NEITHER THIS OPTION NOR ANY OF THE SECURITIES ISSUABLE UPON
EXERCISE HEREOF HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES
LAW. NO TRANSFER OF THIS OPTION OR OF THE SECURITIES ISSUABLE
UPON EXERCISE HEREOF SHALL BE VALID OR EFFECTIVE UNLESS SUCH
TRANSFER IS MADE PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
UNDER THE SECURITIES ACT AND IN COMPLIANCE WITH ANY APPLICABLE
STATE SECURITIES LAW OR PURSUANT TO EXEMPTIONS THEREFROM.
STOCK OPTION AGREEMENT
This STOCK OPTION AGREEMENT (this "Agreement"), is dated as
of July 19, 2002 (the "Effective Date"), between TEMTEX
INDUSTRIES, INC., a Delaware corporation (the "Company"), and
XXXXXXX XXXXXXXX (the "Grantee").
WITNESSETH:
WHEREAS, the Grantee serves as the Chief Executive Officer
and President of the Company pursuant to the terms of that
Employment Contract of even date herewith (the "Employment
Agreement"); and
WHEREAS, the Board of Directors of the Company (collectively
the "Board" and individually, a "Director") has granted to the
Grantee an option to purchase 500,000 shares (the "Shares") of
the Company's common stock, (the "Common Stock"); and
WHEREAS, the option evidenced by this Agreement is not
granted pursuant to the Company's 1990 Stock Plan for Key
Employees nor its 1999 Omnibus Securities Plan;
NOW, THEREFORE, to evidence the stock option so granted, and
to set forth its terms and conditions, the Company and the
Grantee hereby agree as follows:
1. Confirmation of Grant; Option Price. The Company hereby
evidences and confirms its grant to the Grantee, effective on the
date hereof, of an option (the "Option"), subject to the terms
and conditions hereof, to purchase the Shares at an option price
equal to $0.55 per share, which such price is equal to at least
the fair market value as of the date of grant (the "Option
Price"). The Option is not intended to be an incentive stock
option under the Internal Revenue Code of 1986, as amended.
Furthermore, the parties acknowledge that this Option is not
granted under the Company's 1990 Stock Plan for Key Employees nor
its 1999 Omnibus Securities Plan, nor is it subject to the
provisions or interpretations of either of these plans.
2. Vesting, Term of Exercise.
(a) Vesting. On each Measurement Date set forth in Column 1
below, the Option shall vest and become exercisable for the
corresponding number of shares of Common Stock set forth in
Column 2 below if, but only if, (i) as of such Measurement Date
the Grantee employment has not terminated and (ii) the Company
has achieved the Performance Target (as defined below).
Therefore the "Vested Portion" of the Option as of any particular
date shall be the cumulative total of all shares for which the
Option has become exercisable in accordance with the schedule set
forth in Column 2, provided the Performance Target has been
met.[FN-1] For purposes of this Agreement, the Company shall
have achieved the "Performance Target" if and when the Company
has achieved positive "EBITDA" for any full fiscal year occurring
entirely within the Term of this Agreement. "EBITDA" shall mean
for any fiscal year the sum of net income for such period plus an
amount which, in the determination of net income for such period,
has been deducted for interest expense, total federal, state and
local income taxes and depreciation and amortization expense, all
as reasonably determined by the Company in accordance with
generally accepted accounting principals; provided, however, that
in calculating EBITDA for purposes of the Performance Target, no
deduction shall be made with respect to the granting, vesting,
exercise or termination of any warrants or any employee stock
options of the Company, including, without limitation, the stock
options subject hereto. The Company need satisfy the Performance
Target only once during the Term of this Option.
