Exhibit 99.10
STOCK OPTION AGREEMENT
THIS STOCK OPTION AGREEMENT is effective as of the 23rd day of October, 1997,
between SAF T LOK INCORPORATED, a Florida corporation (the "Company"), and XXXXX
X. XXXXXXX (the "Optionee").
Background
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A. Optionee is currently a director of the Company.
B. The Company considers it desirable and in the Company's best interest that
Optionee be given an inducement to acquire a proprietary or equity interest
in the Company as an added incentive to advance the interests of the
Company in the form of an option to purchase common stock of the Company.
C. This Agreement shall be considered an individual benefit plan for the
Optionee.
Agreement
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In consideration of the mutual covenants and agreements contained herein and
other good and valuable consideration, the receipt of which is hereby
acknowledged, the parties hereto agree as follows:
1. Grant of Option. The Company hereby grants to Optionee the right and option
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(hereinafter referred to as the "Option") to purchase up to an aggregate of
250,000 shares of the Company common stock (the "Stock") at an exercise price
equal to $2.00 per share (the "Exercise Price"), on the terms and conditions
herein set forth. The date of grant of the Option is the date set forth on
Exhibit "A" attached hereto.
2. Period of Option. The term of the Option shall be for a period of five
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years from the date hereof, subject to earlier termination as provided herein.
Prior to the expiration of the Option, Optionee may exercise the Option for
portions of the total option stock granted only in accordance with the vesting
schedule set forth on Exhibit "A" attached hereto.
3. Exercise of Option. The Option shall be exercisable only during the term of
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the Option as long as the Optionee is a member of the Board of Directors of the
Company, or any successor thereof. Notwithstanding the preceding sentence, as
long as the Option's term has not expired, the Option which is otherwise
exercisable in accordance with the provisions of this Agreement shall be
exercisable.
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(a) for a period ending 90 days after the Optionee is no longer able to
serve as a member of the Board of Directors or has failed to be reelected to the
Board of Directors; or
(b) for a period ending 90 days after the removal or resignation of the
Optionee from the Board of Directors; or
(c) by the estate of the Optionee, within one year after the date of the
Optionee's death, if the Optionee should die while serving on the Board of
Directors of the Company, or any successor thereof; or
(d) within one year after the Optionee no longer serves as a member of the
Board of Directors due to disability (as defined in Section 22(e) of the Code)
and such disability is the reason the Optionee no longer serves as a member of
the Board of Directors of the Company.
4. Investment Representation and Agreement. Optionee represents that this
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Option and any shares purchased pursuant to this Option are purchased for
investment purposes only and for Optionee's own account. Optionee acknowledges
that this Option and the shares pertaining to this Option are not registered
under the Securities Act of 1933, as amended, the Florida Securities and
Investor Protection Act, or the securities laws of any other state.
5. Restrictive Legend. Optionee hereby agrees that certificates evidencing the
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shares of stock purchased by Optionee pursuant to this Agreement shall be
stamped or otherwise imprinted with a conspicuous legend in substantially the
following form:
These shares have not been registered under the Securities Act
of 1933, as amended, the Florida Securities and Investor
Protection Act or any other state securities laws, and
therefore, cannot be sold unless they are subsequently
registered under the Act and any applicable state securities
laws, or unless an exemption from registration is available.
6. Nonassignability of Option Rights. The Option is exercisable only by
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Optionee, except in the case of Optionee's death while the Optionee is a member
of the Board of Directors, in which case the Option is exercisable by Optionee's
estate's personal representative pursuant to paragraph 3(c), and except in the
case of Optionee no longer serving as a member of the Board of Directors due to
disability occurring while the Optionee was a Director of the Company, in which
case the Option is exercisable, if necessary, by Optionee's legal representative
pursuant to paragraph 3(d). The Option may not be sold, exchanged, assigned,
pledged, encumbered, hypothecated, or otherwise transferred except by will or by
the laws of descent and distribution. The Option shall not be subject to
execution, attachment, or similar process. Upon any attempt to sell, exchange,
assign, pledge, encumber, hypothecate, or otherwise transfer the Option or any
right thereunder, the Option and all rights thereunder shall immediately become
null and void.
7. Method of Exercise. Optionee may exercise the Option, in whole or in part,
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by written notice to the Company stating in such written notice the number of
shares of Stock such Optionee elects to purchase under the Option, and the time
of the delivery
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thereof, which time shall be at least 15 days after the giving of such notice,
unless an earlier date shall have been mutually agreed upon. Upon receipt of
such written notice, the Company shall provide the Optionee with that
information required by the applicable state and federal securities laws. If,
after receipt of such information, Optionee desires to withdraw such notice of
exercise, Optionee may withdraw such notice of exercise by notifying the
Company, in writing, prior to the time set forth for delivery of the shares of
Stock. In no event may the Option be exercised after the expiration of its term.
Optionee is under no obligation to exercise an Option or any part thereof.
