Document:

exv10w7

 

Exhibit 10.7

LAND SUBLEASE AGREEMENT

     This AGREEMENT (hereinafter this “Lease”), made as of the 1st day of May,
2007, by and between Signet Maritime Corporation, a Delaware corporation (“LESSOR”), at 1500 Main
Street, TX 78632 USA, Telephone (361) 776-7500 and Orion Construction L.P. (“LESSEE”) 12550 Fuqua
St., Houston Texas, 77034 Telephone (713) 852-6500.

RECITALS

     A. Lessor is the current lessor of certain property located at 1500 Main Street on Farm
Road 1069 in Ingleside, San Patricio County, State of Texas, described on Exhibit “A” attached
hereto and referred to herein as the “Leased Premises”.

     B. Lessee desires to establish on Leased Premises facilities to support Lessee’s marine
construction business.

     C. Lessor has agreed to lease the Leased Premises to Lessee, and Lessee has agreed to lease
the Leased Premises from Lessor, pursuant to the terms and conditions set forth hereafter.

     NOW, THEREFORE, for and in consideration of the mutual covenants and promises contained
herein, the parties agree as follows:

     1. Lease. Subject to the terms and conditions hereof, Lessor leases to Lessee and
Lessee rents from Lessor the Leased Premises for the Term hereof. Lessor covenants with Lessee that
the Lessor is the lessee from the owner vested with the title to the Leased Premises and has full
right and lawful authority to sublease the Leased Premises to Lessee. Lessor represents and
warrants that: i) Lessee’s use of the Leased Premises will not violate any recorded use
restrictions or encroach upon any existing property rights; and ii) Lessor has secured all consents
to the lease to Lessee of the Leased Premises, if any, required from third parties (including, for
example, required consents from mortgage holders or Lessor’s business partners). This Lease shall
encompass only the surface estate and shall expressly exclude any and all rights to the minerals or
water rights underneath the surface estate.

     2. Term. Subject to the provisions of paragraph 1 above, the start of this Lease shall
commence on a date mutually agreed by both parties not later than May 1, 2007 (“Commencement Date”)
and will be confirmed in writing by a letter from Lessee to Lessor. The initial period of this
lease shall be for twenty-four (24) months from the

 

 

Commencement Date. The Lessee may extend this lease for up to two (2) one year extension periods
after the initial period subject to agreement by Lessor and Lessee to the rent and other terms and
conditions to apply during such extension periods. Lessee must give Lessor written notice of
Lessee’s desire to so extend the lease by giving the Lessor sixty (60) days written notice prior to
the expiration of the initial period and the first extension period if applicable. The initial
period and any extension periods are referred to herein collectively as the “Term” of this Lease.
This Lease will terminate without further notice to Lessee when the Term, as it may be extended,
expires, and any holding over by the Lessee after the Term will not constitute a renewal of the
Lease or grant to Lessee any rights under the Lease or to the Leased Premises. If the Lessee holds
over and continues in possession of the Leased Premises after the Term, as it may be extended,
Lessee will be considered to be occupying the leased Premises at will, subject to all of the terms
of this Lease.

3. Rent.

          A. Tangible Compensation: Rent for the Leased Premises is established as Six
Thousand Dollars ($6,000) per month, paid on a monthly basis in arrears not later than the fifth
(5th) day after the end of the month in question. Total anticipated rent from this Lease
is $144,000 for the two year initial period of the lease. Rent shall be increased by the amount of
any increases in taxes, insurance, or other costs incurred by Lessor in connection with the Leased
Premises during the Term hereof. Said increase shall be on a pro-rata basis of the Leased Premises
to the total Lessor’s property, unless tax, insurance or other cost increase is solely due to
improvements made by the Lessor. Lessor shall furnish Lessee verification of any such tax,
insurance or other cost increases through current and previous statements and other documentation.

          B. Intangible Compensation: In addition to cash rent the Lessee will provide the
following intangible benefits to the Lessor.

               1. The Lessor’s core business being marine vessel towing, the Lessee will give the Lessor a
first right of refusal to perform the Lessee’s towing needs provided the Lessor can perform such
work at a rate equal to or less than the market rate in effect for the area and service in question
and that the Lessor can meet the towing schedule required by the Lessee. The Lessor would maintain
insurance coverage for towing services reasonably acceptable to Lessee’s insurance company’s
requirements. This is commonly known as the right-of-first-refusal.

               2. The Lessee’s core business being marine construction, the
Lessor will give the Lessee a first right of refusal to perform marine construction for the Lessor
on the same basis as in (1) above. Furthermore, the Lessee will assist the Lessor in procuring
design services and construction materials and will give preferential pricing to the Lessor for
marine construction at the Lessor’s facilities adjacent to the Leased Premises.

          B. Potential Compensation: Due to the adjacent residential property, the Lessee may
be required to install a “privacy” fence along part of the south side of the Leased Premises. Said
fence will be installed only if directed by the City of Ingleside

 

 

Zoning and Planning Commission due to complaints by the adjacent property owner(s). Said fence
will be either 6’ chain link with opaque slats or 6’ solid wood. Length of fence not to exceed 500
feet. Lessee will leave fence on leased property at termination of the lease.

     4. Condition and Use of Leased Premises. The Leased Premises are leased to Lessee
strictly on an AS IS, WHERE IS WITH ALL FAULTS basis. Lessor makes no representations or warranties
as to condition, suitability, or freedom from defects, obstructions, or hazards of the Leased
Premises or any waterways, docks, anchorages, or slips adjacent thereto. Lessee acknowledges that
it has made a full inspection of the Leased Premises and such other property and has accepted the
Leased Premises and such other property in their current condition. Lessee may use the Leased
Premises only for support and storage of material, assembly and fabrication of materials and other
work associated with the Lessee’s business of marine construction. Lessee shall be responsible for
obtaining all permits required to utilize the Leased Premises as intended.

     5. Access; Interference.

Lessor shall provide Lessee with access to the Leased Premises on a 24 hour a day, seven (7) days
per week basis, for individuals, vehicles, and construction materials and equipment, as may be
reasonably required by Lessee for the purpose of executing the Lessee’s business and which shall
not cause damage or deterioration to the Leased Premises, such access to be from the existing
entrance on the Lease Premises from Highway 1069. No expansion of such entrance shall be allowed
without prior written consent of Lessor. The Lessee shall have his own entrance gate at said
entrance controlled solely by the Lessee.

     6. Utilities. The Lessee may use existing utility connections and services on
the Lease Premises. Lessee shall pay for connection fees and use fees for all electricity,
telephone service, water, sewer, waste removal and all other such utilities or services used or
consumed by Lessee on the Leased Premises.

     7. Taxes. Lessor shall pay all real and personal property taxes assessed, levied or
to become a lien on the Leased Premises. Lessee shall reimburse Lessor on demand for any such taxes
levied or assessed with respect to any improvements the Lessee makes to the Leased Premises or
Lessee’s activities thereon.

     8. Maintenance and Repair. Lessee shall be responsible for maintaining the Leased
Premises in good condition throughout the term of this lease. Lessee shall use reasonable care and
diligence to keep and maintain the Leased Premises orderly and free from waste, and shall deliver
the same to Lessor in the same condition that existed on the Commencement Date, reasonable wear and
tear and damage by the elements excepted.

 

 

     9. Alterations and Improvements. Lessee shall be entitled to undertake alterations,
additions and improvements to the Lease Premises during the term of this Lease, subject to Lessor’s
prior written approval and to the terms and provisions contained in this Lease. Except as may
otherwise be provided for herein, all improvements of any kind constructed or placed by Lessee on
the Leased Premises shall be the property of Lessee unless Lessee shall be in default under this
Lease, and shall be removed by Lessee on the expiration of the Lease, at the Lessee’s sole expense
unless said alterations and improvements are accepted by the Lessor.