Column 1 Column 2
Measurement Date Shares Vesting on
Measurement Date
-------------------------------------- ------------------
First anniversary of the Date of Grant 166,666
Second anniversary of the Date of Grant 166,666
Third anniversary of the Date of Grant 166,668
(b) Effect of Change in Control. Notwithstanding the
provisionsof Section 2(a) hereof, as of the effective time and date of any
Change in Control (as defined herein) the Option shall become
available for exercise as to 100% of the Shares, subject to the
provisions hereof, regardless of whether any or all of the
Measurement Dates have passed and regardless of whether the
Company has achieved the Performance Target on or before the date
of the Change in Control. As used herein "Change in Control"
means the following and shall be deemed to occur if any of the
following events specified in clauses (i), (ii) or (iii) occur:
(i) Any person (other than Xxxxx X. Upfield or his
estate, if he should be deceased) becomes, after the Effective Date, the
beneficial owner (within the meaning of Rule 13d-3 promulgated
under the Securities Exchange Act of 1934, as amended), directly
or indirectly, of fifty percent (50%) or more of the combined
voting power of the Company's then outstanding securities; or
----------------------
FN-1 By way of example, if the Grantee remains employed by the
Company on the second anniversary, but the Performance
Target has not been met, none of the Options shall be vested
on such anniversary. If the Grantee is employed by the
Company as of the third or any subsequent anniversary and by
that date the Company has achieved the Performance Target,
then all 500,000 of the Options shall be vested as of that
date. As a further example, if Grantee remains employed by
the Company on the first anniversary, and the Performance
Target has been met, 166,666 of the Options shall be vested
as of that date and an additional 1,66,666 and 166,668
Options shall vest, respectively, on each of the second and
third anniversary dates of the Date of Grant (assuming
Grantee remains employed by the Company) because the
Performance Target has previously been met.
-2-
(ii) A merger or consolidation of the Company with
any other corporation, other than a merger or consolidation that would
result in the voting securities of the Company outstanding
immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting
securities of the surviving entity) more than fifty percent (50%)
of the combined voting power of the voting securities of the
Company or such surviving entity outstanding immediately after
such merger or consolidation; provided, however, that a merger or
consolidation effected to implement a recapitalization of the
Company (or similar transaction) in which no person acquires more
than fifty percent (50%) of the combined voting power of the
Company's then outstanding securities or a merger or
consolidation primarily effected to change the Company's
jurisdiction of incorporation shall not constitute a Change in
Control, and provided further a merger or consolidation in which
the Company is the surviving entity (other than as a wholly owned
subsidiary of another entity) and in which the Board of Directors
of the Company or the successor to the Company after giving
effect to the merger or consolidation, is comprised of a majority
of members who are either (A) Directors of the Company
immediately preceding the merger or consolidation, or (B)
appointed to the Board of Directors by the Company (or the Board)
as an integral part of such merger or consolidation, shall not
constitute a Change in Control; or
(iii) Approval by the stockholders of the Company or any
order by a court of competent jurisdiction of a plan of
liquidation of the Company, or the sale or disposition by the
Company of all or substantially all of the Company's assets other
than (A) the sale or disposition of all or substantially all of
the assets of the Company to a person or persons who beneficially
own, directly or indirectly, at least fifty percent (50%) or more
of the combined voting power of the outstanding voting securities
of the Company at the time of the sale; or (B) pursuant to a
dividend in kind or spin-off type transaction, directly or
indirectly, of such assets to the stockholders of the Company.
Notwithstanding the foregoing, a Change in Control of the
type described in clauses (ii) or (iii) above shall be deemed to
be completed on the date it occurs, and a Change in Control of
the type described in clause (i) above shall be deemed to be
completed as of the date the entity or group attaining fifty
percent (50%) or greater ownership has elected its
representatives to the Board of Directors and/or caused its
nominees to become officers of the Company with the authority to
terminate or alter the terms of any employee's employment.
