Exhibit 10.28
STOCK OPTION
AGREEMENT
FOR
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
This Stock Option Agreement (the "Agreement") is effective on and as of
August 25, 1997, between IAT MULTIMEDlA, INC., a Delaware corporation with its
principal office at IAT A.G., Geschaftshaus Wasserschloss, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇,
▇▇-▇▇▇▇ ▇▇▇▇▇▇▇▇▇-▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, fax number ▇▇-▇▇-▇▇▇-▇▇▇▇ ("the Company"),
and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, an individual residing at ▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇, ▇-▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇, fax number ▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇, ("▇▇. ▇▇▇▇▇▇▇▇").
W I T N E S S E T H:
WHEREAS, ▇▇. ▇▇▇▇▇▇▇▇ is a director of the Company and a consultant of the
Company, and
WHEREAS, the Company desires to provide an incentive to ▇▇. ▇▇▇▇▇▇▇▇ to
remain a consultant of the Company and to encourage stock ownership, and
WHEREAS, the achievement of these goals will be assisted by the grant of an
option to purchase shares of the Company's common stock, $0.01 par value (the
"Stock").
NOW, THEREFORE, the parties agree as follows:
1. Grant of Option. Subject to the terms and conditions herein set forth,
the Company hereby grants to ▇▇. ▇▇▇▇▇▇▇▇ the right and option (the "Option") to
purchase from the Company a total of 75,000 shares of Stock at a purchase price
per share equal to $6 per Share pursuant to the terms and conditions set forth
in section 2 hereof.
2. Terms and Conditions of Option.
(a) Expiration Date. Subject to earlier termination or expiration of the
Option as provided in this Agreement, the Option shall expire on August 25,
2007.
(b) Vesting of Option. ▇▇. ▇▇▇▇▇▇▇▇ may not exercise the Option for any
shares of Stock until the Option has vested. ▇▇. ▇▇▇▇▇▇▇▇'▇ rights with respect
to the Option shall become vested according to the following schedule:
Time Amount of Options Vested
---- ------------------------
August 25, 1997 25 000
February 25, 1998 25,000
Upon determination by the
Compensation Commitee
(excluding ▇▇. ▇▇▇▇▇▇▇▇) 25,000
1
(c) Exercise Upon Termination of Retainment Agreement. The vested portion
of the Option may be exercised by ▇▇. ▇▇▇▇▇▇▇▇, or his heirs, devises, or
legatees no later than one (1) year from February 25, 1998 or the date ▇▇.
▇▇▇▇▇▇▇▇'▇ death or disability and the unvested portion of the Option shall be
forfeited, but in no event shall any portion of the Option remain exercisable
after the expiration date of the Option as specified in paragraph (a) of this
Section 2.
(d) Method of Exercise. (i) Subject to the terms and conditions of this
Agreement, to the extent the right to purchase shares of Stock has accrued, the
Option may be exercised, in whole or part, from time to time, by written notice
and payment to the Company in accordance with the procedure prescribed herein.
Each notice shall (x) state the election to exercise the Option and the number
of shares in respect of which it is being exercised; and (y) be accompanied by
payment, by cash or certified check payable to the order of the Company in the
amount of the purchase price for the shares being purchased in the event ▇▇.
▇▇▇▇▇▇▇▇ elects to exercise by payment of the exercise. In the event ▇▇.
▇▇▇▇▇▇▇▇ elects for cashless exercise of the Option, the notice shall so state
and the Company will calculate the amount of shares of Stock to be withheld in
payment for the exercise of the option price based upon the closing sales price
of the Stock on the dates elected by ▇▇. ▇▇▇▇▇▇▇▇ to exercise the Option and
will deliver the remaining shares of Stock to ▇▇. ▇▇▇▇▇▇▇▇.
(ii) The certificate or certificates for shares of Stock as to which the
Options shall be exercised will be registered in the name of ▇▇. ▇▇▇▇▇▇▇▇ and
will bear the following legend:
"The shares represented by this certificate have not
been registered under the Securities Act of 1933, as
amended, and may not be sold, transferred, or otherwise
disposed of except as expressly permitted under the
terms of that certain Stock Option Agreement, dated as
of August 25, 1997, between IAT Multimedia, Inc. and
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇."
(e) Non-Transferability. The Option shall not be transferable other than by
will or by the laws of descent and distribution. During the lifetime of ▇▇.
▇▇▇▇▇▇▇▇, the Option shall be exercisable only by ▇▇. ▇▇▇▇▇▇▇▇. ▇▇. ▇▇▇▇▇▇▇▇ may
not pledge, hypothecate or otherwise encumber or permit any liens to attach to
the Option.
(f) Tax Withholding. In the event the Company determines that it is
required to withhold amounts for payment of federal, state and local income
taxes, or any other taxes in connection with the exercise of the Option or the
disposition of shares of Stock issued pursuant to the exercise of the Option,
▇▇. ▇▇▇▇▇▇▇▇ or any person succeeding to the rights of ▇▇. ▇▇▇▇▇▇▇▇, as a
condition to such exercise or disposition, shall make arrangements satisfactory
to the Company to enable it to satisfy such withholding requirement.
(g) Regulatory Compliance. If at any time the Board determines that (a)
the listing, registration or qualification of shares of Stock upon any
securities exchange or under any state or federal law, (b) the consent or
approval of any government or regulatory body or (c) an agreement or
representations by ▇▇. ▇▇▇▇▇▇▇▇ with respect thereto, is necessary then the
exercise of the Option shall not be consummated in whole or in part unless
such listing, registration, qualification, consent, approval, agreement or
representations shall have been effected or obtained.
