OPTION
THIS OPTION is made and entered into this 19th day of February, 1999, by
and between J. Xxxxxx Xxxxxx ("Optionee"), and Xxxxxx Xxxxx or his assigns
("Optionor").
WITNESSETH:
WHEREAS, Optionor is the beneficial owner of 159,440 shares (the
"Shares") of Common Stock, $.001 par value ("Common Stock") of Guardian
Technologies International, Inc., a Delaware corporation (the "Company"); and
WHEREAS, Optionor desires to sell and Optionee desires to purchase the
Common Stock subject to the terms and conditions hereinbelow set forth;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinbelow set forth, the parties agree as follows:
1. GRANT OF OPTION. Subject to the terms and conditions set forth in
this Option Agreement, Optionor hereby grants to Optionee the right and option
to purchase from Optionor the Common Stock for the option price set forth in
Paragraph 2 hereof.
2. OPTION PRICE AND TERM. The Option granted in Paragraph 1 above
shall be exercisable as follows:
(a) As to 100,000 shares of Common Stock, Optionee hereby
irrevocably and unconditionally agrees to exercise the option to purchase all
100,000 shares of Common Stock at an exercise price of $1.75 per share within
one hundred twenty (120) days of the date hereof.
(b) As to 59,440 shares of Common Stock, Optionee may exercise the
option to purchase the 59,440 shares of Common Stock at an exercise price of
$5.00 per share at any time and from time to time for a period of one (1) year
from the date hereof; provided, however, that Optionee shall not be obligated
to purchase such shares unless Optionor exercises the put option provided for
in Paragraph 5 hereof subject to the terms and conditions set forth therein.
3. TIME OF EXERCISE OF OPTION. This option may be exercised at any
time and from time to time commencing on the date of this Option (the
"Exercise Date"), and terminating on the dates set forth in Paragraph 2(a) and
(b) above. Following each termination date, the option herein granted with
respect to those Shares shall thereafter be unexercisable and of no further
legal force and effect. Upon termination of this Option, the shares of Common
Stock shall be released from any restriction or obligation under this
Agreement.
4. METHOD OF EXERCISE. The Option shall be exercised by written notice
by Optionee to Optionor at Optionor's principal place of business accompanied
by delivering to Optionor an executed Notice of Exercise of Option in the form
attached hereto as Exhibit A, and Optionee's check in payment of the option
price for the number of shares of Common Stock for which the Option is
exercised. Upon payment of the option price, Optionor shall tender to the
Company certificates representing the number of shares of Common Stock
purchased by Optionee pursuant to its exercise of the Option, such
certificates duly endorsed in blank or accompanied by duly-executed
Irrevocable Stock Powers; whereupon Optionor shall cause the Company to issue
in the name of Optionee certificates representing all of the shares of Common
Stock purchased by Optionee pursuant to exercise of such Options.
5. PUT OPTION. In the event the Market Price, as hereinafter defined,
of the shares of Common Stock of the Company is $5.00 per share or more for at
least fifteen (15) consecutive trading days (the "Minimum Price Condition"),
Optionor shall have the right and option to put to Optionee and require
Optionee to purchase from Optionor the 59,444 shares of Common Stock described
in Paragraph 2(b) above, at the put option price of $5.00 per share. Such put
option may be exercised, if at all, by Optionor serving written notice upon
Optionee within ten (10) days following the satisfaction of the Minimum Price
Condition; whereupon Optionee shall have a period of thirty (30) days from the
date of such written notice to tender to Optionor the aggregate put option
exercise price of $297,200 against delivery by Optionor to Optionee of
certificates representing the shares of Common Stock covered by the put
option. For purposes of this put option, "Market Price" shall mean the
average bid and ask prices of the Company's Common Stock on the over-the-
counter market as quoted on the Nasdaq Small Cap Market or any other quotation
service or exchange upon which such securities are traded. The put option
described herein shall terminate and be of no further force or effect one (1)
year from the date hereof. In the event Optionor exercises the put option
described herein and Optionee defaults or otherwise fails to purchase the
shares of Common Stock in accordance with the terms and conditions described
herein, then and in such event all outstanding and unexercised options granted
to Optionee pursuant to Paragraph 2 hereof shall be deemed null, void,
unenforceable and of no further legal force or effect.
