LOGIMETRICS, INC.
Stock Option Agreement
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Xx. Xxxxxxx X. Xxxxxxx
00 Xxx Xxxxxx Xxxx
Xxxxx Xxxxx, XX 00000
Dear Xx. Xxxxxxx:
We are pleased to notify you that by the determination of the
Board of Directors an option to purchase an aggregate of 250,000 shares of
the Common Stock of LogiMetrics, Inc. (herein called the "Company") at an
exercise price of $.50 per share has this 1st day of May, 1996 been
granted to you. This option may be exercised only upon the terms and
conditions set forth below:
1. Purpose of Option.
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The purpose of this option is to further the growth and
development of the Company by encouraging employees of the Company to
obtain a proprietary interest in the Company through the ownership of
stock, thereby providing such employees with an added incentive to
continue in the employ and to promote the success of the Company, and
affording the Company a means of attracting to its service employees of
outstanding ability.
2. Acceptance of Option Agreement.
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Your execution of this option agreement will indicate
your acceptance of and your willingness to be bound by its terms; it
imposes no obligation upon you to purchase any of the shares subject to
the option. Your obligation to purchase shares can arise only upon your
exercise of the option in the manner set forth in paragraph 4 hereof.
3. When Option May be Exercised.
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The option granted you hereunder may be exercised in
whole or in part at any time and from time to time until the close of
business on March 7, 2003.
4. Adjustment for Issue or Sale of Common Stock at Less Than
Purchase Price. In case, at any time or from time to time after the date
hereof ("Issuance Date"), the Company shall issue or sell shares of its
Common Stock (other than any Common Stock issuable upon (i) conversion of
the Company's Amended and Restated 12% Convertible Subordinated Debentures
dated as of July 14, 1995 ("1995 Debentures"), (ii) exercise of those
certain Amended and Restated Series A Warrants dated March 7, 1996 to
purchase 600,000 shares of Common Stock ("Series A Warrants"), (iii)
exercise by each of Xxxxxx X. Xxxxxxxxxx and Xxxxxx Deutsch (the
"Principals") of their right to purchase 100,000 shares of Common Stock at
a price of $.10 per share ("Principals' Options"), (iv) exercise of those
certain Amended and Restated Series B Warrants dated March 7, 1996 to
purchase 1,500,000 shares of Common Stock ("Series B Warrants"), (v)
conversion of the Company's 12% Convertible Senior Subordinated Debentures
dated March 7, 1996 ("Senior Subordinated Debentures"), (vi) exercise of
those certain Series C Warrants dated March 7, 1996 to purchase an
aggregate of 2,542,380 shares of Common Stock ("Series C Warrants"), (vii)
exercise of those certain Series D Warrants dated March 7, 1996 to
purchase an aggregate of 2,830,200 shares of Common Stock ("Series D
Warrants"), (viii) exercise of those certain Stock Options, dated March 7,
1996 to purchase 225,000 shares of Common Stock issued to Xxxxxxx X. Xxxxx
("Xxxxx Options"), (ix) exercise of those certain Series E Warrants dated
March 7, 1996 to purchase an aggregate of 1,000,000 shares of Common Stock
("Series E Warrants"), and (x) conversion of the Company's 30 shares of
Series A 12% Cumulative Convertible Redeemable Preferred Stock ("Preferred
Stock" and together with the 1995 Debentures, the Senior Subordinated
Debentures, the Series A, B, C, D and E Warrants (collectively, the
"Warrants"), the Xxxxx Options, the Principals' Options and any shares of
Common Stock issuable upon conversion or exercise thereof, the "Subject
Securities")), for a consideration per share less than thirty cents ($.30)
per share (the "Trigger Price") (or, if a Pro Forma Trigger Price shall be
in effect as provided below in this Paragraph 3, then less than such Pro
Forma Trigger Price per share), then and in each such case, upon the
exercise hereof as provided in Paragraph 1 hereof, you shall be entitled
to receive, in lieu of the shares of Common Stock theretofore receivable
upon the exercise of this Option, a number of shares of Common Stock
determined by (a) dividing the Trigger Price by a Pro Forma Trigger Price
per share to be computed as provided below in this Paragraph 4, and (b)
multiplying the resulting quotient by the number of shares of Common Stock
provided called for by this Option. A Pro Forma Trigger Price per share
shall be the price computed (to the nearest cent, a fraction of half cent
or more being considered a full cent):
by dividing (i) the sum of (x) the result obtained by
multiplying the number of shares of Common Stock of the
Company outstanding immediately prior to such issue or
sale by the Trigger Price (or, if a Pro Forma Trigger
Price shall be in effect, by such Price), and (y) the
consideration, if any, received by the Company upon such
issue or sale, by (ii) the number of shares of Common
Stock of the Company outstanding immediately after such
issue or sale.
