EXHIBIT K
MOBILITY ELECTRONICS, INC.
NON-QUALIFIED STOCK OPTION AGREEMENT
(COMMITTEE CHAIRMAN GRANT)
This Non-Qualified Stock Option Agreement (the "Agreement"), dated as
of May 22, 2002, is entered into by and between Mobility Electronics, Inc., a
Delaware corporation (the "Company"), and XXXXXXX X. XXXXXX, a director of the
Company (the "Optionee"). In consideration of the mutual promises and covenants
made herein, the parties hereby agree as follows:
1. GRANT OF OPTION. Under the terms and conditions of the Company's
Amended and Restated 1996 Long Term Incentive Plan (the "Plan"), the Company
grants to the Optionee an option (the "Option") to purchase from the Company all
or any part of a total of 1,000 shares of the Company's Common Stock, par value
$.01 per share, at a price of $1.60 per share. The Option is granted as of the
date first above written (the "Date of Grant"). This Option constitutes the
initial automatic grant of an option to Optionee, in his role as a director of
the Company, pursuant to Section 6(b)(v)(A) of the Plan, as modified for
Optionee pursuant to Section 6(b)(v)(C) of the Plan.
2. CHARACTER OF OPTION. The Option is not an "incentive stock option"
within the meaning of Section 422 of the Internal Revenue Code of 1986, as
amended.
3. TERM. Each vested portion of the Option will expire on the fourth
anniversary of the date of vesting.
4. VESTING. Subject to the provisions of Section 6(b) of the Plan, the
Option will vest and may be exercised at the cumulative rate of 250 shares per
calendar quarter, commencing on July 1, 2002. Notwithstanding the above, this
Option shall: (i) cease to vest, and any unvested portion of the Option shall be
deemed to be terminated and not thereafter exercisable, at such time as Optionee
ceases to be a Director of the Company; and (ii) be exercisable, and shall
vest, in full upon a Change in Control of the Company.
A "Change in Control" means the occurrence of one or more of the
following events:
(a) Any person within the meaning of Section 13(d) and 14(d)
of the Securities Exchange Act or 1934, as amended (the "Exchange
Act"), other than the Company (including its subsidiaries, directors or
executive officers) has become the beneficial owner, within the meaning
of Rule 13d-3 under the Exchange Act, of 50 percent or more of the
combined voting power of the Company's then outstanding Common Stock or
equivalent in voting power of any class or classes of the Company's
outstanding securities ordinarily entitled to vote in elections of
directors ("voting securities");
(b) Shares representing 50 percent or more of the combined
voting power of the Company's voting securities are purchased pursuant
to a tender offer or exchange offer (other than an offer by the Company
or its subsidiaries or affiliates);
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(c) As a result of, or in connection with, any tender offer or
exchange offer, merger or other business combination, sale of assets or
contested election, or any combination of the foregoing transactions (a
"Transaction"), the persons who were directors of the Company before
the Transaction shall cease to constitute a majority of the Board of
Directors of the Company or of any successor to the Company;
(d) Following the date hereof, the Company is merged or
consolidated with another corporation and as a result of such merger or
consolidation less than 50 percent of the outstanding voting securities
of the surviving or resulting corporation shall then be owned in the
aggregate by the former shareholders of the Company, other than (A) any
party to such merger or consolidation, or (B) any affiliates of any
such party; or
(e) The Company transfers more than 50 percent of its assets,
or the last of a series of transfers results in the transfer of more
than 50 percent of the assets of the Company, to another entity that is
not wholly-owned by the Company. For purposes of this subsection (v),
the determination of what constitutes 50 percent of the assets of the
Company shall be made by the Compensation Committee of the Board of
Directors of the Company, as constituted immediately prior to the
events that would constitute a change of control if 50 percent of the
Company's assets were transferred in connection with such events, in
its sole discretion.
5. PROCEDURE FOR EXERCISE. Exercise of the Option or a portion thereof
shall be effected by the giving of written notice to the Company and payment of
the purchase price prescribed in Section 1 above for the shares to be acquired
pursuant to the exercise.
6. PAYMENT OF PURCHASE PRICE. Payment of the purchase price for any
shares purchased pursuant to the Option shall be in cash, unless otherwise
agreed to in writing by the Compensation Committee of the Board of Directors of
the Company.
7. TRANSFER OF OPTIONS. The Option may not be transferred except by
will or the laws of descent and distribution and, during the lifetime of the
Optionee, may be exercised only by the Optionee or by the Optionee's legally
authorized representative.
8. ACCEPTANCE OF THE PLAN. The Option is granted subject to all of the
applicable terms and provisions of the Plan, and such terms and provisions are
incorporated by reference herein. The Optionee hereby accepts and agrees to be
bound by all the terms and conditions of the Plan.
9. AMENDMENT. This Agreement may be amended by an instrument in writing
signed by both the Company and the Optionee.
10. MISCELLANEOUS. This Agreement will be construed and enforced in
accordance with the laws of the State of Delaware and will be binding upon and
inure to the benefit of any successor or assign of the Company and any executor,
administrator, trustee, guardian or other legal representative of the Optionee.
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Executed as of the date first above written.
MOBILITY ELECTRONICS, INC.
By: /s/ XXXXXXX X. XXXXX
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Xxxxxxx X. Xxxxx,
Chief Executive Officer
/s/ XXXXXXX X. XXXXXX
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Xxxxxxx X. Xxxxxx
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Social Security Number of Optionee
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