EXHIBIT 4.6
1997 Incentive Stock Option
No. _____
DEVON ENERGY CORPORATION
1997 STOCK OPTION PLAN
__________________________________
INCENTIVE STOCK OPTION
AWARD AGREEMENT
Participant
Name:______________________ Grant Date:___________, 199_
Vesting Schedule
Percent of
Stock
Exercise Dates:
Option Exercisable
Shares Subject to Option:____________
Expiration Date:______________, 2007
Exercise Price: $_______________
Special Terms and Conditions:
INCENTIVE STOCK OPTION
AWARD AGREEMENT
UNDER THE DEVON ENERGY CORPORATION
1997 STOCK OPTION PLAN
THIS INCENTIVE STOCK OPTION AGREEMENT (the "Award
Agreement"), made as of the grant date set forth on the cover
page of this Award Agreement (the "Cover Page") at Oklahoma City,
Oklahoma, by and between the participant named on the Cover Page
(the "Participant") and DEVON ENERGY CORPORATION (the "Company"):
WITNESSETH:
WHEREAS, the Participant is an employee of the Company or
any Subsidiary of the Company, and it is important to the Company
that the Participant be encouraged to remain in the employ of the
Company or a Subsidiary of the Company; and
WHEREAS, in recognition of such facts, the Company desires
to provide to the Participant an opportunity to purchase shares
of the common stock of the Company, as hereinafter provided,
pursuant to the "Devon Energy Corporation 1997 Stock Option Plan"
(the "Plan"), a copy of which has been provided to the
Participant; and
WHEREAS, any capitalized terms used but not defined herein
have the same meanings given them in the Plan.
NOW, THEREFORE, in consideration of the mutual covenants
hereinafter set forth and for good and valuable consideration,
the Participant and the Company hereby agree as follows:
Section 1. Grant of Incentive Stock Option. The Company
hereby grants to the Participant an incentive stock option (the
"Incentive Stock Option") intended to qualify under Section 422
of the Internal Revenue Code of 1986, as amended (the "Code"), to
purchase all or any part of the number of shares of its common
stock, par value $.10 (the "Stock") set forth on the Cover Page,
under and subject to the terms and conditions of this Award
Agreement and the Plan which is incorporated herein by reference
and made a part hereof for all purposes. The purchase price for
each share to be purchased hereunder shall be the exercise price
set forth on the Cover Page (the "Exercise Price").
Section 2. Times of Exercise of Incentive Stock Option.
After, and only after, the conditions of Section 10 hereof have
been satisfied, the Participant shall be eligible to exercise the
Incentive Stock Option pursuant to the vesting schedule set forth
on the Cover Page (the "Vesting Schedule"). If the Participant's
employment with the Company (or of any one or more of the
Subsidiaries of the Company) remains full-time and continuous at
all times prior to any of the exercise dates specified on the
Cover Page (the "Exercise Dates"), then the Participant shall be
entitled, subject to the applicable provisions of the Plan and
this Award Agreement having been satisfied, to exercise on or
after the applicable Exercise Date, on a cumulative basis, the
number of Incentive Stock Options determined by multiplying the
aggregate number of shares of Stock subject to the Incentive
Stock Option set forth on the Cover Page by the designated
percentage set forth on the Cover Page.
Section 3. Term of Incentive Stock Option. Subject to
earlier termination as hereafter provided, the Incentive Stock
Option shall expire at the close of business on the expiration
date set forth on the Cover Page and may not be exercised after
such expiration date; provided, however, in no event shall the
term of the Incentive Stock Option be longer than ten years from
the Date of Grant. At all times during the period commencing
with the date the Incentive Stock Option is granted to the
Participant and ending on the earlier of the expiration of the
Incentive Stock Option or the date which is three months prior to
the date the Incentive Stock Option is exercised by the
Participant, the Participant must be an employee of either (i)
the Company, (ii) a Subsidiary of the Company, or (iii) a
corporation or a parent or a Subsidiary of such corporation
issuing or assuming an Incentive Stock Option in a transaction to
which Section 424 of the Code applies.
Section 4. Nontransferability of Incentive Stock Option.