     Lessee shall keep the Leased Premises free and clear of any and all construction, mechanics’,
materialsmen’s and other liens for or arising out of or in connection with work and labor done,
services performed or materials used or furnished for or in connection with any work or
construction by, for, or permitted by Lessee on the Leased Premises. Lessee shall at all times
promptly and fully pay or discharge any and all such claims on which any such liens may be based,
and Lessee shall also indemnify Lessor and the Leased Premises against all such liens and suits or
other proceedings relating thereto. Lessee shall have the right to contest in good faith and with
adequate reserves the correctness or validity of any of the aforementioned liens, so long as
Lessor’s interest in the Leased Premises and this Lease is not jeopardized. If Lessee fails to
timely take either such action, then Lessor may pay the lien claim, and any amounts so paid,
including expenses and interest, shall be paid by lessee to Lessor within (10) days after Lessor
has invoiced Lessee therefor.

     10. Insurance and Indemnity.

     A. Release and Indemnity Obligations. (I) ALL PROPERTY KEPT, STORED
OR MAINTAINED IN OR ON THE LEASED PREMISES BY LESSEE SHALL BE SO KEPT, STORED OR MAINTAINED AT THE
RISK OF THE LESSEE ONLY.

     (ii) LESSEE SHALL RELEASE, PROTECT, DEFEND, INDEMNIFY AND HOLD HARMLESS THE LESSOR GROUP AND
OR ANY THIRD PARTY WHOM LESSOR IS CONTRACTUALLY OBLIGATED TO INDEMNIFY FOR SUCH MATTERS, AND THEIR
RESPECTIVE INSURERS AND SUBROGEES FROM AND AGAINST ANY CLAIMS AND OTHER LOSSES ON ACCOUNT OF OR FOR
ILLNESS, INJURY, OR DEATH TO THE EMPLOYEES AND OTHER PERSONNEL OF THE LESSEE GROUP OR ITS
CONTRACTORS AND SUBCONTRACTORS OF ANY TIER, OR FOR LOSS, DAMAGE, OR LOSS OF USE OF PROPERTY OF THE
LESSEE GROUP OR ITS CONTRACTORS OR SUBCONTRACTORS OF ANY TIER, OR FOR POLLUTION OR CONTAMINATION
(INCLUDING CLEANUP COSTS, COSTS OF REMOVAL, REMEDIATION, PROPERTY DAMAGE, AND FINES AND PENALTIES)
EMANATING FROM LESSEE’S EQUIPMENT, VESSELS, OR OTHER PROPERTY OR RESULTING FROM LESSEE’S OPERATIONS
OR USE OF THE LEASED PREMISES.

 

 

     (iii) LESSOR SHALL RELEASE, PROTECT, DEFEND, INDEMNIFY AND HOLD HARMLESS THE LESSEE GROUP AND
THEIR INSURERS AND SUBROGEES FROM AND AGAINST ANY CLAIMS OR OTHER LOSSES, ON ACCOUNT OF OR FOR
ILLNESS, INJURY, OR DEATH TO EMPLOYEES AND OTHER PERSONNEL OF THE LESSOR GROUP OR FOR LOSS,
DAMAGE, OR LOSS OF USE OF PROPERTY OF THE LESSEE GROUP OTHER THAN THE LEASED PREMISES.

     (iv) THE PARTIES HERETO SHALL RELEASE, PROTECT, DEFEND, INDEMNIFY AND HOLD HARMLESS THE OTHER
PARTY AND ITS GROUP, AND THEIR INSURERS AND SUBROGEES FROM AND AGAINST ANY CLAIMS OR OTHER LOSSES,
ON ACCOUNT OF OR FOR ILLNESS, INJURY, OR DEATH TO EMPLOYEES AND OTHER PERSONNEL OR FOR LOSS,
DAMAGE, OR LOSS OF USE OF PROPERTY OF ANY ENTITIES NOT INCLUDED WITHIN SUBSECTIONS (III) OR (IV)
ABOVE, TO THE EXTENT IN EACH CASE (I.E., IN THE SAME DEGREE) THAT SUCH PERSONAL INJURY OR DEATH OR
LOSS, DAMAGE, OR LOSS OF USE OF PROPERTY IS CAUSED BY THE NEGLIGENCE OR OTHER LEGAL FAULT OF THE
INDEMNIFYING PARTY OR ITS GROUP.

     (v) THE RELEASE AND INDEMNITY PROVISIONS SET FORTH IN THIS LEASE SHALL APPLY TO ALL CLAIMS
AND OTHER LOSSES WHICH ARISE DIRECTLY OR INDIRECTLY OUT OF OR INCIDENT TO OR CONNECTED WITH THIS
LEASE OR BREACH OF ANY TERMS OR CONDITIONS OF THIS LEASE. EXCEPT AS EXPRESSLY PROVIDED HEREIN TO
BE TO THE EXTENT OF THE NEGLIGENCE OR OTHER FAULT OR STRICT LIABILITY OF A PARTY, SUCH RELEASE AND
INDEMNITY PROVISIONS SHALL APPLY REGARDLESS OF WHETHER CAUSED OR CONTRIBUTED TO BY NEGLIGENCE OR
OTHER FAULT (INCLUDING SOLE, JOINT, CONCURRENT OR GROSS NEGLIGENCE) ANY OF THE PARTIES SO RELEASED
OR INDEMNIFIED OR THEIR CONTRACTORS OR SUBCONTRACTORS OF ANY TIER OR ANY OTHER THEORY OF LEGAL
LIABILITY, INCLUDING STRICT LIABILITY, DEFECT IN PREMISES, MATERIALS, OR EQUIPMENT, OR THE
UNSEAWORTHINESS OR OTHER FAULT OF ANY VESSEL, OR ANY OTHER ANTICIPATED OR UNANTICIPATED EVENT OR
CONDITION, AND REGARDLESS OF WHETHER PRE-EXISTING THE EXECUTION OF THIS LEASE. THE PARTIES
RELEASED OR INDEMNIFIED HEREIN SHALL HAVE THE RIGHT TO PARTICIPATE IN THE DEFENSE OF ANY
INDEMNIFIED CLAIMS AT THEIR OWN EXPENSE.

     (vi) THE RELEASES AND INDEMNITIES CONTAINED HEREIN SHALL BE SUPPORTED BY INSURANCE, BUT SHALL
NOT BE LIMITED BY THE LIMITS THEREOF. IF IT IS JUDICIALLY DETERMINED THAT THE MONETARY LIMITS OR
SCOPE OF COVERAGE OF THE INSURANCES REQUIRED UNDER

 

 

THIS LEASE OR OF THE RELEASE OR INDEMNITY PROVISIONS VOLUNTARILY ASSUMED UNDER THIS AGREEMENT
EXCEED THE MAXIMUM MONETARY LIMITS OR SCOPE PERMITTED UNDER APPLICABLE LAW, IT IS AGREED THAT SAID
INSURANCE REQUIREMENTS OR RELEASE OR INDEMNITY PROVISIONS SHALL AUTOMATICALLY BE AMENDED TO
CONFORM TO THE MAXIMUM MONETARY LIMITS AND SCOPE PERMITTED UNDER SUCH LAW AND EITHER OF THE
PARTIES HERETO MAY APPLY FOR REFORMATION OF THIS LEASE ACCORDINGLY.

     (vii) THE RELEASE AND INDEMNITY PROVISIONS SET FORTH IN THIS LEASE THAT APPLY TO AN EVENT OR
CONDITION THAT OCCURS DURING THE TERM OF THIS LEASE SHALL SURVIVE AND NOT BE AFFECTED BY THE
EXPIRATION OR TERMINATION OF THIS LEASE. THE PARTIES RELEASED OR INDEMNIFIED SHALL BE ENTITLED TO
REASONABLE ATTORNEYS FEES AND COSTS INCURRED IN SUCCESSFULLY ASSERTING OR ENFORCING THE RELEASES
AND INDEMNITY PROVISIONS SET FORTH IN THIS LEASE AGAINST THE INDEMNITOR.

