Exhibit 10.32
STOCK OPTION AGREEMENT
THIS STOCK OPTION AGREEMENT is entered into as of April 9, 2001, by and
between TSET, Inc., a Nevada corporation ("TSET"), and Xxxxxxx X. Xxxxxxxxxx,
Xx. ("Wellington").
WITNESSETH:
WHEREAS, TSET desires to grant to Wellington an option to acquire up to
50,000 restricted shares of TSET's common stock, par value $0.001 per share (the
"Option Shares"), in consideration of valuable contributions made by Wellington
to TSET and its wholly-owned subsidiaries; and
WHEREAS, Wellington desires to accept such option.
NOW, THEREFORE, for and in consideration of the premises and mutual
promises, covenants, and agreements set forth herein and for other good and
valuable consideration, the delivery, receipt, and sufficiency of which is
hereby acknowledged, the parties hereto agree as follows:
1. GRANT OF OPTION. TSET hereby grants to Wellington an option (the
"Option") to acquire the Option Shares at an exercise price of
$0.885 per share (the "Exercise Price "). The Option shall
immediately and fully vest in Wellington's favor for all purposes
upon execution and delivery of this Agreement by the parties. The
Option is personal to Wellington and may be exercised only by
Wellington during his lifetime. The Option shall continue in full
force and effect for a period of 5 years from the date hereof (the
"Term"), at which time the Option shall expire and terminate unless
previously exercised by Wellington. The Option shall not be subject
to forfeiture or termination, except for Wellington's failure to
exercise the Option during the Term.
2. EXERCISE OF OPTION. The Option may be exercised by Wellington, in
whole or in part, at any time during the Term upon receipt by TSET
of written notice from Wellington (the "Exercise Notice "). The
Exercise Notice shall specify the number of Option Shares Wellington
desires to acquire pursuant thereto and provide any necessary or
appropriate instructions to TSET and its transfer agent regarding
the denomination of certificates representing the Option Shares and
the name in which the Option Shares should be registered. The
exercise of the Option shall be on a "cashless" basis and Wellington
shall not be required to remit to TSET any payment therefor.
3. RESERVATION OF THE OPTION SHARES. To ensure fulfillment of its
obligations hereunder should Wellington elect to exercise the
Option, TSET shall reserve from its authorized but unissued capital
that number of shares of its common stock equal to the Option
Shares.
4. RESTRICTIONS ON TRANSFER. Wellington acknowledges that the Option
Shares are subject to certain restrictions upon transfer, and cannot
be sold, assigned, transferred, or conveyed (in any case, a
"transfer") except in compliance with such restrictions and
applicable provisions of federal and state securities laws.
Certificates representing the Option Shares shall bear appropriate
restrictive legends and notices. In the event Wellington desires to
transfer any Option Shares prior to the expiration of such
restrictions, TSET shall be entitled to receive from Wellington
written undertakings, certifications, or opinions of legal counsel
evidencing compliance with such restrictions.
5. TAX MATTERS. Wellington acknowledges that treatment of the Option,
the Option Shares, and events or transactions with respect thereto,
for federal and state income and other tax purposes, is dependent
upon various factors and events which are not determined by this
Agreement. TSET makes no representations to Wellington with respect
to, and hereby disclaims any and all responsibility as to such tax
treatment. Wellington shall be solely and fully responsible for the
payment of, and shall pay, any and all federal, state, and other
taxes (including any and all withholding taxes) levied with respect
to the grant of the Option, the purchase of the Option Shares, and
any subsequent transfer thereof. In the event the exercise of the
Option or the disposition of the Option Shares following exercise of
the Option results in Wellington's realization of income which for
federal, state, local, or other income tax purposes is, in TSET's
opinion, subject to withholding of tax, then at the election of TSET
and prior to the delivery to Wellington of certificates representing
the Option Shares acquired by him pursuant to an Exercise Notice,
(a) Wellington shall pay to TSET an amount equal to such withholding
tax or (b) TSET may withhold such amount from any compensation or
other payments owed by TSET to Wellington.
6. NONQUALIFIED STATUS. The Option is not intended to be an "incentive
stock option" as defined in the Internal Revenue Code of 1986, as
amended, and shall not be treated as such whether or not, by the
terms hereof, it meets the requirements of any applicable provisions
thereof.
