EXHIBIT D
THIS OPTION HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, AND MAY BE OFFERED AND SOLD ONLY IF
REGISTERED PURSUANT TO THE PROVISIONS OF THAT ACT OR IF, IN
THE OPINION OF COUNSEL TO THE SELLER, AN EXEMPTION FROM
REGISTRATION THEREUNDER IS AVAILABLE, THE AVAILABILITY OF
WHICH MUST BE ESTABLISHED TO THE SATISFACTION OF VECTOR.
OPTION AGREEMENT
OPTION AGREEMENT, dated as of January 24, 1996, by and between
V' POWER CORPORATION, a Bahamian corporation (the "Optionee"), on the one hand,
and VECTOR AEROMOTIVE CORPORATION, a Nevada corporation ("Vector") on the other.
WHEREAS, effective as of December 29, 1995, the Optionee and
Vector entered into a Share Purchase Agreement (the "Purchase Agreement")
pursuant to which, among other things, the Optionee is to receive the right (the
"Option") to purchase up to 50,000,000 Common Shares, par value $.01 per share
(the "Option Shares") of Vector pursuant to the terms of an option agreement;
and
WHEREAS, this option agreement (the "Option Agreement")
constitutes the option agreement described in the Purchase Agreement;
NOW, THEREFORE, in consideration of the agreements set forth
below, the parties here agrees as follows:
1. The Option. Subject to the terms and conditions hereof, the
Optionee is hereby granted the Option, at any time or from time to time
commencing on the date of Option Agreement and at or before 5:00 P.M., Eastern
Time, on January 24, 1997 (such one year period hereinafter the "Option
Exercise Period"), but not thereafter, to subscribe for and purchase any and all
of the Option Shares for a price of $.45 per Option Share purchased (the "Option
Exercise Price"). If the rights represented hereby shall not be exercised during
the Option Exercise Period, this Option shall become and be void without further
force or effect, and all rights represented hereby shall cease and expire.
2. Exercise of Option. During the Option Exercise Period, the
Optionee may exercise this Option upon presentation and surrender of this Option
and upon payment of the Option Exercise Price for the Option Shares to be
purchased to Vector at the principal office of Vector. Upon exercise of this
Option,
the form of election hereinafter provided must be duly executed and the
instructions for registration of the Option Shares acquired by such exercise
must be completed and delivered with this Option to Vector. In the event of the
exercise of this Option in part only, Vector shall cause to be delivered to the
Optionee a new Option of like tenor to this Option in the name of the Optionee
evidencing the right of the Optionee to purchase the number of Option Shares
purchasable hereunder as to which this Option has not been exercised. On
exercise of this Option, unless (i) Vector receives an opinion from counsel
satisfactory to it that such a legend is not required in order to assure
compliance with the Securities Act of 1933, as amended (the "1933 Act"), or any
applicable state securities laws, or (ii) the Option Shares are registered under
the 1933 Act, each certificate for Option Shares issued hereunder shall bear a
legend reading substantially as follows:
This option has not been registered under the
Securities Act of 1933, as amended, and may be offered and
sold only if registered pursuant to the provisions of that Act
or if, in the opinion of counsel to the seller, an exemption
from registration thereunder is available, the availability of
which must be established to the satisfaction of Vector.
The foregoing legend may be removed with respect to any Option Shares sold upon
registration or sold pursuant to an exemption from registration including the
exemption, for sales made in accordance with Rule 144 promulgated under the 1933
Act, provided Vector receives an opinion from counsel satisfactory to it that
such legend may be removed.
3. Assignment. Subject to the terms contained herein, this
Option may be assigned by the Optionee in whole or in part by execution by the
Optionee of the form of assignment attached hereto. In the event of any
assignment, Vector, upon request and upon surrender of this Option by the
Optionee at the principal office of Vector accompanied by payment of all
transfer taxes, if any, payable in connection therewith, shall transfer this
Option on the books of Vector. If the assignment is in whole, Vector shall
execute and deliver a new Option or Options of like tenor to this Option to the
appropriate assignee expressly evidencing the right to purchase the aggregate
number of Option Shares purchasable hereunder; and if the assignment is in part,
Vector shall execute and deliver to the appropriate assignee a new Option or
Options of like tenor expressly evidencing the right to purchase the portion of
the aggregate number of Option Shares as shall be contemplated by any such
assignment, and shall concurrently execute and deliver to the Optionee a new
Option of like tenor to this Option evidencing the right to purchase the
remaining portion of the Option Shares
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purchasable hereunder which have not been transferred to the assignee.
4. Transfer of Option. The Optionee, by acceptance hereof,
agrees that, before any transfer is made of all or any portion of this Option,
the Optionee shall give written notice to Vector ar least 15 days prior to the
date of such proposed transfer, which notice shall specify the identity, address
and affiliation, if any, of such transferee. No such transfer shall be made
unless and until Vector has received an opinion of counsel for Vector or for the
Optionee stating that no registration under the 1933 Act or any state securities
law is required with respect to such disposition or a registration statement has
been filed by Vector and declared effective by the Securities and Exchange
Commission covering such proposed transfer and the Option and/or the Option
Shares have been registered under appropriate state securities laws.