     (viii) AS USED IN THIS LEASE, THE TERM “LESSOR GROUP” SHALL MEAN INDIVIDUALLY AND COLLECTIVELY
LESSOR AND ITS PARENTS, SUBSIDIARIES, AFFILIATES, AND INTERRELATED COMPANIES, AND THEIR RESPECTIVE
OFFICERS, DIRECTORS, AGENTS, EMPLOYEES, AND REPRESENTATIVES. AS USED IN THIS LEASE, THE TERM
“LESSEE GROUP” SHALL MEAN INDIVIDUALLY AND COLLECTIVELY LESSEE AND ITS PARENTS, SUBSIDIARIES,
AFFILIATES, AND INTERRELATED COMPANIES AND THEIR RESPECTIVE OFFICERS, DIRECTORS, AGENTS, EMPLOYEES,
AND REPRESENTATIVES. AS USED IN THIS LEASE, THE TERMS “LOSSES” AND “CLAIMS” SHALL EACH MEAN ALL AND
ANY LOSSES, COSTS, CLAIMS, DEMANDS, LIABILITIES, CAUSES OF ACTION, SUITS, PROCEEDINGS, JUDGMENTS,
AWARDS OR DAMAGES, INCLUDING REASONABLE ATTORNEY’S FEES AND EXPENSES INCLUDING FEES OF EXPERT
WITNESSES AND COSTS OF DEFENSE, FOR OR IN CONNECTION AN EVENT, CONDITION, OR RISK IN QUESTION.

     B. Lessee’s Insurance. Lessee shall, during the entire term of the Lease,
keep in full force and effect (i) a policy of commercial general liability insurance for bodily
injury and property damage with respect to the Leased Premises and the business operated by Lessee
and/or any subcontractors or suppliers doing business on the Leased Premises, (ii) full form hull
and machinery on American Institute Time Hull Clauses and protection and indemnity insurance on
SP-23 form or equivalent covering any vessels owned or chartered, time or bareboat, by Lessee and
docked at or operating at the Leased Premises, (iii) automobile liability coverage, and (iv)
workers’ compensation and employer’s liability insurance including Longshoremen’s and Harbor
Workers’

 

 

Compensation coverage, borrowed servant, and voluntary compensation coverage. Lessee shall cause
Lessor and the owner of the Leased Premises to be named as additional named insureds on the
Lessee’s commercial general liability policy, hull and machinery, protection and indemnity, and
automobile liability policies. The commercial general liability, protection and indemnity, and
automobile liability polices shall have limits of liability of not less than Ten Million Dollars
($10,000,000.00) per occurrence, single limit coverage, whether primary limits or in combination
with excess or umbrella coverage. Such policies shall be further endorsed to provide that they are
primary insurance as respects such additional named insureds, regardless of any excess or other
insurance clauses therein. Such policies shall further include contractual liability insurance
covering Lessee’s indemnity obligations hereunder and pollution coverage. All policies, including
the workers’ compensation and employer’s liability policies shall include a full waiver of
subrogation in favor of such named additional assureds and provide that such named additional
assureds shall not be liable for premiums. All deductibles and self insured retentions shall be in
amounts satisfactory to Lessor and shall be for the sole account of Lessee. All such policies shall
be occurrence as opposed to claims made policies and shall not contain annual or other aggregates.
The insurers on all such policies shall be rated A or better by A.M. Best & Co. Lessee shall
furnish Lessor prior to the Commencement Date with a certificate or certificates of insurance or
other acceptable evidence that such insurance is in force at all times during the tenancy of this
Lease. Lessee shall be given thirty (30) (or ten (10) days if
cancellation is for non - payment of
premiums) days prior written notice of any cancellation, nonrenewal, or material modifications of
such policies.

     (c) The insurance requirements of this Lease are separate and independent covenants and it is
the express intention of the parties that insurance available to either party shall not be primary
to nor need be exhausted before the parties are required to honor their Release and Indemnity
obligations under this Lease.

     12. Eminent Domain.

     A. Total Condemnation. If the whole of the Leased Premises shall be taken by any
public authority under the power of eminent domain, then the term of this Lease shall cease as of
the day possession shall be taken by such public authority, with a proportionate refund by Lessor
up to that day of such rent as may have been paid in advance.

     B. Partial Condemnation. In the event a portion of the Leased Premises is taken under
the power of eminent domain and the remainder of the Leased Premises shall not be suitable for the
use envisioned by the Lessee, or if the remainder of the property is not one undivided parcel,
Lessee shall have the right to terminate this Lease as of the date of such taking by giving to
Lessor written notice of such termination within fifteen (15) days after Lessee has been notified
that the property has been so taken. In the event of such partial taking and Lessee does not so
terminate this Lease, then the Lease shall

 

 

continue in full force and effect as to the part not taken, and the Rent shall not be
affected.

     C. Lessor’s and Lessee’s Damages. Notwithstanding anything hereinbefore
contained to the contrary, the Lessor shall include separately the Lessee’s reasonable damages for
the loss of use of the Leased Premises in any and all condemnation proceedings. All amounts awarded
during the condemnation proceedings for the Lessee’s damages shall be paid to the Lessee upon
receipt of payment by the Lessor.

     13. Bankruptcy. Neither this Lease nor any interest herein, nor any estate hereby
created, shall pass to any trustee or receiver or assignee for the benefit of creditors of Lessee,
or otherwise by operation of law, so as to jeopardize Lessor’s interest herein.

     14, Quiet Enjoyment. So long as Lessee keeps and performs all the of the
covenants and conditions contained herein, Lessee shall have continued possession and use of the
Leased Premises, free and clear of any claims against Lessor and all persons claiming under, by or
through Lessor. The liability of Lessor to Lessee for any default by Lessor under the terms of this
Lease shall be limited to Lessee’s actual direct, but not consequential, damages therefor and shall
be recoverable only from the interest of Lessor in the Leased Premises, and Lessor shall not be
personally liable for any deficiency. From time to time, Lessee shall furnish to any party
designated by Lessor, within ten (10) days after Lessor has made a request therefor, a certificate
signed by Lessee confirming and containing such factual certifications and representations as to
this Lease as Lessor may reasonably request.

     15. Subletting and Assignment. Lessee shall not sublet the Leased
Premises or assign or transfer this Lease or any interest herein, without Lessor’s prior written
consent. Notwithstanding the foregoing, Lessee may assign this Lease without consent, provided
Lessee remains primarily liable, to a wholly owned affiliate, or to a successor in connection with
a merger, consolidation or sale of the business or assets or Lessee, in which event Lessee shall
give Lessor prior written notice of the proposed merger, consolidation or sale. Lessor may transfer
any portion of the Leased Premises and any of its rights under this Lease. If Lessor assigns its
rights under this Lease, then Lessor shall thereby be released from any further obligations
hereunder, provided that the assignee assumes Lessor’s obligations hereunder in writing. Lessee
shall attorn to any party succeeding to Lessor’s interest in the Leased Premises, whether by
purchase, foreclosure, deed in lieu of foreclosure, power of sale, termination of lease, or
otherwise, upon such party’s request, and should execute such agreements confirming such attornment
as such party may reasonably request.

     16. Default of Lessee. In the event of any failure of Lessee (i) to maintain
in full force and effect any of the insurances required under Section 10(b) hereof or otherwise
fail to perform any of the covenants and agreements contained in said Section 10(b), or (ii) to pay
any amounts due hereunder within fifteen (15) days after the date when due, or (iii) to perform any
other of the terms, conditions or covenants of this

 

 

Lease for more than thirty (30) days after written notice of such default shall have been
received by Lessee, or if Lessee shall abandon the Leased Premises, or suffer this Lease to be
taken under any writ of execution, then Lessor shall have the immediate right to pursue all rights
and remedies it may have under law, including the right to terminate this Lease without prejudice
to Lessor’s right to recover the unpaid rentals due for the remainder of the Term of this Lease,
all without being obligated to release or otherwise take any steps to mitigate damages. In the
event of any default by the Lessee under the terms of this Lease and Lessor instituting any court
proceedings with respect to such default, Lessee shall be responsible for the payment of the
Lessor’s reasonable attorney’s fees, expenses, and court costs with respect to such court
proceedings if Lessor is the prevailing party.

