EXHIBIT 99.3
NONQUALIFIED STOCK OPTION AGREEMENT BETWEEN ACRES GAMING
INCORPORATED AND XXXX XXXXXX DATED DECEMBER 8, 1999
ACRES GAMING INCORPORATED
1993 STOCK OPTION AND INCENTIVE PLAN
NONQUALIFIED STOCK OPTION AGREEMENT
OPTIONEE: Xxxx Xxxxxx
GRANT DATE: December 8, 1999
NUMBER OF OPTION SHARES: 25,000
OPTION PRICE PER SHARE: $1.00 per Share
EXPIRATION DATE: December 8, 2009
THIS AGREEMENT is made as of the Grant Date set forth above, by
and between Acres Gaming Incorporated, a Nevada corporation (the "Company"), and
the Optionee named above, who is an employee of the Company or of a Subsidiary
of the Company (the "Optionee").
The Company desires, by affording the Optionee an opportunity to
purchase shares of its Common Stock, par value $.01 per share (the "Common
Stock"), as hereinafter provided, to carry out the purpose of the Acres Gaming
Incorporated 1993 Stock Option and Incentive Plan (the "Option Plan").
NOW, THEREFORE, in consideration of the mutual covenants
hereinafter set forth and for other good and valuable consideration, the parties
hereby agree as follows:
1. GRANT OF OPTION. The Company hereby grants to the Optionee the right
and option to purchase all or any part of the aggregate number of shares of
Common Stock set forth above (the "Option Shares") (such number being subject to
adjustment as provided in paragraph 8 hereof) on the terms and conditions set
forth in this Agreement. This option is not intended to be an "incentive stock
option" within the meaning of section 422 of the Internal Revenue Code of 1986,
as amended.
2. PURCHASE PRICE. The purchase price of the Option Shares shall be the
Option Price per share set forth above (such Option Price being subject to
adjustment as provided in paragraph 8 hereof).
3. TERM AND EXERCISE OF OPTION. The term of this option shall commence
on the Grant Date set forth above and shall continue until the Expiration Date
set forth above, unless earlier terminated as provided herein. Unless a
committee of the Board of Directors of the Company appointed to administer the
Option Plan (the "Committee") shall decide otherwise, and except as otherwise
provided herein, this option will be exercisable in cumulative installments as
follows:
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a. Up to 6,250 Option Shares may be purchased at any time after
December 8, 1999 and prior to termination of this option;
b. Up to 6,250 Option Shares (less any shares previously
purchased pursuant to this option) may be purchased at any time after
April 1, 2000 and prior to termination of this option; and
c. Up to 6,250 Option Shares (less any shares previously
purchased pursuant to this option) may be purchased at any time after
April 1, 2001, and prior to termination of this option; and
d. Up to 6,250 Option Shares (less any shares previously
purchased pursuant to this option) may be purchased at any time after
April 1, 2002, and prior to termination of this option; and
IMMEDIATE ACCELERATION OF OPTION. Notwithstanding any provision
in this option to the contrary, this 25% of this option will become exercisable
in full immediately if, subsequent to the Grant Date set forth above and prior
to the Expiration Date or other termination of this option, the shareholders of
the Company approve an agreement to merge or consolidate with or into another
corporation under circumstances in which the company is not the surviving party,
or an agreement to sell or otherwise dispose of all or substantially all of the
Company's assets (including a plan of liquidation.)
Neither the Optionee nor the Optionee's legal representatives,
legatees or distributees, as the case may be, will be, or will be deemed to be,
a holder of any Option Shares for any purpose unless and until certificates for
such shares are issued to the Optionee or the Optionee's legal representatives,
legatees or distributees, under the terms of the Option Plan.