For the purpose of this Paragraph 4:
4.1. Stock Splits, Dividends, etc., in Common Stock or
Convertible Securities. In case the Company splits its Common Stock or
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shall declare any dividend, or make any other distribution, upon any stock
of the Company of any class payable in Common Stock, or in any stock or
other securities directly or indirectly convertible into or exchangeable
for Common Stock (any such stock or other securities being hereinafter
called "Convertible Securities"), such split, declaration or distribution
shall be deemed to be an issue or sale (as of the record date for such
split, dividend or other distribution), without consideration, of such
Common Stock or such Convertible Securities, as the case may be.
4.2. Issuance or Sale of Convertible Securities. In
case the Company shall issue or sell any Convertible Securities other than
the Subject Securities, there shall be determined the price per share for
which Common Stock is issuable upon the conversion or exchange thereof,
such determination to be made by dividing (a) the total amount received or
receivable by the Company as consideration for the issue or sale of such
Convertible Securities, plus the minimum aggregate amount of additional
consideration, if any, payable to the Company upon the conversion or
exchange thereof, by (b) the maximum number of shares of Common Stock of
the Company issuable upon the conversion or exchange of all such
Convertible Securities.
If the price per share so determined shall be less
than the Trigger Price (or, if a Pro Forma Trigger Price shall be in
effect, less than such Price) as of the date of such issue or sale, then
such issue or sale shall be deemed to be an issue or sale for cash (as of
the date of issue or sale of such Convertible Securities) of such maximum
number of shares of Common Stock at the price per share so determined,
provided that, if such Convertible Securities shall by their terms provide
for an increase or increases, with the passage of time, in the amount of
additional consideration, if any, payable to the Company, or in the rate
of exchange, upon the conversion or exchange thereof, the Pro Forma
Trigger Price per share shall, forthwith upon any such increase becoming
effective, be readjusted to reflect the same, and provided, further, that
upon the expiration of such rights of conversion or exchange of such
Convertible Securities, if any thereof shall not have been exercised, the
Pro Forma Trigger Price per share shall forthwith be readjusted and
thereafter be the price which it would have been had an adjustment been
made on the basis that the only shares of Common Stock so issued or sold
were those issued or sold upon the conversion or exchange of such
Convertible Securities, and that they were issued or sold for the
consideration actually received by the Company upon such conversion or
exchange, plus the consideration, if any, actually received by the Company
for the issue or sale of all such Convertible Securities which shall have
been converted or exchanged.
4.3. Grant of Rights or Options for Common Stock. In
case the Company shall grant any rights or options to subscribe for,
purchase or otherwise acquire Common Stock of any class other than the
Subject Securities, there shall be determined the price per share for
which Common Stock is issuable upon the exercise of such rights or
options, such determination to be made by dividing (a) the total amount,
if any, received or receivable by the Company as consideration for the
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granting of such rights or options, plus the minimum aggregate amount of
additional consideration, if any, payable to the Company upon the exercise
of such rights or options, by (b) the maximum number of shares of Common
Stock issuable upon the exercise of such rights or options.
