**Exhibit 10.64**

**2002 OMNIBUS EMPLOYEE INCENTIVE PLAN**

 

**RIGHTS AGREEMENT**

 

**THIS RIGHTS AGREEMENT**, dated as of**«Grant Date»** (the "Agreement"),is between MAXXAM INC., a Delaware corporation (the "Company"), and**«FirstMiddle» «Last»**, an officeror employee of the Company and/or of one or more of its subsidiaries (the"Grantee").

 

The Section 162(m) Compensation Committee of the Company's Board ofDirectors (the "Committee") has determined that the objectives of the Company's2002 Omnibus Employee Incentive Plan (the "Plan") will be furthered by grantingto the Grantee certain rights pursuant to the Plan.

 

In consideration of the foregoing and of the mutual undertakings setforth in this Agreement, the Company and the Grantee agree asfollows:

 

 

1.1          The Company hereby grants to the Grantee **«Shares»** non-qualified stock options (the"Options"), with such Options having tandem stock appreciation rights ("SARs"),in connection with the same number of shares of the Company's common stock, $.50par value (the "Common Stock"). The Options and tandem SARs shall becollectively referred to hereinafter as the "Rights."

 

1.2          The appreciation base per share of Common Stock covered by the Rights is**$«Price»**, which was the FairMarket Value per share of the Company's Common Stock on the date of thisAgreement.

 

 

2.1          No portion of the Rights shall become exercisable prior to the firstanniversary of the date of this Agreement.

 

2.2          The Rights shall become exercisable with respect to 20% of the Rightsinitially subject thereto on the first anniversary of the date of thisAgreement, and with respect to an additional 20% of such Rights on each of thesecond, third, fourth and fifth anniversaries of the date of this Agreement, sothat all of the Rights covered hereby shall become exercisable in full on suchfifth anniversary.

 

2.3          The Rights may be partially exercised from time to time within thepercentage limitations on exercisability set forth in Section 2.2above.

 

2.4          The Rights shall expire and cease to be exercisable 10 years after thedate of this Agreement, or on such earlier date as may be provided for herein orin accordance with the terms of the Plan.

 

 

 

 

2.5          The exercise of Options or SARs which comprise the Rights shall have theeffect described in Plan Section 8.3.

 

 

3.1          The Option may be exercised only by the giving of written notice to theCompany, which notice shall state the election to exercise the Option and thenumber of whole shares of Common Stock with respect to which the Option is beingexercised. Such notice must be accompanied by payment of the full purchase pricefor the number of shares purchased. Such payment shall be made: **(a)** by certified or official bank check (or theequivalent thereof acceptable by the Company) for the full Option exerciseprice; or **(b)** with the consent ofthe Committee, by delivery of shares of the Company's Common Stock acquired atleast six months prior to the Option exercise date and having a Fair MarketValue (determined as of the exercise date) equal to all or part of the Optionexercise price and a certified or official bank check (or the equivalent thereofacceptable by the Company) for any remaining portion of the full Option exerciseprice; or **(c)** at the discretionof the Committee and to the extent permitted by law, by such other provision,consistent with the terms of the Plan, as the Committee may from time to timeprescribe. Shares of Common Stock owned through employee benefit plans of theCompany may be used to make purchase payments if no adverse tax consequences toeither the Company or such plans would result. 

 

3.2        The Company shall cause to be issued and delivered to the Grantee acertificate(s) representing the number of shares of Common Stock due to theGrantee upon exercise of any portion of the Option no later than fifteen (15)business days following exercise.

 

 

4.1          The SARs may be exercised only by the giving of written notice to theCompany, which notice shall state the election to exercise, the number of SARsbeing exercised and the effective date of the exercise, which date may not beprior to the date of such notice.

 

4.2          The payment for exercise of any portion of the SARs granted hereby shallbe payable by the Company to the Grantee in cash, except that the Company mayelect to satisfy such payment in shares of Common Stock or a combination of cashand Common Stock.

 

4.3          A Grantee may, at least 20 days prior to the expected exercise of anyportion of the SARs granted hereby, but not more than once each calendarquarter, verbally request the Company to advise the Grantee of the form (cash,stock or both) of payment that the Company will make upon the expected exercise.In such event, the Company will verbally advise the Grantee of the form ofpayment (and the proportion of payment in cash and stock when both are to bemade) prior to such exercise. The verbal request to the Company may be made toits President or the Chairman of the Committee, and the advice of form ofpayment by the Company shall be made by the above-identified person receivingthe request of the Grantee.

 

4.4          The Company shall pay to the Grantee the amount due upon exercise of anyportion of the SARs no later than fifteen (15) business days following any suchexercise.

 

 

 

 

Any notice to be given to the Company hereunder shall be in writing andshall be addressed to the Secretary of the Company, 1330 Post Oak Boulevard,Suite 2000, Houston, Texas 77056, or at such other address as the Company mayhereafter designate to the Grantee by notice as provided herein. Any notice tobe given to the Grantee hereunder shall be addressed to the Grantee at his worklocation or at the address set forth beneath the Grantee's signature hereto, orat such other address as the Grantee may hereafter designate to the Company bynotice as provided herein. Notices hereunder shall be deemed to have been dulygiven when personally delivered or mailed by registered mail or certified mailto the party entitled to receive the same.

 

 

The rights and privileges of the Rights shall be subject to all the termsand provisions of the Plan, which are incorporated herein by reference and madea part hereof, including, without limitation, the provisions of Plan Section 5.4(generally relating to adjustments to the number of shares of Common Stockrelating to the Rights and to the appreciation base per share of Common Stockupon certain changes in capitalization). Any term defined in the Plan shall havethe same meaning in this Agreement. In the event of any conflict between theprovisions of this Agreement and the Plan, the provisions of the Plan shallcontrol.

 

 

7.1          If the employment of the Grantee shall terminate for any reason otherthan death, disability or retirement, any outstanding Rights granted herebywhich are then exercisable shall terminate upon the expiration date of suchRights or three months after the date of termination of employment, whicheverfirst occurs, except that, where termination of employment is for cause, alloutstanding Rights granted hereby, whether or not then exercisable, shallterminate immediately upon termination of employment.

 

7.2          In the event the employment of the Grantee is terminated by reason ofdeath, disability or retirement, any outstanding Rights granted hereby which arethen exercisable may be exercised at any time, or from time to time, prior tothe expiration date of such Rights or within twelve (12) months after the dateof termination of employment, whichever first occurs.

 

 

This Agreement is being executed in duplicate originals so that eachparty may retain a signed original. Both original documents constitute asingular agreement.

 

 

 

This Agreement shall be binding upon and inure to the benefit of theparties hereto and the successors and assigns of the Company and, to the extentset forth in Plan Section 18.1 and in this Agreement, the heirs and personalrepresentatives of the Grantee.

 

**IN WITNESS WHEREOF,** the parties hereto haveexecuted this Agreement as of the date and year first above written.

 

 

 

By:     /s/Bernard L. Birkel

Secretary

 

By:     /s/FirstMiddleLast