     17. Waiver. The provisions of this Lease may be amended, modified, or waived
only in writing signed by both parties. One or more waivers of any covenant or condition by Lessor
shall not be construed as a waiver of a subsequent breach of the same covenant or condition, and
the consent or approval by Lessor to or any act of Lessee requiring Lessor’s consent or approval
shall not be deemed to waive or render unnecessary Lessor’s consent or approval to or of any
subsequent similar act by Lessee.

     18. Notices. All notices, demands and requests required or permitted to be
given under the provisions of this Lease shall be in writing and shall be deemed given (a) when
personally delivered to the party to be given such notice or other communication, (b) on the
business day that such notice or other communication is sent by facsimile or similar electronic
device, fully prepaid, which facsimile or similar electronic communication shall promptly be
confirmed by written notice, (c) on the third business day following the date of deposit in the
United States mail if such notice or other communication is sent by United States mail and the
postage thereon is fully prepaid, or (d) on the business day following the day such notice or other
communication is sent by reputable overnight courier, to the following:

	 	If to Lessor: 	 	J. Barry Snyder

Signet Maritime Corporation 

1500 Main Street 

Ingleside, Texas 78362

Telephone (361) 776-7500
	 
	 	If to Lessee: 	 	Robert Lewis, Vice-President 
Orion Construction L.P

12550 Fuqua St. 

Houston, Texas 77034 

Telephone (713) 852-6500.

 

 

Or to such other address as the parties may designate in writing.

     19. Construction. Nothing contained herein shall be deemed or construed by the parties
hereto, nor by any party, as creating the relationship of principal and agent or partnership or of
joint venture between the parties hereto, it being understood and agreed that not any other
provision contained herein, nor any acts of the parties hereto, shall be deemed to create any
relationship between the parties hereto other than the relationship of Lessor and Lessee.

     20. Partial Invalidity. If any term, covenant or condition of this Lease or the
application thereof to any person or circumstance shall, to any extent, be invalid or
unenforceable, the remainder of the Lease, or the application of such term, covenant or condition
to persons or circumstances other than those as to which it is held invalid or unenforceable, shall
be valid and be enforced to the fullest extent permitted by law.

     21. Successors. All rights and liabilities herein given to, or imposed upon, the
respective parties shall extend to and bind the respective legal representatives, successors and
assigns of the parties.

     22. Signage. Lessee shall be entitled to display signage on the Leased Premises as
permitted by the applicable local laws or ordinances.

     23. Environmental Provisions.

     (i). Substance. The term “Hazardous Substances” used in this Lease shall mean any
product, substance, chemical, material or waste whose presence, nature, quantity and/or intensity
of existence, use, manufacture, disposal, transportation, spill, release or effect, either by
itself or in combination with other materials expected to be on the Leased Premises, is potentially
injurious to the public health, safety or welfare, the environment or the Leased Premises.

     (ii). Reportable Use. Lessee shall not engage in any activity in, on or about the
Leased Premises which constitutes a Reportable Use (as Hereinafter defined) of Hazardous Substances
without the express written consent of Lessor and compliance in a timely manner (at Lessee’s sole
cost and expense) with all applicable laws. “Reportable Use” shall mean (i) the installation or use
of any above or below ground storage tank, (ii) the generation, possession, storage of,
transportation, or disposal of Hazardous Substance that requires a permit from, or with respect to
which a report, notice, registration or business plan is required to be filed with any governmental
authority. Notwithstanding the foregoing, Lessee shall be permitted, without Lessor’s prior
consent, but in compliance with all applicable laws, to use any ordinary and customary materials
reasonably required to be used by Lessee in the normal course of Lessee’s business on the Leased
Premises, so long as such use is not a Reportable Use and does not expose the Leased Premises or
neighboring properties to any meaningful risk of contamination or damage or expose Lessor to any
liability therefor. In addition,
Lessor may (but without any obligation to do so), condition its consent to the use or presence
of any Hazardous Substance, activity or storage tank by Lessee

 

 

upon Lessee giving Lessor such additional assurances as Lessor, in its reasonable
discretion, deems necessary to protect itself, the public, the Leased Premises and the environment
against damage, contamination or injury and/or liability therefrom or therefor, including but not
limited to, the installation (and removal on or before Lease’s expiration or earlier termination)
of reasonably necessary protective modifications to the Leased Premises (such as concrete
encasements) and/or the deposit of security in an amount reasonably determined by Lessor to be held
by Lessor under this Lease for assurance thereof.

     24. Governing Law. This Lease shall be construed in accordance with the
laws of the State of Texas. Any disputes under or in connection with this Lease shall be heard
solely in the state and federal courts sitting in San Patricio County or as close thereto as the
same may be located.

     25. Entire Agreement. The headings of this Lease are used for convenience of
reference only, and shall not be used in the interpretation or construction of this Lease. This
Lease constitutes the entire agreement between Lessor and Lessee regarding the subject matter
hereof and supersedes all oral or statements, representations, understanding, promises, and
commitments, and agreements relating hereto, all of which are deemed to be merged herein and may
not be relied upon by either party.

          IN WITNESS WHEREOF, Lessor and Lessee have executed this LAND SUBLEASE AGREEMENT on the
day and year first above written.

	 	 	 	 	 	 	 
	Signed and Acknowledged:

	 	 	 	LESSOR:
	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	Signet Maritime Corporation	 	 
	 
	 	 	 	 	 	 
	/s/ [ILLEGIBLE]

	 	 	 	/s/ J. Barry Snyder	 	 
	 

	 	 	 	 	 	 
	Witness

	 	 	 	J. Barry Snyder	 	 
	 

	 	 	 	President	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	LESSEE:	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	Orion Construction, L.P	 	 
	 
	 	 	 	 	 	 
	/s/ [ILLEGIBLE]

	 	 	 	/s/ Robert W. Lewis	 	 
	 

	 	 	 	 	 	 
	Witness

	 	 	 	Robert W. Lewis	 	 
	 

	 	 	 	Vice Presidentexv10w8

 

Exhibit 10.8

HUNTER ACQUISITION CORP.

2005 STOCK INCENTIVE PLAN

     Section 1. PURPOSE

          1.1 Purpose. The purpose of the Hunter Acquisition Corp. 2005 Stock Incentive Plan
(the “Plan”) is to provide a means through which Hunter Acquisition Corp., a Delaware corporation
(the “Company”), may attract able persons to serve as employees, directors, or consultants of the
Company or its subsidiaries and to provide a means whereby those individuals upon whom the
responsibilities of the successful administration and management of the Company rest, and whose
present and potential contributions to the welfare of the Company are of importance, may acquire
and maintain stock ownership, thereby strengthening their concern for the welfare of the Company.
A further purpose of the Plan is to provide such individuals with additional incentive and reward
opportunities designed to enhance the profitable growth of the Company. Accordingly, the Plan
provides for granting Incentive Stock Options, options that do not constitute Incentive Stock
Options, Restricted Stock Awards, or any combination of the foregoing, as is best suited to the
circumstances of the particular employee, consultant, or director as provided in the Plan.

     Section 2. DEFINITIONS

          2.1 Definitions. Whenever the following capitalized words or phrases are used, the
following definitions will be applicable throughout the Plan, unless specifically modified by any
Section:

               (a) “Affiliate” means, with respect to any person, any other person directly or indirectly
controlling, controlled by, or under common control with such other person.

               (b) “Award” means, individually or collectively, any Option or Restricted Stock Award.

               (c) “Board” means the board of directors of the Company.

               (d) “Change of Control Value” means the amount determined in accordance with Section
9.4.

               (e) “Class B Stock” means the Class B Stock, $0.01 par value, of the Company or any security
into which such Class B Stock may be changed by reason of any transaction or event of the type
described in Section 9.

               (f) “Code” means the Internal Revenue Code of 1986, as amended. Reference in the Plan to any
section of the Code will be deemed to include any amendments or successor provisions to such
section and any regulations under such section.

               (g) “Committee” means a committee of the Board that is selected by the Board as provided in
Section 4.1.

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               (h) “Company” means Hunter Acquisition Corp., a Delaware corporation.