(c) Transactions Not Involving a Change in Control. If the
Company shall consummate any merger, consolidation, business
combination, other reorganization or other similar transaction (a
"Reorganization") not involving a Change in Control in which
holders of shares of Common Stock are entitled to receive in
respect of such shares any securities, cash or other
consideration (including without limitation a different number of
shares of Common Stock), the Option outstanding under this
Agreement shall thereafter be claimed or exercisable, in
accordance with this Agreement, only for the kind and amount of
securities, cash and/or other consideration receivable upon such
Reorganization by a holder of the same number of shares of Common
Stock as are subject to the Option immediately prior to such
Reorganization, and any adjustments will be made to the terms of
the Option, and this Agreement, in the sole discretion of the
Board as it may deem appropriate to give effect to the
Reorganization.
-3-
(d) Adjustment Provisions.
(i) If (A) the outstanding shares of Common Stock are
increased, decreased or exchanged for a different number or kind of shares
or other securities, or if additional shares or new or different
shares or other securities are distributed in respect of such
shares of Common Stock (or any stock or securities received with
respect to such Common Stock), through merger, consolidation,
sale or exchange of all or substantially all of the assets of the
Company, reorganization, recapitalization, reclassification,
stock dividend, stock split, reverse stock split, spin-off, split-
off or other distribution with respect to such shares of Common
Stock (or any stock or securities received with respect to such
Common Stock), or (B) the value of the outstanding shares of
Common Stock is reduced by reason of an extraordinary dividend
payable in cash or property, an appropriate and proportionate
adjustment may be made in (1) the number and kind of shares or
other securities subject to the outstanding Option under this
Agreement, and/or (2) the price for each share or other unit of
any other securities subject to the outstanding Option under this
Agreement.
(ii) No fractional interests will be issued under
this Agreement resulting from any adjustments, but the Board, in
its sole discretion, may make a cash payment in lieu of any fractional
shares of Common Stock or other securities issuable as a result
of such adjustments.
(iii) Any adjustment pursuant to this Section 2(d)
shall be made by the Board, in its discretion, to preserve the benefits or
potential benefits intended to be made available under this
Agreement or otherwise necessary to reflect any capital change or
other event described in Section 2(d). The determination made by
the Board with respect to the foregoing shall be final, binding
and conclusive upon the Grantee.
(e) Term of Exercise. The Shares eligible for purchase
pursuant to Section 2 hereof may thereafter be purchased, subject to the
provisions hereof, at any time and from time to time until the
close of business on the date one day prior to the date on which
the Option terminates (the "Term").
3. Termination of Option.
(a) Normal Termination Date. The Option shall terminate
at the close of business on the tenth (10th) anniversary of the
Effective Date (the "Normal Termination Date").
(b) Effect of Termination of Employment.
(i) Termination For Cause or Without Good Reason.
Subject to Section 3(b)(iv), and except as otherwise provided in a written
agreement between the Company and the Grantee, which may be
entered into at any time before or after Grantee's termination of
employment of the Grantee, in the event of a "for cause"
termination (as that term is defined in the Employment Agreement)
or voluntary termination without "good reason" (as that term is
defined by the Employment Agreement) of the Grantee from
employment with the Company, all of the Grantee's unvested
Options shall be immediately terminated and become void, and all
of the Grantee's unexercised Options (whether or not vested)
shall be forfeited, expire and become void, as of the date of
such for cause termination or voluntary termination without good
reason.
-4-
(ii) Termination For Designated Events. Subject to
Section 3(b)(iv), and except as otherwise provided in a written
agreement between the Company and the Grantee, which may be
entered into at any time before or after termination of
employment of the Grantee, in the event the Grantee dies, becomes
permanently disabled or retires, vesting shall cease immediately
and the Grantee shall then maintain the right to exercise all
Options then vested for a period to continue until the earlier of
(1) the date such Options would have expired in accordance with
their terms had the Grantee remained employed and (2) one year
after the date of such termination.
(iii) Termination Other than For Cause or With Good Reason.
