DIRECTOR OPTION AGREEMENT
This Option Agreement, dated October ____, 1998, between ABC Dispensing
Technologies, Inc., a Florida corporation (the "Company") and [insert name of
director] (the "Director").
WHEREAS, as consideration of the Director's prior service as a director
of the Company to induce the Director to continue to serve as a member of the
Company's Board of Directors, the Company intends to grant to the Director
common stock purchase options that will vest only upon a Change of Control (as
defined in paragraph two (2) below),
NOW, THEREFORE, in consideration for Director's prior service as a
director of the Company and as an inducement to the Director to continue to
serve as a director of the Company, the Company and the Director hereby agree as
follows:
1. The Company hereby grants to the Director an option to
purchase 40,000 shares of the Company's Common Stock, par
value $.01 per share, subject to the provisions set forth
herein. The option price to be paid per share of common stock
upon exercise of such option shall be equal to the market
price per share on the date which is 90 days prior to the date
of the Change of Control. The option represented by this
Agreement shall only vest if the Director remains a director
of the Company at the time of the occurrence of a Change of
Control, if and whenever such Change in Control shall occur.
The option will not vest until the occurrence of a Change of
Control.
2. For purposes of this Agreement, a "Change of Control" shall
occur if (i) any person or group of persons (within the
meaning of Section 13 or Section 14 of the Securities Exchange
Act of 1934, as amended) shall acquire (other than directly
from the Company) beneficial ownership (within the meaning of
Rule 13d-3 promulgated by the Securities and Exchange
Commission under said Act) of 20% or more of the outstanding
shares of common stock of the Company, (ii) during any period
of 12 consecutive calendar months, individuals who were
directors of the Company on the first day of such period (or
who were appointed or nominated for election as directors of
the Company by at least a majority of the individuals who were
directors on the first day of such period or who were so
elected or appointed other than in connection with an actual
or threatened proxy contest) (the "Incumbent Board") shall
cease to constitute a majority of the Board of Directors of
the Company, or (iii) there is consummation of a complete
liquidation or dissolution of the Company or a merger,
consolidation or sale of all or substantially all of the
Company's assets (collectively, a "Business Combination")
other than a Business Combination in which all or
substantially all of the stockholders of the Company receive
50% or more of the stock of the company resulting from the
Business Combination, at least a majority of the Board of
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Directors of the resulting company were members of the
Incumbent Board and after which no person owns 20% or more of
the stock of the resulting corporation, which did not own such
stock immediately before the Business Combination. For
purposes of this Agreement, the term "market value" shall mean
the last reported sales price of a share of the Company's
common stock as reported by any national securities exchange
on which the common stock is then listed or admitted to
trading, or the National Market System of NASDAQ, or if the
common stock is neither so reported or listed, the closing
price as reported by NASDAQ, or if not listed or admitted to
trading on NASDAQ, the average of the closing bid and asked
price in the over-the-counter market as reported by NASDAQ or
any comparable system or if not approved for quotation on
NASDAQ or any comparable system, the average of the closing
bid and asked prices as furnished by the two members of the
National Association of Securities Dealers, Inc. selected from
time to time by the Company for that purpose, or if no such
bid or asked prices are available because no market then
exists for the Company's common stock, the book value per
share determined as of the date of the then most recent
quarterly or annual financial statements prepared by the
Company.
3. Upon vesting, such option may be exercised in whole or in
part, from time to time, by the giving to the Company of
notice in writing to that effect. Within 10 days after the
receipt by it of notice of exercise of such option, the
Company shall cause certificates for the number of shares with
respect to which such option is exercised to be issued in the
name of the Director or his executors, administrators, or
other legal representatives, heirs, legatees, next of kin, or
distributees, or properly endorsed or accompanied by separate
stock powers duly executed, and to be delivered to Director or
his executors, administrators, or other legal representatives,
heirs, legatees, next of kin, or distributees. Payment of the
option price for the shares with respect to which such option
is exercised may be made in cash or upon surrender of a number
of shares at the then current market price per share necessary
to satisfy the aggregate exercise price of such option.
4. The option herein granted shall not be transferrable by the
Director other than by will or the laws of descent and
distribution, and shall be exercisable, during his lifetime
only by him. Notwithstanding anything in this Agreement to the
contrary, the option herein granted shall in no event be
exercisable after the expiration of ten (10) years from the
date such option vests.
5. If the Company shall issue any additional shares of stock by
way of a stock dividend on, or split-up, subdivision, or
reclassification of outstanding common shares, then such
option shall be deemed to cover such additional shares to the
extent that the same would have been issued to Director had
such option been exercised in its entirety at the time of such
issuance of additional shares, and there shall be a
corresponding proportionate adjustment of the option price per
share set forth above so that in the aggregate the option
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price for all shares then covered shall be the same as the
aggregate option price for the shares remaining subject to
such option immediately prior to the issuance of such
additional shares.
6. If there shall be any capital reorganization, or
consolidation, or merger of the Company with any other entity
or entities or any sale of all or substantially all of the
Company's property and assets to any other entity or entities,
the Company shall take appropriate action to enable the
Director to receive upon any subsequent exercise of such
option, in whole or in part, in lieu of any shares of common
stock of the Company, the share or shares, securities or other
assets as were issuable or payable upon such reorganization,
consolidation, merger or sell in respect of or in exchange for
such shares of common stock.
7. This Agreement shall be governed by the laws of the State of
Florida.
8. This Agreement may be amended or terminated by the Board of
Directors of the Company without the consent of the Director
at any time prior to the occurrence of a Change of Control
provided all Director Option Agreements then outstanding are
similarly amended or terminated (providing for options vesting
upon the occurrence of a change of control).
IN WITNESS WHEREOF, the Company and the Director have caused this
Agreement to be executed, as of the day and year first above written.
ABC DISPENSING TECHNOLOGIES, INC.
By:_____________________________
Name: Xxxxxxx X. Xxxxxx, Xx.
Title: President
DIRECTOR
________________________________
Name:
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