SECOND AMENDED AND RESTATED STOCK OPTION AGREEMENT
BETWEEN VALESC HOLDINGS INC. AND
XXXXXXX XXXXXX
This Stock Option Agreement is made as of August 22, 2003 by and
between Xxxxxxx Xxxxxx, an individual currently residing at 000 Xxxxxxxxx
Xxxxxx, Xxx. 0, Xxxxxxx, XX 00000, and Valesc Holdings Inc. ("Valesc").
WHEREAS, the parties previously entered into a Stock Option Agreement
dated March 24, 2003 with respect to 2,110,639 shares of common stock, $.0001
par value per share, of Valesc (the "Common Stock") owned by Xx. Xxxxxx, which
agreement was amended and restated effective June 25, 2003 to cover an
additional 44,141 shares of Common Stock acquired by Xx. Xxxxxx;
WHEREAS, Xx. Xxxxxx now owns 21,299 additional shares of Common Stock
and the parties desire to amend and restate the Amended and Restated Stock
Option Agreement to include these shares and to adjust the exercise price of all
of the shares to reflect the additional shares cash value;
NOW THEREFORE, the parties agree as follows:
Xxxxxx Xxxxxx hereby grants a stock option to Valesc or its designee(s)
to purchase up to 2,176,079 shares of Common Stock of Valesc owned by Xx.
Xxxxxx. This Option is granted as of the date hereof and may be exercised only
upon the terms and conditions set forth below.
1. Purpose of the Option
---------------------
This Option has been granted for good and valuable consideration in
connection with the Separation Agreement entered into by Xx. Xxxxxx and Valesc
dated March 24, 2003.
2. Option Exercise Price
---------------------
Subject to any adjustment required as set forth in Section 7 below, the
exercise price of shares covered by this Option shall now be as follows to
reflect the adjusted per share exercise price to give effect to the cash value
of (i) $30,889 for the additional shares on June 25, 2003, (ii) $14,909 for the
additional shares on August 22, 2003, and (iii) the original exercise price of
$.10 per share for 2,110,639 shares of common stock:
During the One-Year Period Exercise Price
Ended March 31: Per Share:
2004 $.12
2005 $.12
2006 $.12
2007 $.17
2008 $.22
3. Acceptance of Option
--------------------
Valesc's acceptance of this Option indicates its acceptance of the
terms set forth herein. It imposes no obligation upon Valesc or its designee(s)
to purchase any or all of the shares subject to the Option, which may arise only
upon exercise of the Option in the manner set forth in Section 5 hereof. The
purchaser acknowledges that the stock certificates representing any of the
shares purchased from Xx. Xxxxxx may have a restricted legend and their resale
will be subject to the provisions of the federal securities laws and rules and
regulations published by the SEC.
4. When Option May Be Exercised
----------------------------
This Option may be exercised in full or in part at any time and from
time to time until March 31, 2008 (the "Expiration Date") and may not be
exercised for less than 10,000 shares at any one time.
5. How Option May Be Exercised
---------------------------
This Option or any portion thereof is exercisable by a written notice
signed by Valesc or its designee(s) and delivered to the Escrow Agent as
specified in the Amended and Restated Escrow Agreement entered into by Xx.
Xxxxxx and Valesc, attached as Exhibit A hereto, signifying Valesc's or its
designee's election to exercise the Option. The notice must state the number of
shares of Common Stock as to which the Option is being exercised and must be
accompanied by payment for the full purchase price of the shares being
purchased. Payment shall be in cash or check payable to the order of the Escrow
Agent on behalf of Xxxxxxx Xxxxxx.
6. Non-Transferability of Option
-----------------------------
This Option shall not be transferrable, except that it may be exercised
by specified designees of Valesc.
7. Adjustments to Option Price and Shares
--------------------------------------
If at any time after the date of grant of this Option, Valesc shall, by
stock dividend, split- up, combination, reclassification, exchange, merger,
consolidation or otherwise, change its shares of Common Stock into a different
number or kind or class of shares or other securities or property, then the
number of shares covered by this Option, and the price of each such share shall
be proportionately adjusted for any such change. If there is any dispute as to
the proper adjustment, so long as the Board of Directors' determination is not
unreasonable, such determination shall be conclusive. Any fraction of a share
resulting from any adjustment shall be eliminated.
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8. Reservation of Shares
---------------------
During the period from the date hereof until March 31, 2006, Xx. Xxxxxx
shall reserve and keep available such number of shares of Common Stock as will
be sufficient to satisfy the requirements of this Option. In the event that Xx.
Xxxxxx does not have shares available prior to March 31, 2006 to satisfy the
exercise of an option, then Xx. Xxxxxx shall have ten (10) business days to
acquire those shares and fifteen (15) business days to deliver those shares to
the Company. To the extent that Xx. Xxxxxx cannot deliver all of the required
shares or elects not to, he shall pay Valesc 70% of the difference between the
aggregate exercise price and the aggregate fair market value of the shares
subject to the exercise on the date of that exercise. Subsequent to March 31,
2006, Xx. Xxxxxx will not be under any obligation to reserve shares to satisfy
the requirements of the Option. However, to the extent he still owns any shares
after July 1, 2006, he shall be obligated to deliver any of those shares to the
extent the Company elects to exercise its right to purchase pursuant to the
Option.
-----------------------------
Xxxxxxx Xxxxxx
VALESC HOLDINGS INC.
By:___________________________
Xxxxxx Xxxxx
President
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OPTION EXERCISE FORM
To: Xxxxxxx Xxxxxx, c/x Xxxxx & Associates, P.C., as Escrow Agent
The undersigned holder hereby irrevocably elects to exercise the right
to purchase ______________ shares of Common Stock covered by this Option
Agreement according to the conditions hereof and herewith makes full payment of
the purchase price of such shares. Enclosed is our check in the amount of
$__________________ payable to Xxxxx & Associates, P.C. as escrow agent,
pursuant to the Amended and Restated Escrow Agreement dated as of August 22,
2003.
Kindly deliver to the undersigned a certificate representing the
shares.
INSTRUCTIONS FOR DELIVERY
Name: _______________________________________________________
(please typewrite or print in block letters)
Address: ____________________________________________________
Dated: ____________________________
Signature___________________________________
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Exhibit A
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Escrow Agreement
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