EXHIBIT 10.22
STOCK OPTION AGREEMENT
This Agreement made as of this 6th day of December, 1996, by and between
IRATA, INC., a Texas corporation (the "Company"), and XXXXX X. XXXXXX (the
"Optionee").
W I T N E S S E T H:
WHEREAS, the Optionee is a valued employee of the Company, having
substantial responsibility for its future growth; and
WHEREAS, the Board of Directors of the Company considers it advisable and
in the best interest of the Company to provide the Optionee with additional
incentive by providing the Optionee with a proprietary interest in the success
of the Company; and
WHEREAS, in order to provide the Optionee with a proprietary interest in
the Company, the Board has granted the Optionee an option to purchase Class A
Common Stock, $.10 par value ("Class A Stock"), of the Company.
NOW, THEREFORE, in order to set forth the terms and conditions of such
option, the Company and the Optionee hereby agree as follows:
1. Grant of Option. The Company hereby grants to the Optionee the option
to purchase 300,000 shares of Class A Stock at a price of $.50 per
share, such purchase to be upon the terms and conditions hereinafter
set forth. The Option granted hereunder is granted under the 1996
Stock Option Plan of the Company (the "Plan") and is designated as an
"Incentive Stock Option" under the Plan.
2. Amount and Dates Exercisable. The Optionee shall become immediately
vested in 50,000 shares, shall be vested with respect to an additional
41,667 shares on February 1, 1997, shall be vested with respect to an
additional 41,667 shares on May 1, 1997, and shall be vested with
respect to an additional 41,667 shares on August 1, 1997. This option
shall become exercisable with respect to 175,001 shares on August 1,
1997; shall become exercisable with respect to an additional 24,000
shares on October 30, 1997; shall become exercisable with respect to
an additional 59,334 shares on January 28, 1998; shall become
exercisable with respect to an additional 41,665 shares on April 28,
1998; and shall be fully exercisable thereafter until November 3,
2002, when this option shall expire.
3. Exercise of Option. The option granted hereunder shall be exercised by
delivering to the Company a written notification specifying the number
of shares of Class A Stock which the Optionee desires to purchase,
together with payment of the exercise price either by check, cash,
certified check, bank draft, postal or express money order to the
order of the Company, by delivery to the Company for cancellation of a
portion of this option that is then exercisable valued at "Fair Market
Value", or by delivery to the Company of other shares of Class A Stock
valued at "Fair Market Value" or by any combination of such methods.
For purposes hereof the "Fair Market Value" of a portion of this
option or shares of Class A Common Stock shall be determined in good
faith by the Board of Directors of the Company. As promptly as
practical after receipt of such written notification and
payment, the Company shall deliver to the Optionee a certificate for
the number of shares with respect to which the option has been
exercised in accordance with Section 6 of the Plan.
4. Transferability of Option. Except as hereinafter set forth, this
option shall not be transferable by the Optionee otherwise than by
will or under the laws of descent and distribution, and shall be
exercisable, during Optionee's lifetime, only by Optionee.
5. Termination of Service of Optionee. In the event that the Optionee
ceases to be an employee of the Company by reason of voluntary
termination by the Optionee or by reason of termination for Cause (as
defined in the Executive Employment Agreement between the Company and
Optionee dated November 1, 1996) by the Company, prior to the
expiration date of this option ("Expiration Date"), this option shall
terminate and any vested or exercisable portion shall remain
exercisable until the Expiration Date of the option. After a "Change
of Control" of the Company (as defined in the Executive Employment
Agreement), the death of the Optionee, or termination of the
employment relationship with the Optionee by the Company other than
for Cause, all unexercised options shall be vested and fully
exercisable and shall remain exercisable until the Expiration Date of
the option. In the case of death, Optionee's executors, administrators
or any person or persons to whom this option may be transferred by
will or by the laws of descent and distribution, shall have the right
to exercise this option until the Expiration Date of the option.
6. Requirements of Law. The Company shall not be required to sell or
issue any shares under this option if the issuance of such shares
shall constitute a violation by the Optionee or the Company of any
provisions of any law or regulation of any governmental authority.
Specifically in connection with the Securities Act of 1933 (as now in
effect or hereunder amended) (the "'33 Act"), upon exercise of this option,
unless a registration statement under the '33 Act is in effect with respect to
the shares of Class A Stock covered hereby, the Company shall not be required to
issue such shares unless the Company has received evidence satisfactory to it to
the effect that the issuance of shares is exempt from the registration
provisions of the '33 Act, the Optionee is acquiring such shares for investment
and not with a view to distribution thereof, and unless the certificate issued
representing the share of Class A Stock bears a legend in substantially the
following form:
"The shares of stock represented by this certificate have not been
registered under the Securities Act of 1933 or under the securities
laws of any State and may not be sold or transferred except upon such
registration or upon receipt by the corporation of an opinion of
counsel for the Corporation that registration is not required for such
sale or transfer."
