EXHIBIT 16.
STOCK OPTION AGREEMENT
STOCK OPTION AGREEMENT made this ____ day of April, 1997 by SAF T
LOK INCORPORATED, a Florida corporation (the "Company"), in favor
of XXXXXXX X. XXXXXXX (the "Holder").
AGREEMENT:
For good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Company has agreed, among
other things, to grant to Holder the Option (as herein defined).
1. Grant. The Company hereby grants to Holder the right
to purchase fifty thousand (50,000) newly-issued shares (the
"Shares") of the Company's Common Stock, $0.01 par value (the
"Common Stock"), exercisable at any time and from time to time
through December 31, 2001 (the "Option").
2. Exercise Price. The exercise price per Share for which
all or any of the Shares may be purchased pursuant to the terms
of the Option is two dollars and fifty cents ($2.50) (the "Exer
cise Price").
3. Exercise. The Option may be exercised by the Holder as
to all or in increments of ten thousand (10,000) Shares (or the
balance of the Shares if less than such number), upon delivery of
written notice of intent to exercise in the form attached hereto
as Exhibit "A" to the Company at the following address: 00000
X.X. Xxxxxxx Xxxxxxx, Xxxxxxxx, Xxxxxxx 00000, or such other ad-
dress as the Company shall designate in a written notice to the
Holder, together with this Agreement and a check payable to the
Company for the aggregate Exercise Price of the Shares so pur
chased. Upon exercise of the Option as aforesaid, the Company
shall, as promptly as practicable, and in any event within thirty
(30) days thereafter, execute and deliver to the Holder a certif-
icate or certificates for the total number of whole Shares for
which the Option is being exercised. If the Option shall be ex-
ercised with respect to less than all of the Shares, the Holder
shall be entitled to receive a new Agreement covering the number
of Shares in respect of which the Option shall not have been ex-
ercised, which new Agreement shall in all other respects be iden-
tical to this Agreement. The Company covenants and agrees that
it shall pay when due any and all state and federal issue taxes
which may be payable in respect of the issuance of the Option or
the issuance of any Shares upon exercise of the Option.
4. Covenants and Conditions. The above provisions are
subject to the following:
(a) Neither the Option nor the Shares have been regis-
tered under the Securities Act of 1933, as amended (the "Securi
ties Act") or any state securities laws (the "Blue Sky Laws").
The Option has been acquired for investment purposes and not with
a view to distribution or resale and may not be pledged, hypothe-
cated, sold, made subject to a security interest, or otherwise
transferred without (i) an effective registration statement under
the Securities Act and applicable Blue Sky Laws, or (ii) an opin-
ion of counsel, which opinion and counsel shall be reasonably
satisfactory to the Company and its counsel, that registration is
not required under the Securities Act or under any applicable
Blue Sky Laws. Transfer of the Shares issued upon the exercise
of the Option shall be restricted in the same manner and to the
same extent as the Option and the certificates representing such
Shares shall bear substantially the following legend:
THE SHARES OF COMMON STOCK REPRESENTED BY THIS CERTIFI
CATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "ACT"), OR ANY APPLICABLE
STATE SECURITIES LAW AND MAY NOT BE TRANSFERRED UNTIL
(I) A REGISTRATION STATEMENT UNDER THE ACT OR SUCH AP-
PLICABLE STATE SECURITIES LAW SHALL HAVE BECOME EFFEC
TIVE WITH REGARD THERETO, OR (II) IN THE OPINION OF
COUNSEL ACCEPTABLE TO THE COMPANY, REGISTRATION UNDER
THE ACT OR SUCH APPLICABLE STATE SECURITIES LAW IS NOT
REQUIRED IN CONNECTION WITH THE PROPOSED TRANSFER.
The Holder agrees to execute such other documents and instruments
as counsel for the Company reasonably deems necessary to effect
the compliance of the issuance of the Option and any Shares is-
sued upon exercise of the Option with applicable federal and
state securities laws.
(b) The Company covenants and agrees that all Shares
which may be issued upon exercise of the Option shall, upon is-
suance and payment therefor, be legally and validly issued and
outstanding, fully paid and nonassessable, free from all taxes,
liens, charges and preemptive rights, if any, with respect there-
to or to the issuance thereof. The Company shall at all times
reserve and keep available for issuance upon the exercise of the
Option such number of authorized but unissued shares of Common
Stock as will be sufficient to permit the exercise in full of the
Option.
5. Transfer of Option. The Option may not be transferred,
in whole or in part. In the event of the death or final deter-
mination of legal incapacity of the Holder during such time as
the Holder shall possess the Option granted hereunder, the per-
xxxxx representative of the Holder may, for a period of ninety
(90) days following the date of death or final determination of
legal incapacity, exercise the Option to the extent that the Hol-
der was entitled to exercise the Option on such date. Any person
so desiring to exercise the Option shall be required, as a condi
tion to the exercise of the Option, to furnish to the Company
such documentation as the Company shall deem necessary to evi-
dence the authority of such person to exercise the Option on be-
half of the Holder.