Subject to Section 3(b)(iv), and except as otherwise provided in
a written agreement between the Company and the Grantee, which
may be entered into at any time before or after termination of
employment, in the event of the termination of employment with
the Company (1) by the Company for any reason other than "for
cause" termination (as defined in the Employment Agreement) or
(2) by the Grantee for "good reason" (as defined in the
Employment Agreement) the Option shall become exercisable as to
100% of the Shares, subject to the provisions hereof, regardless
of whether any or all of the Measurement Dates have passed and
regardless of whether the Company has achieved the Performance
Target on or before the effective date of the termination and the
Grantee shall maintain the right to exercise all Options so
vested for a period to continue until the earlier of (1) the date
such Options would have expired in accordance with their terms
had the Grantee remained employed and (2) one hundred and twenty
(120) days after the date of such termination.
(iv) Discretionary Alteration of Vesting and Exercise Periods.
Notwithstanding anything to the contrary in Sections 3(b)(i),
3(b)(ii) or 3(b)(iii), the Company may in its discretion
designate longer periods to exercise the Options following the
Grantee's termination of employment with the Company.
(v) No Employment or Other Continuing Rights. Nothing contained
in this Agreement shall confer upon the Grantee (A) any right to
continue in the employ (or other business relationship) of the
Company or constitute any contract or agreement of employment or
engagement, or interfere in any way with the right of the Company
to reduce the Grantee's compensation or other benefits or to
terminate the employment or engagement of the Grantee, with or
without cause; or (B) any right to exercise or claim his rights
under this Agreement otherwise than in accordance with the
express terms and conditions of this Agreement. Except as
expressly provided in this Agreement, the Company shall have the
right to deal with the Grantee in the same manner as if this
Agreement did not exist, including, without limitation, with
respect to all matters related to the hiring, retention,
discharge, compensation and conditions of the employment or
engagement of the Grantee. Any questions as to whether and when
there has been a termination of the Grantee's employment or
engagement, the reason (if any) for such termination, and/or the
consequences thereof under the terms of this Agreement shall be
determined by the Board, and the Board's determination thereof
shall be final, conclusive and binding upon the Grantee.
-5-
4. Restrictions on Exercise, Non-Transferability of Option.
(a) Restrictions on Exercise. Except as otherwise provided
by the Company, during the lifetime of the Grantee, only he or his
court appointed guardian may exercise the Option (or any portion
thereof) granted to him under this Agreement, unless it has been
transferred with the consent of the Company, pursuant to a
domestic relations order (a "DRO") as defined by the Internal
Revenue Code ("IRC") or Title I of ERISA or the rules thereunder.
(b) Non Transferability of Option. Except as otherwise provided
by this Section 4 or by the Company, this Option may not be sold,
pledged, assigned, transferred, encumbered, alienated,
hypothecated or otherwise disposed of (whether voluntarily or
involuntarily or by operation of law by judgment, levy,
attachment, garnishment or any other legal or equitable
proceedings (including bankruptcy)) in any manner other than by
will or the laws of descent and distribution or, subject to the
consent of the Company, pursuant to a DRO, unless and until such
Option has been exercised, if applicable, and the shares of
Common Stock underlying such Option have been issued, and all
restrictions applicable to such shares have lapsed, and no Option
or interest or right therein shall be liable for the debts,
contracts, liabilities or contractual obligations of the Grantee.
Any attempted disposition of this Option or any interest therein
shall be null and void and of no effect, except to the extent
that such disposition is permitted by the preceding sentence.
