EXHIBIT 10.3
OPTION AGREEMENT
THIS OPTION AGREEMENT, dated as of the 26th day of March, 1997 by and
between ARTRA GROUP INCORPORATED, a Pennsylvania corporation ("ARTRA"), FILL-MOR
HOLDING, INC., a Delaware corporation ("Fill-Mor") (ARTRA AND Fill-Mor
hereinafter jointly referred to as "Grantor") and XXXXXX X. XXXXXX ("Grantee").
WHEREAS, Grantor owns the common stock of COMFORCE Corporation, a
Delaware corporation ("Comforce"); and
WHEREAS, Grantee has agreed to make a loan in the amount of $1,000,000
(the "Loan"), to ARTRA to be evidenced by ARTRA's Promissory Note of even date
herewith in said principal amount, payable to the order of Lender with interest
as therein described (such Term Loan Promissory Note, together with any and all
renewals, extensions, replacements, supplements or additional notes are
hereinafter collectively referred to as the "Note").
NOW, THEREFORE, in consideration of the premises, it is agreed as
follows:
1. Option. Grantor hereby grants to Grantee the option to purchase
25,000 shares of the common stock (the "Shares") of Comforce at a price of $4.00
per share (the "Option").
2. Term of Option. This Option shall be effective from the date hereof
and shall expire one year after the repayment of the Note, or the exercise of
the terms of Paragraphs 6 or 7, hereinbelow.
3. Repayment of Note - Reduction of Price. In the event that Artra does
not repay the Note in full, on or before May 26, 1997, price for the Shares
shall, effective May 26, 1997, be reduced from $4.00 per share to $2.00 per
share.
4. Repayment of Note - Additional Shares. In the event that Artra does
not repay the Note in full on or before June 26, 1997, and every thirty (30)
days thereafter until the Note is paid in full, Grantor hereby grants to Grantee
an option to purchase an additional 5,000 shares of the common stock of Comforce
(the "Additional Shares") at a price of $2.00 per share (the "Additional
Option").
5. Exercise of Option. This Option and the Additional Option may be
exercised in whole or in part at any time on or before the above-stated time of
expiration of this Option, or if such day is a day on which banking institutions
are authorized by law to close in Chicago, Illinois, then on the next succeeding
business day, by written notice to ARTRA at 000 Xxxxxxx Xxxxxx, Xxxxxxxxxx,
Xxxxxxxx 00000, accompanied by payment in full for the number of shares of
Common Stock specified in such notice. Upon Grantee's exercise of this Option or
the Additional Option, Grantee will be entitled to receive a stock certificate
representing the Shares (and, as the case may be, the Additional Shares) for
which the Grantee has made payment.
6. Put of Option Agreement. Grantee shall have a one time option to
require Artra to purchase this Option from Grantee on or before the date of May
30, 1997, for a total purchase price of $50,000.00 (the "Put Option"). Grantee
shall exercise the Put Option by giving Artra five (5) days written notice
(which shall be in the form of Exhibit "A" attached hereto and made a part
hereof) prior to the date of May 30, 1997.
7. Purchase of Option. Provided that Artra has repaid the Note in full
at the maturity thereof, and that Grantee shall not have exercised the Option or
the Put Option on or before the date of May 30, 1997, Artra shall have a one
time option, but not the obligation, to purchase this Option from Grantee, for a
total price of $50,000.00. Artra shall exercise the right to purchase this
Option by giving Grantee five (5) days written notice (which shall be in the
form of Exhibit "B" attached hereto and made a part hereof) prior to the date of
May 30, 1997. Upon Grantee's receipt of Artra's notice and payment in full, this
Option shall automatically terminate.
8. Governing Law. This Option has been executed and delivered in the
State of Illinois and shall be construed in accordance with the laws of the
State of Illinois.
IN WITNESS WHEREOF, Artra, Grantee and Fill-Mor have executed this
Option Agreement as of the day and date above first written.
GRANTEE: GRANTOR:
ARTRA GROUP Incorporated
By: _____________________
Its: _____________________
_________________________
XXXXXX X. XXXXXX
Fill-Mor Holding, Inc.
By: _____________________
Its: _____________________
EXHIBIT A
NOTICE OF PUT OPTION
Dated: _____________________
TO: ARTRA GROUP Incorporated
000 Xxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
RE: Option Agreement
Please be advised that in accordance with Paragraph 6 of the Option Agreement,
Grantee hereby exercises its rights under the Put Option.
Very truly yours,
_________________________
Xxxxxx X. Xxxxxx
EXHIBIT B
NOTICE OF PURCHASE OPTION
Dated: __________________
TO: Xxxxxx X. Xxxxxx
000 X. Xxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, XX 00000
RE: Option Agreement
To Whom It May Concern:
Please be advised that in accordance with Paragraph 7 of the Option Agreement,
Grantor hereby exercises its right to purchase the option. Enclosed please find
our check in the amount of $50,000.
Very truly yours,
ARTRA GROUP Incorporated
By: ______________________________
Its: ______________________________