If the price per share so determined shall be less
than the Trigger Price (or, if a Pro Forma Trigger Price shall be in
effect, less than such Price) as of the date of such issue or sale, then
the granting of such rights or options shall be deemed to be an issue or
sale for cash (as of the date of the granting of such rights or options)
of such maximum number of shares of Common Stock at the price per share so
determined, provided that, if such rights or options shall by their terms
provide for an increase or increases, with the passage of time, in the
amount of additional consideration, if any, payable to the Company upon
the exercise thereof, the Pro Forma Trigger Price per share shall,
forthwith upon any such increase becoming effective, be readjusted to
reflect the same, and provided, further, that upon the expiration of such
rights or options, if any thereof shall not have been exercised, the Pro
Forma Trigger Price per share shall forthwith be readjusted and thereafter
be the price which it would have been had an adjustment been made on the
basis that the only shares of Common Stock so issued or sold were those
issued or sold upon the exercise of such rights or options and that they
were issued or sold for the consideration actually received by the Company
upon such exercise, plus the consideration, if any, actually received by
the Company for the granting of all such rights or options, whether or not
exercised.
4.4. Grant of Rights or Options for Convertible
Securities.
In case the Company shall grant any rights or options to
subscribe for, purchase or otherwise acquire Convertible Securities, such
Convertible Securities shall be deemed, for the purposes of
subparagraph 4.2. above, to have been issued or sold for the total amount
received or receivable by the Company as consideration for the granting of
such rights or options plus the minimum aggregate amount of additional
consideration, if any, payable to the Company upon the exercise of such
rights or options, provided that, upon the expiration of such rights or
options, if any thereof shall not have been exercised, the Pro Forma
Trigger Price per share shall forthwith be readjusted and thereafter be
the price which it would have been had an adjustment been made upon the
basis that the only Convertible Securities so issued or sold were those
issued or sold upon the exercise of such rights or options and that they
were issued or sold for the consideration actually received by the Company
upon such exercise, plus the consideration, if any, actually received by
the Company for the granting of all such rights or options, whether or not
exercised.
4.5. Dilution in Case of Other Stock or Securities. In
case any shares of stock or other securities, other than Common Stock of
the Company, shall at any time be receivable upon the exercise of this
Option, and in case any additional shares of such stock or any additional
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such securities (or any stock or other securities convertible into or
exchangeable for any such stock or securities) shall be issued or sold for
a consideration per share such as to dilute the purchase rights evidenced
by this Option, then and in each such case the Pro Forma Trigger Price per
share shall forthwith be adjusted, substantially in the manner provided
for above in this Paragraph 4, so as to protect against the effect of such
dilution.
4.6. Expenses, etc., Deducted. In case any shares of
Common Stock or Convertible Securities or any rights or options to
subscribe for, purchase or otherwise acquire any Common Stock or
Convertible Securities shall be issued or sold for cash, the consideration
received therefor shall be deemed to be the amount received by the Company
therefor, after deducting any expenses incurred and any underwriting or
similar commissions, compensation or concessions paid or allowed by the
Company in connection with such issue or sale.
4.7. Determination of Consideration. In case any shares
of Common Stock or Convertible Securities or any rights or options to
subscribe for, purchase or otherwise acquire any Common Stock or
Convertible Securities shall be issued or sold for a consideration other
than cash (or a consideration which includes cash, if any cash constitutes
a part of the assets of a corporation or business substantially all of the
assets of which are being received a such consideration) then, for the
purpose of this Paragraph 4, the Board of Directors of the Company shall
promptly determine the fair value of such consideration, and such Common
Stock, Convertible Securities, rights or options shall be deemed to have
been issued or sold on the date of such determination in good faith. Such
value shall not be more than the amount at which such consideration is
recorded in the books of the Company for accounting purposes except in the
case of an acquisition accounted for on a pooling of interest basis. In
case any Common Stock or Convertible Securities or any rights or options
to subscribe for, purchase or otherwise acquire any Common Stock or
Convertible Securities shall be issued or sold together with other stock
or securities or other assets of the Company for a consideration which
covers both, the Board of Directors of the Company shall promptly
determine what part of the consideration so received is to be deemed to be
the consideration for the issue or sale of such Common Stock or
Convertible Securities or such rights or options.