(c) Death or Incapacity of Grantee. After the death
of the Grantee, any exercisable or vested but unpaid portion of the
Options may, prior to the time when such portion becomes
unexercisable or is terminated or expires pursuant to the
provisions of Section 3(b) above or otherwise, under this
Agreement, be exercised by or paid to the beneficiary most
recently named by the Grantee in a written designation thereof
filed with the Company or, in the absence of a validly designated
beneficiary, his or her personal representative or by any person
empowered to do so under the deceased Grantee's will or under the
then applicable laws of descent and distribution. In the event
this Option is to be exercised by, or paid to, the executors,
administrators, heirs or distributees of the estate of a deceased
Grantee, or such Grantee's beneficiary, or an incapacitated
Grantee's guardian, or the transferee of such Option, in any case
pursuant to the terms and conditions of this Agreement, and in
accordance with such terms and conditions as may be specified
from time to time by the Company, the Company shall be under no
obligation to issue shares of Common Stock or make any payment
under such Option unless and until the Board is satisfied that
the person or persons exercising or to receive payment under such
Option is the duly appointed legal representative of the deceased
Grantee's estate or the proper legatee or distributees thereof.
-6-
5. Manner of Exercise/ Payment.
(a) To the extent the Option shall have become and remains
exercisable as provided in Section 2 hereof, and subject to such
administrative regulations as the Board may have adopted, the
Option may be exercised from time to time, in whole or in part,
by notice to the Secretary of the Company in writing given 30
days prior to the date on which the Grantee will so exercise the
Option (the "Exercise Date"), specifying the number of Shares
with respect to which the Option is being exercised (the
"Exercise Shares") and the Exercise Date. The Grantee may not
exercise the Option for less than 100 shares at any one time, and
the Option must be exercised in multiples of 100 shares unless
the number of shares exercised is the total number of shares
vested and available for exercise at such time. On or before the
Exercise Date, the Grantee shall deliver to the Company (i) full
payment for the Exercise Shares in United States dollars in cash,
or cash equivalent satisfactory to the Company and in an amount
equal to the Option Price multiplied by the number of the
Exercise Shares, (ii) full payment for all applicable federal,
state and local tax required to be withheld by the Company in
United States dollars in cash, or cash equivalent satisfactory to
the Company (including without limitation, the withholding of
salary by the Company), or, at the election of the Grantee, by
the retention by the Company of a portion of the Shares purchased
upon exercise of the Option to be credited against the amount of
such tax at fair market value on the date of exercise, and (iii)
written confirmation, in form and substance satisfactory to the
Company, as of the exercise date of the representations,
warranties and covenants of the Grantee contained in Section 6
hereof.
(b) On the Exercise Date, and subject to satisfaction of the
obligations of the Grantee set forth in this Section 5, the
Company shall deliver to the Grantee a certificate or
certificates representing the Exercise Shares, registered in the
name of the Grantee. The Company may require the Grantee to
furnish or execute such other documents as the Company shall deem
necessary (i) to evidence such exercise, (ii) to determine
whether registration is then required under the Securities Act,
or (iii) to comply with or satisfy the requirements of the
Securities Act, state securities laws or any other applicable
law, rule or regulation.
(c) In the discretion of the Company, and subject to such
limitations or conditions as it may prescribe, if permitted by
applicable law, (i) payments for the Option Price may be by
matured capital stock of the Company (i.e., capital stock owned
longer than six (6) months by the person delivering such capital
stock or by such person and his or her spouse jointly) delivered
in transfer to the Company by or on behalf of the person
exercising the Option and duly endorsed in blank or accompanied
by stock powers duly endorsed in blank, with signatures
guaranteed in accordance with the Securities Act and/or
Securities Exchange Act of 1934, as amended, if required by the
Board (valued at the fair market value as of the exercise or
purchase date), or such other consideration as the Board may from
time to time in the exercise of its discretion deem acceptable in
any particular instance; (ii) the Company may allow the exercise
of Options in a broker-assisted or similar transaction in which
the Option Price is not received by the Company until promptly
after exercise, (iii) the Company may loan the applicable Option
Price to the Grantee, if the Exercise will be followed by a
prompt sale of some or all of the underlying shares and a portion
of the sale proceeds is dedicated to full payment of the Option
Price and any other amounts required pursuant to this Agreement;
and/or (iv) the Company may loan the Option Price to the Grantee
on such terms and at such rates of interest and upon such
security (if any) as shall be approved by the Board.
