MRC Global Inc. Nonqualified Stock Option Agreement (Feb. 2014 rev.)

1. Grant of Nonqualified Stock Option.  The Company hereby grants to the Participant a Nonqualified Stock Option (the “Option”) that provides the Participant the right and option to purchase __________ Shares at the purchase price (the “Option Price”) of $_______ per Share, in accordance with the provisions of this Agreement and the terms of the MRC Global Inc. 2011 Omnibus Incentive Plan (the “Plan”).  The Option shall be subject to the execution and return of this Agreement by the Participant (or the Participant’s estate, if applicable) to the Company as provided in Section 8 hereof.  The Option is made under and pursuant to the Plan, which Plan is incorporated herein by reference, and the Option is subject to all of the provisions thereof.  Capitalized terms used herein without definition shall have the same meanings given such terms in the Plan.  The Option is not intended to constitute an “incentive stock option” as that term is used in Code Section 422.    

2. Vesting Schedule.  This Option shall vest and become exercisable in accordance with the following schedule, subject to Section 3 of this Agreement:

Vesting Date

Percentage of
Option Vested

First anniversary of Grant Date

Second anniversary of Grant Date

Third anniversary of Grant Date

3. Accelerated Vesting.  Notwithstanding Section 2 above, the vesting of the Option shall change upon the occurrence of certain events as follows:

3.1 Death or Disability.  Upon the Participant’s  Termination by reason of the Participant’s death or Disability at any time on or after the Grant Date and prior to the third anniversary of the Grant Date, the Option will be deemed to be vested and exercisable with respect to an additional 33%  (or 34% if on or after the second anniversary of the Grant Date) of the Shares subject to the Option.

3.2 Change in Control.  Upon a Change in Control, the Option shall become 100% vested and exercisable.

3.3 Retirement.  If the Participant’s employment with the Company and its Subsidiaries Terminates and either:

4. Exercise of Option    

5. Termination of Employment; Breach of Restrictive Covenants

6. Issuance of Shares Upon Option Exercise.  Upon the Company’s determination that the Option has been validly exercised as to any of the Shares, the Company shall issue certificates or evidence of book entry shares for the Shares.  The Share certificates or evidence of book entry shares shall be issued in the Participant’s name (or, at the discretion of the Participant, jointly in the names of the Participant and the Participant’s spouse) or the name of the Participant’s nominee.   The Company shall maintain a record of all information pertaining to the Participant’s rights under this Agreement, including the number of Shares with respect to which the Option is exercisable.

7. Restrictive Covenant.  In consideration of the Option that the Company has granted to Participant in this Agreement, Participant agrees not to engage in Prohibited Activity during Participant’s employment with the Company and any of its subsidiaries (the “Company Group”) and for a period of [CEO: 18][EVPs: 12][all others: six] months after Participant’s termination of employment with the Company Group (the “Restricted Period”).  If the Participant engages in a Prohibited Activity during the Restricted Period, the Company and/or its appropriate subsidiaries may seek an injunction from a court of competent jurisdiction to prevent Participant from engaging in the Prohibited Activity during the Restricted Period without the necessity of posting bond or other security to obtain the injunction.  Both the Company and the Participant agree that monetary damages

alone are an insufficient remedy for breach of the foregoing covenant.  The Company and/or its appropriate subsidiaries may seek monetary damages in addition to an injunction, and the covenant in favor of the Company Group in this Agreement is in addition to, and not in lieu of, any similar covenants that Participant may have entered into in favor of any member of the Company Group in any employment or other agreement.  To the extent that a court of competent jurisdiction rules that the restrictions in the foregoing covenant are too broad, these restrictions shall be interpreted and construed in the broadest possible manner to provide the Company Group the broadest possible protection, including (without limitation) with respect to geographic coverage, activities of the Company Group’s businesses and time of applicability of the restrictions.

8. Execution of Agreements.   The Option granted to the Participant shall be subject to the Participant’s execution and return of this Agreement.

9. No Right to Continued Employment.  Nothing in this Agreement shall interfere with or limit in any way the right of the Company or its Subsidiaries to Terminate the Participant’s employment, nor confer upon the Participant any right to continuance of employment by the Company or any of its Subsidiaries or continuance of service as a Board member.