The Company covenants and agrees that, should any
determination of fair value of consideration or of allocation of
consideration be made by the Board of Directors of the Company, pursuant
to this subparagraph 4.7, it will, not less than seven (7) days after any
and each such determination, deliver to you a certificate signed by the
President or a Vice President and the Treasurer or an Assistant Treasurer
of the Company reciting such value as thus determined and setting forth
the nature of the transaction for which such determination was required to
be made, the nature of any consideration, other than cash, for which
Common Stock, Convertible Securities, rights or options have been or are
to be issued, the basis for its valuation, the number of shares of Common
Stock which have been or are to be issued, and a description of any
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Convertible Securities, rights or options which have been or are to be
issued, including their number, amount and terms.
4.8. Record Date Deemed Issue Date. In case the Company
shall take a record of the holders of shares of its stock of any class for
the purpose of entitling them (a) to receive a dividend or a distribution
payable in Common Stock or in Convertible Securities, or (b) to subscribe
for, purchase or otherwise acquire Common Stock or Convertible Securities,
then such record date shall be deemed to be the date of the issue or sale
of the Common Stock issued or sold or deemed to have been issued or sold
upon the declaration of such dividend or the making of such other
distribution, or the date of the granting of such rights of subscription,
purchase or other acquisition, as the case may be.
4.9. Shares Considered Outstanding. The number of
shares of Common Stock outstanding at any given time shall include shares
issuable in respect of scrip certificates issued in lieu of fractions of
shares of Common Stock, but shall exclude shares in the treasury of the
Company.
4.10. Duration of Pro Forma Trigger Price. Following
each computation or readjustment of a Pro Forma Trigger Price as provided
in this Paragraph 3, the newly computed or adjusted Pro Forma Trigger
Price shall remain in effect until a further computation or readjustment
thereof is required by this Paragraph 4.
5. Adjustment for Dividends in Other Stock, Property, Etc.;
Reclassifications, Etc.
In case at any time or from time to time after the
Issuance Date the holders of the Common Stock of the Company of any class
(or any other shares of stock or other securities at the time receivable
upon the exercise of this Option) shall have received, or, on or after the
record date fixed for the determination of eligible stockholders, shall
have become entitled to receive:
(a) other or additional stock or other securities or
property (other than cash) by way of dividend;
(b) any cash paid or payable out of capital or paid-
in surplus or surplus created as a result of a
revaluation of property by way of dividend; or
(c) other or additional (or less) stock or other
securities or property (including cash) by way of
stock-split, spin-off, split-off, split-up,
reclassification, combination of shares or
similar corporate rearrangement;
(other than additional shares of Common Stock issued to holders of Common
Stock as a stock dividend or stock-split, adjustments in respect of which
shall be covered by the provisions of Paragraph 3 hereof), then in each
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case, upon the exercise of this Option as provided in Paragraph 3 hereof,
you shall be entitled to receive, in lieu of, or in addition to, as the
case may be, the shares theretofore receivable upon the exercise of this
Option, the amount of stock or other securities or property (including
cash in the cases referred to in clauses (b) and (c) above) which you
would hold on the date of such exercise if, on the Issuance Date, you had
been the holder of record of the number of shares of Common Stock of the
Company called for on the face of this Option and had thereafter, during
the period from the Issuance Date to and including the date of such
exercise, retained such shares and/or all other or additional (or less)
stock or other securities or property (including cash in the cases
referred to in clauses (b) and (c) above) receivable by him as aforesaid
during such period, giving effect to all adjustments called for during
such period by Paragraphs 4 and 6 hereof.
