EXHIBIT 4.3
STOCK OPTION AGREEMENT
PRIME CELLULAR, INC.
AGREEMENT made as of this 16th day of January, 1998 (the
"Grant Date") between Prime Cellular, Inc. (the "Company"), a Delaware
corporation, having a principal place of business at 000 Xxxxxxxx Xxxxx,
Xxxxxxxx, XX 00000 and Xxxxxxx Xxxx ("Axel"),residing at 000 Xxxxxxxxx Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000.
In consideration of the mutual covenants hereinafter set forth
and for other good and valuable consideration, the parties hereto agree:
1. Grant of Option. The Company hereby grants to Axel as a
matter of separate agreement and not in lieu of any compensation for services
provided by Axel in his position as director of the Company, the right and
option (the "Option") to purchase all or any part of an aggregate of 100,000
shares of common stock of the Company (the "Option Shares"), on the terms and
conditions and subject to all the limitations set forth herein, of which Option
Shares shall be exercisable and shall vest as of the date hereof.
All Option Shares, when issued and delivered in accordance
with the terms of this Agreement, shall be fully paid and non-assessable, and
the certificate or certificates representing such Option Shares shall so state.
2. Exercise of Option and Issue of Shares. The Option may be
exercised in whole or in part (to the extent that it is exercisable in
accordance with its terms) by giving written notice to the Company, in the form
attached hereto as Exhibit A, together with the tender of the Exercise Price.
Such written notice shall be signed by the person exercising the Option, shall
state the number of Option Shares with respect to which the Option is being
exercised, shall contain any warranty required by Section 5 below and shall
otherwise comply with the terms and conditions of this Agreement. The Company
shall pay all original issue taxes with respect to the issue of the Option
Shares pursuant hereto and all other fees and expenses necessarily incurred by
the Company in connection herewith. Except as specifically set forth herein,
Axel acknowledges that any income or other taxes due from him with respect to
this Option or the Option Shares issuable pursuant to this Option shall be his
responsibility. The holder of this Option shall have rights as a shareholder
only with respect to any Option Shares covered by the Option after due exercise
of the Option and tender of the full exercise price for the Option Shares being
purchased pursuant to such exercise.
3. Exercise Price. The purchase price of the Option Shares
covered by this Option shall be $0.75 per share (the "Exercise Price").
4. Term of Option. The Option shall terminate four (4) years
from the date of this Agreement (the "Term").
5. Purchase for Investment.
(a) Unless the offering and sale of the Option Shares
to be issued upon the particular exercise of the Option shall have been
effectively registered under the Securities Act of 1933, as now in force or
hereafter amended, or any successor legislation (the "Act"), or an exemption
from such registration is available, the Company shall be under no obligation to
issue the Option Shares covered by such exercise unless and until the following
conditions have been fulfilled:
(1) The person(s) who exercise the Option shall
warrant to the Company, at the time of such exercise, that such person(s) are
acquiring such Option Shares for his or her own account, for investment and not
with a view to, or for sale in connection with, the distribution of any such
Option Shares, in which event the person(s) acquiring such Option Shares shall
be bound by the provisions of the following legend which shall be endorsed upon
the certificate(s) evidencing their Option Shares issued pursuant to such
exercise:
"The shares represented by this certificate have not been
registered under the Securities Act of 1933, as amended (the
"Act"). Such shares may not be sold, transferred or otherwise
disposed of unless they have first been registered under the
Act or, unless, in the opinion of counsel satisfactory to the
Company's counsel, such registration is not required."
(2) The Company shall have received an opinion
of its counsel that the Option Shares may be issued upon such particular
exercise in compliance with the Act without registration thereunder. Without
limiting the generality of the foregoing, the Company may delay issuance of the
Option Shares until completion of any action or obtaining of any consent, which
the Company deems necessary under any applicable law (including without
limitation state securities or "blue sky" laws).
(b) Axel acknowledges that he has been informed of the
applicable provisions of Rule 144 promulgated under the Act, including, without
limitation, its requirements that (i) shares must have been owned and paid for a
period of at least one year before sale may occur; (ii) the Company must be at
the time of sale and for a specified prior period a reporting company under the
Exchange Act of 1934 and current in its filings thereunder; (iii) sale must
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occur in a customary sale through a broker; (iv) the number of shares which may
be sold within any three (3) month period must not exceed the volume limitations
contained in the Rule; and (v) prior notice of an intended sale must be fully
filed with the Commission in the manner prescribed by law. Axel realizes that,
in the event Rule 144 is not available, registration under the Act or an
exemption therefrom will be required for any sale and the Company is not
obligated to register any shares or to assist in obtaining an exemption from
such registration if such exemption is otherwise available. Accordingly, Axel
understands that, if the terms and conditions of Rule 144 are not fully met,
sale of the shares acquired hereby may not be readily possible.
