1
Exhibit 10.42
OPTION AGREEMENT
VALUEVISION INTERNATIONAL, INC.
TO
XXX XXXXXXXX
OPTION AGREEMENT made as of the 31st day of July, 2000, between ValueVision
International, Inc., a Minnesota corporation ("ValueVision"), and Xxx Xxxxxxxx,
an employee of ValueVision ("Employee").
WHEREAS, ValueVision desires, by affording Employee an opportunity to
purchase its shares of Common Stock, $0.01 par value ("Shares"), as hereinafter
provided, to carry out the resolutions of the Board of Directors of ValueVision
granting a non-qualified stock option to Employee as partial compensation for
his efforts on behalf of ValueVision as its employee.
NOW, THEREFORE, in consideration of the mutual covenants hereinafter set
forth and for other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties hereto agree as follows:
1. Grant of Option. ValueVision hereby irrevocably grants to Employee the
right and option, hereinafter called the Option, to purchase all or any part of
an aggregate of two hundred fifty thousand (250,000) Shares (such number being
subject to adjustment as provided in paragraph 7 hereof) on the terms and
conditions herein set forth.
2. Purchase Price. The purchase price of the Shares covered by the Option
shall be $14.375, which is equal to the last price on the NASDAQ System of one
share of ValueVision's Common Stock on the last trade date prior to the date
hereof day first written above.
3. Exercise of Option. The right to exercise the Option in whole or in
part, shall be effective, except as otherwise specifically limited herein, as
follows: on the date hereof, the employee may purchase up to 83,333 Shares; on
and after the first anniversary of the date hereof, Employee may
2
purchase up to 83,333 Shares; and on and after the second anniversary of the
date hereof, Employee may purchase up to an additional 83,334 Shares.
Each of the rights to purchase Shares granted in the preceding sentence
shall expire five (5) years after the right to purchase the Shares became
effective, except as otherwise specifically limited herein. ValueVision and
Employee agree that no accelerated vesting under any circumstance will occur.
The purchase price of Shares acquired through exercise of any part of the Option
shall be paid in full in cash at the time of exercise. Employee, as holder of
the Option, shall not have any of the rights of a Shareholder with respect to
the Shares covered by the Option except to the extent that one or more
certificates for such Shares shall be delivered to Employee upon the due
exercise of all or any part of the Option.
4. Non-Transferability. The Option shall not be transferable otherwise than
by will or the laws of descent and distribution, and the Option may be
exercised, during the lifetime of Employee, only by Employee. More particularly
(but without limiting the generality of the foregoing), the Option may not be
assigned, transferred (except as provided above), pledged, or hypothecated in
any way, shall not be assignable by operation of law, and shall not be subject
to execution, attachment, or similar process. Any attempted assignment,
transfer, pledge, hypothecation, or other disposition of the Option contrary to
the provisions hereof, and the levy of any execution, attachment, or similar
process upon the Option shall be null and void and without effect.
5. Exercise Upon Termination. If Employee ceases to serve as an employee of
ValueVision, while the Option remains in effect, whether as a result of
resignation or termination, with or without cause, the Option may be exercised
(to the extent that Employee shall have been entitled to do so on the last day
in which he served as an employee of ValueVision) by Employee at anytime within
ninety (90) days of the day in which he ceased to serve as an employee of
ValueVision. Upon the expiration of such ninety (90) day period, or, if earlier,
upon the expiration date of the Option as set forth in Paragraph 3 hereof, the
Option shall become null and void.
3
6. Exercise Upon Death. If Employee dies while the Option remains in
effect, the Option may be exercised (to the extent that Employee shall have been
entitled to do so at the date of his death) by the legatee or legatees of
Employee under his will, or by his personal representatives or distributees, at
any time within ninety (90) days after his death. Upon the expiration of such
ninety (90) day period, or, if earlier, upon the expiration date of the Option
as set forth in paragraph 3 hereof, the Option shall become null and void.
7. Changes in Capital Structure. If all or any portion of the Option shall
be exercised subsequent to any Share dividend, split-up, recapitalization,
merger, consolidation, combination or exchange of Shares, separation,
reorganization, or liquidation occurring after the date hereof, as a result of
which Shares of any class shall be issued in respect of outstanding Shares, or
Shares shall be changed into the same or a different number of Shares of the
same or another class or classes, the person or persons so exercising the Option
shall receive, for the aggregate price paid upon such exercise, the aggregate
number and class of Shares which, if Shares (as authorized at the date hereof)
had been purchased at the date hereof for the same aggregate price (on the basis
of the price per Share set forth in paragraph 2 hereof) and had not been
disposed of, such person or persons would be holding, at the time of such
exercise, as a result of such purchase and all such shared dividends, split-ups,
recapitalizations, mergers, consolidations, combinations or exchanges of Shares,
separations, reorganizations, or liquidations; provided, however, that no
fractional Share shall be issued upon any such exercise, and the aggregate price
paid shall be appropriately reduced on account of any fractional Share not
issued.
8. Method of Exercising Option. Subject to the terms and conditions of this
Agreement, the Option may only be exercised by written notice to ValueVision.
Such notice shall state the election to exercise the Option and the number of
Shares in respect of which it is being exercised, and shall be signed by the
person or person so exercising the Option. Such notice shall either: (a) be
accompanied by payment of the full purchase price of such Shares, in which event
4
ValueVision shall deliver a certificate or certificates representing such Shares
as soon as practicable after the notice shall be received; or (b) fix a date
(not less than five (5) nor more than ten (10) business days from the date such
notice shall be received by ValueVision) for the payment of the full purchase
price of such Shares against delivery of a certificate or certificates
representing such Shares. Payment of such purchase price shall, in either case,
be made by certified or cashier's check payable to the order of ValueVision. All
Shares that shall be purchased upon the exercise of the Option as provided
herein shall be fully paid and non-assessable.
9. General. ValueVision shall at all times during the term of the Option
reserve and keep available such number of Shares as will be sufficient to
satisfy the requirements of this Option Agreement. This Option shall be
construed in accordance with the laws of the State of Minnesota.
IN WITNESS WHEREOF, ValueVision and Employee have executed this Agreement
effective as of the date first written above.
VALUEVISION INTERNATIONAL, INC.
By: /s/ Xxxx XxXxxxxxx
-------------------------------------
Xxxx XxXxxxxxx
Chief Executive Officer
Employee:
/s/ Xxx Xxxxxxxx
-------------------------------------