               (i) “Consultant” means any person who is not an Employee or Director and who is providing
services to the Company or any parent or subsidiary corporation (as defined in section 424 of the
Code) as an advisor, consultant, or other non-common law employee.

               (j) “Corporate Change” means either (i) the Company will not be the surviving entity in any
merger, share exchange, or consolidation (or survives only as a subsidiary of an entity), (ii) the
Company sells, leases, or exchanges, or agrees to sell, lease, or exchange, all or substantially
all of its assets to any other person or entity, (iii) the Company is to be dissolved and
liquidated, (iv) any person or entity, including a “group” as contemplated by Section 13(d)(3) of
the 1934 Act, acquires or gains ownership or control (including, without limitation, power to vote)
of more than 50% of the outstanding shares of the Company’s voting stock (based upon voting power),
or (v) at such time as the Company becomes a reporting company under the 1934 Act, as a result of
or in connection with a contested election of Directors, the persons who were Directors of the
Company before such election will cease to constitute a majority of the Board; provided,
however, that a Corporate Change will not include (A) any reorganization, merger,
consolidation, sale, lease, exchange, or similar transaction, which involves solely the Company and
one or more entities wholly-owned, directly or indirectly, by the Company immediately prior to such
event or (B) the consummation of any transaction or series of integrated transactions immediately
following which the record holders of the voting stock of the Company immediately prior to such
transaction or series of transactions continue to hold 50% or more of the voting stock (based upon
voting power) of (1) any entity that owns, directly or indirectly, the stock of the Company, (2)
any entity with which the Company has merged, or (3) any entity that owns an entity with which the
Company has merged.

               (k) “Director” means (i) an individual elected to the Board by the stockholders of the Company
or by the Board under applicable corporate law who either is serving on the Board on the date the
Plan is adopted by the Board or is elected to the Board after such date and (ii) for purposes of
and relating to eligibility for the grant of an Award, an individual elected to the board of
directors of any parent or subsidiary corporation (as defined in section 424 of the Code) of the
Company.

               (l) “Employee” means any person in an employment relationship with the Company or any parent
or subsidiary corporation (as defined in section 424 of the Code).

               (m) “Fair Market Value” means, as of any specified date, (i) the mean of the high and low
sales prices of the Class B Stock either (A) if the Class B Stock is traded on the National Market
System of the NASDAQ, as reported on the National Market System of NASDAQ on that date (or if no
sales occur on that date, on the last preceding date on which such sales of the Class B Stock are
so reported), or (B) if the Class B Stock is listed on a national securities exchange, as reported
on the stock exchange composite tape on that date (or if no sales occur on that date, on the last
preceding date on which such sales of the Class B Stock are so reported); (ii) if the Class B Stock
is not traded on the National Market System of the NASDAQ or a national securities exchange but is
traded over the counter at the time a determination of its

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fair market value is required to be made under the Plan, the average between the reported high
and low or closing bid and asked prices of Class B Stock on the most recent date on which Class B
Stock was publicly traded; (iii) in the event Class B Stock is not publicly traded at the time a
determination of its value is required to be made under the Plan, the amount determined by the
Committee in its discretion in such manner as it deems appropriate; or (iv) on the date of an
initial public offering of common stock, the offering price under such initial public offering.

               (n) “Forfeiture Restrictions” will have the meaning assigned to such term in Section
8.2.

               (o) “Holder” means an Employee, Consultant, or Director who has been granted an Award.

               (p) “Incentive Stock Option” means an incentive stock option within the meaning of section 422
of the Code.

               (q) “1934 Act” means the Securities Exchange Act of 1934, as amended.

               (r) “Nonstatutory Stock Option” means Options that do not constitute Incentive Stock Options.

               (s) “Option” means an Award granted under Section 7 and includes both Incentive Stock
Options and options that do not constitute Incentive Stock Options.

               (t) “Option Agreement” means a written agreement between the Company and a Holder with respect
to an Option, including the accompanying “Notice of Grant of Stock Option.”

               (u) “Plan” means Hunter Acquisition Corp. 2005 Stock Incentive Plan, as amended from time to
time.

               (v) “Restricted Stock Agreement” means a written agreement between the Company and a Holder
with respect to a Restricted Stock Award, including the accompanying “Notice of Grant of Restricted
Stock.”

               (w) “Restricted Stock Award” means an Award granted under Section 8.

               (x) “Rule 16b-3” means SEC Rule 16b-3 promulgated under the 1934 Act, as such may be amended
from time to time, and any successor rule, regulation, or statute fulfilling the same or a similar
function.

               (y) “Stock Appreciation Right” will have the meaning assigned to such term in Subsection
7.4(d).

          2.2 Number and Gender. Wherever appropriate in the Plan, words used in the singular
will be considered to include the plural, and words used in the plural will be

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considered to include the singular. The masculine gender, where appearing in the Plan, will
be deemed to include the feminine gender.

          2.3 Headings. The headings of Sections and Subsections in the Plan are included
solely for convenience, and, if there is any conflict between such headings and the text of the
Plan, the text will control. All references to Sections and Subsections are to this document
unless otherwise indicated.

     Section 3. EFFECTIVE DATE AND DURATION OF THE PLAN

          3.1 Effective Date. The Plan will become effective upon the date of its adoption by
the Board, provided that the Plan is approved by the stockholders of the Company within 12
months after such adoption. Notwithstanding any provision in the Plan, in any Option Agreement, or
in any Restricted Stock Agreement, no Option will be exercisable and no Restricted Stock Award will
vest prior to such stockholder approval.

          3.2 Duration of Plan. No further Awards may be granted under the Plan after ten years
from the date the Plan is adopted by the Board. The Plan will remain in effect until all Options
granted under the Plan have been exercised, forfeited, assumed, substituted, satisfied or expired
and all Restricted Stock Awards granted under the Plan have vested or been forfeited.

     Section 4. ADMINISTRATION

          4.1 Composition of Committee. The Plan will be administered by a committee of, and
appointed by, the Board. In the absence of the Board’s appointment of such Committee to administer
the Plan, the Board will serve as the Committee. Notwithstanding the foregoing, from and after the
date upon which the Company becomes a “publicly held corporation” (as defined in section 162(m) of
the Code and applicable interpretive authority under the Code), the Plan will be administered by a
committee of, and appointed by, the Board that will be comprised solely of two or more outside
Directors (within the meaning of the term “outside directors” as used in section 162(m) of the Code
and applicable interpretive authority under the Code and within the meaning of “Non-Employee
Director” as defined in Rule 16b-3).

          4.2 Powers. Subject to the express provisions of the Plan, the Committee will have
authority, in its discretion, to determine which Employees, Consultants, or Directors will receive
an Award, the time or times when such Award will be made, whether an Incentive Stock Option or
Nonstatutory Stock Option will be granted, and the number of shares to be subject to each Option or
Restricted Stock Award. In making such determinations, the Committee will take into account the
nature of the services rendered by the respective Employees, Consultants, or Directors, their
present and potential contribution to the Company’s success, and such other factors as the
Committee in its discretion will deem relevant.

          4.3 Additional Powers. The Committee will have such additional powers as are
delegated to it by the other provisions of the Plan. Subject to the express provisions of the
Plan, this will include the power (a) to construe the Plan and the respective agreements executed
under the Plan, (b) to prescribe rules and regulations relating to the Plan, (c) to determine the
terms, restrictions, and provisions of the agreement relating to each Award, including such terms,
restrictions, and provisions as will be requisite in the judgment of the Committee to cause

4

 

designated Options to qualify as Incentive Stock Options, and (d) to make all other
determinations necessary or advisable for administering the Plan. The Committee may correct any
defect, supply any omission, or reconcile any inconsistency in the Plan or in any agreement
relating to an Award in the manner and to the extent it will deem expedient to carry it into
effect. The determinations of the Committee on the matters referred to in this Section will be
conclusive and binding on all persons.