6. Adjustment Upon Changes In Capitalization.
(a) If all or any portion of the Option shall be ex-er
cised subsequent to any stock split, stock dividend, recapital
ization, combination of shares of the Company, or other similar
event occurring after the date hereof, then the Holder exercising
the Option shall receive, for the aggregate price paid upon the
exercise, the aggregate number and class of shares which the Hol-
der would have received if the Option had been exercised immedi-
ately prior to such stock split, stock dividend, recapitaliza
tion, combination of shares, or other similar event. If any ad-
justment under this paragraph 6(a) would create a fractional
share of Common Stock or a right to acquire a fractional share of
Common Stock, such fractional share shall be disregarded and the
number of shares subject to the Option shall be the next higher
number of shares, rounding all fractions upward. Whenever there
shall be an adjustment pursuant to this paragraph 6(a), the Com-
pany shall forthwith notify the Holder of such adjustment, set-
ting forth in reasonable detail the event requiring the adjust
ment and the method by which such adjustment was calculated.
(b) If all or any portion of the Option shall be ex-er
cised subsequent to any merger, consolidation, exchange of
shares, separation, reorganization or liquidation of the Company
or other similar event occurring after the date hereof, as a re-
xxxx of which shares of Common Stock shall be changed into the
same or a different number of shares of the same or another class
or classes of securities of the Company or another entity, then
the Holder exercising the Option shall receive, for the aggregate
price paid upon such exercise, the aggregate number and class of
shares which the Holder would have received if the Option had
been exercised immediately prior to such merger, consolidation,
exchange of shares, separation, reorganization or liquidation, or
other similar event. If any adjustment under this paragraph 6(b)
would create a fractional share of Common Stock or a right to
acquire a fractional share of Common Stock, such fractional share
shall be disregarded and the number of shares subject to this
Option shall be the next higher number of shares, rounding all
fractions upward. Whenever there shall be an adjustment pursuant
to this paragraph 6(b), the Company shall forthwith notify the
Holder of such adjustment, setting forth in reasonable detail the
event requiring the adjustment and the method by which such ad-
justment was calculated.
7. Notices. The Company shall provide the Holder with a
copy of any notice that the Company is required to provide those
persons holding shares of the Common Stock on the same date such
persons receive such notice.
8. Loss, Destruction, Etc. of Agreement. Upon receipt of
evidence satisfactory to the Company of the loss, theft, mutila
tion or destruction of this Agreement, and in the case of any
such loss, theft or destruction, upon delivery of a bond of in-
demnity in such form and amount as shall be reasonably satisfac-
tory to the Company, or in the event of such mutilation, upon
surrender and cancellation of the Agreement, the Company shall
make and deliver a new Agreement of like tenor in lieu of such
lost, stolen, destroyed or mutilated Agreement. Any Agreement
executed and delivered under the provisions of this paragraph 8
in lieu of any Agreement alleged to be lost, destroyed or stolen,
or in lieu of any mutilated Agreement, shall constitute an orig-
inal contractual obligation on the part of the Company.
IN WITNESS WHEREOF, the Company and the Holder have executed
this Stock Option Agreement as of the date first above written.
SAF T LOK INCORPORATED
By:
Xxxxxxxx X. Xxxxxx, Chairman
_______________________________
XXXXXXX X. XXXXXXX
Exhibit "A" to
Stock Option Agreement dated April ___, 1997
NOTICE OF EXERCISE OF OPTION TO PURCHASE
SHARES OF COMMON STOCK
OF SAF T LOK INCORPORATED
The undersigned does by this notice request that Saf T Lok Incor-
porated, a Florida corporation (the "Company"), issue to the un-
dersigned that number of shares of Common Stock specified below
(the "Shares") at the price per Share specified below pursuant to
the exercise of the undersigned's option under the Stock Option
Agreement (the "Agreement") dated April ___, 1997 between the un-
dersigned and the Company.
Simultaneously herewith, the undersigned delivers to the Company
the purchase price for the Shares (i.e., that amount which is ob-
tained by multiplying the number of Shares for which the Option
is being exercised by the price specified), by good check.
The undersigned hereby represents and warrants that the under
signed is acquiring the Shares for the undersigned's own account
and not on behalf of any other person and without any present
view to making a public offering or distribution of same and
without any present intention of selling same at any particular
time or at any particular price or upon the occurrence of any
particular event or circumstance.
The undersigned acknowledges and understands that in connection
with the acquisition of the Shares by the undersigned:
1. The Company has informed the undersigned that the Shares are
not registered under the Securities Act of 1933, as amended (the
"Act"), or applicable state securities or Blue Sky law or laws,
and thus the Shares may not be transferred or otherwise disposed
of until the Shares are subsequently registered under the Act and
the applicable state securities or Blue Sky law or laws or an
exemption from such registration requirements is available.
2. The undersigned has been informed that a legend referring to
the restrictions indicated herein on transferability and sale
will be placed upon the certificate(s) evidencing the Shares.
3. If the undersigned is required to file a Form 144 with the
Securities and Exchange Commission in connection with sales of
the Shares pursuant to Rule 144 under the Act, the undersigned
shall mail a copy of such Form to the Company at the same time
and each time the undersigned mails a copy to the Securities and
Exchange Commission.
A. Date of Stock Option Agreement: April ___, 1997
B. Number of Shares covered by Agreement: 50,000
C. Number of Shares of Common Stock actually to be purchased at
this time (must be 10,000 Shares or whole multiples thereof
and cannot be greater than 100,000):________
D. Exercise price per Share: $2.50
E. Aggregate price to be paid for Shares actually purchased (D
multiplied by C): $________
Dated:________________________
Very truly yours,
______________________________
XXXXXXX X. XXXXXXX
Residence:
0000 00xx Xx. X.X. #XX
Xxxxxxxxxx, X.X. 00000
ACCEPTED:
SAF T LOK INCORPORATED
By:___________________________
Title:_____________________
Dated:________________________