Any determination in this connection by the Company shall be final, binding and
conclusive. At such time as a registration statement under the '33 Act is in
effect with respect to the shares of Class A Stock represented by certificates
bearing the above legend or at such time as, in the opinion of counsel for the
Company, such legend is no longer required solely for compliance with applicable
securities laws, then the holders of such certificates shall be entitled to
exchange such certificates for certificates
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representing a like number of shares but without such legend. The Company may,
but shall in no event be obligated to, register any securities covered hereby
pursuant to the '33 Act.
Specifically in connection with The Securities Act of the State of Texas
(as now in effect or hereafter amended) (the "Texas Act"), upon exercise of this
option, unless a registration statement under the Texas Act is in effect with
respect to the shares of Class A Stock covered hereby, the Company shall not be
required to issue such shares unless, in the opinion of counsel for the Company,
the issuance of such shares is exempt from the provisions of the Texas Act. The
Company may, but shall in no event be obligated to, register any securities
covered hereby pursuant to the Texas Act.
The Company shall not be obligated to take any other affirmative action in
order to cause the exercise of this option or the issuance of shares pursuant
hereto to comply with any law or regulation of any governmental authority.
7. No Rights as Stockholder. The Optionee shall have no rights as a
stockholder with respect to shares covered by this option until the
date of issuance of a stock certificate for such shares; no adjustment
for dividends, or otherwise, shall be made if the record date therefor
is prior to the date of issuance of such certificate.
8. Changes in the Company's Capital Structure.
(i) The existence of this Option shall not affect in any way the
right or power of the Company or its stockholders to make or
authorize any or all adjustments, recapitalizations,
reorganizations, or other changes in the Company's capital
structure or its business, or any merger or consolidation of the
Company, or any issue of bonds, debentures, preferred or prior
preference stock ahead of or affecting the Common Stock or the
rights thereof, or the dissolution or liquidation of the
Company, or any sale or transfer of all or any part of its
assets or business, or any other corporate act or proceeding,
whether of a similar character or otherwise.
(ii) If, while this Option is outstanding, the Company shall effect a
subdivision or consolidation of shares or other increase or
reduction of the number of shares of the Common Stock
outstanding without receiving compensation therefor in money,
services or property, then (a) in the event of an increase in
the number of such shares outstanding, the number of shares of
Common Stock then subject to this Option shall be
proportionately increased; and (b) in the event of a decrease in
the number of such shares outstanding the number of shares then
available under this Option shall be proportionately decreased.
(iii) After a merger of one or more corporations into the Company, or
after a consolidation of the Company and one or more
corporations in which the Company shall be the surviving
corporation, the holder of this Option shall, at no additional
cost, be entitled upon exercise of this Option to receive
(subject to any required action by stockholders) in lieu of the
number of shares as to which this Option shall then be so
exercisable, the number and class of shares of stock or
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other securities to which such holder would have been entitled
to receive pursuant to the terms of the agreement of merger or
consolidation if, immediately prior to such merger or
consolidation, such holder had been the holder of record of a
number of shares of the Company equal to the number of shares as
to which this Option had been exercisable.
(iv) If the Company is merged into or consolidated with another
corporation or other entity under circumstances where the
Company is not the surviving corporation, or if the Company
sells or otherwise disposes of substantially all of its assets
to another corporation or other entity while this Option remains
outstanding, then the Plan Administrator (as defined in the
Plan) may direct that any of the following shall occur:
(a) If the successor entity is willing to assume the obligation
to deliver shares of stock or other securities after the
effective date of the merger, consolidation or sale of
assets, as the case may be, the holder of this Option shall
be entitled to receive, upon the exercise of this Option
and payment of the option price, in lieu of shares of
Common Stock, such shares of stock or other securities as
the holder of this Option would have been entitled to
receive had this Option been exercised immediately prior to
the consummation of such merger, consolidation or sale.
(b) The Plan Administrator may waive any limitations set forth
in or imposed pursuant to the Plan or this Option Agreement
with respect to this Option such that this Option shall
become exercisable prior to the record or effective date of
such merger, consolidation, or sale of assets.
(c) The Plan Administrator may cancel this Option as of the
effective date of any such merger, consolidation, or sale
of assets provided that prior notice of such cancellation
shall be given to the holder of this Option at least 30
days prior to the effective date of such merger,
consolidation, or sale of assets, and the holder of this
Option shall have the right to exercise this Option in full
during a period of not less than 30 days prior to the
effective date of such merger, consolidation, or sale of
assets.
(v) Except as provided in the Plan, the issuance by the Company of
Common Stock or any other shares of capital stock or securities
convertible into shares of capital stock, for cash property,
labor done, or other consideration, shall not affect, and no
adjustment by reason thereof shall be made with respect to, the
number or price of shares of Common Stock then subject to this
Option.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed on this 6th day of December, 1996, but as of the day and year first
above written.
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IRATA, INC.
By:_________________________________
Authorized Officer
By:_________________________________
XXXXX X. XXXXXX, Optionee
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