     Section 5. STOCK SUBJECT TO THE PLAN

          5.1 Stock Offered. Subject to the limitations set forth in Section 5.2, the
stock to be offered pursuant to the grant of an Award may be (a) authorized but unissued Class B
Stock or (b) previously issued and outstanding Class B Stock reacquired by the Company. Any of
such shares that remain unissued and are not subject to outstanding Awards at the termination of
the Plan will cease to be subject to the Plan, but until termination of the Plan the Committee will
at all times make available a sufficient number of shares to meet the requirements of the Plan.

          5.2 Plan and Individual Limitations on Shares. Subject to adjustment in the same
manner as provided in Section 9 with respect to shares of Class B Stock subject to Options
then outstanding, the aggregate number of shares of Class B Stock that may be issued under the Plan
will not exceed 4,000,000 shares. Notwithstanding any provision in the Plan to the contrary, the
maximum number of shares of Class B Stock that may be subject to Awards granted under the Plan to
any one individual during any calendar year may not exceed 4,000,000 shares (as adjusted from time
to time in accordance with the provisions of the Plan). Shares will be deemed to have been issued
under the Plan only (a) to the extent actually issued and delivered pursuant to an Award or (b) to
the extent an Award is settled in cash. To the extent that an Award lapses or the rights of its
Holder terminate, any shares of Class B Stock subject to such Award will again be available for the
grant of an Award. From and after the date upon which the Company becomes a “publicly held
corporation” (as defined in section 162(m) of the Code and applicable interpretive authority under
the Code), the limitation set forth in the preceding sentences will be applied in a manner that
will permit compensation generated under the Plan to constitute “performance-based” compensation
for purposes of section 162(m) of the Code, including, without limitation, counting against such
maximum number of shares, to the extent required under section 162(m) of the Code and applicable
interpretative authority under the Code, any shares subject to Options that are canceled or
repriced.

     Section 6. GRANT OF AWARDS

               6.1 Eligibility for Award. Awards may be granted only to persons who, at the time of
grant, are Employees, Consultants, or Directors.

               6.2 Grant of Awards. The Committee may from time to time in its discretion grant
Awards to one or more Employees, Consultants, or Directors determined by it to be eligible for
participation in the Plan in accordance with the provisions of Section 6.1. An Award may
be granted on more than one occasion to the same person, and, subject to the limitations set forth
in the Plan, such Award may include an Incentive Stock Option, a Nonstatutory Stock Option, a
Restricted Stock Award, or any combination thereof.

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     Section 7. STOCK OPTIONS

          7.1 Option Period. The term of each Option will be as specified by the Committee at
the date of grant.

          7.2 Limitations on Vesting and/or Exercise of Option. An Option will be vested and/or
exercisable in whole or in part and at such times as determined by the Committee and set forth in
the Notice of Grant and Option Agreement. The Committee in its discretion may provide that an
Option will be vested or exercisable upon (a) the attainment of one or more performance goals or
targets established by the Committee, which are based on (i) the price of a share of Class B Stock,
(ii) the Company’s earnings per share, (iii) the Company’s market share, (iv) the market share of a
business unit of the Company designated by the Committee, (v) the Company’s sales, (vi) the sales
of a business unit of the Company designated by the Committee, (vii) the net income (before or
after taxes) of the Company or a business unit of the Company designated by the Committee, (viii)
the cash flow return on investment of the Company or any business unit of the Company designated by
the Committee, (ix) the earnings before or after interest, taxes, depreciation, and/or amortization
of the Company or any business unit of the Company designated by the Committee, (x) the economic
value added, or (xi) the return on stockholders’ equity achieved by the Company; (b) the Holder’s
continued employment as an Employee with the Company or continued service as a Consultant or
Director for a specified period of time; (c) the occurrence of any event or the satisfaction of any
other condition specified by the Committee in its sole discretion; or (d) a combination of any of
the foregoing. Each Option may, in the discretion of the Committee, have different provisions with
respect to vesting and/or exercise of the Option.

          7.3 Special Limitations on Incentive Stock Options.

               (a) An Incentive Stock Option may be granted only to an individual who is an Employee at the
time the Option is granted.

               (b) No Incentive Stock Option will be granted to an individual if, at the time the Option is
granted, such individual owns stock possessing more than 10% of the total combined voting power of
all classes of stock of the Company or of its parent or subsidiary corporation, within the meaning
of section 422(b)(6) of the Code, unless (i) at the time such Option is granted the option price is
at least 110% of the Fair Market Value of the Class B Stock subject to the Option and (ii) such
Option by its terms is not exercisable after the expiration of five years from the date of grant.

               (c) If an Option is designated as an Incentive Stock Option in the Notice of Grant of Stock
Option, to the extent that such Option (together with all Incentive Stock Options granted to the
Optionee under the Plan and all other stock option plans of the Company and its parent and
subsidiaries) becomes exercisable for the first time during any calendar year for shares having a
Fair Market Value greater than $100,000, the portion of each such Incentive Stock Option that
exceeds such amount will be treated as a Nonstatutory Stock Option. For purposes of this
Subsection, Options designated as Incentive Stock Options are taken into account in the order in
which they were granted, and the Fair Market Value of Class B Stock is determined as of the time
the Option with respect to such Class B Stock is granted. If the Code

6

 

is amended to provide for a different limitation from that set forth in this Subsection, such
different limitation will be deemed incorporated in the Plan effective as of the date required or
permitted by such amendment to the Code. If the Option is treated as an Incentive Stock Option in
part and as a Nonstatutory Stock Option in part by reason of the limitation set forth in this
Subsection, the Optionee may designate which portion of such Option the Optionee is exercising. In
the absence of such designation, the Optionee will be deemed to have exercised the Incentive Stock
Option portion of the Option first. Separate certificates representing each such portion will be
issued upon the exercise of the Option.

               (d) An Incentive Stock Option (i) will not be transferable otherwise than by will or the laws
of descent and distribution and (ii) will be exercisable during the Holder’s lifetime only by such
Holder or his guardian or legal representative.

               (e) The price at which a share of Class B Stock may be purchased upon exercise of an Incentive
Stock Option will not be less than 100% of the Fair Market Value of a share of Class B Stock on the
date such Option is granted.

          7.4 Option Agreement.

               (a) Each Option will be evidenced by an Option Agreement in such form and containing such
provisions not inconsistent with the provisions of the Plan as the Committee from time to time will
approve, including, without limitation, provisions to qualify an Incentive Stock Option under
section 422 of the Code and provisions relating to vesting and exercisability. The terms and
conditions of the Options and respective Option Agreements need not be identical. Subject to the
consent of the Holder, the Committee may, in its sole discretion, amend an outstanding Option
Agreement from time to time in any manner that is not inconsistent with the provisions of the Plan
(including, without limitation, an amendment that accelerates the time at which the Option, or a
portion of the Option, may be exercisable).

               (b) Each Option Agreement will specify the effect of termination of (i) employment, (ii) the
consulting, advisory, or other non-common law employee relationship, or (iii) membership on the
Board, as applicable, on the vesting and/or exercisability of the Option.

               (c) An Option Agreement may provide for the payment of the option price, in whole or in part,
by the delivery of a number of shares of Class B Stock (plus cash if necessary) having a Fair
Market Value equal to such option price. Moreover, an Option Agreement may provide for a “cashless
exercise” of the Option through procedures satisfactory to, and approved by and in the sole
discretion of, the Committee. Generally, and without limiting the Committee’s absolute discretion,
a “cashless exercise” will only be permitted at such times in which the shares underlying this
Option are publicly traded.

               (d) An Option Agreement may provide for the surrender of the right to purchase shares under
the Option in return for a payment in cash or shares of Class B Stock or a combination of cash and
shares of Class B Stock equal in value to the excess of the Fair Market Value of the shares with
respect to which the right to purchase is surrendered over the option price for such shares (“Stock
Appreciation Right”), on such terms and conditions as the

7

 

Committee in its sole discretion may prescribe. In the case of any such Stock Appreciation
Right that is granted in connection with an Incentive Stock Option, such right will be exercisable
only when the Fair Market Value of the Class B Stock exceeds the price specified for such Class B
Stock in the Option or the portion of the Option to be surrendered.

