Exhibit 10.19
This Option has not been registered
under the Securities Act of 1933, as amended, or any applicable
state securities laws, and may not be sold or transferred unless
such sale or transfer is in accordance with the registration
requirements of such Act and applicable laws or some other
exemption from the registration requirements of such Act and
applicable laws is available with respect thereto. This Option is
also subject to the transfer restrictions set forth
herein.
NON-STATUTORY INCENTIVE STOCK
OPTION AGREEMENT
THIS OPTION GRANT AGREEMENT (the
“Agreement”), dated as of May 30, 2008 (the
“Grant Date”), is entered into between API NANOTRONICS
CORP., a Delaware corporation (the “Company”), and
MARTIN MOSKOVITS (the “Option-holder”).
WHEREAS, the Option-holder is an employee of the
Company;
WHEREAS, the Company desires to afford the Option-holder
an opportunity to purchase shares of common stock (“Common
Stock”) in the Company as provided in this Agreement,
effective as of the Grant Date; and
WHEREAS, the Board of Directors of the Company has
approved the issuance of this option to Option-holder.
NOW, THEREFORE,
in consideration of the premises and
the mutual covenants set forth in this Agreement and for other good
and valuable consideration, the receipt of which is hereby
acknowledged, the parties hereto have agreed, and do hereby agree,
as follows:
1. Issuance
.
This option is issued by the Company
as of the Grant Date.
2. Grant of Option, Option
Price and Term .
(a) Grant . Subject to the
terms and conditions of this Agreement, the Company hereby grants
to the Option-holder, as a matter of separate agreement and not in
lieu of salary or any other compensation for services, the right
and option (“Option”) to purchase five hundred thousand
(500,000) shares of Common Stock of the Company (“Option
Shares”). This Option is intended to be neither an
“incentive stock option” as defined in Section 422
of the Internal Revenue Code of 1986, as amended (the
“Code”), nor an option granted pursuant to an
“employee stock purchase plan” as defined in
Section 423 of the Code.
(b) Option Price . For each
of the Option Shares purchased, upon purchase thereof the
Option-holder shall pay to the Company $0.1005 (the “Option
Price”) which the parties agree represents an amount not less
than the fair market value of the Option Shares on the Grant Date.
Accordingly, the aggregate Option Price to purchase all of the
Option Shares subject to the Option granted hereunder is $50,250
(the “Aggregate Option Price”).
(c) No Fractional Shares .
The Company shall not be required to issue any fractional Option
Shares hereunder. The fair market value of any fractional Option
Shares to be issued to the Option-holder upon exercise of an Option
issued under this Agreement shall be paid by the Company to the
Option-holder in cash.
(d) Option Term . The term of
the Option granted hereunder shall be a period of five
(5) years from March 15, 2006 (the “Option
Period”). The termination of the Option Period shall result
in the termination and cancellation of such Option. In no event
shall the Option be exercisable at any time after the expiration of
the Option Period.
3. Vesting
.
The Options granted herein are
immediately vested.
4. Exercise of
Option .
a) Exercise for
Cash
The vested portion of this Option
may be exercised, in whole at any time or in part from time to
time, commencing May 30, 2008, and prior to 5:00 P.M., P.S.T.,
on March 14, 2011, by the Option-holder by the surrender of
this Option (with the subscription form at the end hereof duly
executed) to the Company at its principal office, together with
proper payment of the Option Price times the number of shares of
Common Stock to be received. Payment for Option Shares shall be
made by certified or official bank check payable to the order of
the Company or if applicable, without cash pursuant to a cashless
net exercise. If this Option is exercised in part, this Option must
be exercised for a number of whole shares of the Common Stock, and
the Option-holder is entitled to receive a new Option covering the
Option Shares which have not been exercised. Upon such surrender of
this Option the Company will (a) issue a certificate or
certificates in the name of the Option-holder for the largest
number of whole shares of the Common Stock to which the
Option-holder shall be entitled and, if this Option is exercised in
whole, in lieu of any fractional share of the Common Stock to which
the Option-holder shall be entitled, pay to the Option-holder cash
in an amount equal to the fair value of such fractional share
(determined in such reasonable manner as the Board of Directors of
the Company shall determine), and (b) deliver the other
securities and properties receivable upon the exercise of this
Option, or the proportionate part thereof if this Option is
exercised in part, pursuant to the provisions of this
Option.