5. Share Dividends, Reclassification, Reorganization
Provisions.
(a) If, prior to the expiration of this Option by
exercise or by its terms, Vector shall issue any of its Common Shares as a share
dividend or subdivide the number of outstanding Common Shares into a greater
number of shares then, in either of such cases, the Option Exercise Price per
share purchasable pursuant to this Option in effect at the time of such action
shall be proportionately reduced and the number of Option Shares purchasable
pursuant to this Option shall be proportionately increased; and conversely, if
Vector shall reduce the number of outstanding Common Shares by combining such
shares into a smaller number of shares then, in such case, the Option Exercise
Price per share purchasable pursuant to this Option in effect at the time of
such action shall be proportionately increased and the number of Option Shares
at that time purchasable pursuant to this Option shall be proportionately
decreased. If Vector shall, at any time during the life of this Option, declare
a dividend payable in cash on its Common Shares and shall at substantially the
same time offer to its shareholders a right to purchase new Common Shares from
the proceeds of such dividend or for an amount substantially equal to the
dividend, all Common Shares so issued shall, for the purpose of this Option, be
deemed to have been issued as a share dividend. Any dividend paid or distributed
upon Common Shares in shares of any other class of securities convertible into
Common Shares shall be treated as a dividend paid in Common Shares to the extent
that Common Shares are issuable upon the conversion thereof.
(b) If, prior to the expiration of this Option by
exercise or by its terms, Vector shall be recapitalized by reclassifying its
outstanding Common Shares, or Vector or a successor corporation shall
consolidate or merge with or convey all or substantially all of its or any
successor corporation's property and assets to any other corporation or
corporations (any
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such corporation being included within the meaning of the term "successor
corporation" used above in the event of any consolidation or merger of any such
corporations with, or the sale of all or substantially all of the property of
any such corporation, to another corporation or corporations), the Optionee
shall thereafter have the right to purchase, upon the basis and upon the terms
and conditions and during the time specified in this Option, in lieu of the
Option Shares theretofore purchasable upon the exercise of this Option, such
shares, securities or assets as may be issued or payable with respect to, or in
exchange for, the number of Option shares theretofore purchasable upon the
exercise of this Option had such recapitalization, consolidation, merger or
conveyance not taken place and, in any such event, the rights of the Optionee to
an adjustment in the number of Option shares purchasable upon the exercise upon
this Option as herein provided shall continue and be preserved in respect of any
shares, securities or assets which the Optionee becomes entitled to purchase.
(c) If, (i) Vector shall take a record of holders
of its Common Shares for the purpose of entitling them to receive a dividend
payable otherwise than in cash, or any other distribution in respect of the
Common shares (including cash), pursuant to, without limitation, any spin-off,
split-off, or distribution of Vector's assets; or (ii) Vector shall take a
record of the holders of its Common Shares for the purpose of entitling them to
subscribe for or purchase any shares of any class or to receive any other
rights; or (ii) in the event of any classification, reclassification or other
reorganization of the securities which Vector is authorized to issue,
consolidation or merger by Vector with or into another corporation, or
conveyance of all or substantially all of the assets of Vector; or (iv) in the
event of any voluntary or involuntary dissolution, liquidation or winding up of
Vector; then, and in any such case, Vector shall mail to the Optionee, at least
30 days prior thereto, a notice stating the date or expected date on which a
record is to be taken for the purpose of such dividend, distribution or rights,
or the date on which such classification, reclassification, reorganization,
consolidation, merger, conveyance, dissolution, liquidation or winding up, as
the case may be, will be effected. Such notice shall also specify the date or
expected date, if any is to be fixed, as to which holders of Common Shares of
record shall be entitled to participate in such dividend, distribution or
rights, or shall be entitled to exchange their Common Shares or securities or
other property deliverable upon such classification, reclassification,
reorganization, consolidation, merger, conveyance, dissolution, liquidation or
winding up, as the case may be.
(d) If Vector, at any time while this Option
shall remain unexpired and unexercised in whole or in part, shall sell all or
substantially all of its property, dissolve, liquidate or wind up its affairs,
the Optionee may thereafter receive upon exercise hereof, in lieu of each Option
Share which
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it would have been entitled to receive, the same kind and amount of any
securities or assets as may be issuable, distributable or payable upon any such
sale, dissolution, liquidation or winding up with respect to each Common Shares
of Vector purchased upon exercise of this Option.
6. Reservation of Shares Issuable on Exercise of Option. At
all times during the Option Exercise Period, Vector will reserve and keep
available out of its authorized Common Shares, solely for issuance upon the
exercise of this Option, such number of Common Shares and other securities as
from time to time may be issuable upon exercise of this Option.
