EXHIBIT (d)(5)
FIRST AMENDMENT
TO
INCENTIVE STOCK OPTION AGREEMENT
This First Amendment to Incentive Stock Option Agreement (this
"Amendment"), dated September 23, 2002, is entered into by and between U.S.
Vision, Inc., a Delaware corporation (the "Company") and Xxxxx Xxxxxxx (the
"Optionee").
The following recitals are true and constitute the basis of this
Amendment:
A. The Optionee and the Company entered into that certain
Incentive Stock Option Agreement dated June 1, 2000 (the
"Stock Option Agreement"), pursuant to which the Optionee
received options to acquire 76,050 shares of the Company's
common stock at an exercise price of $3.00 per share (the
"Stock Options");
B. Pursuant to Section 11 of the Stock Option Agreement, in the
event that the Company is sold or is merged or consolidated
with another party, the Optionee is entitled to receive cash
in an amount determined by multiplying (i) the excess, if any,
of the per share price received by the stockholders of the
Company in connection with any such transaction over the
applicable exercise price per share of common stock subject to
the Stock Options by (ii) the total number of shares of common
stock subject to the Stock Options, whether or not those
options are then exercisable;
C. On May 14, 2002, the Company entered into a Merger Agreement
with Kayak Acquisition Corp. ("Kayak"), pursuant to which
Kayak will be merged with and into the Company (the "Merger")
and, at the effective time of the Merger (the "Effective
Time"), all holders of outstanding shares of common stock will
be entitled to receive $4.25 in cash for each share owned at
that time and, except for the stock options held by the
Optionee, Xxxxxxx X. Xxxxxxxx, Xx. and Xxxxxx Xxxxxx, all
holders of outstanding stock options and warrants, whether or
not then exercisable, will be entitled to receive in cash,
without interest from the Company, an amount determined by
multiplying (i) the excess, if any, of $4.25 over the
applicable exercise price per share of common stock subject to
such stock options or warrants by (ii) the total number of
shares of common stock subject to such stock options and
warrants;
D. Notwithstanding the provisions of Section 11 of the Stock
Option Agreement, in consideration for the cancellation of the
Stock Options at the Effective Time, the Optionee has agreed
to accept a deferred, non-interest bearing, unsecured cash
payment in the amount of $95,063, less all withholding or
other taxes required by law to be withheld in connection with
the cancellation of the Stock Options, to be paid by the
Company on the fifth (5th) anniversary of the Effective Time
(the "Deferred Cash Payment"); and
E. The Optionee and the Company desire to enter into this
Amendment to provide for the cancellation of the Stock Options
and the Company's obligation to pay the Deferred Cash Payment,
all to be effective at the Effective Time.
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NOW, THEREFORE, for and in consideration of the terms and conditions
set forth herein, the receipt and sufficiency of which are hereby acknowledged,
the parties agree as follows:
SECTION 1. DEFINITIONS. Unless otherwise defined herein, all
capitalized terms shall have the meanings ascribed to them by the Stock Option
Agreement.
SECTION 2. AMENDMENTS. Section 11 of the Stock Option Agreement is
hereby amended by adding the following paragraph to the end of Section 11:
"Notwithstanding any other term or provision of this Agreement to the
contrary, the Incentive Options to purchase 76,050 shares of common
stock of the Company granted to the Optionee by the Company, whether
or not those options are then exercisable hereunder, shall be canceled
at the Effective Time and the Company shall pay the Optionee the
Deferred Cash Payment, less all withholding or other taxes required by
law to be withheld in connection with the cancellation of the Stock
Options, on the fifth (5th) anniversary of the Effective Time. The
amount of the Deferred Cash Payment shall not bear interest and the
Company's obligation to pay the Deferred Cash Payment shall not be
secured by any asset of the Company. Further, the Company's obligation
to pay the Deferred Cash Payment shall be expressly subordinate to the
rights of the Company's senior lender, Commerce Bank, N.A. and the
Optionee agrees to execute and deliver a subordination agreement or
similar agreement on terms reasonably acceptable to Commerce Bank,
which agreement shall subordinate the payment of the Deferred Cash
Payment to the repayment in full of all outstanding obligations of the
Company to Commerce Bank, N.A."
SECTION 3. REFERENCES. From and after the date of effectiveness of this
Amendment, all references to the Stock Option Agreement shall be deemed to be
references to the Stock Option Agreement as amended hereby.
SECTION 4. EFFECTIVENESS OF THIS AMENDMENT; CONDITIONS TO AMENDMENT.
This Amendment shall be effective upon the execution of counterparts of this
Amendment by the Optionee and the Company.
SECTION 5. ENTIRE AGREEMENT; RATIFICATION. This Amendment embodies the
entire agreement of the parties and supersedes any prior agreements or
understandings with respect to the subject matter hereof. Except as modified or
supplemented in connection herewith, the Stock Option Agreement shall continue
in full force and effect.
SECTION 6. COUNTERPARTS. This Amendment may be executed in any number
of counterparts, all of which taken together shall constitute one and the same
instrument. In making proof hereof, it shall not be necessary to produce or
account for any counterpart other than one signed by the party against which
enforcement is sought.
SECTION 7. NO ORAL AGREEMENTS. This Amendment represents the final
agreement between and among the parties hereto with respect to the subject
matter hereof and may not be contradicted by evidence of prior, contemporaneous
or subsequent oral agreements of the parties. There are no unwritten oral
agreements between the parties hereto.
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IN WITNESS WHEREOF, this Amendment is executed as of the date first set
forth above.
U.S. VISION, INC.
By: /s/ XXXXXXX X. XXXXXXXX, XX. /s/ XXXXX XXXXXXX
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Xxxxxxx X. Xxxxxxxx, Xx., CEO Xxxxx Xxxxxxx
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