EXHIBIT 4
TOP SOURCE TECHNOLOGIES, INC.
NON-QUALIFIED STOCK OPTION AGREEMENT
TO: Xxxxxxx Xxxxxx, Jr.
As referenced in your employment agreement with Top Source
Technologies, Inc. (the "Company") dated as of May 21, 1997 (the "Employment
Agreement"), pursuant to the Company's 1993 Stock Option Plan, as amended (the
Plan"), you have been granted non-qualified stock options for the purchase of
500,000 shares (the "Option") of the Company's Common Stock at various exercise
prices as outlined in the attached Schedule A-1, the closing price of the
Company's Common Stock on the American Stock Exchange on May 20, 1997. Please
sign and return to the Company the acceptance and Acknowledgement attached to
this Stock Option Agreement. The terms of the Plan, including, without
limitation, those relating to withholding taxes, are incorporated into this
Agreement by reference. This Option is not intended to qualify as an "incentive
stock option" within the meaning of Section 422 of the Internal Revenue Code of
1986, as amended.
The terms of the Option are set forth in the Plan and in this
Agreement. Certain of the terms set forth in the Plan are summarized below;
however, reference should be made to the Plan for the complete terms.
Term: This Option shall terminate ten years from date of grant
unless sooner terminated in accordance with the terms of the Plan and this
Agreement.
.
Exercise: During your lifetime only you can exercise the
Option. The Plan also provides for exercise of the Option by the personal
representative of your estate or the beneficiary thereof following your death.
You may use the Notice of Exercise in the form attached to this Agreement when
you exercise the Option.
Notices: All notices sent in connection with this Option shall
be in writing and, if to the Company, shall be delivered personally to the
Secretary of the Company or mailed to its principal office, addressed to the
attention of the Secretary and, if to the Optionee, shall be delivered
personally or mailed to the Optionee at the address noted on the attached
Acceptance and Acknowledgement. Such addresses may be changed at any time by
notice from one party to the other.
Payment for Shares: The Option may be paid for by delivery
to the Company of the following together with the Notice of Exercise:
(a) Bank certified or cashier's checks; or
(b) Unless the Committee (as defined in the Plan) in its sole
discretion determines otherwise, shares of the capital stock of the Company held
by you having a fair market value at the time of exercise, as determined in good
faith by the Plan Administrator, equal to the exercise price.
Upon receipt of written notice of exercise and payment and
delivery of any other required documentation, the Company shall deliver to the
person exercising the Option a certificate or certificates for such shares. It
shall be a condition to the performance of the Company's obligation to issue or
transfer Common Stock upon exercise of this option that the Optionee pay, or
make provision satisfactory to the Company for the payment of, any taxes which
the Company is obligated to collect with respect to the issue or transfer of
Common Stock upon exercise.
Termination: If your employment by the Company is terminated
for Cause, as defined in the Employment Agreement, the Option will terminate as
of the first discovery by the Company of any reason for termination for Cause.
If your employment stops because of your Death or Disability, as defined in the
Employment Agreement, the Option shall terminate 12 months after your employment
stops. Otherwise the Option will terminate three months after your employment
with the Company ends.
Nothing in the Plan or in this Agreement shall confer on you any right
to continue in the employ of the Company or any parent or subsidiary of the
Company or interfere in any way with the right of the Company or any parent or
subsidiary of the Company to terminate your employment at any time.
Transfer of Option: The Option is not transferable except by will or
by the applicable laws of descent and distribution.
Vesting: The Option is vested as outlined in Schedule A-1:
Notwithstanding the foregoing, the vesting of such Options shall be
accelerated in the event of a Change in Control, as that term is defined in the
Employment Agreement.
Date of Grant: The date of grant of the Option is May 21, 1997.
YOUR PARTICULAR ATTENTION IS DIRECTED TO SECTION 15 OF THE PLAN WHICH
DESCRIBES CERTAIN IMPORTANT CONDITIONS RELATING TO FEDERAL AND STATE SECURITIES
LAWS THAT MUST BE SATISFIED BEFORE THE OPTION CAN BE EXERCISED AND BEFORE THE
COMPANY CAN ISSUE ANY SHARES TO YOU. THE COMPANY HAS NO OBLIGATION TO REGISTER
THE SHARES THAT WOULD BE ISSUED UPON THE EXERCISE OF YOUR OPTION, AND IF SUCH
SHARES ARE NOT REGISTERED, YOU WILL NOT BE ABLE TO EXERCISE THE OPTION UNLESS AN
EXEMPTION FROM REGISTRATION IS AVAILABLE. AT THE PRESENT TIME, EXEMPTIONS FROM
REGISTRATION UNDER FEDERAL AND STATE SECURITIES LAWS ARE VERY LIMITED AND MIGHT
BE UNAVAILABLE TO YOU PRIOR TO THE EXPIRATION OF THE OPTION. CONSEQUENTLY, YOU
MIGHT HAVE NO OPPORTUNITY TO EXERCISE THE OPTION AND TO RECEIVE SHARES UPON SUCH
EXERCISE. IN ADDITION, YOU SHOULD CONSULT WITH YOUR TAX ADVISOR CONCERNING THE
RAMIFICATIONS TO YOU OF HOLDING OR EXERCISING YOUR OPTIONS OR HOLDING OR SELLING
THE SHARES UNDERLYING SUCH OPTIONS.
