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Exhibit 4
STOCK OPTION AGREEMENT
BY THIS STOCK OPTION AGREEMENT ("Agreement") made and entered into this
18th day of December, 1996 ("Grant Date"), FORTE COMPUTER EASY, INC., a Utah
corporation (the "Company"), and AAP HOLDINGS, INC., a Delaware corporation (the
"Optionee"), hereby state, confirm, represent, warrant and agree as follows:
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RECITALS
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1.1 Pursuant to Section 1.1 of that certain Agreement and Plan of
Reorganization dated October 25, 1996 (the "Agreement") between the Company and
the Optionee, the Company has agreed to issue to the Optionee options to acquire
1.5 times the number of shares of the $0.01 par value common stock (the "Common
Stock") of the Company subject to outstanding options immediately prior to the
closing of the transactions contemplated by the Agreement.
1.2 By this Agreement, the Company and the Optionee desire to establish
the terms upon which the Company is willing to grant to the Optionee, and upon
which the Optionee is willing to accept from the Company, such option.
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AGREEMENTS
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2.1 GRANT OF STOCK OPTION. Subject to the terms and conditions
hereinafter set forth and to the terms and conditions applicable to the Prior
Option (as defined in Section 2.5 hereof) from time to time, the Company grants
to the Optionee the right and option (the "Option") to purchase from the Company
all or any part of an aggregate number of SIX HUNDRED EIGHTY-TWO THOUSAND EIGHT
HUNDRED EIGHTY-SEVEN (682,887) shares of Common Stock, authorized but unissued
or, at the option of the Company, treasury stock if available (the "Optioned
Shares").
2.2 EXERCISE OF OPTION. Subject to the terms and conditions of this
Agreement and those of the other documents and agreements referred to herein,
the Option may be exercised only upon written notice to the Company which sets
forth the number of Optioned Shares as to which the Option is being exercise and
the exercise price thereof.
2.3 PURCHASE PRICE. The price to be paid for the Optioned Shares (the
"Purchase Price") shall be $0.375 per share, subject to adjustment from time to
time as set forth herein.
2.4 PAYMENT OF PURCHASE PRICE. Payment of the Purchase Price may be
made as follows:
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(a) In United States dollars in cash or by check, bank draft
or money order payable to the Company; or
(b) At the discretion of the Board of Directors of the
Company, through the delivery of shares of Common Stock with an
aggregate fair market value at the date of such delivery, equal to the
Purchase Price; or
(c) By a combination of both (a) and (b) above.
The Board of Directors of the Company shall determine acceptable methods for
tendering Common Stock as payment upon exercise of an Option and may impose such
limitations and conditions on the use of Common Stock to exercise an Option as
it deems appropriate.
2.5 EXERCISABILITY OF OPTION. Notwithstanding any provisions to the
contrary set forth herein, the Option shall be subject in all respects to the
terms and conditions applicable to the option previously granted by the Company
to Xxxx Xxxxxxxxxx to purchase 455,258 shares of Common Stock (the "Prior
Option"), including without limitation exercise price, conditions of exercise,
forfeiture, restrictions on transferability of Common Stock received upon
exercise, and terms of expiration. A copy of the agreement between the Company
and the holder of the Prior Option, which sets forth the material terms of the
Prior Option as of the date hereof, is attached hereto as EXHIBIT A. Without
limiting the generality of the foregoing, the terms and conditions of the Option
shall be deemed to be modified to reflect and correspond to any modifications,
alterations or amendments (whether by agreement, operation of law or otherwise)
in the terms and conditions of the Prior Option from time to time. The Option
shall be exercisable, in whole or in part, only to the extent that the Prior
Option is actually exercised, and shares of Common Stock shall be issued in
respect of the exercise of the Option only to the extent that shares of Common
Stock are issued in respect of the exercise of the Prior Option. If the Prior
Option is terminated or expires in whole or in part for any reason at any time,
the Option shall be deemed to be terminated, in whole or in part, to a like
extent. The Company shall provide the Optionee with prompt written notice of any
exercise of the Prior Option and of any modifications, alterations or amendments
of the Prior Option pursuant to any agreement or document to which the Company
is a party.
2.6 TERMINATION OF OPTION. Except as otherwise provided herein, the
Option, to the extent not heretofore exercised, shall terminate upon termination
for any reason of the Prior Option.
2.7 ADJUSTMENTS. In the event of any stock split, reverse stock split,
stock dividend, combination or reclassification of shares of Common Stock or any
other increase or decrease in the number of issued shares of Common Stock
effected without receipt of consideration by the Company, the number and kind of
Optioned Shares (including any Option outstanding after termination of
employment or death) and the Purchase Price per share shall be proportionately
and appropriately adjusted without any change in
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the aggregate Purchase Price to be paid therefor upon exercise of the Option,
but only to the extent that any such adjustment is made in respect of the Prior
Option. The determination by the Board of Directors of the Company as to the
terms of any of the foregoing adjustments shall be conclusive and binding.
