EXHIBIT 10.2
OPTION AGREEMENT
This Option and any Shares acquired upon the exercise hereof have not
been registered under the Securities Act of 1933, as amended, and may
not be transferred, sold or otherwise disposed of except while such a
registration is in effect or pursuant to an exemption from registration
under such Act.
This OPTION AGREEMENT (the "Agreement") is entered into as of this 30th
day of June, 1999 (the "Effective Date"), by and between SignatureCard, Inc., an
Indiana corporation ("Optionee"), and Transmedia Network Inc., a Delaware
corporation (the "Company").
W I T N E S S E T H:
WHEREAS, the parties hereto have entered into an Asset Purchase
Agreement, dated as of March 17, 1999, as the same may be amended from time to
time (the "Asset Purchase Agreement"), pursuant to which the Company is
purchasing certain assets (the "Assets") from Optionee relating to the
membership program operated under the Dining a la Card trade name and service
xxxx, offering to members cash rebates or mileage credits in selected airline
mileage programs on charges at participating restaurants and other
establishments (the "Business");
WHEREAS, as partial consideration for the Assets, pursuant to Section
1.3(a)(i)(B) of the Asset Purchase Agreement, the Company has agreed to issue
and deliver to Optionee an option to purchase up to 400,000 shares of the common
stock of the Company, par value $.02 per share (the "Common Stock"), on the
terms and subject to the conditions contained herein; and
WHEREAS, it is a condition precedent to the closing of the transactions
contemplated by the Asset Purchase Agreement that this Agreement be executed;
NOW, THEREFORE, in consideration of the purchase of the Assets and of
the premises and the respective covenants and conditions contained herein and in
the Asset Purchase Agreement, the parties, intending to be legally bound, hereby
agree as follows (capitalized terms used and not defined herein having the
meanings ascribed thereto in the Asset Purchase Agreement):
1. Grant of Option. The Company hereby grants to Optionee as of the
date hereof an option (the "Option") to purchase up to 400,000 shares of Common
Stock (the "Shares") on the terms and subject to the conditions set forth
herein.
2. Term and Conditions. The grant and exercise of the Option is subject
to the following terms and conditions:
(Page 82 of 252 Pages)
(a) Option Price. Subject to the provisions of Section 5, the
purchase price for the Shares subject to the Option shall be $4.00 per share
(the "Exercise Price").
(b) Option Period. The Option shall be exercisable, in whole
or in part, from time to time and at any time, on any business day during the
period (the "Option Period") commencing at 5:00 p.m. 90 days from the Effective
Date (the "Effective Time") and terminating at 5:00 p.m. eastern standard time
(the "Expiration Time") on the third anniversary of the Effective Date (the
"Expiration Date"), after which time the Option shall terminate and be of no
further force or effect.
3. Manner of Exercise of the Option. The Optionee may exercise the
Option from time to time at any time prior to the Expiration Time, by delivering
a written notice of exercise of the Option (an "Exercise Notice") addressed to
the Company, as set forth in Section 10(a) hereof. The Exercise Notice shall
specify the number of Shares being purchased and the date on which the closing
of such purchase will occur, which date shall be within five (5) days after the
date of the delivery to the Company of the Exercise Notice. At the closing, (a)
Optionee shall pay an amount equal to the Exercise Price times the number of
Shares being purchased pursuant to the Option (i) in cash or by certified or
official bank check to the Company or by wire transfer of immediately available
funds to an account designated by the Company; or (ii) through the written
election of the Optionee to have Shares withheld by the Company from the Shares
otherwise to be received, with such withheld Shares having an aggregate fair
market value on the date of closing equal to the aggregate Exercise Price; and
(b) the Company shall deliver to Optionee certificates evidencing the Shares
then being purchased upon exercise of the Option. The closing of the purchase
and sale shall take place at the offices of the Company, unless the parties
shall otherwise agree.
4. Non-Assignability of the Option. The Option shall not be assignable,
transferable or subject to pledge or hypothecation; provided, however, that the
Optionee may assign or transfer the Option to an Affiliate (as defined in the
Asset Purchase Agreement) or to any successor-in-interest of the Optionee or of
such Affiliate (collectively, "Permitted Transferees"). The Option is
exercisable only by the Optionee or a Permitted Transferee.
5. Adjustments. The number of Shares subject to the Option and the
Exercise Price shall be adjusted appropriately for any recapitalization,
reorganization, stock split, stock dividend, increase or decrease in the issued
and outstanding Common Stock or similar event which occurs after the Effective
Date. In the event of any merger, consolidation, share exchange, sale or
transfer of all or substantially all of the assets of the Company or similar
event, the Optionee upon exercise of the Option, shall be entitled to receive
only the kind and amount of securities, cash or other property as it would have
received had it purchased the number of Shares for which it is then exercising
the Option immediately prior to such merger, consolidation, share exchange, sale
or transfer. For purposes of determining the relative amounts of cash,
securities and other property the Optionee shall be entitled to receive, it
shall be presumed that the Optionee shall have failed to exercise any right of
election as to the kind or amount of securities, cash or other property it was
to receive.
(Page 83 of 252 Pages)
6. Reservation of Shares of Common Stock. The Company shall, at all
times during the Option Period, reserve and keep available such number of shares
of Common Stock as will be sufficient to satisfy the requirements of the Option,
shall pay all original issue taxes with respect to the issuance of Shares
pursuant hereto, and all other taxes, fees and expenses necessarily incurred by
the Company in connection therewith and will, from time to time, use its best
efforts to comply with all laws and regulations which, in the opinion of counsel
for the Company, shall be applicable thereto.