Except as otherwise herein provided, the Incentive Stock Option
shall not be transferable otherwise than by will or the laws of
descent and distribution, and the Incentive Stock Option may be
exercised during the lifetime of the Participant only by the
Participant. More particularly (but without limiting the
generality of the foregoing), the Incentive Stock Option may not
be assigned, transferred (except as provided above), pledged or
hypothecated in any way whatsoever, shall not be assignable by
operation of law and shall not be subject to execution,
attachment, or similar process. Any attempted assignment,
transfer, pledge, hypothecation or other disposition of the
Incentive Stock Option contrary to the provisions hereof shall be
null and void and without effect.
Section 5. Employment. So long as the Participant shall
continue to be a full-time and continuous employee of the Company
or one or more of the Subsidiaries of the Company, the Incentive
Stock Option shall not be affected by any change of duties or
position. Nothing in the Plan or in this Award Agreement shall
confer upon the Participant any right to continue in the employ
of the Company or any of the Subsidiaries or Affiliated Entities
of the Company, or interfere in any way with the right to
terminate the Participant's employment at any time.
Section 6. Special Rules With Respect to Incentive Stock
Options. With respect to the Incentive Stock Option granted
hereunder, the following special rules shall apply:
(a) Annual Limitation on Exercise of Incentive Stock
Options. Except as provided in Section 8 herein, in no event
during any calendar year will the aggregate Fair Market Value,
determined as of the time the Incentive Stock Option is granted,
of the Stock for which the Participant may first have the right
to exercise under the Incentive Stock Option and any other
"incentive stock options" granted under all plans qualified under
Section 422 of the Code which are sponsored by the Company, its
parent or its Subsidiaries or Affiliated Entities exceed
$100,000.
(b) Acceleration of Otherwise Unexercisable Incentive
Stock Options on Death, Disability or Other Special
Circumstances. The Committee, in its sole discretion, may permit
(i) a Participant who terminates employment due to a Disability,
(ii) the personal representative of a deceased Participant, or
(iii) any other Participant who terminates employment upon the
occurrence of special circumstances (as determined by the
Committee) to purchase all or any part of the shares subject to
the Incentive Stock Option for which the applicable Exercise
Date(s) has not yet occurred on the date of the Participant's
death, termination of his employment due to a Disability, or as
the Committee otherwise so determines. With respect to shares
subject to the Incentive Stock Option for which the applicable
Exercise Date has occurred or for which the Committee has
permitted purchase in accordance with the foregoing provision,
the Participant, or the representative of a deceased Participant,
shall automatically have the right to purchase such shares within
three months of such date of termination of employment, one year
in the case of a Participant suffering a Disability or three
years in the case of a deceased Participant, but not beyond the
Expiration Date.
Section 7. Method of Exercising Incentive Stock Option.
(a) Procedures for Exercise. The manner of exercising
the Incentive Stock Option herein granted shall be by written
notice to the Secretary of the Company at the time the Incentive
Stock Option, or part thereof, is to be exercised, and in any
event prior to the expiration of the Incentive Stock Option.
Such notice shall state the election to exercise the Incentive
Stock Option, the number of shares of Stock to be purchased upon
exercise, the form of payment to be used, and shall be signed by
the person so exercising the Incentive Stock Option.
(b) Form of Payment. Payment of the full Exercise
Price for shares of Stock purchased under this Award Agreement
shall accompany the Participant's written notice of exercise,
together with full payment for any applicable withholding taxes.
Payment shall be made (i) in cash or by check, draft or money
order payable to the order of the Company; (ii) by delivering
Stock or other equity securities of the Company having a Fair
Market Value on the date of payment equal to the amount of the
Exercise Price; (iii) by directing the Company to withhold shares
of Stock having a Fair Market Value at the date of payment equal
to the amount of the Exercise Price from the shares of Stock to
be delivered to the Participant upon exercise of the Incentive
Stock Option to the foregoing procedure which may be available
for the exercise of the Incentive Stock Option, the Participant
may deliver to the Company a notice of exercise which includes an
irrevocable instruction to the Company to deliver the stock
certificate representing the shares of Stock being purchased,
issued in the name of the Participant, to a broker approved by
the Company and authorized to trade in the Stock of the Company.
