Exhibit 10.13
This document constitutes part
of a prospectus covering
securities that have been
registered under the
Securities Act of 1933.
OPTION AGREEMENT, dated as of October 17, 2001, between XXXXXX X.
XXXXXX (the "Optionee"), with a business address at c/o Concord Camera Corp.,
0000 Xxxxxxxxx Xxxxxxxxx, Xxxxx 000X, Xxxxxxxxx, Xxxxxxx 00000, and CONCORD
CAMERA CORP., a New Jersey corporation ("Concord").
WHEREAS, the Optionee is presently employed by Concord or a subsidiary
thereof (collectively, the "Concord Group of Companies"); and
WHEREAS, the Optionee has tendered an eligible option to Concord in
exchange for the Option described herein, pursuant to Concord's offer to
exchange outstanding stock options with an exercise price of more than $7.00 per
share for new options to purchase 75% of the shares that were subject to the
outstanding eligible option at an exercise price of $5.97 per share; and
WHEREAS, Concord is desirous of increasing the incentive of the
Optionee to exert his utmost efforts to contribute to the future success and
prosperity of the Concord Group of Companies.
NOW, THEREFORE, the parties agree as follows:
1. Grant of Option. Subject to the terms and conditions set forth
herein, Concord hereby grants to the Optionee the right and option (the
"Option") to purchase an aggregate of 67,500 shares (the "Option Shares") of
Concord's no par value common stock (the "Common Stock") which Option is not
intended to qualify as an incentive stock option, as defined in Section 422 of
the Internal Revenue Code of 1986, as amended (the "Code").
2. Cancellation of Prior Option. The Optionee has delivered to Concord
and Concord hereby acknowledges receipt of an option to purchase up to 90,000
shares of Common Stock, originally granted to Optionee as of April 17, 2000. The
foregoing option has been cancelled and is replaced with the Option described
herein.
3. Purchase Price. The purchase price (the "Purchase Price") of the
Option Shares shall be $5.97 per share, subject to adjustment pursuant to
Section 7.
4. Time of Exercise.
(a) The Option shall become exercisable, on a cumulative basis, as to
22,500 Option Shares on the date hereof, as to an additional 22,500 Option
Shares on April 17, 2002, and as to the remaining 22,500 Option Shares on April
17, 2003.
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(b) The Option shall expire and shall not be exercisable after April
16, 2010, unless it expires or terminates sooner pursuant to Section 5.
5. Exercise of Option after Termination of Employment.
(a) If the employment of the Optionee with a member of the Concord
Group of Companies is terminated voluntarily by the Optionee without the consent
of such employer or for "Cause" (as hereinafter defined), and immediately after
such termination the Optionee is not then employed by any other member of the
Concord Group of Companies, the Option to the extent not theretofore exercised
shall expire forthwith. For purposes of this Option Agreement, "Cause" shall
mean "Cause" as defined in any employment agreement ("Employment Agreement")
between the Optionee and his employer, and, in the absence of an Employment
Agreement or in the absence of a definition of "Cause" in such Employment
Agreement, "Cause" shall mean: (i) any continued failure by the Optionee to obey
the reasonable instructions of the President, Managing Director or the Board of
Directors of his employer; (ii) continued neglect by the Optionee of his duties
and obligations as an employee of his employer, or a failure to perform such
duties and obligations to the reasonable satisfaction of the President, Managing
Director or the Board of Directors of his employer; (iii) willful misconduct of
the Optionee or other actions in bad faith by the Optionee which are to the
detriment of any of the Concord Group of Companies including without limitation
conviction of a felony, embezzlement or misappropriation of funds or conviction
of any act of fraud; or (iv) a breach of any material provision of any
Employment Agreement not cured within 10 days after written notice thereof.
(b) If the Optionee's employment with a member of the Concord Group of
Companies is terminated other than (i) by reason of death, (ii) voluntarily by
the Optionee without the consent of his employer, or (iii) for Cause, and
immediately after such termination the Optionee is not then employed by any
other member of the Concord Group of Companies, the Option may be exercised at
any time within three months after such termination, subject to the provisions
of Section 5(d). The Option, to the extent unexercised, shall expire on the day
three months after the termination of the Optionee's employment with the member
of the Concord Group of Companies. For the purposes of this Option Agreement,
the retirement of the Optionee either pursuant to a pension or retirement plan
adopted by his employer or on the normal retirement date prescribed from time to
time by his employer, and the termination of employment as a result of a
disability (as defined in Section 22(e)(3) of the Code) shall be deemed to be a
termination of such Optionee's employment other than voluntarily by the
Optionee.
(c) If the Optionee dies (i) while employed by a member of the Concord
Group of Companies or (ii) within three months after the termination of his
employment other than voluntarily by the Optionee without the consent of his
employer or for Cause, the Option may be exercised at any time within six months
after the Optionee's death, subject to the provisions of Section 5(d). The
Option, to the extent unexercised, shall expire six months after the Optionee's
death.
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(d) The Option may not be exercised pursuant to this Section 5 except
to the extent that the Optionee was entitled to exercise the Option at the time
of the termination of his employment, or at the time of his death, and in any
event may not be exercised after the date specified in Section 4(b).
6. Leave of Absence.
In the event the Optionee is on military or sick leave or other bona
fide leave of absence (such as temporary employment by the United States or any
state government), the Optionee shall be considered as remaining in the employ
of his employer for 90 days or such longer period as may be determined by the
Board of Directors of his employer.
