UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. )*
SONO-TEK CORPORATION
--------------------
(Name of Issuer)
Common Stock, $.01 par value
----------------------------
(Title of Class of Securities)
835483 108
----------
(CUSIP Number)
James L. Kehoe
12 Lenape Lane,
Salisbury Mills, New York 12577
(914) 496-6519
(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)
August 1, 1997
--------------
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box. ____
Note: Six copies of this statement, including all exhibits, should be filed
with the Commission. See Rule 13d-1(a) for other parties to who copies are to be
sent.
* The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
<PAGE>
SCHEDULE 13D
CUSIP No. 835483 108
1 NAME OF REPORTING PERSON
S.S. or I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
James L. Kehoe
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) ______
(b) ______
3 SEC USE ONLY
4 SOURCE OF FUNDS*
PF
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(d) or 2(e) _______
6 CITIZENSHIP OR PLACE OF ORGANIZATION
U. S. Citizen
7 SOLE VOTING POWER
292,900
NUMBER OF
SHARES
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY
EACH
REPORTING
PERSON 9 SOLE DISPOSITIVE POWER
WITH
292,900
10 SHARED DISPOSITIVE POWER
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
292,900
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES* _______
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
6.3%
14 TYPE OF REPORTING PERSON*
IN
* See instructions before filling out.
<PAGE>
ITEM 1. Security and Issuer.
--------------------
This statement on Schedule 13D ("Schedule 13D") relates to the shares
of common stock, $ .01 par value, ("Common Stock") of Sono-Tek Corporation, a
New York Corporation ("Issuer"). The principal executive offices of the Issuer
are at 2012 Route 9W, Bldg. 3, Milton, New York 12547 (914) 795-2020.
ITEM 2. Identity and Background.
------------------------
(a)-(c), (f). This Schedule 13D is filed on behalf of James L. Kehoe
who acquired the right to acquire 200,000 shares of Common Stock through an
option granted to him by the Issuer under its 1993 Stock Incentive Plan as
consideration for continued employment services ("Transaction"). James L. Kehoe,
an individual, is a U.S. citizen whose principal place of business is 2012 Route
9W, Bldg. 3, Milton, New York 12547. James L. Kehoe is the Chief Executive
Officer of the Issuer.
(d) During the last 5 years, James L. Kehoe has not been convicted in a
criminal proceeding (excluding traffic or similar misdemeanors).
(e) During the last 5 years, James L. Kehoe has not been a party to a
civil proceeding of a judicial or administrative body of competent jurisdiction
and as a result of such proceeding was or is subject to a judgment, decree or
final order enjoining future violations of, or prohibiting or mandating
activities subject to, federal or state securities laws or finding any violation
with respect to such laws.
ITEM 3. Source and Amount of Funds or Other Consideration.
--------------------------------------------------
On August 1, 1997, the Issuer granted to James L. Kehoe an option to
acquire 200,000 shares of Common Stock at the fair market value of $ .37 per
share under the 1993 Stock Incentive Plan, which was immediately exercisable.
James L. Kehoe shall use his personal funds to pay the option strike price for
the Common Stock acquired, when and if he chooses to exercise this option or any
other option granted under the 1993 Stock Incentive Plan.
The Issuer has also granted to James L. Kehoe options to acquire Common
Stock in the following transactions:
a) On January 17, 1995, the Issuer granted to James L. Kehoe an option
to acquire 50,000 shares of Common Stock at the fair market value of $ .38 per
share under the 1993 Stock Incentive Plan, which were immediately exercisable.
b) On January 17, 1995, the Issuer granted to James L. Kehoe an option
to acquire 10,000 shares of Common Stock at the fair market value of $ .38 per
share under the 1993 Stock Incentive Plan, which were exercisable over a three
year period, the last 2,000 of which are first exercisable on January 17, 1998.
c) On June 3, 1996, the Issuer granted to James L. Kehoe an option to
acquire 10,000 shares of Common Stock at the fair market value of $ .82 per
share under the 1993 Stock Incentive Plan, which were exercisable over a three
year period, 4,500 of which became exercisable on June 3, 1997, 3,500 of which
become first exercisable on June 3, 1998 and 2,000 of which become first
exercisable on June 3, 1999.
James L. Kehoe has exercised none of the options to acquire Common
Stock disclosed above but retains the right to do so at any time for ten years
from the date of initial grant under the conditions set forth in each respective
grant. Until such time as James L. Kehoe exercises an option, he has no voting
rights associated with the underlying shares of Common Stock.
<PAGE>
ITEM 4. Purpose of Transaction.
------------------------
The purpose of the Transaction was to enable the Issuer to provide
incentive compensation to James L. Kehoe as an executive officer of the Issuer
and to motivate and retain James L. Kehoe by making it possible for him to
purchase shares of the Issuer's Common Stock on terms which give him a more
direct and continuing interest in the future success of the Issuer's business.
