Exhibit 99.1
ACTV OPTION AGREEMENT
Dated as of August 18, 1999
WHEREAS, THE TEXAS INDIVIDUALIZED TELEVISION NETWORK. INC., a Delaware
corporation ("TexNet"), and XXXXX XXXXX ("Holder") are parties to that certain
Option Agreement dated as of March 14, 1997 (as amended January 14, 1998, the
"TexNet Option Agreement"), granting to Holder the right and option to purchase
250,000 shares (the "TexNet Option Shares") of TexNet's Class B common stock,
par value $.01 per share (the "TexNet Class B Stock"), at a price of $ 1.50 per
TexNet Option Share;
WHEREAS, Subsection 1(d) of the TexNet Option Agreement provides that the
option granted thereunder to purchase the TexNet Option Shares may, after
January 1, 1999, be exchanged, in whole or in part, for an option to purchase
from ACTV. INC., a Delaware corporation ("ACTV"), an equal number of shares,
i.e., 250,000 shares (the ACTV Option Shares"), of ACTV's common stock, par
value $.10 per share (the "ACTV Common Stock"), at a price of $1.50 per ACTV
Option Share;
WHEREAS, the Holder desires to effect the foregoing exchange effective the
date hereof on the terms and subject to the conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the receipt of $1.00 and other good
and valuable consideration, the receipt of which is hereby acknowledged. TexNet,
the Holder and ACTV hereby agree as follows:
SECTION 1. Option to Purchase Common Stock.
a. ACTV hereby grants to the Holder a fully-vested option (the "Option")
to purchase from ACTV two hundred fifty thousand (250,000) ACTV Option Shares at
a purchase price of $1.50 per ACTV Option Share (the "ACTV Option Price"). The
"Option Period" shall commence on the date hereof and shall terminate in its
entirety on (and shall thereupon cease to be exercisable, in any respect, from
and after) March 14, 2007.
b. Except as limited by Section 5 hereof, the Option may be exercised, in
whole or part, by the Holder by delivery to ACTV, at any time during the Option
Period, of a written notice (the "Option Notice"), which Option Notice shall
state the Holder's intention to exercise the Option, the date on which the
Holder proposes to purchase the ACTV Option Shares (the "Closing Date") and the
number of ACTV Option Shares to be purchased on the Closing Date, which Closing
Date shall be no later than 30 days nor earlier than 10 days following the date
of the Option Notice. Upon receipt by ACTV of an Option Notice from the Holder,
the Holder shall be obligated to purchase that number of ACTV Option Shares to
be purchased on the Closing Date set forth in the Option Notice.
c. The purchase and sale of ACTV Option Shares acquired pursuant to the
terms of this Option Agreement shall be made on the Closing Date at the offices
of ACTV. Delivery of the stock certificate or other instrument registered in the
name of the Holder, evidencing the ACTV Option Shares being purchased on the
Closing Date, shall be made by ACTV to the Holder on the Closing Date against
the delivery to ACTV of a certified or bank check in the full amount of the
aggregate purchase price therefor.
SECTION 2. Representations and Warranties of The Holder. The Holder hereby
represents and warrants to ACTV that in the event the Holder acquires any ACTV
Option Shares, such ACTV Option Shares will be acquired for his own account, for
investment and not with a view to the distribution thereof. The Holder
understands the ACTV Option Shares will not be registered under the Securities
Act of 1933, as amended (the "Securities Act"), and that they must be held
indefinitely unless a subsequent disposition thereof is registered under the
Securities Act or the transaction is exempt from registration. The certificate
or certificates representing any Option Shares shall bear the following
restrictive legend:
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT'), AND MAY NOT BE SOLD, TRANSFERRED,
PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF (i) AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, OR (ii) AN
OPINION OF COUNSEL, WHICH OPINION SHALL BE REASONABLY SATISFACTORY TO
COUNSEL FOR ACTV, INC. ("ACTV"), THAT AN EXEMPTION FROM REGISTRATION FOR
SUCH SALE, OFFER, TRANSFER, HYPOTHECATION OR OTHER ASSIGNMENT IS AVAILABLE
UNDER THE SECURITIES ACT. IN ADDITION, THIS STOCK CERTIFICATE OF STOCK AND
THE SHARES REPRESENTED HEREBY ARE HELD SUBJECT TO THE TERMS AND CONDITIONS
CONTAINED IN THAT CERTAIN AGREEMENT BY AND AMONG ACTV AND ITS SHAREHOLDERS
DATED AS OF MARCH 6,1997. AS AMENDED, AND MAY NOT BE TRANSFERRED EXCEPT IN
ACCORDANCE WITH THE TERMS AND PROVISIONS THEREOF. A COPY OF SUCH AGREEMENT
WILL BE FURNISHED BY ACTV UPON WRITTEN REQUEST.
