EXHIBIT 2.2
CYBERSTAR COMPUTER CORPORATION
NONQUALIFIED STOCK OPTION AGREEMENT
June 21, 2000
Dear Xxxxxxx Xxxxx:
You are hereby notified that you have been granted an option
("Option"), to purchase 25,000 shares of Common Stock ("Stock") of CyberStar
Computer Corporation (the "Company") at a price of $1.75 per share.
THIS STOCK OPTION AGREEMENT, AND THE RIGHTS GRANTED HEREUNDER ARE
CONTINGENT UPON THE CLOSING OF THE STOCK EXCHANGE AGREEMENT DATED APRIL 1, 2000,
ENTERED INTO BY AND AMONG CYBERSTAR COMPUTER CORPORATION, A MINNESOTA
CORPORATION, AND XXXXXXXX X. XXXXX, XXXXXXX XXXXX, XXXX XXXXX AND XXXX XXXXXXXX
(THE "EXCHANGE AGREEMENT"). IN THE EVENT THE EXCHANGE AGREEMENT DOES NOT CLOSE,
THIS OPTION IS VOID AND INOPERABLE.
Your Option is also limited and conditioned by the following:
1. Your Option is exercisable as follows:
(a) This Option shall become exercisable as to all of the
Stock on the first day following the third anniversary hereof provided:
(i) you have been and remain a full-time employee of the Company on the
date the Stock is eligible to be exercised; and (ii) the aggregate
gross sales of the ITC division of the Company produced by Messrs.
Grohs, Wolfe, Xxxxxxxx and Bumba shall be $100,000,000 or more on or
before the third anniversary of the closing of the Exchange Agreement.
(b) This Option shall become exercisable as to all of the
Stock on the first day following the fifth anniversary hereof provided
you have been and remain a full-time employee of the Company on the
date the Stock is eligible to be exercised.
2. This Option will expire to the extent not exercised, on or before
June 21, 2006. YOU WILL NOT RECEIVE ANY WARNING OR NOTICE BY THE COMPANY OF THE
TERMINATION OF YOUR RIGHTS UNDER THIS OPTION.
3. Additional Right to Convert Option.
(a) You shall have the right to require the Company to convert
this Option (the "Conversion Right") into shares of Common Stock as
provided for in this Paragraph 3. Upon exercise of the Conversion
Right, the Company shall deliver to you (without payment by you of any
cash consideration) that number of
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shares of Common Stock equal to the quotient obtained by dividing (x)
the value of the Option at the time the Conversion Right is exercised
(determined by subtracting the aggregate purchase price for the Stock
in effect immediately prior to the exercise of the Conversion Right
from the aggregate Market Price for the Stock immediately prior to the
exercise of the Conversion Right) by (y) the Market Price of one share
of Common Stock immediately prior to the exercise of the Conversion
Right.
(b) The Conversion Right may be exercised by you, at any time
or from time to time, after this Option has become exercisable pursuant
to Paragraph 1, prior to its expiration, on any business day, by
delivering a written notice in the form attached hereto (the
"Conversion Notice") to the Company at the offices of the Company,
exercising the Conversion Right and specifying a place and date not
less than one nor more than 20 business days from the date of the
Conversion Notice for the closing of such conversion.
(c) At any closing under Paragraph 3(b) hereof, (i) you agree
to surrender the Option and (ii) the Company will deliver to you a
certificate or certificates for the number of shares of Common Stock
issuable upon such conversion, together, with cash in lieu of any
fraction of a share.
4. Definition of "Market Price". For purposes of this Option, the term
"Market Price" with respect to shares of Common Stock of any class or series
means the last reported sale price or, if none, the average of the last reported
closing bid and asked prices on any national securities exchange or quoted in
the National Association of Securities Dealers Automated Quotations System
(NASDAQ), or if not listed on a national securities exchange or quoted in
NASDAQ, the average of the last reported closing bid and asked prices as
reported by Metro Data Company, Inc. from quotations by marketmakers in such
Common Stock on the Minneapolis-St. Xxxx over-the-counter market or, if not
listed on a national securities exchange or quoted on NASDAQ or quoted by
marketmakers, the fair market value as determined in good faith by the Company's
Board of Directors.
5. Except as set forth in Paragraph 3 above, the purchase price of any
shares of Stock purchased pursuant to exercise of this Option may be paid in
cash, by certified or cashier's check, or, by transfer to the Company of shares
of Stock already owned by you and having a fair market value, as of the date of
your exercise of the Option, which is not less than the purchase price of the
Stock being acquired pursuant to your Option, provided that such shares of Stock
were acquired and full consideration paid therefor at least six months prior to
such delivery, or any combination thereof, or by any other method authorized by
the Company's Board of Directors.
6. Except as set forth in Paragraphs 7 and 8, in the event of
termination of your employment, your Option may be exercised at any time within
three months after the date of termination of your employment or until the
expiration of the stated term of the Option, whichever is shorter, but only to
the extent you were entitled to exercise your Option at the date of termination
of your employment.
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7. In the event of termination of your employment as a result of
"Disability" (as defined as the permanent and total disability of you within the
meaning of Section 22(e)(3) of the Internal Revenue Code of 1986, as amended),
your Option may be exercised at any time within one year of such termination or
until the expiration of the stated term of the Option, whichever is shorter, to
the extent you were entitled to exercise the Option at the time of your
Disability. In the event of your death within one year after termination of your
employment as a result of Disability, your Option may be exercised at any time
within one year following the date of your death or until the expiration of the
stated term of the Option, whichever is shorter, by your estate or by a person
who acquired the right to exercise your Option by will or by the laws of descent
and distribution, but only to the extent you were entitled to exercise the
Option at the time of termination of your employment.
