eAcceleration Corp.
Acceleration Software International Corporation
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June 30, 2000
Millennium Capital Quest
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Re: Amendment and Termination Agreement dated May 1, 2000
(the Agreement"), among the undersigned and you
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Gentlemen:
This letter confirms the following:
1. Paragraph 5 of the Agreement is hereby amended to increase the
exercise price of the five-year options referred to therein to $5.31
per share;
2. The five-year options referred to in paragraph 5 of the
Agreement shall be represented by the option certificate attached
hereto as Exhibit A, which hereby replaces any and all other option
certificate(s) relating to the common stock of eAcceleration Corp.
and/or Acceleration Software International Corporation owned by you;
and
3. Except as set forth above, all terms and provisions of the Agreement
shall remain in full force and effect.
If the foregoing accurately sets forth your understanding, please sign
where indicated below
Very truly yours,
EACCELERATION CORP.
ACCELERATION SOFTWARE
INTERNATIONAL CORPORATION
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
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▇▇▇▇▇ ▇▇▇▇▇▇▇
President
Accepted and agreed as of the date first above written:
MILLENNIUM CAPITAL QUEST
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Chairman/CFO
Exhibit A
THE OPTIONS EVIDENCED HEREBY AND THE SHARES OF COMMON STOCK ISSUABLE PURSUANT
HERETO HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.
THE OPTIONS AND ANY SHARES OF COMMON STOCK ISSUABLE PURSUANT THERETO HAVE BEEN
AND WILL BE ACQUIRED FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO DISTRIBUTION
OR RESALE, AND MAY NOT BE SOLD, ASSIGNED, PLEDGED, HYPOTHECATED OR OTHERWISE
TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT FOR THE OPTIONS AND/OR
SUCH SHARES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND APPLICABLE STATE
SECURITIES LAWS OR AN OPINION OF COUNSEL SATISFACTORY TO THE ISSUER OF THE
OPTIONS AND SUCH SHARES TO THE EFFECT THAT REGISTRATION IS NOT REQUIRED UNDER
SUCH ACT AND SUCH STATE SECURITIES LAWS.
Void after 5:00 p.m. New York City time, on April 30, 2010.
Option to Purchase 34,300 Shares of Common Stock.
OPTION TO PURCHASE COMMON STOCK
of
eAcceleration Corp.
This is to certify that, FOR VALUE RECEIVED, MILLENIUM CAPITAL
QUEST, or permitted assigns ("Holder"), is entitled to purchase, subject to the
provisions of this option certificate, from eAcceleration Corp., a Delaware
corporation (the "Company"), 34,300 fully paid, validly issued and nonassessable
shares of the common stock, $.0001 par value (the "Common Stock"), of the
Company at an exercise price of $5.31 per share (the "Exercise Price"), at any
time or from time to time during the period commencing on the date hereof and
terminating on April 30, 2010 (the "Termination Date"), but not later than 5:00
p.m. New York City Time, on the Termination Date (subject to the provisions of
this option certificate). The number of shares of Common Stock to be received
upon the exercise of this option certificate and the price to be paid for each
share of Common Stock may be adjusted from time to time as hereinafter set
forth. The rights granted by this option certificate to purchase shares of
Common Stock are hereinafter sometimes referred to as the "Options;" the shares
of Common Stock deliverable upon exercise of the Options, as adjusted from time
to time, are hereinafter sometimes referred to as "Option Shares;" and the
exercise price of a share of Common Stock in effect at any time, as adjusted
from time to time, is hereinafter sometimes referred to as the "Exercise Price."
The Options have been granted outside of the Company's 1999 Stock
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Incentive Compensation Plan (the "1999 Plan"); provided, however, that,
except as specifically provided in this option certificate, the Options shall be
governed and interpreted in accordance with the provisions of the 1999 Plan.
1. DURATION.
Subject to the earlier termination as provided herein or under the
1999 Plan, the Option shall expire at the close of business on April 30, 2010
(the "Termination Date").
2. WRITTEN NOTICE OF EXERCISE.
The Options may be exercised only by delivering to the President or
Secretary of the Company, at the Company's principal executive offices, of a
written notice of exercise substantially in the form described in paragraph 8
hereof.
3. ANTI-DILUTION PROVISIONS.
(a) If there is any stock dividend, stock split, or combination of shares
of Common Stock, the number and amount of Option Shares then subject to the
Options shall be proportionately and appropriately adjusted as determined by the
Committee, whose determination shall be final, conclusive and binding upon
Holder and the Company.
(b) If there is any other change in the Common Stock, including a
recapitalization, reorganization, sale or exchange of assets, exchange of
shares, offering of subscription rights, or a merger or consolidation in which
the Company is the surviving corporation, an adjustment, if any, shall be made
in the Option Shares then subject to the Options as the Board of Directors or
Committee may deem equitable, and whose determination shall be final, conclusive
and binding upon Holder and the Company. Failure of the Board of Directors or
the Committee to provide for an adjustment pursuant to this subparagraph prior
to the effective date of any Company action referred to in this Paragraph 3(b)
shall be conclusive evidence that no adjustment is required in consequence of
such action.
(c) If the Company is merged into or consolidated with any other
corporation and the Company is not the surviving corporation, or if it sells all
or substantially all of its assets to any other corporation, then either (i) the
Company shall cause provisions to be made for the continuance of the Options
after such event, or for the substitution for the Options of an option covering
the number and class of securities which Holder would have been entitled to
receive in such merger or consolidation by virtue of such sale if Holder had
been the holder of record of a number of shares of Common Stock equal to the
number of Option Shares covered by the unexercised portion of the Options, or
(ii) the Company shall give to Holder written notice of its election not to
cause such provision to be made and the Options shall become exercisable in full
(or, at the election of Holder in part) at any time during a period of twenty
days, to be designated by the Company, ending not more than ten days prior to
the effective date of the merger,
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consolidation or sale, in which case the Options shall not be exercisable
to any extent after the expiration of such twenty-day period. In no event,
however, shall the Options be exercisable after the Termination Date.