James L. Kehoe did not acquire the securities reported herein to gain
control of the Issuer, nor to change or alter the constitution of the board of
directors, bylaws or charter. The Transaction reported herein does not represent
an extraordinary corporate transaction, nor a material change in the issuer's
business or corporate structure. The Transaction disclosed herein does not alter
the rights of any class of shareholders.
ITEM 5. Interest in Securities of the Issuer.
-------------------------------------
(a)-(b). In aggregate, James L. Kehoe has direct beneficial ownership
and sole voting and dispositive power of 292,800 shares ( 6.3 % ) of the
outstanding Common Stock, of which 264,500 of these shares are under options to
purchase. James L. Kehoe has exercised none of the options granted to him to
acquire Common Stock under the 1993 Stock Incentive Plan. He has not tendered
any pecuniary consideration for any option disclosed herein nor has he tendered
any pecuniary consideration for the strike price to acquire the underlying
shares of any option herein.
(c). Except for the following Transaction, James L. Kehoe has not
engaged in any transactions in shares of Common Stock since August 1, 1997:
Date of How Transaction
Acquisition Number of Shares Price per Share was Effectuated
- ----------- ---------------- --------------- ---------------
August 1, 1997 200,000 $ .37 Option for Common Stock
(d). Not applicable
(e). Not applicable
ITEM 6. Contracts, Arrangements, Understandings or Relationships with
----------------------------------------------------------------
Respect to Securities of the Issuer.
------------------------------------
The option for 200,000 shares was acquired through the Issuer's grant
of an option under the 1993 Stock Incentive Plan, which was immediately
exercisable at the fair market value of $ .37 per share ("Option"). The Option
requires James L. Kehoe to pay the strike price of the Option in cash at the
time of exercise. Each of the options disclosed in Item 3 above expires ten
years from the date it was initially granted.
ITEM 7. Material to be Filed as Exhibits.
---------------------------------
Attached as Exhibits are copies of the options which represent the
Transaction as well as those other options disclosed in Item 3 above:
1. Exhibit A - Option dated August 1, 1997 for 200,000 shares of Common Stock
2. Exhibit B - Option dated January 17, 1995 for 50,000 shares of Common Stock
3. Exhibit C - Option dated January 17, 1995 for 10,000 shares of Common Stock
4. Exhibit D - Option dated June 3, 1996 for 10,000 shares of Common Stock
<PAGE>
Signature
---------
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: December 30, 1997 /s/ James L. Kehoe
------------------
James L. Kehoe
EXHIBIT A
---------
SONO-TEK CORPORATION
INCENTIVE STOCK OPTION AGREEMENT UNDER 1993 STOCK INCENTIVE PLAN
----------------------------------------------------------------
THIS AGREEMENT, made as of August 1, 1997 by and between Sono-Tek
Corporation, a New York corporation with its principal office at 2012 Route 9W,
Building 3, Milton, NY 12547 (the "Company") and James L. Kehoe, residing at 12
Lenape Lane, Salisbury Mills, N.Y. 12577, an employee (the "Optionee") of the
Company as defined in the 1993 Stock Incentive Plan as amended (the "Plan").
W I T N E S S E T H:
WHEREAS, the Board of Directors of the Company is of the opinion that
the interests of the Company will be advanced by recognizing employees of
outstanding abilities by making it possible for them to purchase shares of the
Company's Common Stock on terms which will give them a more direct and
continuing interest in the future success of the Company's business;
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the parties hereto hereby agree as follows:
1. Subject and pursuant to all terms and conditions of the Plan, a copy
of which is annexed hereto as Exhibit A and made a part hereof as though set
forth fully herein, the Company agrees to and does hereby grant to the Optionee
the right and option (the "Option") to purchase all or any part of an aggregate
of 200,000 shares of common stock of the Company, par value $.01 per share
("Common Stock") to be issued as provided in the Plan at the price of $0.37 per
share, subject to adjustment as provided in paragraph 13 of the Plan. If there
should be any conflict between provisions of this Agreement and the provisions
of the Plan, the provisions of the Plan shall control.
2. The Option may not be exercised more than ten (10) years from the
date of grant of this Option and may be exercised during such term only in
accordance with the terms and provisions of the Plan and the terms and
provisions contained herein.
3. The Option is intended to qualify as an incentive stock option
within the meaning of Section 422 of the Internal Revenue Code of 1986, as
amended from time to time (the "Code").
4. The Option may be exercised at any time prior to the tenth
anniversary of the date of grant (the "Expiration Date") in installments of not
less than 1,000 shares. The right of exercise shall be cumulative so that if the
Option is not exercised to the maximum extent permissible at any time, it shall
be exercisable, in whole or in part, with respect to all shares not so purchased
at any time prior to the Expiration Date or the earlier termination of the
Option.