7. NOTICES. All notices or other communications given or made hereunder
shall be in writing and may be delivered personally, by express,
registered, or certified mail (return receipt requested), by special
courier, or by facsimile transmission (to be followed by delivery of
a written original notice in the most expeditious manner possible,
as aforesaid), all postage, fees, and charges prepaid, to TSET and
Wellington, as the case may be, to the following addresses (which
may be changed by the parties from time to time upon written notice
given as aforesaid):
To TSET: 000 Xxxxx Xxxxx Xxxxxx, XXX 000
Xxxx Xxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxxx
Chief Financial Officer
Tel: 000.000.0000
Fax: 000.000.0000
To Wellington: X.X. Xxx 00000
Xxxxxxx, XX 00000
Tel: 000.000.0000
Fax: 000.000.0000
Notices hereunder shall be deemed given when delivered in person,
upon confirmation of successful transmission when sent by
facsimile, or 5 days after being mailed by express, registered,
or certified mail (return receipt requested), postage and fees
prepaid.
8. INTEGRATION, AMENDMENT, AND WAIVER. When executed and delivered,
this Agreement shall constitute the entire agreement between the
parties with respect to the subject matter hereof and shall
supersede any and all prior agreements and understandings with
respect thereto. No other agreement, whether oral or written, shall
be used to modify or contradict the provisions hereof unless the
same is in writing, signed by the parties, and states that it is
intended to amend the provisions of this Agreement. No waiver by
either party of any breach of this Agreement in any particular
instance shall constitute a waiver of any other breach hereof in any
other circumstance or any relinquishment for the future of their
respective rights to strictly enforce all of the other provisions
hereof or seek all remedies which may be available at law or in
equity.
9. COUNTERPARTS; BINDING EFFECT. This Agreement may be executed in
multiple counterparts (and by facsimile signature, to be followed by
manual signature), each of which shall be deemed an original, and
all of which shall be deemed to constitute a single agreement. This
Agreement shall be binding upon and inure to the benefit of the
parties' respective permitted heirs, successors, and assigns.
10. ASSIGNMENT. This Agreement is personal to the parties hereto.
Accordingly, Wellington shall not assign or transfer this Agreement
without the prior written consent of TSET, which consent shall not
be unreasonably withheld, conditioned, or delayed; provided,
however, that Wellington shall be permitted to assign or transfer
this Agreement to a legal entity owned by Wellington without such
consent. Any attempted assignment of this Agreement by Wellington
without receipt of such consent from TSET shall be null and void.
11. SEVERABILITY. If any provision (or portion thereof) of this
Agreement is adjudged unenforceable by a court of competent
jurisdiction, the remaining provisions shall nevertheless continue
in full force and effect and the provision deemed unenforceable
shall be remade or interpreted by the parties in a manner that such
provisions shall be enforceable to preserve, to the maximum extent
possible, the original intention and meaning thereof. If necessary
to effect such intent, TSET and Wellington shall negotiate in good
faith to amend this Agreement to replace such provision with
language believed in good faith by the parties to be enforceable,
which as closely as possible reflects such intent.
12. NO THIRD PARTY BENEFICIARIES. This Agreement is for the sole benefit
of the parties and their permitted successors, heirs, and assigns.
Nothing herein, expressed or implied, shall give or be construed to
give any other person, other than the parties and their permitted
assigns, any legal or equitable rights hereunder. No finder's or
other fees shall be payable by either party with respect to the
exercise of the Option or the issuance of the Option Shares pursuant
to this Agreement.
13. STATE SECURITIES QUALIFICATIONS. The sale of the Option Shares
pursuant to any exercise of the Option has not been qualified with
the securities regulatory authorities in any state or other
jurisdiction and the issuance of the Option Shares prior to such
qualification may be unlawful unless such transactions are exempt
from such qualification requirements. The rights of the parties
hereto are expressly conditioned upon such qualification being
obtained, unless any such transaction is so exempt.
14. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Oregon, exclusive of its
conflicts of laws principles.
IN WITNESS WHEREOF, the parties have executed and delivered this
Agreement effective as of the date first written above.
TSET, Inc.
By: /s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
Chairman and Chief Executive Officer
/s/ Xxxxxxx X. Xxxxxxxxxx, Xx.
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Xxxxxxx X. Xxxxxxxxxx, Xx.
