EXHIBIT 9
NON-QUALIFIED STOCK OPTION AGREEMENT
AGREEMENT, made as of the 4th day of February 2000, by and between
American Vantage Companies, a Nevada corporation having its place of business at
0000 Xxxx Xxxxxxxxx, Xxxxx 000, Xxx Xxxxx, Xxxxxx 00000 ("Grantor"), and Xxxxxx
Xxxx residing at 0000 Xxxxxxxxxx Xxx, Xxx Xxxxx, Xxxxxx 00000 ("Optionee").
W I T N E S S E T H:
WHEREAS, Optionee is presently performing services for the Grantor and
is not an employee of the Grantor; and
WHEREAS, the Grantor is desirous of increasing the incentive of
Optionee to exert her utmost efforts to improve the business of the Grantor.
NOW, THEREFORE, in consideration of Optionee's continued service to the
Grantor, and for other good and valuable consideration, the Grantor hereby
grants to Optionee options to purchase common stock of the Grantor ("Common
Stock"), on the following terms and conditions:
1. Option.
The Grantor hereby grants to Optionee a non-qualified stock option (not
qualified as described in Section 422 of the Internal Revenue Code of 1986, as
amended (the "Code") to purchase, at any time prior to 5:00 p.m. on February 3,
2010, up to Thirty Three Thousand Three Hundred Thirty Four (33,334) fully paid
and non-assessable shares of Common Stock (the "Shares").
2. Purchase Price.
The purchase price shall be $1.125 per Share. The Grantor shall pay all
original issue or transfer taxes on the exercise of this option and all other
fees and expenses necessarily incurred by the Grantor in connection therewith.
3. Exercise of Option.
All or any part of the option granted hereunder may be exercised by the
Optionee at any time after the date hereof by delivering a Notice of Exercise
substantially in the form attached hereto to the Grantor by hand delivery,
overnight courier or by registered or certified mail, return receipt requested,
addressed to its principal office, as to the number of Shares which Optionee
desires to purchase under the option herein granted. The payment of the exercise
price may be made, at the option of the Holder, either (i) by cash or certified
or bank cashier's check in lawful money of the United States of America, payable
to the order of the Company in an amount equal to the exercise price multiplied
by the number of Shares for which this Option is being exercised, (ii) by
delivery of shares of Common Stock having a fair market value on the trading day
immediately preceding the date of the Grantor's receipt of the Notice of
Exercise equal to the exercise price of the Shares being exercised, (iii) by
having the Company withhold from the shares of Common Stock to be issued upon
exercise of the Options the number of Shares having a value, based on the Common
Stock closing price on the trading day immediately prior to the date of such
exercise, equal to the product of the exercise price times the number of Shares
as to which this Option is being exercised, (iv) by having the Company cancel a
number of Options equal to the number of Shares purchased and to be delivered
upon the exercise of the Options multiplied by a fraction, the numerator of
which is the exercise price and the denominator of which is the excess of the
fair market value of the
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underlying Common Stock on the date of exercise (based on the Common Stock
closing price on the trading day immediately prior to the date of such exercise)
and the exercise price, or (v) by any combination thereof. As soon as
practicable thereafter, the Grantor shall cause to be delivered to Optionee
certificates issued in Optionee's name evidencing the Shares purchased by
Optionee.
4. Option Conditioned On Continued Service.
(a) If Optionee shall be removed as a director for cause, or if
Optionee resigns voluntarily, the option granted to Optionee hereunder shall
expire immediately upon such termination. If Optionee shall be removed as a
director without cause, such option may be exercised at any time within three
(3) months after such termination, subject to the provisions of subparagraph (d)
of this Paragraph 4.
(b) If Optionee dies (i) while performing services for the Grantor
or a subsidiary or parent corporation, or (ii) within three (3) months after the
termination of Optionee's service other than voluntarily by Optionee or for
cause, such option may be exercised by a legatee or legatees of such option
under Optionee's last will or by her personal representatives or distributees at
any time within one year after her death, subject to the provisions of
subparagraph (d) of this Paragraph 4.
(c) If Optionee becomes disabled within the definition of Section
22(e)(3) of the Code while performing services for the Grantor or a subsidiary
or parent corporation, such option may, subject to the provisions of
subparagraph (d) of this Paragraph 4, be exercised at any time within one year
after Optionee's termination of service due to the disability.
(d) An option may not be exercised pursuant to this Paragraph 4
except to the extent that Optionee was entitled to exercise the option at the
time of termination of service or death, and in any event may not be exercised
after the original expiration date of the option.
5. Divisibility and Non-Assignability of the Options.
(a) The Optionee may exercise the options herein granted from time
to time subject to the provisions of Section 3 above with respect to any whole
number of Shares included therein, but in no event may an option be exercised as
to less than one hundred (100) Shares at any one time, except for the remaining
Shares covered by the option if less than one hundred (100).