5. The Option granted in this Option Agreement may be exercised in
whole or in part as provided in the Plan by the Optionee's delivering or mailing
to the Company written notice of exercise in the form prescribed by the Board or
<PAGE>
by a Committee appointed by the Board to administer the Plan, if any, duly
signed by the Optionee. Such exercise shall be effective upon (a) receipt of
written notice by the Company and (b) payment in full to the Company of the
purchase price upon the exercise of the Option. The Option may not be exercised
if the issuance of shares of Common Stock upon such exercise would constitute a
violation of any applicable Federal or State securities or other law or
regulation.
6. The Company shall deliver, or cause to be delivered, to the Optionee
(or his personal representative, as the case may be) stock certificates for the
number of shares of Common Stock with respect to which the Option is being
exercised, against receipt of payment therefor in full by cash or certified
check [alternative as otherwise provided] and delivery of (i) a written
certificate of the Optionee (or his personal representative, as the case may be)
to the effect that he is purchasing such shares for investment and not with a
view to the sale or distribution of any such shares and (ii) such other
certificates, representations and agreements of the Optionee (or his personal
representative, as the case may be) as may be required under the Plan or as the
Company shall also require in order that the Company be reasonably assured that
the issuance, delivery and disposition of such shares are being and will be
effected in compliance with the Securities Act of 1933, as amended (the "Act"),
the Rules and Regulations thereunder, other applicable law, and the rules of
each stock exchange upon which the shares of Common Stock are listed, if any;
provided, however, that if the offer and sale of shares of Common Stock upon
exercise of options granted under the Plan is registered under the Act, the
Optionee (or his personal representative, as the case may be) need not furnish
the certificate described in clause (i) of this sentence. Certificates
evidencing shares of Common Stock issued upon exercise of the Option may contain
such legends reflecting any restrictions upon sale or transfer as in the view of
counsel to the Company may be necessary to the lawful and proper issuance of
such certificates. If outstanding shares of the same class as the shares subject
to the option shall be listed on any stock exchange, the Company shall not be
obligated to deliver any shares until such shares have been listed (or
authorized for listing upon official notice of issuance) on each such stock
exchange. The Company shall use its best efforts to effect such listing.
Delivery of the shares of Common Stock may be made at the office of the Company
or at the office of a transfer agent appointed for the transfer of shares of
Common Stock.
7. In addition to and in furtherance of the provisions of the Plan, the
following terms and conditions shall apply to the exercise of the Option:
(a) As this option is, and is intended to be, an Incentive Stock Option
under the Internal Revenue Code of 1986, as amended, in no event shall the
exercise price of the Option be less than 100% of the fair market value of the
shares of Common Stock subject to the Option on the date hereof.
(b) The Option shall not be transferable otherwise than by will or by
the laws of descent and distribution. The Option shall not be subject, in whole
or in part, to attachment, execution or levy of any kind.
(c) The Option shall expire and all rights thereunder shall end at the
expiration of such period (which the Board has set at ten years) after the date
<PAGE>
hereof as fixed by the Board, subject in all cases to earlier expiration as
provided in subsections (d) and (e) of this Section 7 in the event of
termination of employment or death.
(d) During the lifetime of the Optionee, the Option shall be
exercisable only by him and only while continuously employed by the Company,
within three months after he ceases to be employed or if disabled (within the
meaning of Section 22 (e) (3) of the Code), within one year of such disability
(but, in either case, not later than the end of the period fixed by the Board in
accordance with the provisions of subsection (c) of this Section) if and to the
extent the Option was exercisable by him on the last day of such employment or
the last day before his disability began, as the case may be. Notwithstanding
the foregoing, in the event that the Optionee shall be terminated for cause, all
rights as to any outstanding unexercised and unexpired options or portions
thereof shall immediately terminate.
(e) If the Optionee dies within a period during which the Option could
have been exercised by him, the Option may be exercised within 12 months after
his death or such shorter period as the Board may determine (but not later than
the end of the period fixed by the Board in accordance with the provisions of
subsection (c) of this Section 7) by those entitled under his will or the laws
of descent and distribution (the "Recipients"), but only if and to the extent
the Option was exercisable by him immediately prior to his death.
(f) As this is an Incentive Stock Option, in no event shall the
Optionee, immediately after the Option is granted, own capital stock of the
Company or a Subsidiary possessing more than 10% of the total combined voting
power value of all classes of capital stock of the Company, unless the option
price at the time such Incentive Stock Option is granted is at least 110% of the
fair market value of the shares of common stock subject to the Incentive Stock
Option, and this Incentive Stock Option is not exercisable by its terms after
the expiration of five years from the date of grant.