6. Adjustment for Reorganization, Consolidation, Merger,
Etc.
In case of any reorganization of the Company (or any
other corporation the stock or other securities of which are at the time
deliverable on the exercise of this Option) after the date hereof, or in
case, after such date, the Company (or any such other corporation) shall
consolidate with or merge into another corporation or convey all or
substantially all its assets to another corporation, then and in each such
case, upon the exercise hereof as provided in Paragraph 3 hereof, at any
time after the consummation of such reorganization, consolidation, merger
or conveyance, you shall be entitled to receive the stock or other
securities or property to which you would have been entitled upon such
consummation if you had exercised this Option immediately prior thereto,
all subject to further adjustments as provided in Paragraphs 4 and 6
hereof; in each such case, the terms of this Option shall be applicable to
the shares of stock or other securities or property receivable upon the
exercise of this Option after such consummation.
7. No Dilution or Impairment.
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The Company will not, by amendment of its charter or
through reorganization, consolidation, merger, dissolution, sale of assets
or any other voluntary action, avoid or seek to avoid the observance or
performance of any of the terms of this Option, but will at all times in
good faith assist in the carrying out of all such terms and in the taking
of all such action as may be necessary or appropriate in order to protect
against dilution or other impairment. Without limiting the generality of
the foregoing, the Company will not increase the par value of any shares
of stock receivable upon the exercise of this Option above the amount
payable therefor upon such exercise, and at all times will take all such
action as may be necessary or appropriate in order that the Company may
validly and legally issue fully paid and non-assessable stock upon the
exercise of this Option.
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8. Accountants' Certificate as to Adjustments.
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In each case of an adjustment in the number of shares of
Common Stock or other stock, securities or property receivable on the
exercise of this Option, at your request the Company at its expense shall
promptly cause independent public accountants of recognized standing,
selected by the Company, to compute such adjustment in accordance with the
terms of this Option and prepare a certificate setting forth such
adjustment and showing in detail the facts upon which such adjustment is
based, including a statement of (a) the consideration received or to be
received by the Company for any additional shares issued or sold or deemed
to have been issued or sold, (b) the number of shares of Common Stock
outstanding or deemed to be outstanding and (c) the Pro Forma Trigger
Price. The Company will forthwith mail to you a copy of each such
certificate.
9. Notices of Record Date, Etc.
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In case:
(a) the Company shall take a record of the holders of
its Common Stock (or other stock or securities at
the time deliverable upon the exercise of this
Option) for the purpose of entitling or enabling
them to receive any dividend (other than a cash
or stock dividend at the same rate as the rate of
the last cash or stock dividend theretofore paid)
or other distribution, or to exercise any
preemptive right pursuant to the Company's
charter, or to receive any right to subscribe for
or purchase any shares of stock of any class or
any other securities, or to receive any other
right; or
(b) of any capital reorganization of the Company, any
reclassification of the capital stock of the
Company, any consolidation or merger of the
Company with or into another corporation, or any
conveyance of all or substantially all of the
assets of the Company to another corporation; or
(c) of the voluntary or involuntary dissolution,
liquidation or winding up of the Company;
then, and in each such case, the Company will mail or cause to be mailed
to you a notice specifying, as the case may be, (i) the date on which a
record is to be taken for the purpose of such dividend, distribution or
right, and stating the amount and character of such dividend, distribution
or right, or (ii) the date on which such reorganization, reclassification,
consolidation, merger, conveyance, dissolution, liquidation or winding up
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is to take place, and the times, if any is to be fixed, as of which the
holders of record of Common Stock (or such other stock or securities at
the time deliverable upon the exercise of this Option) shall be entitled
to exchange their shares of Common Stock of any class (or such other stock
or securities) for reclassification, consolidation, merger, conveyance,
dissolution, liquidation or winding up or (iii) the amount and character
of the stock or other securities proposed to be issued or granted, the
date of such proposed issuance or grant and the persons or class of
persons to whom such stock or other securities ar to be offered, issued or
granted. Such notice shall be mailed at least thirty (30) days prior to
the date therein specified.
