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Exhibit 10.76
OPTION AGREEMENT
THIS AGREEMENT is made effective as of February 19, 1998, by and between
[name of non-employee director] (hereinafter referred to as "Optionee"), and
Decora Industries, Inc., a Delaware corporation (hereinafter referred to as
"Optionor").
RECITALS:
WHEREAS, Optionee has performed numerous valuable services to the
Optionor, including serving as a director;
WHEREAS, to compensate Optionee for his services to Optionor, Optionor
has granted to Optionee on an annual basis an option to purchase shares of the
common stock of Optionor;
WHEREAS, Optionee has not been granted an option to purchase the common
stock of Optionor since August 1996;
WHEREAS, Optionor now desires to grant to Optionee and Optionee is
desirous of acquiring an option to purchase a total of 40,000 shares of the
common stock of Optionor (20,000 for 1997 service and 20,000 for 1998 service)
subject to the terms and conditions hereinafter set forth;
NOW, THEREFORE, the parties hereby agree as follows:
1. Incorporation of Recitals. The parties hereby incorporate by this
reference the recitals set forth above.
2. Grant of Option. Subject to the terms and conditions hereinafter set
forth, Optionor hereby gives and grants to Optionee the right and option to
purchase theretofore authorized but unissued common shares of Optionor at such
time and for the purchase price specified below.
A. From February 19, 1998, and up until and including February
18, 2003, Optionee shall have the right and option to purchase, at $5.50 per
share, and Optionor shall have the obligation to issue to Optionee, 40,000
shares of the authorized but unissued common shares of Optionor.
3. Exercise of Option. Optionee may exercise any option granted
hereunder by notifying Optionor in writing of its intention to exercise such
option. A closing date shall then be agreed to in good faith no later than 30
days after the notice, at which time Optionee shall pay the purchase price of
the Shares being purchased, and Optionor shall deliver to Optionee the
certificates for shares duly endorsed. Optionee may purchase all or any part of
the Shares subject to options granted hereby.
4. Representations. Optionor represents and warrants to Optionee that
Optionee, upon proper exercise, shall receive good and marketable title to the
shares of Optionor underlying the
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options being granted hereby, free of all pledges, liens and encumbrances,
except as stated in paragraph 5.
5. Representations and Warranties of Optionee. Optionee hereby
represents and warrants that:
A. The options granted hereby and the Shares which will be
purchased by and delivered to Optionee upon exercise of
such options are being acquired by Optionee for his own
account and not with a view to resale or other
disposition thereof.
B. Optionee will not sell, transfer, or make any other
disposition of any option or the shares to be purchased
and delivered to Optionee hereunder upon the exercise of
such option unless and until (a) such option or shares,
as applicable, are included in a registration statement
or a post-effective amendment under the Securities Act
which has been filed by the Optionor and declared
effective by the Securities and Exchange Commission (the
"SEC"), or (b) in the opinion of counsel for the
Optionor, no such registration statement or
post-effective amendment is required, or (c) the SEC has
first issued a "no action" letter regarding any such
proposed disposition of any option or the shares.
6. Federal and State Securities Law Requirements. The obligation of the
Optionor to deliver and transfer the shares to the Optionee upon any exercise of
any option shall be subject to the following:
A. Optionor may require Optionee, as an additional
condition of its obligation to deliver the shares upon
exercise of any option hereunder, to make any
representations and warranties (including without limit
those set forth in Paragraph 5 hereof) with respect to
the shares as may, in the opinion of counsel to
Optionor, be required to ensure compliance with the
Securities Act, the securities laws of any state, or any
other applicable law, regulation, or rule of any
governmental agency.
B. Each certificate representing the shares issued pursuant
to this Agreement shall bear whatever legends are
required by federal or state law or by any governmental
agency. In particular, unless an appropriate
registration statement is filed pursuant to the
Securities Act with respect to the shares, each
certificate representing such shares shall be endorsed
on its face with the following legend or its equivalent:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933. THE
SECURITIES MAY BE SOLD OR TRANSFERRED ONLY IF THEY HAVE
BEEN REGISTERED UNDER SAID ACT OR THERE EXISTS AN
EXEMPTION FROM REGISTRATION UNDER SAID ACT OR THE
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RULES AND REGULATIONS THEREUNDER EVIDENCED BY A
NO-ACTION LETTER OR AN OPINION OF COUNSEL TO THE ISSUER
OR TO THE HOLDER HEREOF REASONABLY SATISFACTORY TO THE
ISSUER.
7. Restrictions. Optionee:
A. Shall not be entitled to any type of dividend declared
by Optionor, unless and until an option is exercised;
and
B. Shall not be entitled to any voting rights by virtue of
an option; and
C. Acknowledges that the options granted hereby are
personal to Optionee and that Optionee may not sell,
assign, transfer or otherwise dispose of such options to
any other person.
