Exhibit 10.20
AVT Corporation
NONQUALIFIED STOCK OPTION LETTER AGREEMENT
TO: Xxx Xxxx Date of Grant: December 14, 2000
The Board of Directors (the "Board") of AVT Corporation (the "Company") is
pleased to grant you a nonqualified stock option for the purchase of 150,000
shares of the Company's Common Stock at an exercise price of $5.00 per share.
In addition to the terms set forth below this option shall have substantially
the same terms and conditions set forth in the Company's 1989 Restated Stock
Option Plan, which is incorporated herein by reference.
Term: The term of the option is ten years from date of grant, unless
sooner terminated.
Vesting: The option will vest and become exercisable according to the
following schedule:
Date on and After Which Exercisable Portion
Option is Exercisable of Total Option
----------------------- -------------------
December 14, 2001 25%
Each month thereafter 2.0833%
December 14, 2004 100%
Exercise: During your lifetime only you can exercise the option. The
option may be exercised by the personal representative of your estate, by the
beneficiary you have designated on forms prescribed by and filed with the
Company, or the beneficiary of your estate following your death. Subject to the
vesting schedule set forth above, the option may be exercised in whole or in
part at any time and from time to time; provided, however, that no fewer than
100 shares (or the remaining shares then purchasable under the option, if less
than 100 shares) may be purchased upon any exercise of this option and that only
whole shares will be issued pursuant to the exercise of the option. You may use
the Notice of Exercise of Nonqualified Stock Option in the form attached to this
Agreement when you exercise the option.
Payment for Shares: The option may be exercised by the delivery of:
(a) Cash, personal check (unless, at the time of exercise, the Company
determines otherwise), bank certified or cashier's check;
(b) Unless the Board in its sole discretion determines otherwise, shares of
the capital stock of the Company held by you for a period of at least six months
having a fair market value at the time of exercise, as determined in good faith
by the Board, equal to the exercise price; or
(c) A properly executed exercise notice together with irrevocable
instructions to a broker to promptly deliver to the Company the amount of sale
or loan proceeds to pay the exercise price.
Withholding Taxes: As a condition to the exercise of the option, you must
make such arrangements as the Company may require for the satisfaction of any
federal, state or local withholding tax obligations that may arise in connection
with such exercise. The Company has the right to retain without notice
sufficient shares of stock to satisfy the withholding obligation. To the extent
permitted or required by the Company, you may satisfy the withholding obligation
by electing to have the Company or a related corporation withhold from the
shares to be issued upon exercise that number of shares having a fair market
value equal to the amount required to be withheld. If you are subject to
Section 16 of the Exchange Act you must comply with certain requirements in
order to make such election.
Termination: If your relationship with the Company ceases prior to
December 17, 2001 because you are terminated by the Company for any reason
(including due to death or total disability as determined in good faith by the
Board), the shares underlying the option that would otherwise have vested on
December 17, 2001 will be deemed vested on a pro-rata basis over the first year
of employment based on the number of full calendar months actually served.
Transferability of Option: This option and the rights and privileges
conferred hereby may not be transferred, assigned, pledged or hypothecated in
any manner (whether by operation of law or otherwise) other than by will or by
the applicable laws of descent and distribution and shall not be subject to
execution, attachment or similar process. This option is personal to you and is
exercisable solely by you. Any attempt to transfer, assign, pledge, hypothecate
or otherwise dispose of this option or of any right or privilege conferred
hereby, contrary to the provisions hereof, or the sale or levy or any attachment
or similar process upon the rights and privileges conferred hereby will be null
and void. Notwithstanding the foregoing, to the extent permitted by applicable
law and regulation, the Company, in its sole discretion, may permit you to (i)
during
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your lifetime, designate a person who may exercise the option after your death
by giving written notice of such designation to the Company (such designation
may be changed from time to time by you by giving written notice to the Company
revoking any earlier designation and making a new designation) or (ii) transfer
the option and the rights and privileges conferred hereby.
No Status as Shareholder: Neither you nor any party to whom your rights
and privileges under the option pass will be, or have any of the rights or
privileges of, a shareholder of the Company with respect to any of the shares
issuable upon the exercise of this option unless and until this option has been
exercised.
Continuation of Relationship: Nothing in this option will confer upon you
any right to continue in the employ or other relationship of the Company, or to
interfere in any way with the right of the Company to terminate your employment
or other relationship with the Company at any time.
Adjustments Upon Changes in Capitalization:
The aggregate number and class of shares covered by this option and the
exercise price per share thereof (but not the total price), will all be
proportionately adjusted for any increase or decrease in the number of issued
shares of Common Stock of the Company resulting from a split-up or consolidation
of shares or any like capital adjustment, or the payment of any stock dividend.