7. Restriction on Exercise and Resale. Optionee covenants and agrees
that it is acquiring the Option solely for the purpose of investment and not
with a view to, or for sale in connection with, any distribution thereof.
Optionee acknowledges and agrees that neither the Option nor the Shares have
been registered under the Securities Act of 1933, as amended (the "Securities
Act") and will not be so registered at the time such Option is exercised, and
that neither the Option nor the Shares may be transferred or sold except in
compliance with the registration provisions of the Securities Act, or pursuant
to an applicable exemption therefrom and in compliance with applicable state and
local securities laws and regulations. Optionee consents to the inclusion on
each Share certificate of the following legend:
"The securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended, and may not be
transferred, sold or otherwise disposed of except while such a
registration is in effect or pursuant to an exemption from registration
under such Act."
Optionee acknowledges and agrees that it has made his own independent
investigation, analysis and evaluation of the Company and the desirability of
acquiring the Option and, upon exercise thereof, the Shares.
8. Restrictions on Issuing Shares. Each exercise of the Option shall be
subject to the condition that if at any time the Company shall determine that
the satisfaction of withholding tax or other withholding liabilities, or that
the listing, registration, or qualification of any Shares otherwise deliverable
upon such exercise upon any securities exchange or under any state or federal
law, or that the consent or approval of any regulatory body, is necessary or
desirable as a condition of, or in connection with, such exercise or the
delivery or purchase of Shares pursuant thereto, then in any such event, such
exercise shall be deferred until such withholding, listing, registration,
qualification, consent, or approval shall have been effected or obtained free of
any conditions not reasonably acceptable to the Company; provided, that the
Company shall notify Optionee of any such restriction (and its removal) and
shall use its reasonable best efforts to promptly permit the exercise of such
Option, and the length of the Option Period shall be extended for the amount of
time any such restriction is in effect.
9. No Rights as a Stockholder. Until Optionee shall have validly
exercised the Option, delivered the Exercise Price to the Company and purchased
the Shares in accordance with the terms contained herein, the Optionee shall
have no rights as a stockholder of the Company solely by virtue
(Page 84 of 252 Pages)
of this Agreement including the right to receive dividends or distributions or
to vote with respect to the Shares.
10. General.
(a) Notices. All notices and other communications hereunder
shall be in writing and shall be deemed given when received, if delivered
personally or sent by telecopy or reputable overnight carrier (and confirmed in
writing within three business days thereafter), or five calendar days after the
same is sent, if sent by registered or certified mail, return receipt requested,
postage prepaid, to the parties at the addresses and facsimile numbers as set
forth in Section 9.7 of the Asset Purchase Agreement or as otherwise designated
by the parties from time to time.
(b) Exclusive Agreement. This Agreement supersedes all prior
agreements between the parties (written or oral) with respect to the terms and
conditions of the Option and is intended as a complete and exclusive statement
of the terms of the agreement between the Parties with respect to the subject
matter hereof.
(c) Governing Law. This Agreement shall be governed by the
internal laws of the State of Delaware, without giving effect to the conflict of
laws principles thereof.
(d) Dispute Resolution (Arbitration). It is agreed that any
controversy or claim arising out of or relating to this Agreement, or the breach
hereof, shall be settled by arbitration administered by the American Arbitration
Association in Chicago, Illinois under its Commercial Arbitration Rules, before
a panel of three (3) arbitrators, one of whom shall be selected by the Company,
one of whom shall be selected by Optionee, and one of whom shall be selected
jointly by the Company and Optionee (or, in the event that the Company and
Optionee cannot agree, by the first two arbitrators). Judgment on the award
rendered by the arbitrators may be entered in any court having jurisdiction over
the parties. The costs of such arbitration, including without limitation
reasonable attorneys' fees, shall be borne by the non-prevailing party.
(e) No Assignment; Third Parties. Except as otherwise provided
herein, no party shall assign this Agreement or any part hereof without the
prior written consent of the other party. This Agreement shall be binding upon
and inure to the benefit of the parties and their respective heirs, successors,
and assigns. Except as provided herein, nothing in this Agreement shall entitle
any person other than the parties to any claim, cause of action, remedy, or
right of any kind.
(f) Further Assurances. The parties agree to deliver or cause
to be delivered to the other on the closing of the exercise of the Option and at
such other times thereafter as shall be reasonably agreed, any such additional
agreement, document, or instrument as either of them may reasonably request for
the purpose of carrying out this Agreement.
(Page 85 of 252 Pages)
(g) Captions. All section or paragraph headings contained in
this Agreement are for the convenience of the parties and shall not affect the
meaning or interpretation of any provision of this Agreement.
(h) Savings Clause. In the event that any word, phrase, clause
or provision of this Agreement should ever be deemed to be invalid, such word,
phrase, clause or provision shall automatically be amended to conform to all
applicable legal requirements. If this is impossible, such word, phrase, clause
or provision shall be given no effect as if it had not been inserted and the
remaining provisions of this Agreement shall survive as if such word, phrase,
clause or provision had not been inserted.
(i) Amendments; Modifications. Any amendment or modification
to this Agreement must be in writing signed by the parties hereto.
[Signature Page to Follow]
(Page 86 of 252 Pages)
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date first above written.
SIGNATURECARD, INC.
By: /s/ Xxxxxx X. Xxxxxxx
-------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President
TRANSMEDIA NETWORK INC.
By: /s/ Xxxxxxx X. Xxxxx
-------------------------
Name: Xxxxxxx X. Xxxxx
Title: Executive Vice President
and Chief Financial Officer
[Signature Page to Option Agreement]
(Page 87 of 252 Pages)