4. LIMITATIONS ON EXERCISE OF OPTION.
a. Except as provided in paragraph 6 or 7 below, this option may
not be exercised unless the Optionee is, at the time of such exercise,
in the employ of the Company or of a Subsidiary of the Company, and
shall have been continuously so employed since the Grant Date of this
option.
b. The exercise of this option will be contingent upon receipt
from the Optionee (or the purchaser acting under paragraph 7 below) of
(i) representations in writing (if required by the Committee, in its
sole discretion), that the Option Shares are being acquired for
investment and not for resale or with a view to the distribution
thereof, and (ii) the full Option Price of such Option Shares.
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c. The issuance of Option Shares upon the exercise of this option
shall be subject to all applicable laws, rules, and regulations and
shares shall not be issued except upon the approval of proper government
agencies or stock exchanges as may be required.
d. This option shall not be exercisable if at any date of
exercise, it is the opinion of counsel for the Company that registration
of said shares under the Securities Act of 1933, or other applicable
statute or regulation, is required and this option shall again become
exercisable only if the Company elects to and thereafter effects a
registration of said shares under the Securities Act of 1933, or other
applicable statute or regulation, within the period of this option.
5. NONTRANSFERABILITY OF OPTION. This option shall not be transferable
by the Optionee, other than by will or the laws of descent and distribution.
During the lifetime of the Optionee, this option shall be exercisable only by
the Optionee.
6. TERMINATION OF EMPLOYMENT. If the Optionee shall cease to be employed
by the Company or a Subsidiary of the Company as a result of retirement for age
or disability, or voluntary or involuntary separation from employment, this
option may be exercised, to the extent the Optionee shall have been entitled to
do so at the date of termination of employment, within a period of three months
after such termination of employment, but in no case later than the Expiration
Date set forth above. This option will not confer upon the Optionee any right
with respect to continuance of employment by the Company or a Subsidiary of the
Company, nor will it interfere in any way with the Company's right or the
Subsidiary's right to terminate his employment at any time.
7. DEATH OF OPTIONEE. In the event of the death of the Optionee while in
the employ of the Company or of a Subsidiary of the Company, this option may be
exercised, to the extent the Optionee shall have been entitled to do so at the
date of death, within a period of one year after the date of death, but in no
case later than the Expiration Date set forth above. In such event, this option
shall be exercisable only by the executors or administrators of the Optionee or
by the person or persons to whom the Optionee's rights under the option shall
pass by the Optionee's Will or the laws of descent and distribution.
8. ADJUSTMENTS. In the event of any change in the outstanding shares of
Common Stock by reason of any stock dividend, recapitalization, reorganization,
merger, consolidation, split-up, combination or exchange of shares, or rights
offering to purchase Common Stock at a price substantially below fair market
value, or other similar change affecting the Common Stock, while any portion of
this option is outstanding and unexercised, the Committee shall make such
adjustments in the number of Option Shares and in the Option Price as shall be
equitable and appropriate in order to prevent substantial dilution or
enlargement of the rights granted to, or available for, the Optionee. No
adjustment shall be made in connection with the issuance by the Company of any
warrants, rights, or options to acquire additional shares of Common Stock or of
securities convertible into Common Stock at a price that is not substantially
below the fair market value of the Common Stock at the date such warrants,
rights or options are issued.
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9. INTERPRETATION. The interpretation and construction of any provision
of the Option Plan and this option shall be made by the Committee and shall be
final, conclusive and binding on the Optionee and all other persons.
10. SUBSIDIARY. The term "Subsidiary" as used in the Option Plan and in
this Option Agreement means a subsidiary corporation, at least 50% of the
outstanding voting stock or voting power of which is beneficially owned,
directly or indirectly, by the Company.
11. OPTION PLAN GOVERNS. This option is in all respects subject to and
governed by all of the provisions of the Option Plan.
IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed in its corporate name by its duly authorized officer, and the Optionee
has executed this Agreement as of the Grant Date set forth above.
COMPANY: ACRES GAMING INCORPORATED
By
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Xxxx X. Acres, CEO
OPTIONEE:
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Xxxx Xxxxxx
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