(a) Effect of Liquidation or Reorganization
(1) Cash, Stock or Other Property for Stock. Except as provided in
subsection (a)(2), upon a merger (other than a merger of the Company in which
the holders of shares of Common Stock immediately prior to the merger have the
same proportionate ownership of shares of Common Stock in the surviving
corporation immediately after the merger), consolidation, acquisition of
property or stock, separation, reorganization (other than a mere reincorporation
or the creation of a holding company) or liquidation of the Company, as a result
of which the shareholders of the Company receive cash, stock or other property
in exchange for or in connection with their shares of Common Stock, this option
will terminate, but you will have the right immediately prior to any such
merger, consolidation, acquisition of property or stock, separation,
reorganization or liquidation to exercise your option, at your election in whole
or in part, whether or not the vesting requirements set forth in this Agreement
have been satisfied; provided that such acceleration will not occur if, in the
opinion of the Company's outside accountants, such acceleration would render
unavailable "pooling of interests" accounting treatment for any reorganization,
merger or
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consolidation of the Company for which pooling of interests accounting
treatment is sought by the Company.
(2) Conversion of Options on Stock for Stock Exchange. If the
shareholders of the Company receive capital stock of another corporation
("Exchange Stock") in exchange for their shares of Common Stock in any
transaction involving a merger (other than a merger of the Company in which the
holders of Common Stock immediately prior to the merger have the same
proportionate ownership of Common Stock in the surviving corporation immediately
after the merger), consolidation, acquisition of property or stock, separation
or reorganization (other than a mere reincorporation or the creation of a
holding company), this option will be converted into an option to purchase
shares of Exchange Stock unless the Company and the corporation issuing the
Exchange Stock, in their sole discretion, determine that any or all such options
granted hereunder shall not be converted into options to purchase shares of
Exchange Stock but instead shall terminate in accordance with the provisions of
subsection (a)(1) above. The amount and price of converted options will be
determined by adjusting the amount and price of this option in the same
proportion as used for determining the number of shares of Exchange Stock the
holders of the shares of Common Stock receive in such merger, consolidation,
acquisition of property or stock, separation or reorganization. The converted
option will be fully vested whether or not the vesting requirements set forth in
this Agreement have been satisfied; provided that such acceleration will not
occur if, in the opinion of the Company's outside accountants, such acceleration
would render unavailable "pooling of interests" accounting treatment for any
reorganization, merger or consolidation of the Company for which pooling of
interests accounting treatment is sought by the Company.
(b) Fractional Shares
In the event of any adjustment in the number of shares covered by this
option, any fractional shares resulting from such adjustment will be disregarded
and the option will cover only the number of full shares resulting from such
adjustment.
(c) Determination of Board to Be Final
All adjustments referred to herein will be made by the Board, and its
determination as to what adjustments will be made, and the extent thereof, will
be final, binding and conclusive.
Securities Regulation:
Shares will not be issued with respect to this option unless the exercise
of such option and the issuance and delivery of such shares pursuant thereto
complies with all
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relevant provisions of law, including, without limitation, any applicable state
securities laws, the Securities Act of 1933, as amended, the Exchange Act, the
rules and regulations promulgated thereunder, and the requirements of any stock
exchange upon which the shares may then be listed.
As a condition to the exercise of this option, the Company may require you
to represent and warrant at the time of any such exercise that the shares are
being purchased only for investment and without any present intention to sell or
distribute such shares if, in the opinion of counsel for the Company, such a
representation is required by any relevant provision of the aforementioned laws.
At the option of the Company, a stop-transfer order against any shares of stock
may be placed on the official stock books and records of the Company, and a
legend indicating that the stock may not be pledged, sold or otherwise
transferred, unless an opinion of counsel is provided (concurred in by counsel
for the Company) stating that such transfer is not in violation of any
applicable law or regulation, may be stamped on stock certificates in order to
assure exemption from registration. The Company may also require such other
action or agreement by you as may from time to time be necessary to comply with
the federal and state securities laws. THIS PROVISION SHALL NOT OBLIGATE THE
COMPANY TO UNDERTAKE REGISTRATION OF THIS OPTION OR THE SHARES ISSUABLE
HEREUNDER, but if the Company has filed or is filing a Registration Statement on
Form S-8 or any successor form for the registration of securities issued under
stock option or other employee benefit plans, the Company hereby undertakes to
include the shares issuable hereunder in any such registration.
Should any of the Company's capital stock of the same class as the stock
subject to this option be listed on a national securities exchange, all shares
issued hereunder if not previously listed on such exchange will be authorized by
that exchange for listing thereon prior to the issuance thereof.
Please execute the Acceptance and Acknowledgment set forth below on the
enclosed copy of this Agreement and return it to the undersigned.
Very truly yours,
AVT Corporation
By _____________________________
Its ____________________________
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ACCEPTANCE AND ACKNOWLEDGMENT
I, a resident of the State of Washington, accept the nonqualified stock
option described herein. I have read and understand the Agreement.
Dated: _______________
_______________________________ _____________________________
Taxpayer I.D. Number Xxx Xxxx
Address _____________________
_____________________________
_____________________________