8. In the event of your death while you are an employee, your Option
may be exercised at any time within one year after your death or until the
expiration of the stated term of the Option, whichever is shorter, by your
estate or by a person who acquired the right to exercise the Option by will or
by the laws of descent and distribution, to the extent the Option was
exercisable by you at the time of your death.
9. You may not transfer, sell, pledge, assign, or otherwise dispose of
your Option, other than at death by will or the laws of descent and distribution
or pursuant to a qualified domestic relations order as defined by the Internal
Revenue Code or the Employee Retirement Income Security Act, and your Option
during your lifetime is exercisable only by you.
10 Unless a registration statement under the Securities Act of 1933
(and applicable state securities laws) is in effect with respect to this Option
or Stock to be purchased pursuant to this Option, you agree with, and represent
to, the Company that you are acquiring the Option and Stock for the purpose of
investment and not with a view to transfer, sell, or otherwise dispose of the
Option or Stock. The Company may require an opinion of counsel satisfactory to
it prior to the transfer of any Stock to you to assure at all times that it will
be in compliance with applicable federal and state securities laws.
11. If there shall be any change in the Stock subject to this Option
through merger, consolidation, reorganization, recapitalization, stock dividend,
stock split or other change in the corporate structure of the Company,
appropriate adjustments shall be made by the Company in the number of shares and
the price per share of the Stock subject to this Option in order to prevent
dilution or enlargement of option rights granted hereunder.
12. This Option is not intended to be an "Incentive Stock Option" or a
"Nonqualified Stock Option" as defined in the Internal Revenue Code of 1986, as
amended from time to time. The Option is not granted under the Company's 1996
Stock Option Plan.
13. This Agreement shall not confer upon you any right with respect to
continuance of service to the Company or any of its subsidiaries, nor will it
interfere in any way with the right of the Company to terminate such service at
any time.
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As a condition to the issuance of shares of Stock under this Option,
you agree to authorize the Company to withhold in accordance with applicable law
from any regular cash compensation payable to you or, in the alternative, to the
remit to the Company at the time of any exercise of this Option, any taxes
required to be withheld by the Company under federal, state, or local law as a
result of your exercise of this Option. Further, you agree that you are
responsible for payment of any taxes due that are not subject to withholding.
CyberStar Computer Corporation
Dated: June 21, 2000 By:
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Xxxxxxx X. Xxxxxx
Its Chairman of the Board
ACCEPTANCE
The undersigned hereby accepts the terms and provisions of the above
Stock Option Agreement and agrees to be bound by the terms thereof on June 21,
2000. The undersigned also agrees to accept as binding, conclusive, and final
all decisions or interpretations by the Board of Directors on any questions
arising under this Option. The undersigned acknowledges the grant of the Options
in lieu of the warrants to be issued under Section 9.2 of the Exchange Agreement
and that the Options amends and supercedes Section 9.2 of the Exchange
Agreement. The Options granted herein are subject to the closing of the
transactions contemplated by the Exchange Agreement and shall be void and
inoperable if the closing does not occur. The warrants to be issued under the
Exchange Agreement are void whether or not there is a closing under the Exchange
Agreement.
Dated: June 21, 2000
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Xxxxxxx Xxxxx
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NOTICE OF EXERCISE OF STOCK OPTION
AND RECORD OF STOCK TRANSFER
I hereby exercise my Stock Option granted by CyberStar Computer
Corporation (the "Company"), effective June 21, 2000, subject to all terms and
provisions thereof and notify you of my desire to purchase ____________ shares
of Common Stock of the Company (the "Shares"), offered to me pursuant to said
Option. Enclosed is my check in the sum of $__________ in full payment for the
Shares.
[This paragraph is applicable if the Stock is not registered under the
Securities Act of 1933.] I hereby represent that the Shares are being acquired
by me as an investment and not with a view to, or for resale in connection with,
the distribution of any shares of the Company. I understand that the Shares are
not registered under the Securities Act of 1933, as amended (the "Act"), or
applicable state securities laws, that the Shares may not be sold or otherwise
transferred except pursuant to an effective registration statement under the Act
and said laws unless the Company has received an opinion of counsel satisfactory
to it that such transfer or disposition does not require registration under the
Act or said laws and, for any sales under Rule 144 of the Act, such evidence as
it shall request for compliance with that rule or applicable state securities
laws, and that the certificate representing the Shares may contain a legend
referring to such restrictions.
NOTICE OF CONVERSION OF OPTION - To be Executed by the Registered Holder in
Order to Convert the Option pursuant to Paragraph 3 of the Option.
The undersigned hereby irrevocably elects to convert the attached Option into
shares of Common Stock pursuant to the terms of Paragraph 3 of the Option and
requests that the certificates for such shares be issued in the name of the
Option holder.
________ Initial here for conversion election.
I agree to pay any taxes payable as a result of this exercise by:
(check one)
_______ delivery to the Company of any amount required to be
withheld, or
_______ authorizing the Company to withhold the required taxes from
other compensation due to me.
Dated: ___________________
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Optionee's Signature
RECEIPT is hereby acknowledged of the delivery to me by CyberStar
Computer Corporation (the "Company"), on __________________ of stock certificate
no. ______________ for ______________ shares of Common Stock purchased by me
pursuant to the terms and conditions of the Option Agreement referred to above.
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Optionee
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