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Exhibit: 10.7FD
FUNDEX GAMES, LTD.
NONSTATUTORY EMPLOYEE STOCK OPTION AGREEMENT
FUNDEX GAMES, LTD., a Nevada corporation (the "COMPANY"), hereby grants
to (the "OPTIONEE") an option to purchase a total
of shares of Common Stock (the "SHARES") of the Company, at the price set
forth herein, and in all respects subject to the terms and provisions of the
Company's 1996 Stock Option Plan (the "PLAN") applicable to nonstatutory stock
options which terms and provisions are hereby incorporated by reference herein.
Unless otherwise defined or the context herein otherwise requires, capitalized
terms used herein shall have the same meanings ascribed to them in the Plan.
1. NATURE OF THE OPTION. This Option is intended to be a nonstatutory
stock option and is NOT intended to be an incentive stock option within the
meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the
"CODE"), or to otherwise qualify for any special tax benefits to the Optionee.
2. DATE OF GRANT; TERM OF OPTION. This Option is granted as of October
24, 1997 ("OPTION GRANT DATE"), and it may not be exercised later than October
3, 2006.
3. OPTION EXERCISE PRICE. The Option exercise price is $4.00 per Share,
which price is not less than 85% of the fair market value thereof on the date
this Option was granted.
4. EXERCISE OF OPTION. This Option shall be exercisable during its term
only in accordance with the terms and provisions of the Plan and this Option as
follows:
(a) RIGHT TO EXERCISE. This Option shall vest and be
exercisable on the first anniversary of the date of the Option Grant
Date.
(b) METHOD OF EXERCISE. This Option shall be exercisable by
written notice which shall state the election to exercise this Option,
the number of Shares in respect to which this Option is being
exercised, such other representations and agreements as to the
Optionee's investment intent with respect to such Shares as may be
required by the Company hereunder or pursuant to the provisions of the
Plan. Such written notice shall be signed by the Optionee and shall be
delivered in person or by certified mail to the Secretary of the
Company or such other person as may be designated by the Company. The
written notice shall be accompanied by payment of the exercise price
and by an executed Stock Purchase Agreement if required by the Company.
Payment of the exercise price shall be by cash or by check or by such
other method of payment as is authorized by the Board in accordance
with the Plan. The certificate or certificates for the Shares as to
which the Option shall be exercised shall be registered in the name of
the Optionee and shall be legended as set forth in the Plan, the Stock
Purchase Agreement and/or as required under applicable law. This Option
may not be exercised for a fraction of a Share.
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(c) RESTRICTIONS ON EXERCISE. This Option may not be exercised
if the issuance of the Shares upon such exercise would constitute a
violation of any applicable federal or state securities laws or other
laws or regulations. As a condition to the exercise of this Option, the
Company may require the Optionee to make such representations and
warranties to the Company as may be required by any applicable law or
regulation.
(d) NO SHAREHOLDER RIGHTS BEFORE EXERCISE AND ISSUANCE. No
rights as a shareholder shall exist with respect to the Shares subject
to the Option as a result of the grant of the Option. Such rights shall
exist only after issuance of a stock certificate in accordance with
Section 8 (d) (i) of the Plan following the exercise of the Option as
provided in this Agreement and the Plan.
5. INVESTMENT REPRESENTATIONS. In connection with the acquisition of
this Option, the Optionee represents and warrants as follows:
(a) The Optionee is acquiring this Option, and upon exercise
of this Option, he will be acquiring the Shares for investment for his
own account, not as a nominee or agent, and not with a view to, or for
resale in connection with, any distribution thereof.
(b) The Optionee has a preexisting business or personal
relationship with the Company or one of its directors, officers or
controlling persons and by reason of his business or financial
experience, has, and could be reasonably assumed to have, the capacity
to evaluate the merits and risks of purchasing Common stock of the
Company and to make an informed investment decision with respect
thereto and to protect Optionee's interests in connection with the
acquisition of this Option and the Shares.
6. TERMINATION OF STATUS AS AN EMPLOYEE.
(a) If the Optionee's Continuous Employment terminates for any
reason other than death, Disability, or Termination For Cause, the
Optionee shall have the right to exercise the Option at any time within
30 days after the date of such termination to the extent that the
Optionee was entitled to exercise the Option at the date of such
termination (subject to any earlier termination of the Option as
provided by its terms).
(b) If the Optionee's Continuous Employment terminates due to
the death or Disability of the Optionee, the Option may be exercised at
any time within 180 days after the date of such termination, in the
case of death, by the Optionee's estate or by a person who acquired the
right to exercise the Option by bequest or inheritance, or, in the case
of Disability, by the Optionee (subject to any earlier termination of
the Option as provided by its terms).