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b) Cashless Net
Exercise
At the Company’s option, in
lieu of exercising this Option in the manner set forth in paragraph
4(a) above, this Option may be exercised, in whole or in part, by
surrender of the Option without payment of any other consideration,
commission or remuneration, by execution of the cashless exercise
subscription form (at the end hereof, duly executed). The number of
shares to be issued in exchange for the Option will be computed by
subtracting the Option Exercise Price from either (i) the last
sale price of the Common Stock on the date of receipt of the
cashless exercise subscription form, or (ii) the most recent
negotiated value used in connection with any sale of the
Company’s securities or in connection with any business
combination involving the Company, and multiplying that amount by
the number of shares represented by the Option, and dividing by the
last sale price as of the same date. If this Option is exercised in
whole, in lieu of any fractional share of the Common Stock to which
the Option-holder shall be entitled, the Company shall pay to the
Option-holder cash in an amount equal to the fair value of such
fractional share (determined in such reasonable manner as the Board
of Directors of the Company shall determine). If this Option is
exercised in part, this Option must be exercised for a number of
whole shares of the Common Stock, and the Option-holder is entitled
to receive a new Option covering the Option Shares which have not
been exercised.
5. Reservation of Option
Shares .
The Company agrees that, prior to
the expiration of this Option, the Company will at all times have
authorized and in reserve, and will keep available, solely for
issuance or delivery upon the exercise of this Option, the shares
of the Common Stock and other securities and properties as from
time to time shall be receivable upon the exercise of this Option,
free and clear of all restrictions on sale or transfer (except for
applicable state or federal securities laws restrictions) and free
and clear of all pre-emptive rights.
6. Anti-Dilution
Provisions .
a) If, at any time or from time to
time after the date of this Option, the Company shall issue or
distribute (for no consideration) to the holders of shares of
Common Stock evidences of its indebtedness, any other securities of
the Company or any cash, property or other assets (excluding a
subdivision, combination or reclassification, or dividend or
distribution payable in shares of Common Stock, referred to in
Subsection 6(b), and also excluding cash dividends or cash
distributions paid out of net profits legally available therefor if
the full amount thereof, together with the value of other dividends
and distributions made substantially concurrently therewith or
pursuant to a plan which includes payment thereof, is equivalent to
not more than 5% of the Company’s net worth) (any such
non-excluded event being herein called a “Special
Dividend”), the Option Price shall be adjusted by multiplying
the Option Price then in effect by a fraction, the numerator of
which shall be the then current market price of the Common Stock
(defined as the average for the ten consecutive business days
immediately prior to the record date of the daily closing price of
the Common Stock as reported by the principal exchange
or
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market on which the Common Stock is
listed) less the fair market value (as determined by the
Company’s Board of Directors) of the evidences of
indebtedness, securities or property, or other assets issued or
distributed in such Special Dividend applicable to one share of
Common Stock and the denominator of which shall be such then
current market price per share of Common Stock. An adjustment made
pursuant to this Subsection 6(a) shall become effective immediately
after the record date of any such Special Dividend.
b) In case the Company shall
hereafter (i) pay a dividend or make a distribution on its
capital stock in shares of Common Stock, (ii) subdivide its
outstanding shares of Common Stock into a greater number of shares,
(iii) combine its outstanding shares of Common Stock into a
smaller number of shares or (iv) issue by reclassification of
its Common Stock any shares of capital stock of the Company, the
Option Price shall be adjusted so that the Option-holder of this
Option upon the exercise hereof shall be entitled to receive the
number of shares of Common Stock or other capital stock of the
Company which he would have owned had he exercised his Options
immediately prior thereto. An adjustment made pursuant to this
Subsection 6(b) shall become effective immediately after the record
date in the case of a dividend or distribution and shall become
effective immediately after the effective date in the case of a
subdivision, combination or recapitalization. If, as a result of an
adjustment made pursuant to this Subsection 6(b), the Option-holder
of any Option thereafter surrendered for exercise shall become
entitled to receive shares of two or more classes of capital stock
or shares of Common Stock and other capital stock of the Company,
the Board of Directors (whose determination shall be conclusive and
shall be described in a written notice to the Option-holder of any
Option promptly after such adjustment) shall reasonably determine
the allocation of the adjusted Option Price between or among shares
of such classes or capital stock or shares of Common Stock and
other capital stock.
c) In case of any capital
reorganization or reclassification, or any consolidation or merger
to which the Company is a party other than a merger or
consolidation in which the Company is the continuing corporation,
or in case of any sale or conveyance to another entity of the
property of the Company as an entirety or substantially as an
entirety, or in the case of any statutory exchange of securities
with another corporation (incl