          7.5 Option Price, Payment, and Exercise. Subject to Subsections 7.3(b) and
7.3(e) with respect to Incentive Stock Options, the price at which a share of Class B Stock
may be purchased upon exercise of an Option will be determined by the Committee. The Option or
portion of the Option may be exercised by delivery of an irrevocable notice of exercise to the
Secretary of the Company, except as may otherwise be provided in the Option Agreement. The
purchase price of the Option or portion of the Option will be paid in full in the manner prescribed
by the Committee. Separate stock certificates will be issued by the Company for those shares
acquired pursuant to the exercise of an Incentive Stock Option and for those shares acquired
pursuant to the exercise of a Nonstatutory Stock Option.

          7.6 Stockholder Rights and Privileges. The Holder will be entitled to all the
privileges and rights of a stockholder only with respect to such shares of Class B Stock as have
been purchased under the Option and for which certificates of stock have been registered in the
Holder’s name.

          7.7 Options and Rights in Substitution for Stock Options Granted by Other
Corporations. Options and Stock Appreciation Rights may be granted under the Plan from time to
time in substitution for stock options held by individuals employed by corporations who become
Employees, Consultants, or Directors as a result of a merger, consolidation, or other business
combination of the employing corporation with the Company or any subsidiary.

     Section 8. RESTRICTED STOCK AWARDS

          8.1 Restricted Stock Agreement. At the time any Award is made under this Section, the
Company and the Holder will enter into a Restricted Stock Agreement setting forth each of the
matters contemplated by the Plan and such other matters as the Committee may determine to be
appropriate. The terms and provisions of the respective Restricted Stock Agreements need not be
identical.

          8.2 Forfeiture Restrictions. Shares of Class B Stock that are the subject of a
Restricted Stock Award will be subject to restrictions on disposition by the Holder and an
obligation of the Holder to forfeit and surrender the shares to the Company under certain
circumstances (the “Forfeiture Restrictions”). The Forfeiture Restrictions will be determined by
the Committee in its sole discretion, and the Committee may provide that the Forfeiture
Restrictions will lapse upon (a) the attainment of one or more performance goals or targets
established by the Committee, which are based on (i) the price of a share of Class B Stock, (ii)
the Company’s earnings per share, (iii) the Company’s market share, (iv) the market share of a
business unit of the Company designated by the Committee, (v) the Company’s sales, (vi) the sales
of a business unit of the Company designated by the Committee, (vii) the net income (before or
after taxes) of the Company or a business unit of the Company designated by the Committee, (viii)
the cash flow return on investment of the Company or any business unit of the Company designated by
the Committee, (ix) the earnings before or after interest, taxes,

8

 

depreciation, and/or amortization of the Company or any business unit of the Company
designated by the Committee, (x) the economic value added, or (xi) the return on stockholders’
equity achieved by the Company; (b) the Holder’s continued employment as an Employee with the
Company or continued service as a Consultant or Director for a specified period of time; (c) the
occurrence of any event or the satisfaction of any other condition specified by the Committee in
its sole discretion; or (d) a combination of any of the foregoing. Each Restricted Stock Award
may, in the discretion of the Committee, have different Forfeiture Restrictions.

          8.3 Other Terms and Conditions. Class B Stock awarded pursuant to a Restricted Stock
Award will be represented by a stock certificate registered in the name of the Holder of such
Restricted Stock Award. Unless otherwise provided in the Restricted Stock Agreement, the Holder
will have the right to receive dividends with respect to Class B Stock subject to a Restricted
Stock Award, to vote Class B Stock subject to such Restricted Stock Agreement, and to enjoy all
other stockholder rights, except that (a) the Holder will not be entitled to delivery of the stock
certificate until the Forfeiture Restrictions have lapsed, (b) the Company will retain custody of
the stock until the Forfeiture Restrictions have lapsed, (c) the Holder may not sell, transfer,
pledge, exchange, hypothecate, or otherwise dispose of the stock until the Forfeiture Restrictions
have lapsed, and (d) a breach of the terms and conditions established by the Committee pursuant to
the Restricted Stock Agreement will cause a forfeiture of the Restricted Stock Award. At the time
of such Award, the Committee may, in its sole discretion, prescribe additional terms, conditions,
or restrictions relating to Restricted Stock Awards, including, but not limited to, rules
pertaining to the termination of employment or service as a Consultant or Director (by retirement,
disability, death, or otherwise) of a Holder prior to lapse of the Forfeitures Restrictions. Such
additional terms, conditions, or restrictions will be set forth in the Restricted Stock Agreement
made in conjunction with the Award. Subject to the consent of the Holder and the restriction set
forth in the last sentence of Section 8.4 below, the Committee may, in its sole discretion,
amend an outstanding Restricted Stock Agreement from time to time in any manner that is not
inconsistent with the provisions of the Plan.

          8.4 Committee’s Discretion to Accelerate Vesting of Restricted Stock Awards. The
Committee may, in its discretion and as of a date determined by the Committee, fully vest any or
all Class B Stock awarded to a Holder pursuant to a Restricted Stock Award, and, upon such vesting,
all restrictions applicable to such Restricted Stock Award will lapse as of such date. Any action
by the Committee pursuant to this Section may vary among individual Holders and may vary among the
Restricted Stock Awards held by any individual Holder. Notwithstanding the preceding provisions of
this Section, from and after the date upon which the Company becomes a “publicly held corporation”
(as defined in section 162(m) of the Code and applicable interpretive authority under the Code),
the Committee may not take any action described in this Section with respect to a Restricted Stock
Award that has been granted after such date to a “covered employee” (within the meaning of Treasury
Regulation section 1.162-27(c)(2)) if such Award has been designed to meet the exception for
performance-based compensation under section 162(m) of the Code.

          8.5 Payment for Restricted Stock. The Committee will determine the amount and form of
any payment for Class B Stock received pursuant to a Restricted Stock Award, provided that,
in the absence of such a determination, a Holder will not be required to

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make any payment for Class B Stock received pursuant to a Restricted Stock Award, except to
the extent otherwise required by law.

     Section 9. RECAPITALIZATION OR REORGANIZATION

          9.1 No Effect on Board’s or Stockholders’ Power. The existence of the Plan and the
Awards granted under the Plan will not affect in any way the right or power of the Board or the
stockholders of the Company to make or authorize (a) any adjustment, recapitalization,
reorganization, or other change in the Company’s capital structure or its business, (b) any merger,
share exchange, or consolidation of the Company or any subsidiary, (c) any issue of debt or equity
securities ranking senior to or affecting Class B Stock or the rights of Class B Stock, (d) the
dissolution or liquidation of the Company or any subsidiary, (e) any sale, lease, exchange, or
other disposition of all or any part of the Company’s assets or business, or (f) any other
corporate act or proceeding.

          9.2 Adjustment in the Event of Stock Subdivision, Consolidation, or Dividend. The
shares with respect to which Options may be granted are shares of Class B Stock as presently
constituted, but if, and whenever, prior to the expiration of an Option theretofore granted, the
Company will effect a subdivision or consolidation of shares of Class B Stock or the payment of a
stock dividend on Class B Stock without receipt of consideration by the Company, the number of
shares of Class B Stock with respect to which such Option may thereafter be exercised (a) in the
event of an increase in the number of outstanding shares, will be proportionately increased, and
the purchase price per share will be proportionately reduced, and (b) in the event of a reduction
in the number of outstanding shares, will be proportionately reduced, and the purchase price per
share will be proportionately increased. Any fractional share resulting from such adjustment will
be rounded up to the next whole share.

          9.3 Adjustment in the Event of Recapitalization or Corporate Change.

               (a) If the Company recapitalizes, reclassifies its capital stock, or otherwise changes its
capital structure (a “recapitalization”), the number and class of shares of Class B Stock covered
by an Option theretofore granted will be adjusted so that such Option will thereafter cover the
number and class of shares of stock and securities to which the Holder would have been entitled
pursuant to the terms of the recapitalization if, immediately prior to the recapitalization, the
Holder had been the holder of record of the number of shares of Class B Stock then covered by such
Option.