SECTION 3. Reorganization; Mergers; Sales; Etc. If, at any time during the
Option Period, there shall be any capital reorganization, reclassification of
the ACTV Common Stock (other than a change in par value, or from par value to no
par value, or from no par value to par value, or as a result of a stock dividend
or subdivision, split-up or combination of shares), the consolidation or merger
of ACTV with or into another corporation or the sale of all or substantially all
the properties and assets of ACTV as an entirety to any other corporation or
person, the unexercised and fully vested portion of this Option shall, after
such reorganization, reclassification, consolidation, merger or sale, be
exercisable for the kind and number of shares of stock or other securities or
property of ACTV or of the corporation resulting from such consolidation or
surviving such merger or to which such properties and assets shall have been
sold to which the Holder
would have been entititled if the Holder had held shares of ACTV Common Stock
issuable upon the exercise hereof immediately prior to such reorganization,
reclassification, consolidation, merger or sale. The provisions of this Section
3 shall similarly apply to successive reorganizations, reclassifications,
consolidations, mergers and sales.
SECTION 4. Adjustment of Option Shares and Option Price.
a. The number of ACTV Option Shares subject to this Option during
the Option Period shall be cumulative as to all prior dates of calculation and
shall be adjusted for any stock dividend, subdivision, split-up or combination
of ACTV Common Stock.
b. The Option Price shall be subject to adjustment from time to time
as follows:
If, at any time during the Option Period, the number of shares of ACTV
Common Stock outstanding is altered by a stock dividend payable in shares of
ACTV Common Stock or by a subdivision or split-up or combination of shares of
ACTV Common Stock, then, immediately following the record date fixed for the
determination of holders of shares of ACTV Common Stock entitled to receive such
subdivision or split-up or combination, the Option Price shall be appropriately
increased or decreased and the number of shares of ACTV Common Stock issuable
upon the exercise hereof shall be increased or decreased, pursuant to the
formula set forth in Section 4.c.
c. Upon each adjustment of the Option Price pursuant to the
provisions of this Section 4. the number of shares of ACTV Common Stock issuable
upon the exercise hereof shall be adjusted to the nearest full share of ACTV
Common Stock by multiplying a number equal to the Option Price in effect
immediately prior to such adjustment by the number of shares of ACTV Common
Stock issuable immediately prior to such adjustment and dividing the product so
obtained by the adjusted Option Price.
SECTION 5. Termination of the Options.
a. Termination of Options in General. Subject to subsection 5(b),
the Option granted hereby shall terminate and the Option shall no longer be
exercisable in any respect after March 14, 2007.
b. Option Rights Upon Death, Disability, Resignation. If the Holder
dies or becomes disabled while employed by ACTV or resigns from ACTV's
employment prior to his complete exercise of the Option, the Holder (or his
heirs) may exercise his Option at any time during the Option Period, to the
extent that the Holder was entitled to exercise the Option at the date such of
such event.
SECTION 6. Transfer of Option; Successors and Assigns. This
Agreement (including the Option) and all rights hereunder shall not be
transferable at any time without the prior written consent of ACTV. This
Agreement and all the rights
hereunder shall be binding upon and inure to the benefit of the parties hereto
and their respective successors, approved assigns and approved transferees.
SECTION 7. Notices. All notices or other communications which are
required or permitted hereunder shall be in writing and sufficient if delivered
personally or sent by registered or certified mail, postage prepaid, return
receipt requested, addressed as follows:
If to ACTV, to:
ACTV, Inc.
Attn: Day X. Xxxxxxxxx,
Law Department
1270 Avenue of the Americas
Xxx Xxxx, XX 00000
If to TexNet, to:
The Texas Individualized Television Network, Inc.
Attn: Day X. Xxxxxxxxx,
Law Department
1270 Avenue of the Americas
Xxx Xxxx, XX 00000
And if to the Holder, to:
Mr. Xxxxx Xxxxx
00 Xxxxxx Xxxx
Xxxxxxxxx, XX 00000
or to such other address as the party to whom notice is to be given may have
furnished to the other party in writing in accordance herewith. If mailed as
aforesaid, any such communications shall be deemed to have given on the third
business day following the day on which the piece of mail containing such
communication is posted.
SECTION 8. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware.
SECTION 9. Entire Agreement. This Agreement (i) contains the entire
agreement between ACTV and the Holder with respect to the transactions
contemplated herein, (ii) supercedes and replaces the TexNet Option Agreement,
which agreement shall be deemed terminated hereby as of, and of no further force
or effect from and after, the date hereof, and (iii) supersedes all previously
written or oral negotiations, commitments, representations and agreements.
SECTION 10. Amendments and Modifications. This Agreement, or any provision
hereof, may not be amended, changed or modified without the prior written
consent of each of ACTV and the Holder; provided, that clause (ii) of Section 9
hereof may not be amended or modified in any respect without the prior written
consent of all of the parties hereto.
IN WITNESS WHEREOF, the parties hereto have caused this Option Agreement
to be executed and delivered as of the date first set forth above.
ACTV, INC.
By: /s/ Day X. Xxxxxxxxx
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Day X. Xxxxxxxxx,
Xx. Vice President
and General Counsel
THE TEXAS INDIVIDUALIZED
TELEVISION NETWORK, INC.
By: /s/ Xxxxxxxxxxx X. Xxxxx
-------------------------
Xxxxxxxxxxx X. Xxxxx,
Secretary/Treasurer
AGREED TO ACCEPTED BY HOLDER:
/s/ Xxxxx Xxxxx
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XXXXX XXXXX
("Holder")