8. Anti-Dilution. If prior to the exercise of any option granted
hereunder Optionor shall have effected one or more stock split-ups, stock
dividends, or other increases or reductions of the number of Shares of its
common stock outstanding without receiving compensation therefor in money,
services or property, the number of Shares of common stock subject to the
options hereby granted shall (a) if a net increase shall have been effected in
the number of outstanding shares of Optionor's common stock, be proportionately
increased and the cash consideration payable per Share shall be proportionately
reduced; and (b) if a net reduction shall have been effected in the number of
outstanding Shares of Optionor's common stock, be proportionately reduced and
the cash consideration payable per Share be proportionately increased.
9. Piggyback Registration Rights.
A. The Optionor will permit any option shares subject to
this agreement to be included, at the request of the
Optionee in any registration of securities of the
Optionor (other than shares of Common Stock pursuant to
the Optionor's stock option plan or stock purchase plan)
under a registration statement filed by the Optionor
under the Securities Act. The Optionor shall provide
written notice to the Optionee at least 30 days prior to
the filing of any such registration statement sent by
registered mail to the address of record of the
Optionee. If Optionee shall deliver a written request to
the Optionor within ten (10) business days after the
mailing of such notice, setting forth the number of
securities which he intends to sell in the public
offering (the "Registered Securities"), and requesting
inclusion of such Registered Securities therein, the
Optionor agrees to include the Registered Securities in
such registration statement and related underwriting
agreements (if any) or if the Optionor eligible to use
Form S-3 permit Optionee to utilize a selling
shareholders Registration Statement on Form S-3.
Notwithstanding the above, the Optionee may only have
option shares subject to this agreement so registered
one time.
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B. The parties hereto agree that if the offering is
underwritten, the Registered Securities shall be for
purposes of the preceding sentence underwritten by the
same underwriter or underwriters on terms no less
favorable than those applicable to the shares offered by
the Optionor or other stockholders pursuant to such
registration statement, and agree, at the request of the
Optionor or such other stockholders, to join with the
Optionor or such other stockholders in executing
appropriate underwriting agreements with such
underwriter or underwriters and to execute appropriate
powers of attorney and custodian agreements in forms
acceptable to the underwriter or underwriters, which
agreements shall not place any restrictions upon the
sale or transfer of the Registered Securities not
otherwise placed on all other shareholders whose shares
are registered in such registration statement. Optionee
agrees that if, in spite of the best efforts of the
Optionor (which the Optionor agrees to use), the
inclusion of all of the Registered Securities which he
may desire to include in any such registration statement
shall not be acceptable to the managing underwriter or
underwriters of the offering (acting reasonably and in
good faith), some or all of his Registered Securities
may be excluded or withdrawn from such registration
statement in accordance with the following provision:
Optionee shall have the right to include in such
registration statement such number (but only such
number) of shares, as applicable, as shall bear the same
relationship to the total number of Units, Warrants, or
shares, as applicable, which the managing underwriter or
underwriters will permit to be included in such
registration statement by all holders of securities who
wish to register securities in such registration
statement.
C. Optionor shall pay all expenses associated with filing
and causing to become effective any registration
statement and with maintaining its effectiveness
excepting only (i) the underwriting discounts and
commissions incurred directly on the sale of any of
Optionee's Registered Securities included therein, and
(ii) legal expense individually incurred by Optionee,
said discounts, commissions and legal expenses with
respect to the sale of Optionee's shares to be borne by
Optionee.
10. Notice and Opportunity to Cure Default. In the event of a perceived
default of the provisions of this agreement, Optionor agrees to provide Optionee
and his counsel written notice of any default and Optionor shall have 10 days
from receipt of said notice to cure the stated default.
11. Agreement to Perform Necessary Acts. The parties hereto agree to
cooperate fully with one another in executing all documents, certificates,
notices, filings and the like and performing all acts reasonably necessary to
carry out the intent of this agreement.
12. Assignment and Transfer. No option granted hereby may be assigned by
Optionee without the prior written consent of Optionor.
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13. Amendments. This agreement may not be modified, amended or changed
except by an instrument in writing signed by the parties hereto.
14. Litigation and Attorneys' Fees. In the event of any litigation
between the parties to in connection with this Agreement or to enforce any
provision or right hereunder, the unsuccessful party to such litigation shall
pay to the successful party therein by such successful party, which costs,
expenses and attorneys' fees shall be included as a part of any judgment
rendered in such action in addition to any other relief to which the successful
party may be entitled.
IN WITNESS WHEREOF, the parties have executed this Option Agreement as
of the day and year first above written.
OPTIONOR OPTIONEE
Decora Industries, Inc.
By:______________________________
Its:_____________________________ _________________________
[Name of Non-Employee Director]
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