee with the Company or a subsidiary shall
terminate for any reason other than the reasons set forth in
paragraphs 6.1 and 6.2 hereof, unless otherwise provided by the
Committee, (a) the Option, to the extent then presently
exercisable, shall remain in full force and effect and may be
exercised pursuant to the provisions hereof, including expiration
at the end of the fixed term hereof, and (b) the Option, to
the extent not then presently exercisa
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