2.8 LIQUIDATION, SALE OF ASSETS OR MERGER. In the event of a proposed
dissolution or liquidation of the Company, a proposed sale of all or
substantially all of the assets of the Company, or the merger of the Company
with or into another corporation, the option shall in all respects receive the
same treatment as the Prior Option in connection with such transaction as the
Prior Option.
2.9 NOTICES. Any notice to be given under the terms of the Agreement
("Notice") shall be addressed to the Company in care of its Secretary at Forte
Computer Easy, Inc., 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxx 00000, or at its then
current corporate headquarters, and to the Optionee in care of its Secretary at
000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxx, Xxxx 00000, or at its then current corporate
headquarters. Notice shall be deemed duly given when enclosed in a properly
sealed envelope and deposited by certified mail, return receipt requested, in a
post office or branch post office regularly maintained by the United States
Government.
2.10 TRANSFERABILITY OF OPTION. The Option shall not be transferable by
the Optionee (except to any parent, subsidiary or affiliate of the Optionee).
2.11 OPTIONEE NOT A SHAREHOLDER. The Optionee shall not be deemed for
any purposes to be a shareholder of the Company with respect to any of the
Optioned Shares except to the extent that the Option herein granted shall have
been exercised with respect thereto and one or more stock certificates issued
therefor.
2.12 DISPUTES OR DISAGREEMENTS. As a condition of the granting of the
Option herein granted, the Optionee agrees, for himself and his personal
representatives, that any disputes or disagreement which may arise under or as a
result of or pursuant to this Agreement shall be determined by the Board of
Directors of the Company in its sole discretion, and that any interpretation by
the Board of Directors of the terms of this Agreement shall be final, binding
and conclusive.
2.13 MODIFICATION OF AGREEMENT. This Agreement shall not be modified or
amended except pursuant to a written document signed by both parties hereto;
PROVIDED, HOWEVER, that this Agreement shall be deemed to be amended, without
notice to or by any party or any other action on the party of any party hereto,
to reflect any modification, alteration or amendment of the terms or conditions
of the Prior Option, as set forth herein.
[signature page follows]
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IN WITNESS WHEREOF, each of the Company and the Optionee has caused
this instrument to be executed by its duly authorized officer as of the date set
forth above.
FORTE COMPUTER EASY, INC.,
a Utah corporation
By /S/ XXXXX X. XXXXXX
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Xxxxx X. Xxxxxx, President
"COMPANY"
AAP HOLDINGS, INC.,
a Delaware corporation
By /S/ XXXXXX XXXXXXXXXX
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Xxxxxx Xxxxxxxxxx, Chairman
of the Board
"OPTIONEE"
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Exhibit A
STOCK OPTION AGREEMENT
BY THIS STOCK OPTION AGREEMENT ("Agreement") made and entered into this
18th day of December, 1996 ("Grant Date"), FORTE COMPUTER EASY, INC., a Utah
corporation (the "Company"), and Xxxx Xxxxxxxxxx (the "Optionee"), a former
shareholder of Forte, Inc., hereby state, confirm, represent, warrant and agree
as follows:
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RECITALS
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1.1 The Company and the Optionee previously entered into a verbal
agreement regarding the grant by the Company to the Optionee, and the acceptance
by the Optionee from the Company, of an option to purchase 455,258 shares of the
$0.01 par value common stock of the Company ("Common Stock").
1.2 The Company and the Optionee desire to enter into this Agreement
for the purpose of memorializing the terms of the grant of such option.
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AGREEMENTS
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2.1 GRANT OF NON-STATUTORY STOCK OPTION. Subject to the terms and
conditions hereinafter set forth, the Company granted to the Optionee the right
and option (the "Option") to purchase from the Company all or any part of an
aggregate number of FOUR HUNDRED FIFTY-FIVE THOUSAND TWO HUNDRED FIFTY-EIGHT
(455,258) shares of Common Stock, authorized but unissued or, at the option of
the Company, treasury stock if available (the "Optioned Shares").
2.2 EXERCISE OF OPTION. Subject to the terms and conditions of this
Agreement, the Option may be exercised only by completing and signing a written
notice in substantially the following form:
I hereby exercise the Option granted to me by Forte Computer
Easy, Inc. and elect to purchase _______________ shares of
Common Stock of Forte Computer Easy, Inc. for the purchase
price to be determined under Paragraph 2.3 of this Stock
Option Agreement.
2.3 PURCHASE PRICE. The price to be paid for the Optioned Shares (the
"Purchase Price") shall be $0.375 per share.
2.4 PAYMENT OF PURCHASE PRICE. Payment of the Purchase Price may be
made as follows:
(a) In United States dollars in cash or by check,
bank draft or money order payable to the Company; or
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(b) At the discretion of the Board, through the delivery of
shares of Common Stock with an aggregate fair market value at the date
of such delivery, equal to the Purchase Price; or
(c) By a combination of both (a) and (b) above; or
(d) Pursuant to financial assistance which may be provided by
the Company upon Board approval.