8. The Optionee hereby agrees that if at any time the Company registers
any of its securities under the Act (other than pursuant to a registration
statement on form S-8 or similar or successor form) (a "Public Offering"), and
the representative of the underwriters involved in such registration requires
that the Optionee agree not to sell or otherwise transfer or dispose of his
Option Shares (a "Lock-up Agreement"), then the Optionee shall enter into such a
Lock-up Agreement in such form and on such terms as shall be approved by the
Board of Directors of the Company, which form and terms shall be similar to the
forms and terms of any other Lock-up Agreements entered into by the executive
officers of the Company in connection with such registration.
9. Neither the Optionee nor his legal representative shall be, nor have
any of the rights or privileges of, a shareholder of the Company in respect of
any of the shares of Common Stock issuable upon the exercise of this Option,
unless and until certificates representing such shares shall have been issued
and delivered to the Optionee (or his legal representative).
10. The Option may not be transferred in any manner otherwise than by
will or the laws of descent or distribution and may be exercised during the
lifetime of the Optionee only by him. The terms of this Option shall be binding
upon the Executors, administrators, heirs, successors and assigns of the
Optionee.
<PAGE>
Dated as of:____________________
Sono-Tek Corporation
2012 Route 9W, Building 3
Milton, NY 12547
ATTEST:____________________
By:____________________
Samuel Schwartz
Chairman
The Optionee hereby acknowledges receipt of a copy of the Plan, and
represents that he is familiar with the terms and provisions thereof and the
terms and provisions of this Option Agreement, including, but not limited to,
the terms and provisions of Section 8 hereof, and the Optionee hereby accepts
Option subject to all the terms and provisions thereof and herein. The Optionee
hereby agrees to accept as binding, conclusive and final all decisions or
interpretations of the Board of Directors, upon any questions arising under the
Plan. The Optionee hereby authorizes the Company to withhold, in accordance with
applicable law, from any compensation payable to him, any taxes required to be
withheld by federal, state or local law as a result of the exercise of the
Option.
Dated as of ____________________ Optionee:____________________
EXHIBIT B
---------
SONO-TEK CORPORATION
INCENTIVE STOCK OPTION AGREEMENT UNDER 1993 STOCK INCENTIVE PLAN
----------------------------------------------------------------
THIS AGREEMENT, made as of January 17, 1995, by and between Sono-Tek
Corporation, a New York corporation with its principal office at 2012 Route 9W,
Building 3, Milton, NY 12547 (the "Company") and James L. Kehoe, residing at 12
Lenape Lane, Salisbury Mills, NY 12577, an employee (the "Optionee") of the
Company as defined in the 1993 Stock Incentive Plan as amended (the "Plan").
W I T N E S S E T H:
WHEREAS, the Board of Directors of the Company is of the opinion that
the interests of the Company will be advanced by recognizing employees of
outstanding abilities by making it possible for them to purchase shares of the
Company's Common Stock on terms which will give them a more direct and
continuing interest in the future success of the Company's business;
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the parties hereto hereby agree as follows:
1. Subject and pursuant to all terms and conditions of the Plan, a copy
of which is annexed hereto as Exhibit A and made a part hereof as though set
forth fully herein, the Company agrees to and does hereby grant to the Optionee
the right and option (the "Option") to purchase all or any part of an aggregate
of 50,000 shares of common stock of the Company, par value $.01 per share
("Common Stock") to be issued as provided in the Plan at the price of $0.38 per
share, subject to adjustment as provided in paragraph 13 of the Plan. If there
should be any conflict between provisions of this Agreement and the provisions
of the Plan, the provisions of the Plan shall control.
2. The Option may not be exercised more than ten (10) years from the
date of grant of this Option and may be exercised during such term only in
accordance with the terms and provisions of the Plan and the terms and
provisions contained herein.
3. The Option is intended to qualify as an incentive stock option
within the meaning of Section 422 of the Internal Revenue Code of 1986, as
amended from time to time (the "Code").
4. The Option may be exercised prior to the tenth anniversary of the
date of grant (the "Expiration Date") in installments as to not more than the
number of shares and during the respective installment periods set forth in the
table of exercise below. The right of exercise shall be cumulative so that if
the Option is not exercised to the maximum extent permissible during any
exercise period, it shall be exercisable, in whole or in part, with respect to
all shares not so purchased at any time prior to the Expiration Date or the
earlier termination of the Option.
<PAGE>
DATE FIRST EXERCISABLE TOTAL NUMBER OF SHARES FIRST
EXERCISABLE
January 17, 1995 50,000
5. The Option granted in this Option Agreement may be exercised in
whole or in part as provided in the Plan by the Optionee's delivering or mailing
to the Company written notice of exercise in the form prescribed by the Board or
by a Committee appointed by the Board to administer the Plan, if any, duly
signed by the Optionee. Such exercise shall be effective upon (a) receipt of
written notice by the Company and (b) payment in full to the Company of the
purchase price upon the exercise of the Option. The Option may not be exercised
if the issuance of shares of Common Stock upon such exercise would constitute a
violation of any applicable Federal or State securities or other law or
regulation.
