Exhibit 10.22
OPTION AGREEMENT - CONTRIBUTION MATCH
PLUG POWER, L.L.C.
A Delaware Limited Liability Company
This Option Agreement - Contribution Match ("Option Agreement" or
"Agreement") is made this 24th day of April, 1998, by and between Plug Power,
L.L.C., a Delaware limited liability company (the "Company") and Mechanical
Technology, Inc., a New York corporation ("MTI") (hereinafter collectively
referred to as the "Parties").
WHEREAS, on or about June 27, 1997, MTI and Edison Development
Corporation, a Michigan corporation ("EDC") formed the Company by filing a
Certificate of Formation with the office of the Secretary of State of the State
of Delaware and entered into that certain Limited Liability Company Agreement
of Plug Power, L.L.C., dated June 27, 1997 (the "Operating Agreement"); and
WHEREAS, capitalized terms used herein and not otherwise defined shall
have the meaning given it in the Operating Agreement unless otherwise provided;
and
WHEREAS, Section 4.2(b) of the Operating Agreement provides that the
Company may, from time to time and as required, call upon EDC for additional
cash contributions in amounts not to exceed, in the aggregate, $4,250,000 and
that for each $1.00 of such additional cash contributions EDC shall receive one
(1) Share of Class A Membership Interest; and
WHEREAS, Section 4.2(c) of the Operating Agreement provides that, upon
the Company's receipt of each additional cash contribution from EDC, the Company
shall notify MTI in writing of such contribution, and that MTI shall have five
(5) days after receipt of such notice to request an option to purchase
additional Shares of Class A Membership Interest (the "Option") in an amount
not to exceed the number of Shares issues to EDC, and upon such request, the
Company shall execute and deliver to MTI an Option Agreement granting to MTI an
option to purchase such Shares; and
WHEREAS, as of April 15, 1998, EDC made such additional cash contribu-
tion to the Company in the amount of $2.25 million, and the Company has duly
notified MTI, and MTI and EDC have agreed that $2 million of MTI's match of
such contribution will be through the contribution by MTI of a below-market
lease to the Company; and
WHEREAS, MTI has requested an option to purchase 250,000 additional
Shares of Class A Membership Interest in the Company in accordance with Section
4.2(c) of the Operating Agreement.
In consideration of the mutual promises and conditions made herein, the
Parties agree as follows:
1. Grant of Option: Term.
(a) The Company grants to MTI an option to purchase 250,000 Shares
of Class A Membership Interest in the Company upon the terms and conditions set
forth herein.
(b) The term of this Option shall expire at 5:00 p.m. E.S.T. on the
date twelve (12) months after the date of this Agreement, or the date MTI ceases
to be a Member of the Company for any reason, whichever occurs first ("Expira-
tion Date").
2. Option Price. In consideration of the grant of the Option, MTI shall
pay to the Company, upon execution of this Option Agreement $21,250.00, being
the amount equal to interest on the Purchase Price (defined below) at an annual
rate of 8.5% ("Interest Rate"), being the prime rate as reported by the Wall
Street Journal on the date of this Agreement, accruing from the date of this
Agreement to the Expiration Date ("Option Price"). The Option Price shall not
be applied in reduction of the Purchase Price and MTI's Capital Account shall
not be increased as a result of the payment of the Option Price. If MTI fails
to exercise the Option, the Option Price shall not be returned to MTI. If MTI
exercises the Option and pays the Purchase Price prior to the Expiration Date,
the Company shall return to MTI a portion of the Option Price equal to the
amount of interest that would have accrued on the Purchase Price at the
Interest Rate from the date of payment of the Purchase Price to the Expiration
Date.
3. Exercise of Option. MTI may exercise this Option at any time prior to
5:00 p.m. EST on the Expiration Date by written notice to the Company. If MTI
fails to exercise this Option in the manner and by the time set forth above,
this Option shall automatically terminate and MTI shall have no further rights
to purchase Shares of Class A Membership Interest pursuant to this Option
Agreement.
4. Purchase Price. The price for the Shares of Class A Membership Interest
purchased under this Option ("Purchase Price") shall be One Dollar ($1.00) per
Share. The Purchase Price shall be paid either in cash at the time MTI
exercises the Option or, if MTI has any credit available pursuant to Section
4.2(d) of the Operating Agreement, any such credits may be applied in payment
of the Purchase Price (but not in payment of the Option Price.) Upon payment
of the Purchase Price, MTI's Capital Account shall be increased by an amount
equal to the Purchase Price paid to the Company.
5. Delivery of Shares. Within ten (10) days after the Company's receipt of
the exercise of this Option by MTI, the Company shall issue and deliver to MTI
a certificate or certificates for the Shares of Class A Membership Interest
purchased by MTI pursuant to this Option Agreement.
6. Voting Rights Applicable to Option. At all times prior to the earlier
of (a) the Expiration Date of (b) MTI's exercise of this Option and payment of
the Purchase Price, MTI shall have voting rights with respect to the Shares of
Class A Membership Interest in the Company for which MTI has an option to
purchase under this Option Agreement. Should MTI fail to exercise this Option
prior to the Expiration Date or fail to pay the Option Price or Purchase Price
within the time required hereunder for payment thereof, such voting rights
shall automatically terminate.
7. Non-Transferability. This Option shall not be assigned, pledged,
hypothecated, sold, or otherwise transferred or encumbered by MTI, except that
MTI may, without the consent of the Company or EDC, transfer its rights
hereunder to an Affiliate of MTI.
8. Notices. Any notice or other communication to the Company or to MTI
shall be in writing and shall either be delivered in person or mailed by first
class mail, postage prepaid, or sent by telex, telecopy or telegram, addressed
to the Party intended to be the recipient as follows:
If to the Company:
Plug Power, L.L.C.
000 Xxxxxx-Xxxxxx Xxxx
Xxxxxx, Xxx Xxxx 00000
Attn: Xxxx Xxxxxxxxx
with a copy to:
Wise & Xxxxxx
00xx Xxxxx, Xxxx Xxxxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxx Xxxx
or at such other address as the Company may designate by notice to MTI.
If to MTI:
Mechanical Technology, Inc.
000 Xxxxxx-Xxxxxx Xxxx
Xxxxxx, Xxx Xxxx 00000
Attn: Xxxxxxx Xxxxxxx
or at such other address as MTI may designate by notice to the Company.
Any notice, request, consent, offer or demand shall be deemed received,
given or served, if mailed by first class mail, on the 3rd day after the day of
mailing, and, if sent, by telex, telecopy or telegram, 24 hours after the time
of dispatch.
9. Entire Agreement. This Option Agreement supersedes all agreements
previously made between the Parties relating to its subject matter. There are
no other understandings or agreements between the Parties.
10. Governing Law. This Option Agreement shall be construed in accordance
with and governed by the law of the State of Michigan.
11. MTI's Acceptance of the Terms of This Option Agreement. MTI's written
request for this Option Agreement pursuant to Section 4.2(c) of the Operating
Agreement constitutes MTI's acceptance of all the terms and conditions of this
Option Agreement.
Plug Power, L.L.C. has executed this Option Agreement as of the date set
forth above.
WITNESS: PLUG POWER, L.L.C.
(a Delaware limited liability agreement)
/s/ Xxx Xxxxx Xxxxxxx By: /s/ Xxxx Xxxxxxxxx
__________________________ ____________________________
Its: President and CEO
