Exhibit 10.2
NEWTOWN LANE MARKETING, INCORPORATED
STOCK OPTION AGREEMENT
THIS AGREEMENT, made as of this 4th day of April, 2006, by Newtown Lane
Marketing, Incorporated, a Delaware corporation (hereinafter called the
"Company"), with J. Xxxxx Xxxxxxx (hereinafter called the "Holder"):
The Company has adopted a 2006 Stock Incentive Plan (the "Plan"). Said
Plan, as it may hereafter be amended and continued, is incorporated herein by
reference and made part of this Agreement.
The Board, which in the absence of a Committee is charged with the
administration of the Plan pursuant to Section 4 of the Plan, has determined
that it would be to the advantage and interest of the Company to grant the
option provided for herein to the Holder as an inducement to remain in the
service of the Company or one of its subsidiaries, and as an incentive for
increased efforts during such service.
NOW, THEREFORE, pursuant to the Plan, the Company hereby grants to the
Holder as of the date hereof an option (the "Option") to purchase all or any
part of seven hundred fifty thousand (750,000) shares of Common Stock of the
Company, par value $.001 per share, at a price per share of twenty-five cents
($.25), which price is not less than the fair market value of a share of Common
Stock on the date hereof (or 110% of the fair market value of a share of Common
Stock if the Holder is a 10% Holder (as defined in the Plan)), and upon the
following terms and conditions:
1. The Option shall continue in force through June 30, 2011 (the "Expiration
Date"), unless sooner terminated as provided herein and in the Plan. Subject to
the provisions of the Plan, the Option shall become exercisable as of the date
hereof as to 50,000 shares, and on a cumulative basis, as to an additional
50,000 shares on the last day of each of June, September and December 2006, and
the last day of each of March, June, September and December of 2007, and as to
the balance, that is, 350,000 shares as of January 1, 2008, provided, that as of
each of such dates the Holder is serving as a consultant to the Company.
Provided, further, however, that notwithstanding anything else contained herein,
this Option shall become immediately exercisable in full upon the death or
disability of Holder or if the employment of the Holder by the Company shall be
terminated by the Company without cause.
2. In the event that the employment or service of the Holder shall be terminated
prior to the Expiration Date (otherwise than by reason of death or disability),
the Option may, subject to the provisions of the Plan, be exercised (to the
extent that the Holder was entitled to do so at the termination of this
employment or service) at any time prior to but not after the Expiration Date.
If, however, such termination shall have been for cause or voluntarily by the
Holder and without the consent of the Company or any subsidiary corporation
thereof, as the case may be (which consent shall be presumed in the case of
normal retirement), then prior to the third anniversary of such termination, the
Holder will not, without the prior written consent of the Company, (i) sell,
offer to sell, contract to sell, hypothecate, pledge, grant any option to sell
or otherwise dispose of, or file (or participate in the filing of) a
registration statement with the Securities and Exchange Commission (the
"Commission") in respect of, or establish or increase a put equivalent position
or liquidate or decrease a call equivalent position within the meaning of
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Section 16 of the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the Commission promulgated thereunder, with respect to, any
shares of Common Stock or any securities convertible into or exercisable or
exchangeable for Common Stock, (ii) enter into any swap or other arrangement
that transfers to another, in whole or in part, any of the economic consequences
of ownership of Common Stock or any securities convertible into or exercisable
or exchangeable for Common Stock, whether any such transaction is to be settled
by delivery of Common Stock, other securities, in cash or otherwise, or (iii)
publicly announce an intention to effect any transaction specified in clause (i)
or (ii). The foregoing notwithstanding, the undersigned may dispose of shares of
Common Stock which are disposed of as bona fide gifts, approved by the Company,
to transferees who enter into lock-up agreements with the Company on the same
terms and conditions as set forth herein.
Nothing in this Agreement shall confer upon the Holder any right to
continue in the employ or service of the Company or any subsidiary of the
Company or affect the right of the Company or any subsidiary to terminate his
employment or service at any time.