(b) The Optionee may not give, grant, sell, exchange, transfer
legal title, pledge, assign or otherwise encumber or dispose of the options
herein granted or any interest therein, otherwise than by will or the laws of
descent and distribution, and these options, or any of them, shall be
exercisable during Optionee's lifetime only by Optionee.
6. Stock as Investment.
By accepting these options, Optionee agrees for herself, her heirs and
legatees that any and all Shares purchased hereunder shall be acquired for
investment purposes only and not for sale or distribution, and upon the issuance
of any or all of the Shares issuable under the options granted hereunder,
Optionee, or her heirs or legatees receiving such Shares, shall deliver to the
Grantor a representation in writing, that such Shares are being acquired in good
faith for investment purposes only and not for sale or distribution. Grantor may
place a "stop transfer" order with respect to such Shares with its transfer
agent and place an appropriate restrictive legend on the stock certificate(s)
evidencing such Shares.
7. Restriction on Issuance of Shares.
The Grantor shall not be required to issue or deliver any certificate
for Shares purchased upon the
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exercise of any option granted hereunder unless (a) the issuance of such Shares
has been registered with the Securities and Exchange Commission under the
Securities Act of 1933, as amended, or counsel to the Grantor shall have given
an opinion that such registration is not required; (b) approval, to the extent
required, shall have been obtained from any state regulatory body having
jurisdiction thereof; and (c) permission for the listing of such Shares, if
required, shall have been given by Nasdaq and/or any national securities
exchange on which the Common Stock of the Grantor is at the time of issuance
listed.
8. Adjustments Upon Changes in Capitalization.
(a) In the event of changes in the outstanding Common Stock of the
Grantor by reason of stock dividends, stock splits, recapitalizations, mergers,
consolidations, combinations, or exchanges of shares, separations,
reorganizations, or liquidations, the number and class of shares as to which the
options may be exercised shall be correspondingly adjusted by the Grantor. No
adjustment shall be made with respect to stock dividends or splits which do not
exceed 10% in any fiscal year, cash dividends or the issuance to stockholders of
the Grantor of rights to subscribe for additional shares of Common Stock or
other securities. Anything to the contrary contained herein notwithstanding, the
Board of Directors of the Grantor shall have the discretionary authority to take
any action necessary or appropriate to prevent these options from being
disqualified as "Incentive Stock Options" under the United States income tax
laws then in effect.
(b) Any adjustment in the number of Shares shall apply proportionately
to only the unexercised portion of an option granted hereunder. If fractions of
a share would result from any such adjustment, the adjustment shall be revised
to the next higher whole number of Shares so long as such increase does not
result in the holder of the option being deemed to own more than 5% of the total
combined voting power or value of all classes of stock of the Grantor or its
subsidiaries.
9. Effect of Mergers, Consolidations or Sales of Assets.
Anything contained herein to the contrary notwithstanding, a merger or
consolidation in which the Grantor is not the surviving corporation, or a sale
of substantially all of the Grantor's assets or capital stock shall cause the
unexercised options to terminate automatically, unless otherwise provided by the
Board of Directors.
Furthermore, this option may, at the discretion of the Board of
Directors of the Grantor and said other corporation, be exchanged for options to
purchase shares of capital stock of another corporation which the Grantor,
and/or a subsidiary thereof is merged into, consolidated with, or all or a
substantial portion of the property or stock of which is acquired by said other
corporation or separated or reorganized into. The terms, provisions and benefits
to Optionee of such substitute option(s) shall in all respects be identical to
the terms, provisions and benefits of Optionee under his Option(s) prior to said
substitution. To the extent the above may be inconsistent with Sections
424(a)(1) and (2) of the Code, the above shall be deemed interpreted so as to
comply therewith.
10. No Rights in Option Stock.
Optionee shall have no rights as a shareholder in respect of Shares as
to which the option granted hereunder shall not have been exercised and payment
made as herein provided.
11. Effect Upon Employment.
This Agreement does not give Optionee any right to employment by, or
any other relationship with, the Grantor.
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12. Binding Effect.
Except as herein otherwise expressly provided, this Agreement shall be
binding upon and inure to the benefit of the parties hereto, their successors,
legal representatives and assigns.
13. Miscellaneous.
This Agreement shall be construed under the laws of the State of
Nevada. Headings have been included herein for convenience of reference only,
and shall not be deemed a part of this Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
AMERICAN VANTAGE COMPANIES
By: /s/ Xxxxxx X. Xxxxxxxxx
Xxxxxx X. Xxxxxxxxx,
President
ACCEPTED AND AGREED TO:
/s/ Xxxxxx Xxxx
Xxxxxx Xxxx
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