(c) Axel further acknowledges that he has reviewed such
information regarding the Company's activities as he deems necessary to satisfy
himself regarding the desirability of purchasing the Common Stock pursuant
hereto, which information has included, without limitation, copies of the annual
reports of the Company on Forms 10-K for the years ended May 31, 1996 and 1997,
as amended, and on Forms l0-Q, as filed with the Securities and Exchange
Commission during the fiscal years 1996 and 1997.
6. Shareholder Rights. Axel shall have rights as a
shareholder only with respect to any Shares covered by the Option after due
exercise of the Option and tender of the full purchase price for the Option
Shares being purchased pursuant to such exercise.
7. Non-Assignability. The Option shall not be transferable by
Axel otherwise than by will or by the laws of descent and distribution and shall
be exercisable, during Axel's lifetime, only by Axel. The Option shall not be
assigned, pledged or hypothecated in any way (whether by operation of law or
otherwise) and shall not be subject to execution, attachment or similar process.
Any attempted transfer, assignment, pledge, hypothecation or other disposition
of the Option or of any rights granted hereunder contrary to the provisions of
this Section 7, or the levy of any attachment or similar process upon the Option
or such right, shall be null and void.
8. Notices. Any notices required or permitted by the terms
of this Agreement shall be given by registered or certified mail, return receipt
requested, addressed as follows:
To the Company: Prime Cellular, Inc.
000 Xxxxxxxx Xxxxx
Xxxxxxxx, XX 00000
Attention: President
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with a copy to: Xxxxxx Xxxxxxxxxx, LLP
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx Xxxxxxx, Esq.
To the Axel: Xxxxxxx Xxxx
000 Xxxxxxxxx Xxxxx
Xxx Xxxx, XX 00000
or to such other address or addresses of which notice in the same manner has
previously been given. Any such notice shall be deemed to have been given three
(3) days from mailing when mailed in accordance with the foregoing provisions.
Either party hereto may change the address of which notices shall be given by
providing the other party hereto with written notice of such change.
9. Governing Law. This Agreement shall be construed and
enforced in accordance with the law of the State of New York without giving
effect to its conflicts of laws provisions.
10. Benefit of Agreement. This Agreement shall be for the
benefit of and shall be binding upon the heirs, executors, administrators and
successors of the parties hereto.
11. Severability. In the event that any term or condition in
this Agreement shall for any reason be held by a court of competent jurisdiction
to be invalid, illegal or unenforceable in any respect, such invalidity,
illegality or unenforceability shall not affect any other term or condition of
this Agreement, but this Agreement shall be construed as if such invalid or
illegal or unenforceable term or condition had never been contained herein.
12. Entire Agreement. This Agreement supersedes any and all
other agreements, either oral or in writing, between the parties hereto with
respect to the subject matter hereof and contains all of the covenants and
agreements between the parties with respect thereto. Any modification or
termination of this Agreement will be effective only if it is in writing signed
by all of the parties hereto.
13. Execution in Counterparts. This Agreement may be executed
by the parties in one or more counterparts, each of which shall be deemed to be
an original but all of which taken together shall constitute one and the same
agreement, and shall become effective when one or more counterparts has been
signed by each of the parties hereto and delivered to each of the other parties
hereto.
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IN WITNESS WHEREOF, the Company has caused this Agreement to
be executed by its duly authorized officer, and the Axel has hereunto set his
hand, all as of the day and year first above written.
PRIME CELLULAR, INC.
/s/ Xxxxxx X. Xxxxxx
----------------------------
Xxxxxx X. Xxxxxx, President
/s/ Xxxxxxx Xxxx
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XXXXXXX XXXX
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EXHIBIT A
NOTICE OF EXERCISE OF
PRIME CELLULAR, INC. STOCK OPTION
TO PURCHASE COMMON STOCK OF
PRIME CELLULAR, INC.
Name _______________________________________________
Address ____________________________________________
____________________________________________________
Date _______________________________________________
Prime Cellular, Inc.
000 Xxxxxxxx Xxxxx
Xxxxxxxx, XX 00000
Attention: President
Re: Exercise of Prime Cellular, Inc.;
Stock Option
-------------------------------------
Gentlemen:
Subject to acceptance hereof in writing by Prime Cellular,
Inc. (the "Company") pursuant to the provisions of the Stock Option Agreement
between the Company and the Undersigned, the Undersigned hereby elects to
exercise options granted to the Undersigned to purchase ____ shares of $.0l par
value Common Stock of the Company (the "Common Stock").