6. The Company shall deliver, or cause to be delivered, to the Optionee
(or his personal representative, as the case may be) stock certificates for the
number of shares of Common Stock with respect to which the Option is being
exercised, against receipt of payment therefor in full by cash or certified
check (or equivalent form of cash payment as agreed to by the Company) and
delivery of (i) a written certificate of the Optionee (or his personal
representative, as the case may be) to the effect that he is purchasing such
shares for investment and not with a view to the sale or distribution of any
such shares and (ii) such other certificates, representations and agreements of
the Optionee (or his personal representative, as the case may be) as may be
required under the Plan or as the Company shall also require in order that the
Company be reasonably assured that the issuance, delivery and disposition of
such shares are being and will be effected in compliance with the Securities Act
of 1933, as amended (the "Act"), the Rules and Regulations thereunder, other
applicable law, and the rules of each stock exchange upon which the shares of
Common Stock are listed, if any; provided, however, that if the offer and sale
of shares of Common Stock upon exercise of options granted under the Plan is
registered under the Act, the Optionee (or his personal representative, as the
case may be) need not furnish the certificate described in clause (i) of this
sentence. Certificates evidencing shares of Common Stock issued upon exercise of
the Option may contain such legends reflecting any restrictions upon sale or
transfer as in the view of counsel to the Company may be necessary to the lawful
and proper issuance of such certificates. If outstanding shares of the same
class as the shares subject to the option shall be listed on any stock exchange,
the Company shall not be obligated to deliver any shares until such shares have
been listed (or authorized for listing upon official notice of issuance) on each
such stock exchange. The Company shall use its best efforts to effect such
listing. Delivery of the shares of Common Stock may be made at the office of the
Company or at the office of a transfer agent appointed for the transfer of
shares of Common Stock.
7. In addition to and in furtherance of the provisions of the Plan, the
following terms and conditions shall apply to the exercise of the Option:
<PAGE>
(a) As this option is, and is intended to be, an Incentive Stock Option
under the Internal Revenue Code of 1986, as amended, in no event shall the
exercise price of the Option be less than 100% of the fair market value of the
shares of Common Stock subject to the Option on the date hereof.
(b) The Option shall not be transferable otherwise than by will or by
the laws of descent and distribution. The Option shall not be subject, in whole
or in part, to attachment, execution or levy of any kind.
(c) The Option shall expire and all rights thereunder shall end at the
expiration of such period (which the Board has set at ten years) after the date
hereof as fixed by the Board, subject in all cases to earlier expiration as
provided in subsections (d) and (e) of this Section 7 in the event of
termination of employment or death.
(d) During the lifetime of the Optionee, the Option shall be
exercisable only by him and only while continuously employed by the Company,
within three months after he ceases to be employed or if disabled (within the
meaning of Section 22 (e) (3) of the Code), within one year of such disability
(but, in either case, not later than the end of the period fixed by the Board in
accordance with the provisions of subsection (c) of this Section) if and to the
extent the Option was exercisable by him on the last day of such employment or
the last day before his disability began, as the case may be. Notwithstanding
the foregoing, in the event that the Optionee shall be terminated for cause, all
rights as to any outstanding unexercised and unexpired options or portions
thereof shall immediately terminate.
(e) If the Optionee dies within a period during which the Option could
have been exercised by him, the Option may be exercised within 12 months after
his death or such shorter period as the Board may determine (but not later than
the end of the period fixed by the Board in accordance with the provisions of
subsection (c) of this Section 7) by those entitled under his will or the laws
of descent and distribution (the "Recipients"), but only if and to the extent
the Option was exercisable by him immediately prior to his death.
(f) As this is an Incentive Stock Option, in no event shall the
Optionee, immediately after the Option is granted, own capital stock of the
Company or a Subsidiary possessing more than 10% of the total combined voting
power value of all classes of capital stock of the Company, unless the option
price at the time such Incentive Stock Option is granted is at least 110% of the
fair market value of the shares of common stock subject to the Incentive Stock
Option, and this Incentive Stock Option is not exercisable by its terms after
the expiration of five years from the date of grant.
8. The Optionee hereby agrees that if at any time the Company registers
any of its securities under the Act (other than pursuant to a registration
statement on form S-8 or similar or successor form) (a "Public Offering"), and
the representative of the underwriters involved in such registration requires
that the Optionee agree not to sell or otherwise transfer or dispose of his
Option Shares (a "Lock-up Agreement"), then the Optionee shall enter into such a
Lock-up Agreement in such form and on such terms as shall be approved by the
Board of Directors of the Company, which form and terms shall be similar to the
<PAGE>
terms of any other Lock-up Agreements entered into by the executive officers of
the Company in connection with such registration.
9. Neither the Optionee nor his legal representative shall be, nor have
any of the rights or privileges of, a shareholder of the Company in respect of
any of the shares of Common Stock issuable upon the exercise of this Option,
unless and until certificates representing such shares shall have been issued
and delivered to the Optionee (or his legal representative).