4. INVESTMENT REPRESENTATION AND LEGEND OF CERTIFICATES.
Holder acknowledges and agrees that, for any period in which a
registration statement, with respect to the Options and/or Option Shares under
the Securities Act of 1933, as amended (the "Securities Act"), is not effective,
Holder shall hold the Options and will purchase and/or own the Option Shares for
investment and not for resale or distribution. The Company shall have the right
to place upon the face and/or reverse side of any stock certificate or
certificates evidencing the Option Shares such legend as the Committee may
prescribe for the purpose of preventing disposition of such Option Shares in
violation of the Securities Act.
5. NON-TRANSFERABILITY.
The Options shall not be transferable by Holder other than by will or
by the laws of descent or distribution, and are exercisable during the lifetime
of Holder only by Holder. The terms of this option certificate shall be binding
upon the executors, administrators, heirs, successors and assigns of Holder.
6. CERTAIN RIGHTS NOT CONFERRED BY OPTION.
Holder shall not, by virtue of holding Options, be entitled to any
rights of a stockholder in the Company.
7. EXPENSES.
The Company shall pay all original issue and transfer taxes with
respect to the issuance of Option Shares pursuant hereto and all other fees and
expenses necessarily incurred by the Company in connection therewith.
8. EXERCISE OF OPTIONS.
(a) The Options shall become exercisable cumulatively to the extent of the
total number of Option Shares on each of the following dates:
Date Number of Option Shares
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Immediately. . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,860
May 1, 2001. . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,860
May 1, 2002. . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,860
May 1, 2003. . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,860
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May 1, 2004. . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,860
(b) The Options shall be exercisable, in whole or part and from time to
time, by written notice of such exercise, delivered to the President or
Secretary of the Company, at the Company's principal office by personal
delivery, against written receipt therefor, or by pre-paid, certified or
registered mail, return receipt requested. Such notice shall specify the number
of Option Shares for which Options are being exercised (which number, if less
than all of the Option Shares then subject to exercise, shall be 50 or an
integral multiple thereof) and shall be accompanied by payment of the full
exercise price for the Option Shares for which Options are being exercised.
(c) The form of payment of the Exercise Price for Option Shares purchased
pursuant to Options shall consist of (i) cash; (ii) check (subject to
collection); (iii) in the discretion of the Board of Directors of the Company or
the Committee administering the 1999 Plan, by (A) delivery to the Company of a
promissory note, (B) surrender to the Company of other shares of Common Stock
owned by Holder which are then registered under the Securities Act or otherwise
publicly saleable under Rule 144 or other applicable exemption under the
Securities Act and have a fair market value on the date of surrender equal to
the aggregate Exercise Price of the Option Shares as to which Options shall be
exercised, (C) assignment to the Company of the net proceeds (to the extent
necessary to pay such Exercise Price) to be received from a registered broker
upon the sale of the Option Shares or assignment of the net proceeds (to the
extent necessary to pay such Exercise Price) of a loan from such broker in such
amount or (D) such other consideration and method of payment for the issuance of
stock to the extent permitted under Delaware law and satisfying the requirements
of Rule 16b-3 promulgated pursuant to the Securities Exchange Act of 1934, as
amended; or (iv) any combination of such methods of payment.
(d) Any promissory note (the "Note") delivered pursuant to clause (iii)(A)
of paragraph 8(c) shall be in the form prescribed by the Board of Directors of
the Company or the Committee administering the 1999 Plan and shall be in the
principal sum of such total Exercise Price, bear interest at the applicable
federal rate (as such term is defined in the Code) in effect as of the date of
the Note and be duly executed by Holder.
(e) No Shares shall be delivered upon exercise of Options until all laws,
rules and regulations which the Board of Directors of the Company or the
Committee administering the 1999 Plan may deem applicable have been complied
with. If a registration statement under the Securities Act is not then in effect
with respect to the shares issuable upon such exercise, the Company may require
as a condition precedent that Holder, upon exercising the Options, deliver to
the Company a written representation and undertaking, satisfactory in form and
substance to the Committee, that, among other things, Holder is acquiring the
shares for Holder's own account for investment and not with a view to the
distribution thereof.
(f) Holder shall not be considered a record holder of the Option Shares so
purchased for any purpose until the date on which Holder is actually recorded as
the holder of such Option
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Shares in the records of the Company.
(g) In the event of Holder's death, disability or termination of
employment, the exercisability of Options shall be governed by the provisions of
the 1999 Plan, unless such provisions are waived by the Committee, in the
Committee's sole discretion.
Dated: As of May 1, 2000
EACCELERATION CORP.
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
By: --------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: President
Holder acknowledges receipt of a copy of the 1999 Plan and certain
information related thereto and represents that Holder is familiar with the
terms and provisions thereof, and hereby accepts the Option subject to all of
the terms and provisions thereof. Holder has reviewed the 1999 Plan and this
option agreement in their entirety, has had an opportunity to obtain the advice
of counsel prior to executing this option agreement and fully understands all of
the terms and provisions of the Options and this option agreement. Holder hereby
agrees to accept as binding, conclusive and final all decisions or
interpretations of the Committee upon any questions rising under the 1999 Plan.
Holder further agrees to notify the Company upon any change in the residence
address indicated below.
Accepted and agreed as of
May 1, 2000:
MILLENNIUM CAPITAL QUEST
By: ▇▇▇▇▇ ▇. ▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Chairman/CFO
Address: ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
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