Enclosed is a certified check (or bank cashier's check) for
$________________ for the full purchase price payable to the order of Prime
Cellular, Inc.
As soon as the Stock Certificate is registered in the name of
the Undersigned, please deliver it to the Undersigned at the above address.
The Undersigned hereby represents, warrants, covenants and
agrees with the Company as follows:
The Common Stock being acquired by the Undersigned will be
acquired for his own account without the participation of any other
person with the intent of holding the Common Stock for investment and
without the intent of participating, directly or indirectly, in a
distribution of the Common Stock and not with a view to, or for resale
in connection with, any distribution of the Common Stock, nor is the
Undersigned aware of the existence of any distribution of the Common
Stock;
The Undersigned is not acquiring the Common Stock based upon
any representation, oral or written, by any person with respect to the
future value of, or income from, the Common Stock but rather upon an
independent examination and judgment as to the prospects of the
Company;
The Common Stock was not offered to the Undersigned by means
of publicly disseminated advertisements or sales literature, nor is the
Undersigned aware of any offers made to other persons by such means;
The Undersigned is able to bear the economic risks of the
investment in the Common Stock, including the risk of complete loss of
the investment of the Undersigned therein;
The Undersigned understands and agrees that the Common Stock
will be issued and sold to the undersigned without registration under
any state law relating to the registration of securities for sale, and
will be issued and sold in reliance on the exemptions from registration
under the Securities Act of 1933, as amended (the "1933 Act"), provided
by Sections 3(b) and/or 4(2) thereof and the rules and regulations
promulgated thereunder;
The Common Stock cannot be offered for sale, sold or
transferred by the Undersigned other than pursuant to an effective
registration under the 1933 Act or in a transaction otherwise in
compliance with the 1933 Act and evidence satisfactory to the Company
of the compliance with the applicable securities laws or other
jurisdictions. The Company shall be entitled to rely upon an opinion of
counsel satisfactory to it with respect to compliance with the above
laws;
The Company will be under no obligation to register the Common
Stock or to comply with any exemption available for sale of the Common
Stock without registration, and the information or conditions necessary
to permit routine sales of securities of the Company under Rule 144 of
the 1933 Act are not now available and no assurance has been given that
it or they will become available. The Company is under no obligation to
act in any manner so as to make Rule 144 available with respect to the
Common Stock;
The Undersigned has had complete access to and the opportunity
to review and make copies of all material documents related to the
business of the Company. The Undersigned has examined such of these
documents as the Undersigned wished and is familiar with the business
and affairs of the Company. The Undersigned realizes that the purchase
of the Common Stock is a speculative investment and that any possible
profit therefrom is uncertain;
The Undersigned has had the opportunity to ask questions of,
and receive answers from, the Company and any person acting on its
behalf and to obtain all material information reasonably available with
respect to the Company and its affairs. The Undersigned has received
all information and data with respect to the Company which the
Undersigned has requested and which the Undersigned has deemed relevant
in connection with the evaluation of the merits and risks of the
investment of the Undersigned in the Company;
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The Undersigned has such knowledge and experience in financial
and business matters that the Undersigned is capable of evaluating the
merits and risks of the purchase of the Shares hereunder and the
Undersigned is able to bear the economic risk of such purchase; and
The agreements, representations, warranties and covenants made
by the Undersigned herein extend to and apply to all of the Common
Stock of the Company issued to the Undersigned pursuant to this Option.
Acceptance by the Undersigned of the certificate representing such
Common Stock shall constitute a confirmation by the Optionee that all
such agreement, representations, warranties and covenants made herein
shall be true and correct at such time.
The Undersigned understands that the certificates representing
such shares being purchased by the Undersigned in accordance with this
notice shall bear a legend referring to the foregoing covenants,
representations and warranties and restrictions on transfer, and the
Undersigned agrees that a legend to that effect may be placed on any
certificate which may be issued to the Undersigned as a substitute for
the certificates being acquired by the Undersigned in accordance with
this notice.
Very truly yours,
_________________________________
[Name]
AGREED TO AND ACCEPTED BY:
PRIME CELLULAR, INC.
By: ____________________________________
Name:____________________________________
Title: __________________________________
Number of Shares ________________________
Exercised: ______________________________
Number of Shares
Remaining: ______________________________
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