10. The Option may not be transferred in any manner otherwise than by
will or the laws of descent or distribution and may be exercised during the
lifetime of the Optionee only by him. The terms of this Option shall be binding
upon the Executors, administrators, heirs, successors and assigns of the
Optionee.
Dated as of: January 17, 1995
Sono-Tek Corporation
2012 Route 9W, Building 3
Milton, NY 12547
ATTEST:__________________
By:__________________
Samuel Schwartz
Chairman
The Optionee hereby acknowledges receipt of a copy of the Plan, and
represents that he is familiar with the terms and provisions thereof and the
terms and provisions of this Option Agreement, including, but not limited to,
the terms and provisions of Section 8 hereof, and the Optionee hereby accepts
Option subject to all the terms and provisions thereof and herein. The Optionee
hereby agrees to accept as binding, conclusive and final all decisions or
interpretations of the Board of Directors, upon any questions arising under the
Plan. The Optionee hereby authorizes the Company to withhold, in accordance with
applicable law, from any compensation payable to him, any taxes required to be
withheld by federal, state or local law as a result of the exercise of the
Option.
Dated as of ____________________ ____________________
James L. Kehoe
EXHIBIT C
---------
SONO-TEK CORPORATION
INCENTIVE STOCK OPTION AGREEMENT UNDER 1993 STOCK INCENTIVE PLAN
----------------------------------------------------------------
THIS AGREEMENT, made as of January 17, 1995, by and between Sono-Tek
Corporation, a New York corporation with its principal office at 2012 Route 9W,
Building 3, Milton, NY 12547 (the "Company") and James L. Kehoe, residing at 12
Lenape Lane, Salisbury Mills, NY 12577, an employee (the "Optionee") of the
Company as defined in the 1993 Stock Incentive Plan as amended (the "Plan").
W I T N E S S E T H:
WHEREAS, the Board of Directors of the Company is of the opinion that
the interests of the Company will be advanced by recognizing employees of
outstanding abilities by making it possible for them to purchase shares of the
Company's Common Stock on terms which will give them a more direct and
continuing interest in the future success of the Company's business;
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the parties hereto hereby agree as follows:
1. Subject and pursuant to all terms and conditions of the Plan, a copy
of which is annexed hereto as Exhibit A and made a part hereof as though set
forth fully herein, the Company agrees to and does hereby grant to the Optionee
the right and option (the "Option") to purchase all or any part of an aggregate
of 10,000 shares of common stock of the Company, par value $.01 per share
("Common Stock") to be issued as provided in the Plan at the price of $0.38 per
share, subject to adjustment as provided in paragraph 13 of the Plan. If there
should be any conflict between provisions of this Agreement and the provisions
of the Plan, the provisions of the Plan shall control.
2. The Option may not be exercised more than ten (10) years from the
date of grant of this Option and may be exercised during such term only in
accordance with the terms and provisions of the Plan and the terms and
provisions contained herein.
3. The Option is intended to qualify as an incentive stock option
within the meaning of Section 422 of the Internal Revenue Code of 1986, as
amended from time to time (the "Code").
4. The Option may be exercised prior to the tenth anniversary of the
date of grant (the "Expiration Date") in installments as to not more than the
number of shares and during the respective installment periods set forth in the
table of exercise below. The right of exercise shall be cumulative so that if
the Option is not exercised to the maximum extent permissible during any
exercise period, it shall be exercisable, in whole or in part, with respect to
all shares not so purchased at any time prior to the Expiration Date or the
earlier termination of the Option.
<PAGE>
DATE FIRST EXERCISABLE TOTAL NUMBER OF SHARES FIRST
EXERCISABLE
January 17, 1996 4,500
January 17, 1997 3,500
January 17, 1998 2,000
5. The Option granted in this Option Agreement may be exercised in
whole or in part as provided in the Plan by the Optionee's delivering or mailing
to the Company written notice of exercise in the form prescribed by the Board or
by a Committee appointed by the Board to administer the Plan, if any, duly
signed by the Optionee. Such exercise shall be effective upon (a) receipt of
written notice by the Company and (b) payment in full to the Company of the
purchase price upon the exercise of the Option. The Option may not be exercised
if the issuance of shares of Common Stock upon such exercise would constitute a
violation of any applicable Federal or State securities or other law or
regulation.