-7-
6. Representations, Warranties and Covenants of the Grantee.
(a) Investment Intention. The Grantee represents and warrants
that the Option has been, and any Exercise Shares will be,
acquired by him solely for his own account for investment and not
with a view to, or for sale in connection with, any distribution
thereof. The Grantee agrees that he will not, directly or
indirectly, offer, transfer, sell or otherwise dispose of any of
the Exercise Shares (or solicit any offers to buy, purchase or
otherwise acquire any Exercise Shares), except in compliance with
the Securities Act, the rules and regulations thereunder and the
requirements of applicable state securities laws. The Grantee
further understands, acknowledges and agrees that none of the
Exercise Shares may be transferred, sold or otherwise disposed of
unless (i) (A) such disposition is pursuant to an effective
registration statement under the Act, (B) the Grantee shall have
delivered to the Company an opinion of counsel, which opinion and
counsel shall be satisfactory to the Company, to the effect that
such disposition is exempt from the provisions of Section 5 of
the Securities Act, or (C) a no-action letter from the Securities
and Exchange Commission, satisfactory to counsel for the Company,
shall have been obtained with respect to such disposition, and
(ii) such disposition is pursuant to registration or
qualification under any applicable state securities laws or an
exemption therefrom.
(b) Legend. The certificate representing the Exercise Shares
shall bear a restrictive legend concerning registration deemed
appropriate by the Company.
(c) Federal Securities Law Matters. The Grantee acknowledges
receipt of advice from the Company that (i) the Exercise Shares
will not be registered under the Securities Act, (ii) the
Exercise Shares must be held indefinitely and the Grantee must
continue to bear the economic risk of the investment in the
Exercise Shares unless the Exercise Shares are subsequently
registered under the Securities Act or an exemption from such
registration is available, (iii) when and if the Exercise Shares
may be disposed of without registration in reliance upon Rule
144, such disposition can be made only in limited amounts in
accordance with the terms and conditions of such Rule, (iv) if
the exemption afforded by Rule 144 is not available, public sale
without registration will require the availability of an
exemption under the Securities Act, (v) a restrictive legend
concerning registration deemed appropriate by the Company shall
be placed on the certificate representing the Exercise Shares and
(vi) a notation shall be made in the appropriate records of the
Company indicating that the Exercise Shares are subject to
restrictions on transfer and appropriate stop-transfer
restrictions may be issued to the Company's transfer agent with
respect to the Exercise Shares.
(d) Compliance with Rule 144. If any of the Exercise Shares are
disposed of in accordance with Rule 144 under the Securities Act,
the Grantee shall deliver to the Company at or prior to the time
of such disposition an executed copy of Form 144 (if required by
Rule 144) and such other documentation as the Company may
reasonably require in connection with such disposition. No
assurances can be given that Rule 144 will be available for the
public resale of the Exercise Shares.
(e) Ability to Bear Risk. The Grantee represents and warrants
that (i) the financial condition and income of the Grantee is
such that he can afford to bear the economic risk of holding the
Exercise Shares for an indefinite period, and (ii) he can afford
to suffer the complete loss of his investment in the Exercise
Shares.
-8-
(f) Access to Information. The Grantee represents and warrants
that (i) he has been granted the opportunity to ask questions of,
and receive answers from, representatives of the Company
concerning the terms and conditions of the Option and the
purchase of any Exercise Shares, and to obtain any additional
information that he deems necessary to verify the accuracy of the
information contained in such materials, (ii) his knowledge and
experience in financial and business affairs is such that he is
capable of evaluating the merits and risks of an investment in
the Exercise Shares and (iii) he is an executive officer of the
Company and is knowledgeable concerning its business and affairs
on the date hereof.