7. Request to Transfer Agent. On exercise of all or any
portion of this Option, Vector shall, within ten days of the receipt of good and
clean funds for the purchase of any or all of the Option Shares, advise its
Transfer Agent and Registrar of the required issuance of the number of Option
Shares and the names in which such shares are to be registered pursuant to the
exercise form attached hereto. Vector shall also execute and deliver any and all
such further documents as may be requested by the Transfer Agent and Registrar
for the purpose of effecting the issuance of Option shares upon payment therefor
by the Optionee or any assignee.
8. Loss, Theft, Destruction or Mutilation. Upon receipt by
Vector of evidence satisfactory to it (in the exercise of its reasonable
discretion) of the ownership of and the loss, theft, destruction or mutilation
of this Option, and the purchase by the Optionee of a lost security bond (or, if
acceptable to Vector, the provision of a satisfactory indemnity from the
Optionee) in an amount equal to or exceeding the total value of the Option
Shares to be purchased hereunder, Vector will execute and deliver, in lieu
thereof, a new Option of like tenor.
9. Optionee Not a Shareholder. The Optionee or any other
holder of this Option shall, as such, not be entitled by reason of ownership of
this Option to any rights whatsoever of a shareholder of Vector.
10. Transfer Taxes. The Optionee or its assignee(s) will pay
all taxes in respect of the issue or transfer of this Option or the Option
Shares issuable upon exercise hereof.
11. Mailing of Notice. All notices and other communications
from Vector to the Optionee or from the Optionee to Vector shall be mailed by
first class, certified mail, postage prepaid, or sent by receipt confirmed
facsimile transmission, to the address furnished to each party in writing by the
other party.
12. Fractional Shares. No fractional shares or scrip
representing fractional shares shall be issued upon exercise of this Option.
With respect to any fraction of a share called for
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upon the exercise hereof, Vector shall issue to the Optionee at no extra cost
another whole share for any fraction which is one-half or greater, and the
Optionee shall forfeit the fractional share that is less than one-half of a
share.
13. Common Shares Defined. Whenever reference is made in this
Option to the issue or sale of Common Shares, the term "Common Shares" shall
mean the voting Common Shares of Vector of the class authorized as of the date
hereof and any other class of stock ranking on a party with such Common Shares.
14. Registration Rights. The Optionee and Vector acknowledge
their execution of a Registration Rights Agreement between the parties which
provides, among other things, for certain registration rights which are for the
benefit of the Optionee and any assignee(s). Vector's agreements with respect to
the registration rights will continue in effect regardless of the exercise or
surrender of this Option by either the Optionee or any assignee(s).
15. Opinion of Legal Counsel. As a condition to the payment by
Optionee of the Purchase Price specified in the Purchase Agreement, Vector shall
deliver to Optionee at the Closing an opinion of its legal counsel in form and
substance satisfactory to the Optionee and its counsel.
16. Governing Law. This Option shall be governed by, and
construed in accordance with, the laws of the State of New York.
IN WITNESS WHEREOF, the parties have executed this Option
Agreement on the day and year first above written.
VECTOR:
VECTOR AEROMOTIVE CORPORATION
By:/s/ SUDJASWIN E.L.
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Sudjaswin E.L., President
OPTIONEE:
V' POWER CORPORATION
By:/s/ X.X. XXXX
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X.X. XXXX, President
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FORM TO BE USED TO EXERCISE OPTION:
EXERCISE FORM
The undersigned hereby elects irrevocably to exercise the
within Option and to purchase ____________ Common Shares of Vector Aeromotive
Corporation, called for hereby, and hereby makes payment of $________________
(at the rate of $.45 per share) in payment of the Option Exercise Price pursuant
hereto. Please issue the shares as to which this Option is exercised in
accordance with the instructions given below.
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Signature
Date:___________________
INSTRUCTIONS FOR REGISTRATION OF SHARES:
Register Shares in name of:______________________________________
(Print)
Address:_________________________________________________________
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FORM TO BE USED TO ASSIGN OPTION:
ASSIGNMENT
For value received, _____________________________ does hereby sell, assign and
transfer unto ___________________ the right to purchase _____________ Common
Shares of Vector Aeromotive Corporation, evidenced by the within Option, and
does hereby irrevocably constitute and appoint Vector Aeromotive Corporation
and/or its Transfer Agent as attorney to transfer the same on the books of
Vector Aeromotive Corporation with full power of substitution in the premises.
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Signature
Signature Guaranteed
Date:___________________ -----------------------------------
NOTICE: The signature to the form to exercise or form to assign must correspond
with the name as written upon the face of the within Option in every particular
without alteration or enlargement or any change whatsoever, and must be
guaranteed by a bank, other than a savings bank, or by a trust company or by a
firm having membership on a registered national securities exchange.