10. Reservation of Stock, Etc., Issuable on Exercise of
Warrants.
The Company will at all times reserve and keep available,
solely for insurance and delivery upon the exercise of this Option, such
shares of Common Stock and other stock, securities and property as from
time to time shall be issuable upon the exercise of this Option.
11. Registration Rights.
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a. Registration. As soon as reasonably practicable
after the date hereof, the Company will file a registration statement
("Registration Statement") with the Securities and Exchange Commission
("SEC") covering the shares of Common Stock issuable upon exercise of this
Option ("Registrable Securities"), and will use its best efforts to cause
the Registration Statement to become effective on or prior to the
ninetieth day after such filing and to keep the Registration Statement
effective for a period of seven years from the date it is declared
effective by the SEC.
b. Additional Terms. Except as otherwise expressly
stated herein, the following provisions shall be applicable to the
Registration Statement:
(i) The Company will use its best efforts to
cause the Registration Statement to become effective as promptly
as possible, and if any stop order shall be issued by the SEC in
connection therewith to use its reasonable efforts to obtain the
removal of such order. Following the effective date of the
Registration Statement, the Company shall, upon your request,
forthwith supply such reasonable number of copies of the
Registration Statement, preliminary prospectus and prospectus
meeting the requirements of the Act, and other documents
necessary or incidental to a public offering of the Registrable
Securities, as shall be reasonably requested by you to permit you
to make a public distribution of your Registrable Securities.
The Company will use its reasonable efforts to qualify the
Registrable Securities for sale in such states as you shall
reasonably request, provided that no such qualification will be
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required in any jurisdiction where, solely as a result thereof,
the Company would be subject to service of general process or to
taxation or qualification as a foreign corporation doing business
in such jurisdiction. The obligations of the Company hereunder
with respect to your Registrable Securities are expressly
conditioned on your furnishing to the Company such appropriate
information concerning you, your Registrable Securities and the
terms of your offering of such Registrable Securities as the
Company may reasonably request.
(ii) The Company shall pay all expenses incurred
in complying with the provisions of this Paragraph 11, including,
without limitation, all registration and filing fees (including
all expenses incident to filing with the National Association of
Securities Dealers, Inc.), printing expenses, fees and
disbursements of counsel to the Company, securities law and blue
sky fees and expenses and the expenses of any regular and special
audits incident to or required by any such registration. All
underwriting discounts and selling commissions applicable to the
sales of the Registrable Securities, and any state or federal
transfer taxes payable with respect to the sales of the
Registrable Securities and all fees and disbursements of your
counsel, if any, in each case arising in connection with
registration of the Registrable Securities shall be payable by
you.
(iii) In connection with the registration of the
Registrable Securities pursuant to this Paragraph 11, the Company
shall indemnify and hold harmless you, your affiliates, agents
and representatives, each person, if any, who controls the holder
within the meaning of the Securities Act of 1933, as amended (the
"Securities Act"), or the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and any person claiming by or
through any of them (collectively, the "Indemnified Persons")
from and against all losses, claims, damages, expenses or
liabilities (or actions in respect thereof) arising out of or are
based upon any untrue statement of any material fact contained in
the Registration Statement or alleged untrue statement, under
which such securities were registered under the Securities Act,
any preliminary prospectus or final prospectus contained therein,
or any amendment or supplement thereto, or arise out of or are
based upon the omission to state therein a material fact required
to be stated therein or necessary to make the statements made
therein, in light of the circumstances under which they are made,
not misleading, or any violation by the Company of the Securities
Act, the Exchange Act or state securities or blue sky laws
applicable to the Company and relating to action or inaction
required of the Company in connection with such registration or
qualification under such state securities or blue sky laws; and
will reimburse the Indemnified Persons for any legal or any other
expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage,
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liability or action; provided, however, that the Company will not
be liable in any such case to any Indemnified Person to the
extent that any such loss, claim, damage or liability arises out
of or is based upon an untrue statement or omission made in the
Registration Statement, said preliminary prospectus or said final
prospectus or said amendment or supplement or any document
incident thereto in reliance upon and in conformity with written
information furnished to the Company by or on behalf of such
Indemnified Person.