Upon receipt of such notice, the Company shall acknowledge
receipt of the executed notice of exercise and forward this
notice to the broker. Upon receipt of the copy of the notice
which has been acknowledged by the Company, and without waiting
for issuance of the actual stock certificate with respect to the
exercise of the Incentive Stock Option, the broker may sell the
Stock or any portion thereof. The broker shall deliver directly
to the Company that portion of the sales proceeds sufficient to
cover the Exercise Price and withholding taxes, if any. For all
purposes of effecting the exercise of the Incentive Stock Option,
the date on which the Participant gives the notice of exercise to
the Company, together with payment for the shares of Stock being
purchased and any applicable withholding taxes, shall be the date
of exercise. If a notice of exercise and payment are delivered
at different times, the date of exercise shall be the date the
Company first has in its possession both the notice and full
payment as provided herein.
(c) Further Information. In the event the Incentive
Stock Option is exercised, pursuant to the foregoing provisions
of this Section 7, by any person other than the Participant due
to the death of the Participant, such notice shall also be
accompanied by appropriate proof of the right of such person to
exercise the Incentive Stock Option. The notice so required
shall be given by personal delivery to the Secretary of the
Company or by registered or certified mail, addressed to the
Company at ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇-▇▇▇▇, and it shall be deemed to have been given when it is
so personally delivered or when it is so deposited in the United
States mail in an envelope addressed to the Company, as
aforesaid, properly stamped for delivery as a registered or
certified letter.
Section 8. Acceleration of Incentive Stock Option Upon
"Corporate Event". In the case of a "Corporate Event" as defined
in Article IX of the Plan, this Incentive Stock Option will
automatically become fully vested and immediately exercisable
without the requirement of any further act by the Company or the
Participant. See Article IX of the Plan for a more complete
description of the effect of the occurrence of a Corporate Event.
Section 9. Acceleration of Incentive Stock Option Upon
"Change of Control" and Acquisition Date". In the event that a
Change of Control Date or Acquisition Date (as defined in
Sections 2.1 and 2.6 of the Plan) occurs with respect to the
Company, any and all Incentive Stock Options under this Award
Agreement become automatically fully vested and immediately
exercisable with such acceleration to occur without the
requirement of any further act by either the Company or the
Participant.
Section 10. Securities Law Restrictions. The Incentive
Stock Option shall be exercised and Stock issued only upon
compliance with the Securities Act of 1933, as amended (the
"Act"), and any other applicable securities law, or pursuant to
an exemption therefrom. If deemed necessary by the Company to
comply with the Act or any applicable laws or regulations
relating to the sale of securities, the Participant, at the time
of exercise and as a condition imposed by the Company, shall
represent, warrant and agree that the shares of Stock subject to
the Incentive Stock Option are being purchased for investment and
not with any present intention to resell the same and without a
view to distribution, and the Participant shall, upon the request
of the Company, execute and deliver to the Company an agreement
to such effect. The Participant acknowledges that any stock
certificate representing Stock purchased under such circumstances
will be issued with a restricted securities legend.
Section 11. Disqualifying Disposition of Stock. If the
Participant shall make a disposition (within the meaning of
Section 424(c) of the Code and the rules and regulations
thereunder) of any shares of Stock covered by the Incentive Stock
Option within one year after the date of exercise of the
Incentive Stock Option or within two years after the Date of
Grant of the Incentive Stock Option, then in either such event
the Participant shall promptly notify the Company, by delivery of
written notice to the Secretary of the Company, of (i) the date
of disposition, (ii) the number of shares of Stock covered by the
Incentive Stock Option which were disposed of and (iii) the price
at which such shares of Stock were disposed of or the amount of
any other consideration received on such disposition. The
Company may make such provision as it may deem appropriate for
the withholding of any applicable federal, state or local taxes
that it determines it may be obligated to withhold or pay in
connection with the exercise of the Incentive Stock Option or the
disposition of shares of Stock acquired upon exercise of the
Incentive Stock Option.
Section 12. Notices. All notices or other communications
relating to the Plan and this Option Agreement as it relates to
the Participant shall be in writing and shall be delivered
personally or mailed (U.S. Mail) by the Company to the
Participant at the then current address as maintained by the
Company or such other address as the Participant may advise the
Company in writing.
IN WITNESS WHEREOF, the parties have executed this Option
Agreement as of the date and year first above written.
DEVON ENERGY CORPORATION, an
Oklahoma corporation
By: J. ▇▇▇▇▇ ▇▇▇▇▇▇▇
J. ▇▇▇▇▇ ▇▇▇▇▇▇▇, President and
Chief Executive Officer
"PARTICIPANT"
Name: ________________________
Address: _____________________
Telephone: __________________
