THIS DOCUMENT IS A COPY OF THE EXHIBIT FILED ON OCTOBER 24, 1996
PURSUANT TO A RULE 201 TEMPORARY HARDSHIP EXEMPTION.
DELTA COMPUTEC INC.
000 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxxxx 00000
October 10, 1996
Xx. Xxxxxx X. Xxxxxxx
000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxx 00000
Dear Xx. Xxxxxxx:
This letter agreement constitutes an Amended and Restated Stock Option
Agreement (the "Option Agreement") between Delta Computec Inc. ("Delta"), and
Xxxxxx X. Xxxxxxx XX (the "Optionee"), and this Option Agreement supersedes in
part a certain Stock Option Agreement dated May 1, 1996, between Delta and
Xxxxxx X. Xxxxxxx XX (the "Original Option") which entitled Xxxxxx X. Xxxxxxx XX
("Xxxxxxx") to acquire up to 11,440,475 common shares of Delta. The common
shares covered by this Option Agreement constitute a portion of the common
shares as to which the Original Option applied.
This Option Agreement is issued as consideration for Xxxxxxx agreeing to
assist Delta (and their affiliated companies) in their relationship with their
commercial lender, National Canada Finance Corp. ("NCFC"), and as further
consideration for Xxxxxxx'x agreement to provide the Xxxxxxx Commitment to Delta
as set forth in a letter agreement between Delta and Xxxxxxx of May 1, 1995 (the
"Xxxxxxx Commitment Letter"), and as further consideration for Xxxxxxx
purchasing a portion of Delta's obligation to NCFC as of October 10, 1996, Delta
has issued to Optionee this Option Agreement. It is acknowledged that this
Option Agreement is part of a negotiated transaction between Delta and Xxxxxxx
and it is not issued to Optionee as an incentive to service or continued service
to Delta by Optionee.
This Option Agreement is hereby granted to Optionee on the following terms
and conditions:
1. From May 20, 1995 through October 9, 2001, Optionee shall have, and is
hereby granted, an option (the "Option") to purchase up to 8,420,475 common
shares, subject to adjustment as described below (the "Option Shares"), of
Delta. The Optionee may exercise the Option in whole or in part from time to
time but not in amounts less than 100,000 common shares per exercise.
2. The cash exercise price (the "Cash Exercise Price") for the exercise of
the Option and for the purchase of the Option Shares, shall be the payment of a
price calculated by multiplying Ten Dollars ($10.00) by a fraction, the
numerator of which shall be
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the number of Option Shares as of the date of exercise and the denominator of
which shall be 11,440,475, such amount calculated as of the date of issuance of
this Option Agreement being $7.36, and, if the number of Option Shares ever
changes, such amount to be recalculated and restated at that time. The Cash
Exercise Price is to be paid by certified or bank check or money order payable
to the order of Delta. The consideration provided to Delta by Xxxxxxx pursuant
to the transactions set forth in the Xxxxxxx Commitment Letter (the "Xxxxxxx
Consideration") is also a portion of the exercise price of this Option.
3. The Board of Directors of Delta has determined that the fair market
value of the Xxxxxxx Consideration plus the Cash Exercise Price exceeds the fair
value and the par value of the Option Shares, although no representation is made
that the Option Shares will not be assessable.
4. Delta acknowledges that it has reserved for issuance a sufficient number
of Delta's authorized and unissued common shares, representing the Option Shares
and that it will keep the Option Shares reserved during the life of this Option
Agreement.
5. The Optionee may exercise this Option by sending to Delta a written
notice of exercise which notice is received at any time prior to October 10,
2001.
6. This Option Agreement, and the Option Shares, are each restricted
securities and are subject to the provisions of paragraphs 9, 10 and 11 of the
Xxxxxxx Commitment Letter, a copy of which is annexed hereto.
7. Delta agrees to pay any and all fees or costs associated with the
exercise of the Option, including, if necessary, any listing fee for the Option
Shares with the National Association of Securities Dealers, Inc., and any and
all state, federal or other fees or costs associated therewith.
8. If, and whenever, before the expiration of the Option, Delta shall
effect a subdivision or consolidation of its common shares, or the payment of a
share dividend on its common shares without receipt of consideration by Delta,
the number of common shares with respect to which this Option may thereafter be
exercised: (i) in the event of an increase in the number of outstanding common
shares, shall be proportionately increased; and (ii) in the event of a reduction
in the number of outstanding common shares, shall be proportionately reduced.
9. This Option Agreement is binding on, and shall inure to the benefit of,
Delta and the Optionee, and each of their successors and assigns. This Option
Agreement shall not terminate in the event of the death or disability of Xxxxxxx
or as a result of his ceasing to be an officer or director of Delta. This Option
if transferrable, if Optionee is an individual, by will or by the laws of
descent and distribution, but is otherwise not
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transferrable without the prior written consent of Delta, which consent will not
be unnecessarily withheld.
10. This Option Agreement supersedes: (i) the May 1, 1995 Original Option
between Xxxxxxx and Delta; and (ii) any and all prior discussions and
negotiations with regard to the subject matter hereof and may only by amended by
a writing executed by Delta and Optionee.
11. This Option Agreement will be governed by the laws of the State of New
York without consideration of its conflicts of laws principles.
Very truly yours,
DELTA COMPUTEC INC.
By: _____________________
Xxxx XxXxxx
President
Accepted and agreed to:
_______________________________ ("Optionee")
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