EXHIBIT 4.10
COMMERCE GROUP CORP.
A Delaware Corporation
Three (3)-Year Stock Option to Purchase
Fifty Thousand (50,000) Shares of Commerce Group Corp.
Common Stock at a Price of Fifteen Cents ($0.15) Per Share
For value and consideration received on this 13th day of March, 2001,
Commerce Group Corp. (Commerce), a Delaware Corporation, whose business address
is 0000 Xxxxx 00xx Xxxxxx, Xxxxxxxxx, Xxxxxxxxx 00000, grants a stock option
(stock option agreement) to Xxxxxx X. Xxxxx (Option Holder), whose address is
0000 Xxxxxxx 00 Xxxxx, Xxxxxxxx, Xxxxxxxxx 00000, under the following terms and
conditions:
1. Issue. Option Holder will have the right to purchase up to
fifty thousand (50,000) Commerce common shares, ten cents ($0.10)
par value,
hereinafter referred to as "option shares," at a price (option price) of
fifteen cents ($0.15) per share, payable in cash.
Upon tender of the sum of U.S. seven thousand five hundred dollars
($7,500.00), Commerce agrees to issue to Option Holder, a total of fifty
thousand (50,000) Commerce validly issued nonassessable and fully paid common
shares, ten cents ($0.10) par value.
2. Exercise Date. Option Holder will have the right to
purchase the common shares at any time during a three (3) year period
of time,
commencing from the date of this agreement and expiring on March 13, 2004.
3. Tender. At any time the Option Holder of this stock option
agreement, pursuant to the foregoing terms and conditions, shall exercise the
right to purchase these option shares, the Option Holder of said stock option
agreement shall surrender this stock option agreement for said shares of option
shares, accompanied by proper instruments of surrender, to Commerce, at its
principal office, accompanied by a written notice to the effect that the Option
Holder elects to exercise its stock option agreement, and stating the name or
names in which the certificate or certificates for shares of option shares shall
be issued. As promptly as practicable, after the receipt of such notice and the
surrender of this stock option agreement, Commerce shall issue and deliver to
Option Holder or such other holder of the stock option agreement, or to the
written order of such holder, a new certificate or certificates for the number
of shares of option shares issuable upon surrendering of this stock option
agreement. Such issuance of option shares shall be deemed to have been effected
on the date on which such notice shall have been received by Commerce and such
stock option agreement shall have been surrendered as hereinabove provided. All
shares of option shares which may be issued upon exercise of the stock option
agreement, shall, upon issuance, be validly issued, fully paid, and
nonassessable by Commerce.
4. Partial Purchases. Option Holder will not have the right
to purchase the option shares in blocks of not less than the total amount of
option shares provided under the stock option agreement.
5. Notice of Change of Rights. Commerce agrees to notify Option
Holder as follows:
a. When Commerce shall declare a dividend (or make any
other distribution) on its option shares, payable otherwise than in cash out
of the consolidated earnings surplus of Commerce, its subsidiaries,
and the Commerce/Sanseb Joint Venture (Joint Venture); or
b. When Commerce shall authorize the granting to
the holders of its common shares of rights to subscribe for or purchase any
shares
of capital stock of any class or any other rights; or
c. Of any reclassification of the common shares of Commerce
other than a subdivision or a combination of its outstanding shares of
such stock, of any consolidation or merger to which Commerce is a party
and for which approval of any stockholders of Commerce is required or
of the sale or transfer of all or substantially all the assets of
Commerce, its subsidiaries, and the Joint Venture; or
d. Of the voluntary or involuntary dissolution, liquidation or
winding up of Commerce; then Commerce shall cause to be filed at the
office of Commerce, and shall cause to be mailed to the option holders
of this stock option agreement, at their addresses as they shall then
appear on the records of Commerce, at least ten days prior to the
record date specified below, a notice stating:
(1) the record date for such dividend, distribution
or rights or, if a record is not to be taken, the date as of
which the holders of the option shares of record to be
entitled to such dividend, distribution or rights are to be
determined; or
(2) the date on which such reclassification,
consolidation, merger, sale, transfer, dissolution,
liquidation or winding up is expected to become effective, and
the date as of which it is expected that holders of the option
shares of record shall be entitled to exchange their option
shares for securities or other property deliverable upon such
reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation or winding up.