(a) Payment for Option Stock. The exercise of this Option shall be
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contingent upon receipt by the Company of cash or certified bank check to its
order, shares of the Company's Common Stock or cancellation of a vested portion
of the Stock Option, or any combination of the foregoing in an amount equal to
the full option price of the shares of Stock being purchased. The Optionee
shall have no rights as a shareholder with respect to any shares covered by his
Option until the exercise of the Option and the date of issuance of a
certificate to him for such shares. No adjustment shall be made for dividends
or other rights for which the record date is prior to the date such certificate
is issued.
(b) Delivery of Stock to Optionee. Provided the Optionee has delivered
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proper notice of exercise and full payment of the option price, the Company
shall undertake and follow all necessary procedures to make prompt delivery of
the number of shares of Stock which the Optionee elects to purchase at the time
specified in such notice. Such delivery, however, may be postponed at the sole
discretion of the Company to enable the Company to comply with any applicable
procedures, regulations or listing requirements of any governmental agency,
stock exchange or regulatory authority. As a condition to the issuance of
shares of Stock, the Company may require such additional payments from the
Optionee as may be required to allow the Company to withhold any income taxes
which the Company deems necessary to insure the Company that it can comply with
any federal or state income tax withholding requirements.
8. Changes in Capital Structure of Company. In the event of a change in
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capital structure of the Company, the number of shares covered by the Options
and the price per share shall be proportionately adjusted for any increase or
decrease in the number of issued shares of Stock resulting from the splitting or
consolidation of shares, or the payment of a stock dividend, or effected in any
other manner without receipt of additional or further consideration by the
Company. The Company shall give notice of any adjustment to Optionee.
9. Governing Law. This Agreement shall be governed by, interpreted under, and
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construed in accordance with the laws of the State of Florida.
10. Binding Effect. This Agreement will inure to the benefit of and be binding
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on the Company, its successors and assigns, including but not limited to, any
company or entity that may acquire all or substantially all of the Company's
assets and business or into which the Company may be consolidated or merged, and
on Optionee and except as set forth in paragraph 6 above, their heirs, legal
representatives, and successors, as the case may be.
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11. Entire Agreement. This Agreement constitutes the entire agreement of the
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parties hereto with respect to the subject matter of this Agreement and
supersedes any and all previous agreements between parties, whether written or
oral, with respect to such subject matter.
12. Waiver of Modification. No waiver or modification of this Agreement or of
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any convenant, condition, or limitation herein contained shall be valid unless
in writing and duly executed by the party to be charged therewith. Furthermore,
no evidence of any waiver or modification shall be offered or received in
evidence in any proceeding, arbitration, or litigation between the parties
arising out of or affecting this Agreement or the rights or obligations of any
party hereunder, unless such waiver or modification is in writing and duly
executed as aforesaid. The provisions of this paragraph may not be waived except
as herein set forth.
13. Number and Gender. Whenever used herein, singular numbers shall include the
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plural, the singular, and the use of any gender shall include all genders.
14. Invalid Provision. The invalidity or unenforceability of any term or
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provision of this Agreement or the nonapplication of any such term or provision
to any person or circumstance shall not impair or affect the remainder of this
Agreement, and the remaining terms and provisions hereof shall not be
invalidated but shall remain in full force and effect and shall be construed as
if such invalid, unenforceable, or nonapplicable provision were omitted.
15. Nonqualified Stock Option. This Agreement shall be considered an individual
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benefit plan for the Optionee.
IN WITNESS WHEREOF, the parties hereto have executed this agreement as of the
day and year first above written.
"COMPANY" "OPTIONEE"
SAF T LOK INCORPORATED
By:___________________________ ____________________________
Xxxx X. Xxxxxxx Name: Xxxxx X. Xxxxxxx
President
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EXHIBIT "A" TO STOCK OPTION AGREEMENT
NOTICE OF GRANT OF STOCK OPTION
This Agreement shall be considered an individual benefit plan for the Optionee.
Name: Xxxxx X. Xxxxxxx
Address: _______________________________
________________________________
Social Security Number: ________________________
You have been granted a stock option to buy Saf T Lok Incorporated common stock
as follows:
Stock Option Grant Date...................................October 23, 1997
Type of Grant*........................................................NQSO
Exercise Price per Share.............................................$2.00
Total Shares Granted...............................................250,000
Total Amount to Fully Exercise....................................$500,000
Expiration Date of the Grant..............................October 23, 2002
The vesting schedule for this grant is as follows:
1. The option to purchase 83,334 shares shall vest immediately upon this grant.
2. The option to purchase shares shall vest in the amount of 83,333 per year
from the Grant Date set forth in this Exhibit "A", provided that the Optionee
has continually been a member of the Board of Directors of the Company, or
any successor thereof, on the vesting date.
By Order of the Board of Directors of Saf T Lok Incorporated
Validated by: __________________________________________________________
Corporate Secretary
*ISO = Qualified Stock Option
NQSO = Nonqualified Stock Option
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