7. Adjustment upon Changes in Capitalization.
(a) In the event that the outstanding shares of Common Stock are
hereafter changed by reason of reorganization, merger, consolidation,
recapitalization, reclassification, stock split-up, combination or exchange of
shares and the like, or dividends payable in shares of Common Stock, an
appropriate adjustment shall be made by the Board of Directors of Concord in the
aggregate number of Option Shares and Purchase Price. If Concord is reorganized,
consolidated, or merged with another corporation, or if all or substantially all
of the assets of Concord are sold or exchanged, the Optionee shall thereupon be
entitled to receive upon the exercise of the Option the same number and kind of
shares of stock or the same amount of property, cash or securities as he would
have been entitled to receive upon the occurrence of any such corporate event as
if he had been, immediately prior to such event, the holder of the number of
Option Shares covered by the Option; provided, however, that if any of such
events occur, the Board of Directors of Concord shall have the discretionary
power to prevent the Option from being disqualified as an incentive stock option
if it otherwise would have qualified as such.
(b) Any adjustment under this Section 7 in the aggregate number of
Option Shares and Purchase Price shall apply proportionately to only the
unexercised portion of the Option. If fractions of a share would result from any
such adjustment, the adjustment shall be revised to the next lower whole number
of shares.
8. Method of Exercising Option.
(a) The Option shall be exercised by the delivery by Optionee to
Concord at its principal office (or at such other address as may be established
by Concord's Board of Directors) of written notice of the number of shares of
Common Stock with respect to which the Option is being exercised accompanied by
payment in full of the Purchase Price of such shares. Payment of the Purchase
Price for such shares of Common Stock may be made: (i) in U.S. dollars by
delivery of cash or personal check, bank draft or money order payable to the
order of Concord or by money transfers or direct account debits; (ii) by
delivery of certificates representing shares of Common Stock having a fair
market value (as defined below) equal to the Purchase Price; (iii) pursuant to a
broker-assisted "cashless exercise" program if established by Concord; or (iv)
by any combination of the methods of payment described in (i) through (iii)
above.
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(b) For purposes hereof, the fair market value of a share of Common
Stock on a particular day shall be the closing price for the Common Stock on the
National Market System of the National Association of Securities Dealers, Inc.
Automated Quotation System on such day (or if there were no sales on such day,
on the next preceding date on which such closing price was recorded).
9. Withholding. Concord's obligation to deliver shares of Common Stock
upon the exercise of the Option shall be subject to the payment by the Optionee
of any applicable federal, state and local withholding tax. Concord shall, to
the extent permitted by law, have the right to deduct from any payment of any
kind otherwise due to the Optionee any federal, state or local taxes required to
be withheld with respect to such payment. Subject to the right of Concord's
Board of Directors or any committee thereof to disapprove any such election and
require the withholding tax in cash, the Optionee shall have the right to elect
to pay the withholding tax with shares of Common Stock to be received upon
exercise of the Option or which are otherwise owned by the Optionee. Any
election to pay withholding taxes with stock shall be irrevocable once made.
10. Representations.
(a) Unless prior to the exercise of the Option the shares of Common
Stock issuable upon such exercise are the subject of a registration statement
filed with the Securities and Exchange Commission pursuant to the Securities Act
of 1933, as amended (the "Securities Act"), and there is then in effect a
prospectus filed as part of such registration statement meeting the requirements
of Section 10(a)(3) of the Securities Act, the notice of exercise with respect
to the Option shall be accompanied by a representation or agreement of the
Optionee to Concord to the effect that such shares are being acquired for
investment only and not with a view to the resale or distribution thereof, or
such other documentation as may be required by Concord, unless, in the opinion
of counsel to Concord, such representation, agreement or documentation is not
necessary to comply with the Securities Act. If appropriate, certificate(s) for
the Option Shares issued upon the exercise of the Option shall bear a legend
reciting that such Option Shares may only be transferred if there is then in
effect a prospectus filed as part of such registration statement meeting the
requirements of Section 10(a)(3) of the Securities Act unless, in the opinion of
counsel to Concord, such registration is not required. Concord may also issue
"stop transfer" instructions with respect to Option Shares acquired by the
exercise of the Option.
(b) Concord shall not be obligated to issue or sell any shares of
Common Stock until they have been listed on each securities exchange on which
the shares of Common Stock may then be listed and until and unless, in the
opinion of counsel to Concord, Concord may issue such shares pursuant to a
qualification or an effective registration statement, or an exemption from
registration, under such state and federal laws, rules or regulations as such
counsel may deem applicable. Concord shall use reasonable efforts to effect such
listing, qualification and registration, as the case may be.
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11. Option Cannot be Transferred. Unless otherwise agreed to by
Concord, the Option is not transferable otherwise than by will or the laws of
descent and distribution, and the Option may be exercised during Optionee's
lifetime only by the Optionee. Any attempt to transfer the Option in
contravention of this Section 11 is void ab initio. The Option shall not be
subject to execution, attachment or other process.
12. No Rights in Option Shares. The Optionee shall have none of the
rights as a shareholder with respect to any Option Shares until such Option
Shares shall be issued to him upon exercise of the Option.
13. Not a Contract of Employment. Nothing contained herein shall confer
upon the Optionee any right to remain in the employ of any member of the Concord
Group of Companies.
14. Miscellaneous. This Option Agreement cannot be changed or
terminated orally. This Option Agreement contains the entire agreement between
the parties relating to the subject matter hereof. This Option Agreement has
been executed in the State of Florida and shall be governed by and construed in
accordance with the laws of Florida. The paragraph and section headings herein
are intended for convenience of reference only and shall not affect the
interpretation hereof.
IN WITNESS WHEREOF, the parties have executed this Option Agreement as
of the day and year first above written.
CONCORD CAMERA CORP.
By: /s/ Xxxxxx X. Press
--------------------------------------
Xxxxxx X. Press
Vice President and Treasurer
OPTIONEE:
/s/ Xxxxxx X. Xxxxxx
-----------------------------------------
XXXXXX X. XXXXXX
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