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EXHIBIT 10.09
FIRST AMENDMENT TO
FIREARMS TRAINING SYSTEMS, INC.
STOCK OPTION AGREEMENT
SERIES A
WHEREAS, Firearms Training Systems, Inc., a Delaware
corporation (the "Company"), has heretofore granted to the optionee named below
(the "Optionee") a non-qualified option to purchase from the Company shares of
its Class A Common Stock upon and subject to the terms and conditions of a Stock
Option Agreement, Series A dated September 18, 1996 (the "Agreement"); and
WHEREAS, the Company and the Optionee desire to amend the
Agreement in certain respects;
NOW, THEREFORE, the Agreement is amended effective as of July
10, 1998 in the following respects:
1. Section 2.2(a) of the Agreement is amended by deleting the
words "and with respect to an additional sixteen and two-thirds percent
(16-2/3%) of the shares of Stock subject to the Option if such termination
occurs after the second anniversary of the Option Date.", and by adding two new
sentences at the end thereof to read as follows:
Notwithstanding the foregoing, if the Optionee's active employment
ceases in accordance with the Confidential Resignation Agreement (as
hereinafter defined), then (i) the Optionee's employment shall be
deemed to have terminated on January 1, 1999 for purposes of this
paragraph, (ii) such termination shall be deemed to be a termination by
the Company other than for Cause (as defined herein), provided the
terms and conditions of the Confidential Resignation Agreement are
complied with and (iii) subject to Section 2.5 below, the Option shall
become exercisable with respect to 39,000 of the remaining shares of
Stock subject to the Option (the "Transition Shares") at the end of the
Compliance Period (as defined in the Confidential Resignation
Agreement). For purposes of this Agreement, "Confidential Resignation
Agreement" means the
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resignation agreement between the Company and the Optionee dated July
10, 1998.
2. Section 2.2(e) of the Agreement is amended in its entirety to
read as follows:
(e) If the Optionee terminates employment with the
Company for any reason other than as described in subsection (b), (c)
or (d) above, the Option shall be exercisable only to the extent it is
exercisable on the effective date of the Optionee's termination of
employment (except for the Transition Shares, which shall remain
exercisable as set forth in this Agreement) and may thereafter be
exercised by the Optionee or the Optionee's Legal Representative until
and including the latest to occur of (i) the date that is 90 days after
the effective date of the Optionee's termination of employment (ii) the
date on which the Optionee is determined to be noncompliant with
Paragraph 16 thereof, and (iii) if no violation of Paragraph 16 of the
Confidential Resignation Agreement occurs during the Compliance Period,
the date that is twelve months after the end of the Compliance Period;
provided that if the Optionee's employment is terminated by the Company
for Cause at any time, the Option shall terminate automatically on the
effective date of the Optionee's termination of employment, and the
Optionee shall be subject to the provisions of Section 2.5.
3. Section 2.5 of the Agreement is amended in the following
respects:
(i) to insert the phrase "In the event of a determination of the
Optionee's noncompliance with the Confidential Resignation Agreement on account
of the Optionee's breach or failure to comply with his obligations thereunder as
described in Paragraph 16 thereof, or" at the beginning of subsection (a)
thereof,
(ii) to insert the phrase "the date of such determination of
noncompliance or" before the phrase "the date the Optionee engages in such
activity" as it appears twice in subsection (a) thereof, and before the phrase
"the
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date on which the Optionee engaged in such activity" as it appears in subsection
(a) thereof, and (iii) to add the parenthetical phrase "(or in the case of a
breach of the Confidential Resignation Agreement, the Chief Executive Officer)"
after the word "Committee" as it appears in subsection (b) thereof.
4. Section 3.5 of the Agreement is amended in the following
respects:
(i) by adding at line four of Section 3.5, after the words "Section 3.8
of the Plan", the phrase "which results in a sale by the Centre Entities (as
described in the Prospectus for Firearms Training Systems, Inc. dated November
26, 1996) of all or substantially all of the assets of the Company or the shares
held by the Centre Entities (a "Qualifying Change in Control")", and to replace
the words "Change in Control" with "Qualifying Change in Control" throughout
Section 3.5 thereafter,
(ii) to substitute the phrase "there shall be substituted for each
share of Stock for which this Option is exercisable as of the date of the
Qualifying Change in Control" for the phrase "all outstanding options shall
immediately be exercisable in full and there shall be substituted for each share
of Stock available under this Plan, whether or not then subject to an
outstanding option," as it appears in the first sentence of the first paragraph
thereof,
(iii) to substitute the phrase "the Option" for the phrase "each
option" as it appears in the second sentence of the first paragraph thereof,
(iv) to add the phrase "for which the Option is exercisable as of the
date of occurrence of such Qualifying Change in Control" after the phrase "a
cash payment from the Company in an amount equal to the number of shares of
Stock
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then subject to such option" as it appears in the second paragraph thereof, and
(v) to add a new paragraph at the end thereof to read as follows:
In the event of a Qualifying Change in Control prior to the
end of the Compliance Period, the portion of the Option which is
attributable to the Transition Shares shall be deemed to be exercisable
for purposes of this Section 3.5
This instrument may be executed in two counterparts, each of which
shall be deemed an original and both of which together shall constitute one and
the same instrument.
FIREARMS TRAINING SYSTEMS, INC.
By:/s/ Xxxxx X. Xxxxxx
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Xxxxx X. Xxxxxx
President
Accepted this 10th day of July, 1998.
/s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