(iv) You will indemnify and hold harmless the
Company and each person, if any, who controls the Company within
the meaning of the Securities Act or the Exchange Act, each
officer of the Company who signs the Registration Statement and
each director of the Company from and against any and all such
losses, claims, damages or liabilities arising from any untrue
statement in, or omission from, the Registration Statement, any
such preliminary or final prospectus, amendment, or supplement or
document incident thereto if the statement or omission in respect
of which such loss, claim, damage or liability is asserted was
made in reliance upon and in conformity with information
furnished in writing to the Company by you or on your behalf for
use in connection with the preparation of the Registration
Statement or such prospectus or amendment or supplement thereof.
(v) The reimbursements required by clauses
(iii) and (iv) shall be made by periodic payments during the
course of the investigation or defense as and when bills are
received or expenses incurred; provided, however, that to the
extent that an Indemnified Person receives periodic payments for
legal or other expenses during the course of an investigation or
defense, and such person subsequently received payments for such
expenses from any other parties to the proceeding, such payments
shall be used by the Indemnified Person to reimburse the
indemnifying party for such periodic payments. Any party which
proposes to assert the right to be indemnified under clause (iii)
or (iv) will, promptly after receipt of notice of commencement of
any action, suit or proceeding against such party in respect of
which a claim is to be made against any Indemnified Person
hereunder, notify each such indemnifying party of the
commencement of such action, suit or proceeding, enclosing a copy
of all papers served, but the failure to so notify such
indemnifying party of any such action, suit or proceeding shall
not relieve the indemnifying party from any obligation which it
may have to any Indemnified Person hereunder unless and only to
the extent that the indemnifying party is prejudiced by said lack
of notice. In case any such action, suit or proceeding shall be
brought against any Indemnified Person and it shall notify the
indemnifying party of the commencement thereof, the indemnifying
party shall be entitled to participate in and, to the extent that
it shall wish, jointly with any other indemnifying party
similarly notified, to assume the defense thereof, with counsel
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satisfactory to such Indemnified Person, and after notice from
the indemnifying party to such Indemnified Person of its election
so to assume the defense thereof, the indemnifying party shall
not be liable to such Indemnified Person for any legal or other
expense, other than reasonable costs of investigation
subsequently incurred by such Indemnified Person in connection
with the defense thereof. The Indemnified Person shall have the
right to employ its own counsel in any such action, but the
reasonable fees and expenses of such counsel shall be at the
expense of such Indemnified Person, when and as incurred, unless
(A) the employment of counsel by such Indemnified Person has been
authorized by the indemnifying party, (B) the Indemnified Person
has reasonably concluded (based on advice of counsel), that there
may be legal defenses available to it that are different from or
in addition to those available to the indemnifying party, (C) the
Indemnified Person shall have reasonably concluded (based on
advice of counsel) that there may be a conflict of interest
between the indemnifying party and the Indemnified Person in the
conduct of defense of such action (in which case the indemnifying
party shall not have the right to direct the defense of such
action on behalf of the Indemnified Person), or (D) the
indemnifying party shall not in fact have employed counsel to
assume the defense of such action within 15 days after receipt of
notice of such action. An indemnifying party shall not be liable
for any settlement or any action or claim effected without its
consent.