You understand that, during any period in which the shares
which may be acquired pursuant to your Option are subject to the provisions of
Section 16 of the Securities Exchange Act of 1934 (and you are also so subject),
in order for your transactions under the Plan to qualify for the exemption from
Section 16(b) provided by Rule 16b-3, a total of six months must elapse between
the grant of the Option and the sale of the Option (other than upon exercise or
conversion) or the shares underlying the Option.
All decisions or interpretations made by the Committee with
regard to any question arising hereunder or under the Plan shall be binding and
conclusive on the Company and you.
This Agreement shall bind and inure to the benefit of the
parties hereto and the successors and assigns of the Company and, to the extent
provided in the Plan, your executors, administrators, legatees, and heirs.
Please execute the Acceptance and Acknowledgement set forth
below on the enclosed copy of this Agreement and return it to the undersigned.
Very truly yours,
TOP SOURCE TECHNOLOGIES, INC.
Dated: As of May 21, 1997
By:_/s/ XXXXX NATN
XXXXX XXXXX
INSTRUCTION: PLEASE COMPLETE THE INFORMATION REQUESTED BELOW, DETACH THIS PAGE
AFTER SIGNING WHERE INDICATED AND RETURN TO THE COMPANY.
ACCEPTANCE AND ACKNOWLEDGEMENT
I, a resident of the State ofFlorida, accept the non-qualified stock option
described in the Non-Qualified Stock Option Agreement dated as ofMay 21, 1997
and in the Top Source Technologies, Inc. 1993 Stock Option Plan, as amended, and
acknowledge receipt of a copy of this Agreement. I have read and understand all
the provisions and limitations of the Plan, particularly those relating to
non-qualified stock options and the provisions of Section 15 of the Plan
relating to securities regulations.
Dated: As of May 21, 1997
/s/ XXXXXXX X. XXXXXX, XX.
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Signature
Name: Xxxxxxx Xxxxxx, Jr.
Address:
TOP SOURCE TECHNOLOGIES, INC.
NOTICE OF EXERCISE OF NON-QUALIFIED STOCK OPTION
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(Name, please print)
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(Date)
TOP SOURCE TECHNOLOGIES, INC.
0000 Xxxxxxx Xxxxx
Xxxxx 000
Xxxx Xxxxx Xxxxxx, Xxxxxxx 00000
Gentlemen:
I hereby exercise my right to purchase _______________ shares of Common Stock of
Top Source Technologies, Inc., a Delaware corporation (the"Company"), pursuant
to, and in accordance with, the Top Source Technologies, Inc. 1993 Stock Option
Plan and the Non-Qualified Stock Option Agreement ("Agreement") dated as of ,
1997. As provided in that Agreement, I hereby: [check one]
[ ] deliver herewith a certified or bank cashier's
check in the amount of the aggregate option exercise
price; or
[ ] undertake to deliver shares of the capital stock of
the Company held by me having a fair market value at
the time of exercise, as determined in good faith by
the Plan Administrator, equal to the aggregate option
exercise price.
Please deliver to me stock certificates representing the
subject shares registered as follows:
Name:___________________________________________
Address:_________________________________________
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Social Security Number ____________________________
The aggregate exercise price is $ _________ (total number of
shares to be purchased x $--------).
(1) Tax Implications. I understand that there are certain tax
implications to my exercise of my right to purchase shares of Common Stock under
the Agreement. I further understand that it is my obligation to confer with my
own tax advisor with respect to such tax implications.
(2) Securities Regulation. I hereby represent and acknowledge that (i)
the shares of Common Stock I propose to purchase (i) are being purchased for
investment and not for distribution or resale (other than a distribution or
resale which, in the opinion of counsel satisfactory to the Company, may be made
without violating the registration provisions of the Securities Act of 1933, as
amended (the "Act")), (ii) I have been advised and understand that (A) such
shares have not been registered under the Act and are "restricted securities"
within the meaning of Rule 144 under the Act and are subject to restrictions on
transfer and (B) the Company is under no obligation to register such shares
under the Act or to take any action which would make available to me any
exemption from such registration, and (iii) such shares may not be transferred
without compliance with all applicable federal and state securities laws.
Very truly yours,
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Name:
