Exhibit No. 4.4
Form of Non-Qualified Stock Option Certificate
NONSTATUTORY STOCK OPTION AGREEMENT
UNDER
ELECTRONIC CONTROL SECURITY INC.
NONSTATUTORY STOCK OPTION PLAN
AGREEMENT made this 16th day of November, 1999 between ELECTRONIC CONTROL
SECURITY INC., (the "Company") a New Jersey corporation, and XXXX XXXXXX, 00
Xxxxxxxx Xxxxx, Xxxxxx, XX 00000 (the "Optionee"), a consultant to the Company
or one of its parent or subsidiary corporations.
WHEREAS, the Board of Directors of the Company has determined to grant the
option provided for herein to the Optionee, and the Optionee has accepted the
same within thirty days of the date first above written as evidenced by his
dated signature hereafter.
NOW, THEREFORE, in consideration of the mutual covenants herein contained,
it is agreed between the parties hereto as follows:
1. Grant of Option.
The Company grants to the Optionee the right and option to purchase
from the Company, on the terms and conditions hereinafter set forth, all or any
part of an aggregate of fifty thousand (50,000) shares of the authorized but
unissued Common Stock of the Company, at the purchase price of $.30 per share,
as the Optionee may from time to time elect, exercisable at the time for the
number of shares as follows:
(a) on or after January 2, 2000 to and including January 1, 2001,
25,000 shares;
(b) on or after January 2, 2001 to and including January 1, 2002,
25,000 shares;
(c) on or after ________, _____ to and including ____________,
___________ _________ shares; and
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(d) on or after ______________, _______ to and including
______________ _______ (hereinafter referred to as the "terminal date") 50,000
shares. Except as otherwise provided herein, if the Optionee does not purchase
in a specified period the full number of shares to which he is entitled, he may
purchase such shares in the subsequent period in addition to the shares which he
would otherwise be entitled to purchase in such subsequent period. No partial
exercise of such option shall be for less than 1,000 full shares and in no event
shall the Company be required to issue fractional shares. Anything contained
herein to the contrary notwithstanding, if the Optionee shall be, as of the date
hereof, a non-employee director of the Company, options granted hereunder shall
not be exercisable earlier than one year from the date hereof; thereafter, such
options may be exercised only in installments of no more than 25% per year and
such options shall be exercisable only within five years from the date hereof.
2. Method of Exercise.
The option granted hereunder shall be exercisable from time to time,
as hereinabove provided, by payment to the Company in cash of the purchase price
of the shares which the Optionee shall then elect to purchase or pursuant to
Rule 16b-3 of the Securities Exchange Act of 1934, by delivery to the Company of
such number of shares of the Company's Common Stock having a fair market value
(as determined by the Committee) equal to said purchase price. The Company shall
not be required to issue or deliver any certificate or certificates for shares
of the Company's Common Stock purchased from time to time upon exercise of the
option granted hereunder until the conditions set forth in Paragraph 8 hereof
are satisfied. In addition, the Optionee shall promptly pay upon notification of
the amount due and prior to, or concurrently with, the delivery to the Optionee
of a certificate representing such shares any amount necessary to satisfy
applicable federal, state or local tax requirements. Payment for the shares
shall be accompanied by a written request for the shares to be purchased and
such payment and written request shall be directed to the Treasurer of the
Company.
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3. Termination of Option.
The option an all rights granted hereunder, to the extent such
rights have not been exercised, shall terminate and become null and void on the
terminal date or sooner upon the Optionee's ceasing to be a consultant to the
Company, its parent or subsidiary corporations (or by a corporation or
subsidiary of such corporation issuing a new stock option or assuming such stock
option in a transaction to which Section 425 of the Code is applicable), unless
(i) such cessation shall be because of (a) involuntary termination which the
Board of Directors in its sole discretion shall determine to be without cause,
(b) voluntary resignation (which must be with the consent of the Board of
Directors) or (c) retirement in accordance with and as permitted by the terms
and conditions of a retirement plan adopted by the Company, its parent or
subsidiary corporations, in which case the option shall be exercisable within a
period of three months following the cessation date, or (ii) such cessation
shall be because of disability or death (or death shall occur within three
months of such cessation), in which case the option shall be exercisable within
a period of one year following the cessation date by the Optionee, his guardian
of legal representative in the case of disability, or the estate of the Optionee
or by the person or persons to whom the Optionee's rights under the option shall
pass by the Optionee's will or the laws of descent and distribution in the case
of death; provided, however, that an option may be exercised only to the extent
it was exercisable by the Optionee on the date of his ceasing to be a director
or employee and in no event may an option be exercised after the expiration date
thereof.
4. Limitation upon Transfer.
During the lifetime of the Optionee the option and all rights
granted hereunder shall be exercisable only by the Optionee or by his guardian
or legal representative and except as otherwise provided in Paragraph 3 hereof,
the option and all rights granted hereunder shall not be assigned, transferred,
pledged or hypothecated in any way (whether by operation of law or otherwise)
and shall
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not be subject to execution, attachment or similar process. Upon any attempt to
assign, transfer, pledge, hypothecate, or otherwise dispose of such option or of
such rights contrary to the provisions hereof, or upon the levy of any
attachment or similar process upon such option or such rights, such option and
such rights shall immediately become null and void.
5. Adjustments in Case of Changes in Stock.
In the event there is any change in the Common Stock of the Company
by reason of a stock dividend paid with respect to the Common Stock of the
Company, or a recapitalization, a reclassification, a stock split or a
combination of shares with respect to such Common Stock, or if the outstanding
Common Stock of the Company should, by reason of a merger, consolidation,
acquisition of stock or property, separation, reorganization or liquidation to
which the Company is a party, be exchanged for other shares of the Company or of
another corporation which is a party to such transaction, the number of shares
which may be made subject to option and issued under the Plan shall be adjusted
as the Board of Directors of the Company shall determine to be appropriate to
reflect the change or exchange. In the event of any such change or exchange, the
option which has been granted hereunder shall apply to the shares into or for
which the Common Stock covered by the options would have been changed, and the
option price per share shall be adjusted, as the Committee shall determine to be
appropriate.
6. Listing and Registration of Shares.
The Company shall not be required to issue or deliver any shares of
stock upon the exercise of this option prior to (a) the admission or such shares
to listing on any stock exchange on which the Company's Common Stock may then be
listed, and (b) the completion of such registration or other qualification of
such shares under any state or federal law, rule or regulation, as the Company
shall determine to be necessary or advisable. The Company shall not be required
to issue or deliver
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any shares of stock upon the exercise of an option free of transfer
restrictions, of any kind or character, imposed under applicable state or
federal law, rules or regulations.
7. Stock as Investment.
By accepting this option, the Optionee acknowledges for himself, his
heirs, and legatees that any and all shares purchased hereunder shall be
acquired for investment and not for distribution, and prior to the issuance and
delivery of any or all of the shares subject to the option granted hereunder,
the Optionee's or his heirs or legatees receiving such shares, shall, if the
Optionee shall so request, deliver to the Optionee a representation in writing
that such shares are being acquired in good faith for investment and not for
distribution.
8. Rights as Shareholder.
Neither the Optionee's nor is heirs, legatees, guardians or legal
representatives shall be or have any rights or privileges of a shareholder of
the Company in respect of shares to be issued and delivered upon exercise of the
option granted hereunder unless and until certificates representing such shares
shall have been issued, executed, delivered and registered on the Company's
transfer books.
9. Interpretation.
In the event of any conflict between the terms of this Agreement and
the terms of the Plan, the terms of the Plan shall control. This Agreement shall
not be effective unless and until the Plan is effective.
10. Binding Effect.
This Agreement shall be binding upon and inure to the benefit of the
Optionee and the Company and its successors if executed by the Optionee within
thirty days after the date first above
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written which date first above written is the date of the granting of the option
by the Committee. If the Optionee shall fail to execute this Agreement within
said thirty day period, his option shall automatically be terminated.
Nothing herein contained shall confer upon the Optionee any right
with respect to continuous employment by, or service as a director or
consultants of, the Company or its parent or subsidiary corporations, nor
interface in any way with the right of the Company or its parent or subsidiaries
to terminate the Optionee's employment or change his compensation at any time.
IN WITNESS WHEREOF, the Company had caused this Agreement to be
executed by its President or one of its Vice Presidents and the same has been
ratified by a member of the Committee, all as of the day and year first above
written.
ELECTRONIC CONTROL SECURITY, INC.
By: /s/ [Illegible]
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President
Optionee:
/s/ Xxxx Xxxxxx
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Name: Xxxx Xxxxxx
Address: 00 Xxxxxxxx Xxxxx
Xxxxxx, XX 00000
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