               (b) If a Corporate Change occurs, then no later than (i) 10 days after the approval by the
stockholders of the Company of a Corporate Change, other than a Corporate Change resulting from a
person or entity acquiring or gaining ownership or control of more than 50% of the outstanding
shares of the Company’s voting stock, or (ii) 30 days after a Corporate Change resulting from a
person or entity acquiring or gaining ownership or control of more than 50% of the outstanding
shares of the Company’s voting stock, the Committee, acting in its sole discretion and without the
consent or approval of any Holder, will effect one or more of the following alternatives, which
alternatives may vary among individual Holders and which may vary among Options held by any
individual Holder:

10

 

               (i) Accelerate the vesting of any Options (or any portion of any Option) then
outstanding;

               (ii) Accelerate the time at which some or all of the Options (or any portion of the
Options) then outstanding may be exercised so that such Options (or any portion of such
Options) may be exercised for a limited period of time on or before a specified date (before
or after such Corporate Change) fixed by the Committee, after which specified date all
unexercised Options and all rights of Holders under such Options will terminate;

               (iii) Require the mandatory surrender to the Company by selected Holders of some or all
of the outstanding Options (or any portion of such Options) held by such Holders
(irrespective of whether such Options (or any portion of such Options) are then vested or
exercisable under the provisions of the Plan) as of a date, before or after such Corporate
Change, specified by the Committee, in which event the Committee will then cancel such
Options (or any portion of such Options) and cause the Company to pay each Holder an amount
of cash per share equal to the excess, if any, of the Change of Control Value of the shares
subject to such Option over the exercise price(s) under such Options for such shares;

               (iv) Make such adjustments to Options (or any portion of such Options) then outstanding
as the Committee deems appropriate to reflect such Corporate Change (provided,
however, that the Committee may determine in its sole discretion that no adjustment
is necessary to one or more Options (or any portion of such Options) then outstanding); or

               (v) Provide that the number and class of shares of Class B Stock covered by an Option
(or any portion of such Option) theretofore granted will be adjusted so that such Option
will thereafter cover the number and class of shares of stock or other securities or
property (including, without limitation, cash) to which the Holder would have been entitled
pursuant to the terms of the agreement of merger, consolidation, or sale of assets or
dissolution if, immediately prior to such merger, consolidation, or sale of assets or
dissolution, the Holder had been the holder of record of the number of shares of Class B
Stock then covered by such Option.

          9.4 Change of Control Value. For purposes of Subsection 9.3(b)(iii) above,
the “Change of Control Value” will equal the amount determined in one of the following clauses,
whichever is applicable:

               (a) The per share price offered to stockholders of the Company in any such merger,
consolidation, sale of assets, or dissolution transaction;

               (b) The price per share offered to stockholders of the Company in any tender offer or exchange
offer whereby a Corporate Change takes place; or

               (c) If such Corporate Change occurs other than pursuant to a tender or exchange offer, the
fair market value per share of the shares into which such Options being

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surrendered are exercisable, as determined by the Committee as of the date determined by the
Committee to be the date of cancellation and surrender of such Options.

In the event that the consideration offered to stockholders of the Company in any transaction
described in this Section or in Section 9.3 above consists of anything other than cash, the
Committee will determine in its discretion the fair cash equivalent of the portion of the
consideration offered that is other than cash.

          9.5 Other Adjustments. In the event of changes in the outstanding Class B Stock by
reason of recapitalizations, mergers, consolidations, reorganizations, liquidations, combinations,
split-ups, split-offs, spin-offs, exchanges, issuances of rights or warrants, or other relevant
changes in capitalization or distributions to the holders of Class B Stock occurring after the date
of grant of any Award and not otherwise provided for by this Section, (a) such Award and any
agreement evidencing such Award will be subject to adjustment by the Committee in its discretion as
to the number and price of shares of Class B Stock or other consideration subject to such Award,
and (b) the aggregate number of shares available under the Plan and the maximum number of shares
that may be subject to Awards to any one individual may be appropriately adjusted by the Committee,
whose determination will be conclusive and binding on all parties.

          9.6 Stockholder Action. If any event giving rise to an adjustment provided for in
this Section requires stockholder action, such adjustment will not be effective until such
stockholder action has been taken.

          9.7 No Adjustment Except as Provided in the Plan. Except as expressly provided in the
Plan, the issuance by the Company of shares of stock of any class or securities convertible into
shares of stock of any class for cash, property, labor, or services, upon direct sale, upon the
exercise of rights or warrants to subscribe for such shares or other securities, or upon conversion
of shares or obligations of the Company convertible into such shares or other securities, and in
any case whether or not for fair value, will not affect, and no adjustment by reason thereof will
be made with respect to, the number of shares of Class B Stock subject to Awards theretofore
granted or the purchase price per share, if applicable.

     Section 10. AMENDMENT AND TERMINATION OF THE PLAN

          10.1 Termination of Plan. The Board in its discretion may terminate the Plan at any
time with respect to any shares of Class B Stock for which Awards have not theretofore been
granted.

          10.2 Amendment of Plan. The Board will have the right to alter or amend the Plan or
any part of the Plan from time to time; provided that no change in any Award theretofore
granted may be made that would impair the rights of the Holder without the consent of the Holder;
and provided, further, that the Board may not, without approval of the
stockholders, amend the Plan to (a) increase the maximum aggregate number of shares that may be
issued under the Plan or (b) change the class of individuals eligible to receive Awards under the
Plan.

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     Section 11. MISCELLANEOUS

          11.1 No Right To An Award. Neither the adoption of the Plan nor any action of the
Board or of the Committee will be deemed to give an Employee, Consultant, or Director any right to
be granted an Option, any right to a Restricted Stock Award, or any other rights under the Plan
except as may be evidenced by an Option Agreement or a Restricted Stock Agreement duly executed on
behalf of the Company, and then only to the extent and on the terms and conditions expressly set
forth in such Agreement.

          11.2 Unfunded Plan. The Plan will be unfunded. The Company will not be required to
establish any special or separate fund or to make any other segregation of funds or assets to
insure the payment of any Award.

          11.3 No Employment/Consulting/Membership Rights Conferred. Nothing contained in the
Plan will (a) confer upon any Employee or Consultant any right with respect to continuation of
employment or of a consulting, advisory, or other non-common law relationship with the Company or
any subsidiary or (b) interfere in any way with the right of the Company or any subsidiary to
terminate any Employee’s employment or any Consultant’s consulting, advisory, or other non-common
law relationship at any time. Nothing contained in the Plan will confer upon any Director any
right with respect to continuation of membership on the Board.

          11.4 Compliance with Other Laws. The Company will not be obligated to issue any Class
B Stock pursuant to any Award granted under the Plan at any time when the shares covered by such
Award have not been registered under the Securities Act of 1933, as amended, and such other state
and federal laws, rules, or regulations as the Company or the Committee deems applicable and, in
the opinion of legal counsel to the Company, there is no exemption from the registration
requirements of such laws, rules, or regulations available for the issuance and sale of such
shares. No fractional shares of Class B Stock will be delivered, nor will any cash in lieu of
fractional shares be paid.

          11.5 Withholding. The Company will have the right to deduct or cause to be deducted
in connection with all Awards any taxes required by law to be withheld and to require any payments
required to satisfy applicable withholding obligations.

          11.6 No Restriction on Corporate Action. Nothing contained in the Plan will be
construed to prevent the Company or any subsidiary from taking any corporate action that is deemed
by the Company or such subsidiary to be appropriate or in its best interest, whether or not such
action would have an adverse effect on the Plan or any Award made under the Plan. No Employee,
Consultant, Director, beneficiary, or other person will have any claim against the Company or any
subsidiary as a result of any such action.

          11.7 Restrictions on Transfer. An Award (other than an Incentive Stock Option, which
will be subject to the transfer restrictions set forth in Section 7.3) will not be
transferable otherwise than (a) by will or the laws of descent and distribution, (b) with the
consent of the Committee or (c) as expressly set forth in such Award.

          11.8 Governing Law. The Plan will be construed in accordance with the laws of the
State of Delaware.

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