2
(h) Adjustments. In the event of any reorganization, recapitalization,
stock split, stock dividend, combination of shares, consolidation, merger
(other than a merger or consolidation which does not result in any
reclassification, conversion, exchange or cancellation of outstanding shares),
any sale or transfer by the Company of all or substantially all of its assets
or any exchange offer for or the acquisition, directly or indirectly by any
person or group of all or a majority of the then outstanding voting securities
of the Company, rights offering, or any other change in the corporate
structure or rights with respect to any shares of the Company, the Board shall
make (or shall cause the Board of Directors of any corporation which merges
with, or acquires the stock or assets of the Company to make) such equitable
and proportionate adjustment of the number and class of shares of stock then
covered by the Option, or of the purchase price, or both, in order to prevent
dilution or enlargement of the rights of ▇▇. ▇▇▇▇▇▇▇▇.
(i) Fractional Shares. The Option is only exercisable with respect to whole
shares of Stock and not fractions thereof unless the Board otherwise agrees.
Accordingly, the Company shall not be required to issue certificates
representing fractions of shares of Stock upon any exercise of the Option.
3. Piggy-Back Registration Rights. (a) If (but without obligation to do so)
the Company proposes to register (including for this purpose a registration
effected by the Company for stockholders other than ▇▇. ▇▇▇▇▇▇▇▇) any of its
stock under the Securities Act of 1933, as amended (the "Act") in connection
with the public offering of such securities (other than a registration relating
solely to the sale of securities to participants in a Company stock plan, a
registration relating solely to a Rule 145 transaction, a registration on any
form which does not include substantially the same information as would be
required to be included in a registration statement covering the sale of Stock
or a registration in which the only Stock being registered is Stock issuable
upon conversion of debt securities which are also being registered), the Company
shall, at such time, promptly give ▇▇. ▇▇▇▇▇▇▇▇ written notice of such
registration. Upon written request of ▇▇. ▇▇▇▇▇▇▇▇ given within twenty (20) days
after giving of such notice by the Company, the Company shall, subject to the
provisions of section 3(b), cause to be registered under the Act all of the
Stock that ▇▇. ▇▇▇▇▇▇▇▇ has requested to be registered, provided, that the
Company shall not be obligated to effect more than two (2) registrations
pursuant to this Section 3(a).
(b) In connection with any offering involving an underwriting of shares of
the Company's Stock pursuant to Section 3(a), the Company shall not be required
under Section 3(a) to include any of ▇▇. ▇▇▇▇▇▇▇▇'▇ securities in such
underwriting unless ▇▇. ▇▇▇▇▇▇▇▇ accepts the terms of the underwriting as agreed
upon between the Company and the underwriters, and if the underwriter advises
▇▇. ▇▇▇▇▇▇▇▇ in writing that marketing factors require a limitation of the
number of shares to be underwritten, then the Company shall exclude from such
underwriting (i) an amount of stock from ▇▇. ▇▇▇▇▇▇▇▇ which equals, pro rata to
the extent practicable, the amount of stock which is being excluded from the
underwriting from the other stockholders participating in such underwriting, the
minimum amount of stock as is necessary in the opinion of the underwriter(s) to
reduce the size of the offering.
3
4. Treatment of Option as Non-Qualified Stock Option. The Company and ▇▇.
▇▇▇▇▇▇▇▇ acknowledge that the Option granted hereunder shall be treated as a
non-qualified stock option for U.S. federal income tax purposes.
5. Notices. All notices, requests, demands and other communications under
this Agreement shall be in writing and shall be deemed to have been duly given
on the date of service if served by facsimile or personally on the party to whom
notice is to be given, or within seven (7) days after mailing, if mailed to the
party to whom notice is to be given, by first class mail (airmail, if
international), registered or certified, postage prepaid, and properly addressed
to the party, if to the Company or ▇▇. ▇▇▇▇▇▇▇▇, at the address set forth on the
first page of this Agreement or any other address that the Company or ▇▇.
▇▇▇▇▇▇▇▇ may designate by written notice to the other party.
6. Acknowledgment. ▇▇. ▇▇▇▇▇▇▇▇ agrees to be bound by the terms of this
Agreement and hereby acknowledges that all decisions, determinations and
interpretations of the Board in respect of this Agreement and the Option shall
be final, conclusive and binding on ▇▇. ▇▇▇▇▇▇▇▇ and his legal representatives
and beneficiaries.
7. No Rights as Stockholder. Neither ▇▇. ▇▇▇▇▇▇▇▇ nor ▇▇. ▇▇▇▇▇▇▇▇'▇
legal representative, legatees or distributees, as the case may be, shall have
any of the rights or privileges of a stockholder of the Company by virtue of the
Option except with respect to any shares of Stock actually issued or transferred
of record and delivered to one of the aforementioned persons.
8. Reservation of Shares. The Company shall at all times during the term of
the Option reserve and keep available such number of shares of Stock then
subject to the Option as will be sufficient to satisfy the requirements of this
Agreement.
9. Agreement to Perform Necessary Acts. Each party to this Agreement agrees
to perform any further acts and execute and deliver any documents that may be
reasonably necessary to carry out the provisions of this Agreement.
10. Amendments. The provisions of this Agreement may be waived, altered,
amended or repealed, in whole or in part, only upon the written consent of all
parties hereto.
11. Governing Law. The Agreement shall be governed by and construed in
accordance with the laws of the State of New York, without regard to conflicts
of laws principles.
12. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
4
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as
of the day and year first written above.
IAT MULTIMEDIA, INC.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇
-------------------------------------
Name: ▇▇. ▇▇▇▇▇▇ ▇▇▇▇
Title: Co-Chairman
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