(vi) If the indemnification provided for in this
Paragraph 11 is unavailable to any Indemnified Person hereunder
in respect of any losses, claims, damages, liabilities or
expenses referred to therein, then the indemnifying party, in
lieu of indemnifying such Indemnified Person, shall contribute to
the amount paid or payable by such Indemnified Person as a result
of such losses, claims, damages, liabilities or expenses in such
proportion as is appropriate to reflect the relative fault of the
indemnifying party and Indemnified Persons in connection with the
actions that resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable
considerations. The relative fault of such indemnifying party
and Indemnified Persons shall be determined by reference to,
among other things, whether any action in question, including any
untrue or alleged untrue statement of a material fact or omission
or alleged omission to state a material fact, has been made by,
or relates to information supplied by, such indemnifying party or
Indemnified Persons, and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such
action. The amount paid or payable by a party as a result of the
losses, claims, damages, liabilities and expenses referred to
above shall be deemed to include, subject to the limitations set
forth herein, any legal or other fees or expenses reasonably
incurred by such party in connection with any investigation or
proceeding.
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(vii) The Company and you agree that it would not
be just and equitable if contribution pursuant to clause (vi)
were determined by pro rata allocation or by any other method of
allocation that does not take account of the equitable
considerations referred to in the immediately preceding
paragraph. Notwithstanding any other provision hereof, in no
event shall your contribution obligation be greater in amount
than the excess of (A) the dollar amount of proceeds received by
you upon the sale of the securities giving rise to such
contribution obligation over (B) the dollar amount of any damages
that you have otherwise been required to pay by reason of the
untrue or alleged untrue statement or omission or alleged
omission giving rise to such obligation. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f)
of the Securities Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.
(viii) Neither the filing of the Registration
Statement by the Company pursuant to this Agreement nor the
making of any request for prospectuses by you shall impose upon
you any obligation to sell his, her or its Registrable
Securities.
(ix) Upon receipt of notice from the Company
that an event has occurred which requires a post-effective
amendment to the Registration Statement or a supplement to the
prospectus included therein, you shall promptly discontinue the
sale of your Registrable Securities until you receive a copy of a
supplemented or amended prospectus from the Company, which the
Company shall provide as soon as practicable after such notice.
12. How Option May be Exercised.
---------------------------
This option is exercisable by a written notice signed by
you and delivered to the Company at 000-00 Xxxxxx Xxxxxx, Xxxxxxxxx, Xxx
Xxxx 00000, attention of the Office of the President, signifying your
election to exercise the option. The notice must state the number of
shares of Common Stock as to which your option is being exercised, must
contain a statement by you (in a form acceptable to the Company) that such
shares are being acquired by you for investment and not with a view to
their distribution or resale and must be accompanied by cash or a check to
the order of the Company for the full purchase price of the shares being
purchased.
If a notice of the exercise of this option is given by a
person or persons other than you, the Company may require as a condition
to the exercise of the option the submission to the Company of appropriate
proof of the right of such person or persons to exercise the option.
Certificates for shares of the Common Stock so purchased
will be issued as soon as practicable. Except as otherwise provided
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herein, the Company, however, shall not be required to register with the
Securities and Exchange Commission or any other applicable state authority
any shares of Common Stock issued upon exercise of this option and your
right to sell, transfer, assign or otherwise dispose of such shares shall
be subject to your compliance with all applicable federal and state
securities laws.
13. Non-transferability of Option.
-----------------------------
This option shall not be transferable except by Will or
the laws of descent and distribution, and, may be exercised during your
lifetime only by you.
Dated: May 1, 1996
LOGIMETRICS, INC.
------------------------
By: /s/ Xxxxxx X. Xxxxxx
Agreed:
/s/ Xxxxxxx X. Xxxxxxx
----------------------
Xxxxxxx X. Xxxxxxx
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