The Board shall determine acceptable methods for tendering Common Stock as
payment upon exercise of an Option and may impose such limitations and
conditions on the use of Common Stock to exercise an Option as it deems
appropriate. At the election of the Optionee, and subject to the acceptance of
such election by the Board, to satisfy the Company's withholding obligations, it
may retain such number of shares of Common Stock subject to the exercised Option
which have an aggregate fair market value on the date of exercise equal to the
Company's aggregate federal, state, local and foreign tax withholding and FICA
and FUTA obligations with respect to the exercise of the Option by the Optionee.
2.5 EXERCISABILITY OF OPTION. Subject to the provisions of Paragraph
2.6, and except as otherwise provided in Paragraph 2.8, the Option may be
exercised by the Optionee while in the employ of Company which shall include any
parent ("Parent") or subsidiary ("Subsidiary") corporation of the Company as
defined in Sections 424(e) and (f), respectively, of the Internal Revenue Code
of 1986, as amended ("Code"), in whole or in part from time to time. An Option
may not be exercised for a fraction of a share.
2.6 TERMINATION OF OPTION. Except as otherwise provided herein, the
Option, to the extent not heretofore exercised, shall terminate upon the first
to occur of the following dates:
(a) June 8, 1998;
(b) The date on which the Optionee's employment by the Company
is terminated, except if such termination is voluntary or due to
retirement, death or disability within the meaning of Section 22(e)(3)
of the Code;
(c) Thirty (30) days after voluntary termination or
termination due to retirement;
(d) Three (3) months after termination due to disability
within the meaning of Section 22(e)(3) of the Code; or
(e) One (1) year after the Optionee's death (or such other
period of time as determined by the Board).
2.7 ADJUSTMENTS. In the event of any stock split, reverse stock split,
stock dividend, combination or reclassification of shares of Common Stock or any
other increase or decrease in the
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number of issued shares of Common Stock effected without receipt of
consideration by the Company, the number and kind of Optioned Shares (including
any Option outstanding after termination of employment or death) and the
Purchase Price per share shall be proportionately and appropriately adjusted
without any change in the aggregate Purchase Price to be paid therefor upon
exercise of the Option. The determination by the Board as to the terms of any of
the foregoing adjustments shall be conclusive and binding.
2.8 LIQUIDATION, SALE OF ASSETS OR MERGER. In the event of a proposed
dissolution or liquidation of the Company, the Option will terminate immediately
prior to the consummation of such proposed action, unless otherwise provided by
the Board. In the event of a proposed sale of all or substantially all of the
assets of the Company, or the merger of the Company with or into another
corporation, the option shall be assumed or an equivalent option shall be
substituted by such successor corporation, unless the Board determines that the
Optionee shall have the right to exercise the Option as to all of the Common
Stock subject to the Option, including shares as to which the Option would not
otherwise be exercisable. If the Board makes an Option fully exercisable, the
Board shall notify the Optionee that the Option shall be fully exercisable for a
period of thirty (30) days from the date of such notice (but not later than the
expiration of the Option term under Paragraph 2.6, above), and the Option will
terminate upon the expiration of such period.
2.9 NOTICES. Any notice to be given under the terms of the Agreement
("Notice") shall be addressed to the Company in care of its Secretary at Forte
Computer Easy, Inc., 0000 Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxx 00000, or at its then
current corporate headquarters. Notice to be given to the Optionee shall be
addressed to him or her at his or her then current residential address as
appearing on the Company's records. Notice shall be deemed duly given when
enclosed in a properly sealed envelope and deposited by certified mail, return
receipt requested, in a post office or branch post office regularly maintained
by the United States Government.
2.10 TRANSFERABILITY OF OPTION. The Option shall not be transferable by
the Optionee otherwise than by the will or the laws of descent and distribution,
and may be exercised during the life of the Optionee only by the Optionee.
2.11 OPTIONEE NOT A SHAREHOLDER. The Optionee shall not be deemed for
any purposes to be a shareholder of the Company with respect to any of the
Optioned Shares except to the extent that the Option herein granted shall have
been exercised with respect thereto and one or more stock certificates issued
therefor.
2.12 NOT A CONTRACT OF EMPLOYMENT. Nothing contained in this Agreement
shall be deemed to confer upon any individual to whom an Option may be granted
hereunder any right to remain in the employ or service of the Company or a
parent or subsidiary corporation of the Company.
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2.13 DISPUTES OR DISAGREEMENTS. As a condition of the granting of the
Option herein granted, the Optionee agrees, for himself and his personal
representatives, that any disputes or disagreement which may arise under or as a
result of or pursuant to this Agreement shall be determined by the Board in its
sole discretion, and that any interpretation by the Board of the terms of this
Agreement shall be final, binding and conclusive.
IN WITNESS WHEREOF, the Company has caused this instrument to be
executed by its duly authorized officer, and the Optionee has hereunto affixed
his or her signature.
FORTE COMPUTER EASY, INC.,
a Utah corporation
By /S/ XXXXX X. XXXXXX
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Title PRESIDENT
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"COMPANY"
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Xxxx Xxxxxxxxxx
"OPTIONEE"
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