7. Representations and Warranties of the Company. The Company
represents and warrants to the Grantee that (a) this Agreement
has been duly authorized, executed and delivered by the Company,
and (b) the Shares, when issued and delivered in accordance with
the terms hereof, will be duly and validly issued, fully paid and
nonassessable.
8. Rights as Shareholder. Neither Grantee nor his heirs,
legatees or legal representatives shall have any rights as a
shareholder of the Company with respect to any Shares covered by
the Option until the issuance of a certificate or certificates to
such person for such Shares. No adjustment shall be made for
dividends or other rights for which the record date is prior to
the issuance of such certificate or certificates. Neither this
Agreement nor any action taken under this Agreement shall be
converted to create a trust of any kind or a fiduciary
relationship between the Company and the Grantee.
9. No Obligation to Exercise Option. The granting of the
Option shall impose no obligation upon the Grantee to exercise
such Option.
10. Miscellaneous.
(a) Notices. All notices and other communications required or
permitted to be given under this Agreement shall be in writing
and shall be deemed to have been given if delivered personally or
sent by certified express mail, return receipt requested, postage
prepaid, or by any recognized international equivalent of such
mail delivery, to the Company or the Grantee, as the case may be,
at the following addresses or to such other address as the
Company or the Grantee, as the case may be, shall specify by
notice to the other party listed below:
if to the Company, to it at:
Temtex Industries, Inc.
0000 XXX Xxxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: Chairman of the Board
if to the Grantee, to him at:
Xxxxxxx Xxxxxxxx
00 Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxxxx 00000
All such notices and communications shall be deemed to have
been received on the date of delivery or on the third business
day after the mailing thereof, whichever shall occur first.
-9-
(b) Binding Effect, Benefits. This Agreement shall be binding
upon and inure to the benefit of the parties to this Agreement
and their respective successors and assigns. Nothing in this
Agreement, express or implied, is intended or shall be construed
to give any person other than the parties to this Agreement or
their respective successors or assigns any legal or equitable
right, remedy or claim under or in respect of any agreement or
any provision contained herein.
(c) Waiver, Amendment.
(i) Waiver. Either party hereto may by written notice to the
other (A) extend the time for the performance of any of the
obligations or other actions of the other under this Agreement,
(B) waive compliance with any of the conditions or covenants of
the other contained in this Agreement, and (C) waive or modify
performance of any of the obligations of the other under this
Agreement. Except as provided in the preceding sentence, no
action taken pursuant to this Agreement, including, without
limitation, any investigation by or on behalf of any party, shall
be deemed to constitute a waiver by the party taking such action
of compliance with any representations, warranties, covenants or
agreements contained herein. The waiver by any party hereto of a
breach of any provision of this Agreement shall not operate or be
construed as a waiver of any preceding or succeeding breach and
no failure by either party to exercise any right or privilege
hereunder shall be deemed a waiver of such party's rights or
privileges hereunder or shall be deemed a waiver of such party's
rights to exercise the same at any subsequent time or times
hereunder.
(ii) Amendment. This Agreement may be amended, modified or
supplemented only by a written instrument executed by the Grantee
and the Company.
(d) Assignability. Neither this Agreement nor any right,
remedy, obligation or liability arising hereunder or by reason
hereof shall be assignable by Grantee without the prior written
consent of the Company.
(e) Applicable Law. This Agreement shall be governed by and
construed in accordance with the law of the State of Delaware,
regardless of the law that might be applied under principles of
conflict of laws.
(f) Section and Other Headings. The section and other headings
contained in this Agreement are for reference purposes only and
shall not affect the meaning or interpretation of this Agreement.
[signature page follows]
-10-
IN WITNESS WHEREOF, the Company and the Grantee have
executed this Agreement as of the date first above written.
THE COMPANY:
TEMTEX INDUSTRIES, INC.
By:___________________________
Name:_________________________
Title:________________________
GRANTEE:
Xxxxxxx Xxxxxxxx
______________________________