6. ADJUSTMENTS. In the event the Common Stock shall be changed into
the same or different number of shares of any class or classes of stock,
whether by capital reorganization, reclassification or otherwise, or in the
event the Company shall at any time issue Common Stock or convertible
securities by way of dividend or other distribution on any stock of the
Company or subdivide or combine the outstanding shares of Common Stock, or in
the event of any reclassification, capital reorganization or other change of
outstanding shares of Common Stock of the Company as the result of any
consolidation or merger of the Company with or into another corporation, or in
case of any sale or conveyance to another corporation of the property of the
Company as an entirety or substantially as an entirety, then Optionee shall be
entitled to receive, upon valid exercise of the Option herein granted, such
numbers of shares of Common Stock or other securities into which the Common
Stock was changed or converted.
7. RESTRICTION ON TRANSFER. Until the Option granted to Optionee
hereunder has been exercised or expires in accordance with its terms,
Optionor, for himself, his successors and assigns, herewith covenants and
agrees that the Securities may not be sold, transferred, hypothecated,
encumbered, pledged, or otherwise disposed of by Optionor without the express
written consent of Optionee. Optionor agrees that the certificates
representing the Common Stock may contain the following restrictive legend in
conspicuous type:
The securities represented by this certificate are subject
to an Option. Any sale, transfer, encumbrance, pledge, or
hypothecation of these securities in contravention of the
rights granted to the Optionee are void and unenforceable.
8. PROXY. For so long as any of the Options granted herein are
outstanding and exercisable, Optionor hereby irrevocably constitutes,
designates and appoints Optionee to act as Optionor's true and lawful
attorney-in-fact and proxy to vote all of the Shares of the Common Stock
subject to the options herein at any meeting of the Shareholders. The
irrevocable grant of proxy herein is acknowledged to be coupled with an
interest in accordance with applicable law.
9. REPRESENTATIONS OF OPTIONOR. Optionor represents and warrants to
Optionee as follows:
(a) That the shares of Common Stock are validly issued, fully paid
and nonassessable and have been issued pursuant to all requisite action and
authority of the Board of Directors of the Company in accordance with all
legal requirements.
(b) That the shares of Common Stock are fully assignable by
Optionor to Optionee without restriction, except for restrictions on
transferability imposed by or on account of federal or state securities laws.
The shares of Common Stock are not subject to any agreement, covenant or
restriction imposed by or on account of any contract, agreement or by-laws of
the Company or to which Optionor or the Company may be bound.
(c) That the shares of Common Stock are free of all claim, lien,
security interest or encumbrance of any third party and, upon the exercise by
Optionee of the Option herein granted, will be assigned to Optionee free and
clear of any claims, liens or interests of third parties.
10. NOTICES. Whenever notice is called for by this Agreement, notice
shall be in writing, and shall be effective when deposited in the United
States mails, first class postage prepaid, addressed to the other party at the
address first set forth above. Either party may change his address by notice
to the other party as provided herein.
11. FAX/COUNTERPART. This Agreement may be executed by telex, telecopy
or other facsimile transmission, and such facsimile transmission shall be
valid and binding to the same extent as if it were an original. Further, this
Agreement may be signed in one or more counterparts, all of which when taken
together shall constitute the same documents.
12. MISCELLANEOUS. This Agreement contains a complete expression of its
terms and shall not be subject to modification by any prior or contemporaneous
evidence. Optionee may not assign any of its rights pursuant to this
Agreement without the written consent of Optionor. This Agreement shall not
be modified except in a writing signed by both parties.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
OPTIONEE:
By:
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Xxxxxx Xxxxx
OPTIONOR:
By:
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J. Xxxxxx Xxxxxx
EXHIBIT A
GUARDIAN TECHNOLOGIES INTERNATIONAL, INC.
PURCHASE FORM
Dated: ____________, _____
The undersigned hereby irrevocably elects to exercise the
attached Option to the extent of purchasing ________ shares of Common Stock
and hereby makes payment of $_____________ in payment of the Exercise Price
therefor.
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[Signature]
INSTRUCTIONS FOR REGISTRATION OF STOCK
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Name (please typewrite or print in
block letters)
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Address
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City, State, Zip
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Signature
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ASSIGNMENT FORM
FOR VALUE RECEIVED, _____________________________ hereby sells, assigns and
transfers unto ______________________________ (Name, please typewrite or print
in block letters) at ______________________________________ (address) the right
to purchase Common Stock represented by this Option to the extent of
_______________ shares as to which such right is exercisable and does hereby
irrevocably constitute and appoint ________________________________, attorney,
to transfer the same on the books of the Company with full power of substitution
in the premises.
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[Signature]
Dated: ________________, ______