6. Procedures. The Board of Directors of Commerce, or a committee
established by it, shall have the right, from time to time, to adopt other
specific rules of procedure to carry out the full intent of this stock option
agreement, and to do all reasonable acts necessary therefore; provided that such
rules and acts shall not violate the specific terms of this stock option
agreement.
7. Dividends. Until such time as the Option Holder purchases
the option shares under this stock option agreement, the Option Holder
shall not
be entitled to receive such dividends and distributions as from time to time
may be declared by the Board of Directors of Commerce.
8. Voting. The Option Holders of this stock option agreement
shall have no voting rights.
9. Notice. The Option Holders of the stock option agreement
shall be entitled to any notice of shareholders' meetings.
10. Reservation of Common Stock. Commerce shall at all times reserve
and keep available out of its authorized but unissued common shares, or shall
authorize from time to time, an increase in such shares if required, of such
number of its duly authorized shares of common stock, as shall be sufficient to
effect the exercise of this stock option agreement.
11. Registration. Option Holder, as owner of this stock option
agreement, by acceptance thereof, shall agree for itself and for all subsequent
owners, that before any disposition is made of this stock option agreement or of
the option shares, Option Holder shall give written notice to Commerce
describing briefly the manner of any such proposed disposition. No such
disposition shall be made unless and until (1) Commerce has advised such owners
that it has received an opinion from its legal counsel satisfactory to it that
no post-effective amendment to Commerce's registration statement, if any, filed
with the Securities and Exchange Commission (Commission) under the Securities
Act of 1933 (Act) and no other registration under said Act is required to such
disposition, or (2) such post-effective amendment or such other registration has
been filed by Commerce and made effective by the Commission, provided, however,
that Commerce shall have no obligation to so file.
12. Investment Letter Agreement. The Option Xxxxxx agrees at
the time of exercising this option to execute an investment letter
agreement in
such form as is attached to this agreement and identified as Exhibit A.
13. Restriction on Certificates. Each certificate for the option shares
to be issued hereunder, until the Option Holder has held this stock option
agreement for a period of two years, without the intent of selling,
transferring, or disposing them, shall bear a legend reading substantially as
follows:
"Neither this stock option agreement nor the shares of common stock
issuable upon the exercise of the stock option agreement have been
registered under the United States Securities Act of 1933; and the
common stock to be issued under the stock option agreement has been
acquired for investment and has not been registered under the
Securities Act of 1933 or the securities law of any state. Except upon
such registration, such securities may not be sold, pledged,
hypothecated or otherwise transferred unless the transferor delivers to
Commerce Group Corp., an opinion of counsel satisfactory to Commerce
Group Corp., its counsel, its transfer agent and its counsel that
registration is not required and such transfer will not be in violation
of the Securities Act of 1933 or any applicable state securities laws
or any rule of regulation thereunder."
14. Entire Agreement. This agreement is the entire, final and complete
agreement pertaining to the subject matter hereof, and it supersedes and
replaces all written and oral agreements heretofore made or existing by and
between the parties or their representatives insofar as this subject matter is
concerned. Neither party shall be bound by any promises, representations or
agreements except as are herein expressly set forth.
15. Applicable Law. This agreement is being delivered in
and shall be governed by and construed and enforced in accordance with th
laws of
the State of Wisconsin, United States.
16. Binding Effect. This agreement shall be binding upon
and inure to the benefit of all parties and all parties and their
respective
successors, heirs, assigns, and legal representatives are subject to its terms.
In Witness Whereof, Commerce has executed this stock option agreement
on the day and date first written above.
COMMERCE GROUP CORP.
/s/ Xxxxxx X. Xxxxxxxx
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By: Xxxxxx X. Xxxxxxxx, President
This stock option agreement is accepted by Xxxxxx X. Xxxxx on the 13th day of
March 2001.
/s/ Xxxxxx X. Xxxxx
--------------------------------
Xxxxxx X. Xxxxx
Date: March 13, 2001
I, Xxxxxx X. Xxxxx, of 0000 Xxxxxxx 00 Xxxxx, Xxxxxxxx, Xxxxxxxxx 00000, for
valuable consideration assign to my wife, Xxxxxxx X. Xxxxx of the same address
as mine, this three-year Stock Option Agreement dated March 13, 2001 and all
rights thereunder.
/s/ Xxxxxx X. Xxxxx
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Xxxxxx X. Xxxxx