3. (a) The Holder may exercise the Option with respect to all or any part of the
shares then purchasable hereunder by giving the Company written notice in the
form annexed, as provided in paragraph 7 hereof, of such exercise. Such notice
shall specify the number of shares as to which the Option is being exercised and
shall be accompanied by payment in full in cash of an amount equal to the
exercise price of such shares multiplied by the number of shares as to which the
Option is being exercised; provided that, if permitted by the Board, the
purchase price may be paid, in whole or in part, by surrender or delivery to the
Company of securities of the Company having a fair market value on the date of
the exercise equal to the portion of the purchase price being so paid. In such
event fair market value should be determined pursuant to the Plan.
(b) Prior to or concurrently with delivery by the Company to the Holder of
a certificate(s) representing such shares, the Holder shall, upon notification
of the amount due, pay promptly any amount necessary to satisfy applicable
federal, state or local tax requirements. In the event such amount is not paid
promptly, the Company shall have the right to apply from the purchase price paid
any taxes required by law to be withheld by the Company with respect to such
payment and the number of shares to be issued by the Company will be reduced
accordingly.
4. Notwithstanding any other provision of the Plan, in the event of a change in
the outstanding Common Stock of the Company by reason of a stock dividend,
split-up, split-down, reverse split, recapitalization, merger, consolidation,
combination or exchange of shares, spin-off, reorganization, liquidation or the
like, then the aggregate number of shares and price per share subject to the
Option shall be appropriately adjusted by the Board, whose determination shall
be conclusive.
5. This Option shall, during the Holder's lifetime, be exercisable only by the
Holder, and neither this Option nor any right hereunder shall be transferable by
the Holder, by operation of law or otherwise, except by will or by the laws of
descent and distribution. In the event of any attempt by the Holder to transfer,
assign, pledge, hypothecate or otherwise dispose of this Option or of any right
hereunder, except as provided for herein, or in the event of the levy or any
attachment, execution or similar process upon the rights or interest hereby
conferred, the Company may terminate this Option by notice to the Holder and it
shall thereupon become null and void.
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6. Neither the Holder nor in the event of the Holder's death, any person
entitled to exercise the rights of the Holder hereunder, shall have any of the
rights of a stockholder with respect to the shares subject to the Option until
share certificates have been issued and registered in the name of the Holder or
the Holder's estate, as the case may be.
7. Any notice to the Company provided for in this Agreement shall be addressed
to the Company in care of its Secretary, at 00 Xxxxxxx Xxxx, Xxxx Xxxxxxx, Xxx
Xxxx 00000 and any notice to the Holder shall be addressed to the Holder at the
address now on file with the Company, or to such other address as either may
last have designated to the other by notice as provided herein. Any notice so
addressed shall be deemed to be given on the second business day after mailing,
by registered or certified mail, at a post office or branch post office within
the United States.
8. In the event that any question or controversy shall arise with respect to the
nature, scope or extent of any one or more rights conferred by this Option, the
determination by the Board, or if one had been appointed, the Committee (as
constituted at the time of such determination) of the rights of the Holder shall
be conclusive, final and binding upon the Holder and upon any other person who
shall assert any right pursuant to this Option.
Newtown Lane Marketing, Incorporated
By: ____________________________________
Name:
Title:
ACCEPTED AND AGREED
_________________________________
J. Xxxxx Xxxxxxx
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FORM OF NOTICE OF EXERCISE
TO: Newtown Lane Marketing, Incorporated
The undersigned hereby exercises options to purchase __________ shares of
Common Stock of Newtown Lane Marketing, Incorporated (the "Company") as provided
in the Stock Option Agreement dated as of __________, ___ at $__________ per
share, a total of $__________ and makes payment therefor as follows:
(1) To the extent of $__________ of the purchase price, the undersigned
hereby surrenders to the Company certificates for shares of its Common Stock
which, valued at $__________ per share, the fair market value thereof, equals
such portion of the purchase price.
(2) To the extent of the balance of the purchase price, the undersigned
has enclosed a check payable to the order of the Company for $__________.
A stock certificate or certificate for the shares should be delivered in
person or mailed to the undersigned at the address shown below.
The undersigned hereby represents and warrants that it is the
undersigned's present intention to acquire and hold the aforesaid shares of
Common Stock of the Company for his or her own account for investment, and not
with a view to the distribution of any thereof, and agrees that he or she will
make no sale, thereof, except in compliance with the applicable provisions of
the Securities Act of 1933, as amended.
Signature: __________________________
Address: ____________________________
____________________________
____________________________
Dated: __________________________
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