(c) If the Optionee's Continuous Employment terminates due to
Termination For Cause, as determined in the Plan, Optionee's right to
exercise any Option shall immediately cease upon such Termination For
Cause.
(d) Notwithstanding the foregoing regarding the exercise of
the Option after the termination of Continuous Employment, the Option
shall not be exercisable after the expiration of its term, as set forth
in Section 2 herein, and the Option may be exercised only to the extent
the Optionee was entitled to exercise it on the date Optionee's
Continuous Employment with the Company terminated. To the extent that
the Optionee was not entitled to
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exercise the Option at the date of termination, or to the extent the Option is
not exercised within the time specified herein, the Option shall terminate.
7. NONTRANSFERABILITY OF OPTION. This Option may not be sold, pledged,
assigned, hypothecated, gifted, transferred or disposed of in any manner, either
voluntarily or involuntarily by operation of law or otherwise, other than by
will or by the laws of descent or distribution or a transfer between spouses
incident to a "divorce" within the meaning of Section 1041 (a) of the Code, and
may be exercised during the lifetime of the Optionee only by such Optionee or
his or her legal guardian. Subject to the foregoing and the terms of the Plan,
the terms of this Option shall be binding upon the executors, administrators,
heirs, successors and assigns of the Optionee.
8. CONTINUATION OF EMPLOYMENT. Neither this Option, the Plan nor any
Option granted thereunder shall (a) confer upon the Optionee any right
whatsoever to continue in the employment of the Company or any of its
Subsidiaries or (b) limit or restrict in any respect the rights of the Company,
which rights are hereby expressly reserved, to terminate the Optionee's
employment and compensation at any time for any reason whatsoever, with or
without cause, in the Company's sole discretion and with or without notice.
9. WITHHOLDING. The Company reserves the right to withhold, in
accordance with any applicable laws, from any consideration or other amounts
payable to the Optionee any taxes required to be withheld by federal, state or
local law as a result of the grant or exercise of this Option or the sale or
other disposition of the Shares issued upon exercise of this Option.
10. THE PLAN. This Option is subject to, and the Company and the
Optionee agree to be bound by, all of the terms and conditions of the Company's
Plan as such Plan may be amended from time to time in accordance with the terms
thereof, provided that no such amendment shall deprive the Optionee, without his
consent, of this Option or any rights hereunder. Pursuant to the Plan, the Board
is authorized to adopt rules and regulations not inconsistent with the Plan as
it shall deem appropriate and proper. A copy of the Plan in its present form is
available for inspection at the Company's principal office during business hours
by the Optionee or the persons entitled to exercise this Option.
11. ENTIRE AGREEMENT. The terms of this Agreement and the Plan
constitute the entire agreement between the Company and the Optionee with
respect to the subject matter hereof and supersede any and all previous
agreements between the Company and the Optionee.
FUNDEX GAMES, LTD., a Nevada corporation
Date: By:
Title:
The Optionee hereby acknowledges receipt of a copy of the Plan, a copy of
which is attached hereto, and represents that he has read and is familiar with
the terms and provisions thereof and of this Agreement, and hereby accepts this
Option subject to all of the terms and
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provisions thereof and of this Agreement. The Optionee hereby agrees to accept
as binding, conclusive and final all decisions or interpretations of the Board
upon any questions arising under the Plan.
Date: Signature of Optionee
Address
City State Zip Code
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THIS OPTION AND THE SECURITIES WHICH MAY BE PURCHASED UPON EXECUTION OF
THIS OPTION HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR THE SECURITIES LAWS OF ANY STATE, AND HAVE BEEN ACQUIRED FOR
INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH THE SALE, TRANSFER OR
DISTRIBUTION THEREOF. NO SUCH SALE, TRANSFER OR DISTRIBUTION MAY BE EFFECTED
WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATING THERETO OR AN OPINION OF
COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.
THE SHARES WHICH MAY BE PURCHASED UPON EXERCISE OF THIS OPTION ARE
SUBJECT TO A RIGHT OF FIRST REFUSAL AND MAY BE TRANSFERRED ONLY IN ACCORDANCE
WITH THE TERMS OF A STOCK PURCHASE AGREEMENT TO BE ENTERED INTO BETWEEN THE
HOLDER OF THIS OPTION AND THE COMPANY UPON EXERCISE OF THIS OPTION, A COPY OF
WHICH AGREEMENT IS ON FILE WITH THE SECRETARY OF THE COMPANY.