6. The Company shall deliver, or cause to be delivered, to the Optionee
(or his personal representative, as the case may be) stock certificates for the
number of shares of Common Stock with respect to which the Option is being
exercised, against receipt of payment therefor in full by cash or certified
check (or equivalent form of cash payment as agreed to by the Company) and
delivery of (i) a written certificate of the Optionee (or his personal
representative, as the case may be) to the effect that he is purchasing such
shares for investment and not with a view to the sale or distribution of any
such shares and (ii) such other certificates, representations and agreements of
the Optionee (or his personal representative, as the case may be) as may be
required under the Plan or as the Company shall also require in order that the
Company be reasonably assured that the issuance, delivery and disposition of
such shares are being and will be effected in compliance with the Securities Act
of 1933, as amended (the "Act"), the Rules and Regulations thereunder, other
applicable law, and the rules of each stock exchange upon which the shares of
Common Stock are listed, if any; provided, however, that if the offer and sale
of shares of Common Stock upon exercise of options granted under the Plan is
registered under the Act, the Optionee (or his personal representative, as the
case may be) need not furnish the certificate described in clause (i) of this
sentence. Certificates evidencing shares of Common Stock issued upon exercise of
the Option may contain such legends reflecting any restrictions upon sale or
transfer as in the view of counsel to the Company may be necessary to the lawful
and proper issuance of such certificates. If outstanding shares of the same
class as the shares subject to the option shall be listed on any stock exchange,
the Company shall not be obligated to deliver any shares until such shares have
been listed (or authorized for listing upon official notice of issuance) on each
such stock exchange. The Company shall use its best efforts to effect such
listing. Delivery of the shares of Common Stock may be made at the office of the
Company or at the office of a transfer agent appointed for the transfer of
shares of Common Stock.
7. In addition to and in furtherance of the provisions of the Plan, the
following terms and conditions shall apply to the exercise of the Option:
<PAGE>
(a) As this option is, and is intended to be, an Incentive Stock Option
under the Internal Revenue Code of 1986, as amended, in no event shall the
exercise price of the Option be less than 100% of the fair market value of the
shares of Common Stock subject to the Option on the date hereof.
(b) The Option shall not be transferable otherwise than by will or by
the laws of descent and distribution. The Option shall not be subject, in whole
or in part, to attachment, execution or levy of any kind.
(c) The Option shall expire and all rights thereunder shall end at the
expiration of such period (which the Board has set at ten years) after the date
hereof as fixed by the Board, subject in all cases to earlier expiration as
provided in subsections (d) and (e) of this Section 7 in the event of
termination of employment or death.
(d) During the lifetime of the Optionee, the Option shall be
exercisable only by him and only while continuously employed by the Company,
within three months after he ceases to be employed or if disabled (within the
meaning of Section 22 (e) (3) of the Code), within one year of such disability
(but, in either case, not later than the end of the period fixed by the Board in
accordance with the provisions of subsection (c) of this Section) if and to the
extent the Option was exercisable by him on the last day of such employment or
the last day before his disability began, as the case may be. Notwithstanding
the foregoing, in the event that the Optionee shall be terminated for cause, all
rights as to any outstanding unexercised and unexpired options or portions
thereof shall immediately terminate.
(e) If the Optionee dies within a period during which the Option could
have been exercised by him, the Option may be exercised within 12 months after
his death or such shorter period as the Board may determine (but not later than
the end of the period fixed by the Board in accordance with the provisions of
subsection (c) of this Section 7) by those entitled under his will or the laws
of descent and distribution (the "Recipients"), but only if and to the extent
the Option was exercisable by him immediately prior to his death.
(f) As this is an Incentive Stock Option, in no event shall the
Optionee, immediately after the Option is granted, own capital stock of the
Company or a Subsidiary possessing more than 10% of the total combined voting
power value of all classes of capital stock of the Company, unless the option
price at the time such Incentive Stock Option is granted is at least 110% of the
fair market value of the shares of common stock subject to the Incentive Stock
Option, and this Incentive Stock Option is not exercisable by its terms after
the expiration of five years from the date of grant.
8. The Optionee hereby agrees that if at any time the Company registers
any of its securities under the Act (other than pursuant to a registration
statement on form S-8 or similar or successor form) (a "Public Offering"), and
the representative of the underwriters involved in such registration requires
that the Optionee agree not to sell or otherwise transfer or dispose of his
Option Shares (a "Lock-up Agreement"), then the Optionee shall enter into such a
Lock-up Agreement in such form and on such terms as shall be approved by the
Board of Directors of the Company, which form and
<PAGE>
terms shall be similar to the forms and terms of any other Lock-up Agreements
entered into by the executive officers of the Company in connection with such
registration.
9. Neither the Optionee nor his legal representative shall be, nor have
any of the rights or privileges of, a shareholder of the Company in respect of
any of the shares of Common Stock issuable upon the exercise of this Option,
unless and until certificates representing such shares shall have been issued
and delivered to the Optionee (or his legal representative).
10. The Option may not be transferred in any manner otherwise than by
will or the laws of descent or distribution and may be exercised during the
lifetime of the Optionee only by him. The terms of this Option shall be binding
upon the Executors, administrators, heirs, successors and assigns of the
Optionee.