10. Shareholder Rights.   The Participant shall not be deemed to be the holder of, or to have any dividend, voting or other rights of a holder with respect to any Shares subject to the Option until:  

11. Withholding of Taxes.  Prior to the delivery to the Participant (or the Participant’s estate, if applicable) of Shares, the Participant (or the Participant’s estate) shall be required to pay to the Company or any Affiliate, and the Company shall have the right and is hereby authorized to withhold, any applicable withholding taxes in respect of the Shares, or any payment or transfer under, or with respect to, the Shares, and to take such other action as may be necessary in the opinion of the Committee to satisfy all obligations for the payment of withholding taxes.  The Participant may elect to satisfy the withholding requirement, in whole or in part, by having the Company withhold from a Share Payment the number of Shares having a Fair Market Value on the date the withholding is to be determined equal to the minimum statutory withholding requirement or by remitting cash received from a cashless exercise.  The Participant shall be solely responsible for the payment of all taxes relating to the payment or provision of any amounts or benefits hereunder.  In no event shall any withholdings made under this Section 11 exceed the minimum statutory withholding requirement.

12. Modification of Agreement.  This Agreement may be modified, amended, suspended or terminated, and any terms or conditions may be waived, but only by a written instrument executed by the parties hereto, except as otherwise permitted under the Plan.

13. Severability.  Should any provision of this Agreement be held by a court of competent jurisdiction to be unenforceable or invalid for any reason, the remaining provisions of this Agreement shall not be affected by such holding and shall continue in full force in accordance with their terms.

14. Governing Law.  The validity, interpretation, construction and performance of this Agreement shall be governed by the laws of the jurisdiction set forth in the Plan, without giving effect to the conflicts of laws principles thereof.

15. Option Subject to Plan.  By entering into this Agreement, the Participant agrees and acknowledges that the Participant has received and read a copy of the Plan.  The Option is subject to the Plan.  The terms and provisions of the Plan, as it may be amended from time to time, are hereby incorporated herein by reference.  In the event of a conflict between any term or provision contained herein and a term or provision of the Plan, the applicable terms and provisions of the Plan will govern and prevail.

16. Securities Laws.   Upon the acquisition of any Shares pursuant to the exercise of the Option, the Participant will make such written representations, warranties and agreements as the Committee may reasonably request to comply with applicable securities laws or with this Agreement.

17. Legend on Certificates.   The certificates representing the Shares purchased by exercise of the Option shall be subject to such stop transfer orders and other restrictions as the Committee may deem advisable under the Plan or under applicable state and federal securities or other laws, or under any ruling or regulation of any governmental body or national securities exchange (collectively, the “Legal Requirements”), unless an exemption to such registration or qualification is available and satisfied.  The Committee may cause a legend or legends to be put on any such certificates to make appropriate reference to such restrictions.

18. Underwriter Lockup Agreement.  In the event of any underwritten public offering of securities by the Company, the Participant agrees to the extent requested in writing by a managing underwriter, if any, not to sell, transfer or otherwise dispose of any Shares acquired upon exercise of the Option (other than as part of such underwritten public offering) during the time period reasonably requested by the managing underwriter, not to exceed 180 days or such shorter period as such managing underwriter may permit.

19. Successors in Interest.  This Agreement shall inure to the benefit of and be binding upon any successor to the Company.  This Agreement shall inure to the benefit of the Participant’s legal representatives.  All obligations imposed upon the Participant and all rights granted to the Company under this Agreement shall be binding upon the Participant’s heirs, executors, administrators and successors.

20. Resolution of Disputes.  Any dispute or disagreement which may arise under, or as a result of, or in any way relate to, the interpretation, construction or application of this Agreement shall be determined by the Committee.  Any determination made hereunder shall be final, binding and conclusive on the Participant, the Participant’s heirs, executors, administrators and successors, and the Company and its Subsidiaries for all purposes.  By accepting the grant pursuant to this Agreement, the Participant confirms that Participant is subject to the policies of Participant’s employing company within the Company Group (except as may be specifically modified in an employment agreement), including (without limitation) any policy requiring mandatory arbitration of employment disputes and the grant pursuant to this Agreement is further consideration of those policies.

21. Non-Transferability. Subject to the terms of the Plan, no rights under this Agreement shall be transferable otherwise than by will, the laws of descent and distribution or pursuant to a Qualified Domestic Relations Order (“QDRO”), and, except to the extent otherwise provided herein, the rights and the benefits of the Agreement may be exercised and received, respectively, during the lifetime of the Participant only by the Participant or by the Participant’s guardian or legal representative or by an “alternate payee” pursuant to a QDRO.

22. Entire Agreement.  This Agreement constitutes the entire understanding between the Participant and the Company and its Subsidiaries with respect to the Option, and supersedes all other agreements, whether written or oral, with respect to the Option.

23. Headings.  The headings of this Agreement are inserted for convenience only and do not constitute a part of this Agreement.

24. Counterparts and Electronic Administration.  This Agreement may be executed simultaneously in two or more counterparts, each of which shall constitute an original, but all of which taken together shall constitute one and the same agreement.    This Agreement may be signed by indicating assent to be bound by this Agreement through an electronic trading system that the Company establishes or sponsors rather than a physical signature.  Exercise of this Option may be effected through such an electronic system.