Dated as of: January 17, 1995
Sono-Tek Corporation
2012 Route 9W, Building 3
MILTON, NY 12547
ATTEST:_______________
By:_______________
Samuel Schwartz
Chairman
The Optionee hereby acknowledges receipt of a copy of the Plan, and
represents that he is familiar with the terms and provisions thereof and the
terms and provisions of this Option Agreement, including, but not limited to,
the terms and provisions of Section 8 hereof, and the Optionee hereby accepts
Option subject to all the terms and provisions thereof and herein. The Optionee
hereby agrees to accept as binding, conclusive and final all decisions or
interpretations of the Board of Directors, upon any questions arising under the
Plan. The Optionee hereby authorizes the Company to withhold, in accordance with
applicable law, from any compensation payable to him, any taxes required to be
withheld by federal, state or local law as a result of the exercise of the
Option.
Dated as of ____________________ ____________________
James L. Kehoe
EXHIBIT D
---------
SONO-TEK CORPORATION
INCENTIVE STOCK OPTION AGREEMENT UNDER 1993 STOCK INCENTIVE PLAN
----------------------------------------------------------------
THIS AGREEMENT, made as of June 3, 1996, by and between Sono-Tek
Corporation, a New York corporation with its principal office at 2012 Route 9W,
Building 3, Milton, NY 12547 (the "Company") and James L. Kehoe, residing at 12
Lenape Lane, Salisbury Mills, NY 12577, an employee (the "Optionee") of the
Company as defined in the 1993 Stock Incentive Plan as amended (the "Plan").
W I T N E S S E T H:
WHEREAS, the Board of Directors of the Company is of the opinion that
the interests of the Company will be advanced by recognizing employees of
outstanding abilities by making it possible for them to purchase shares of the
Company's Common Stock on terms which will give them a more direct and
continuing interest in the future success of the Company's business;
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the parties hereto hereby agree as follows:
1. Subject and pursuant to all terms and conditions of the Plan, a copy
of which is annexed hereto as Exhibit A and made a part hereof as though set
forth fully herein, the Company agrees to and does hereby grant to the Optionee
the right and option (the "Option") to purchase all or any part of an aggregate
of 10,000 shares of common stock of the Company, par value $.01 per share
("Common Stock") to be issued as provided in the Plan at the price of $0.82 per
share, subject to adjustment as provided in paragraph 13 of the Plan. If there
should be any conflict between provisions of this Agreement and the provisions
of the Plan, the provisions of the Plan shall control.
2. The Option may not be exercised more than ten (10) years from the
date of grant of this Option and may be exercised during such term only in
accordance with the terms and provisions of the Plan and the terms and
provisions contained herein.
3. The Option is intended to qualify as an incentive stock option
within the meaning of Section 422 of the Internal Revenue Code of 1986, as
amended from time to time (the "Code").
4. The Option may be exercised prior to the tenth anniversary of the
date of grant (the "Expiration Date") in installments as to not more than the
number of shares and during the respective installment periods set forth in the
table of exercise below. The right of exercise shall be cumulative so that if
the Option is not exercised to the maximum extent permissible during any
exercise period, it shall be exercisable, in whole or in part, with respect to
all shares not so purchased at any time prior to the Expiration Date or the
earlier termination of the Option.
<PAGE>
DATE FIRST EXERCISABLE TOTAL NUMBER OF SHARES FIRST
EXERCISABLE
June 3, 1997 4,500
June 3, 1998 3,500
June 3, 1999 2,000
5. The Option granted in this Option Agreement may be exercised in
whole or in part as provided in the Plan by the Optionee's delivering or mailing
to the Company written notice of exercise in the form prescribed by the Board or
by a Committee appointed by the Board to administer the Plan, if any, duly
signed by the Optionee. Such exercise shall be effective upon (a) receipt of
written notice by the Company and (b) payment in full to the Company of the
purchase price upon the exercise of the Option. The Option may not be exercised
if the issuance of shares of Common Stock upon such exercise would constitute a
violation of any applicable Federal or State securities or other law or
regulation.
6. The Company shall deliver, or cause to be delivered, to the Optionee
(or his personal representative, as the case may be) stock certificates for the
number of shares of Common Stock with respect to which the Option is being
exercised, against receipt of payment therefor in full by cash or certified
check (or equivalent form of cash payment as agreed to by the Company) and
delivery of (i) a written certificate of the Optionee (or his personal
representative, as the case may be) to the effect that he is purchasing such
shares for investment and not with a view to the sale or distribution of any
such shares and (ii) such other certificates, representations and agreements of
the Optionee (or his personal representative, as the case may be) as may be
required under the Plan or as the Company shall also require in order that the
Company be reasonably assured that the issuance, delivery and disposition of
such shares are being and will be effected in compliance with the Securities Act
of 1933, as amended (the "Act"), the Rules and Regulations thereunder, other
applicable law, and the rules of each stock exchange upon which the shares of
Common Stock are listed, if any; provided, however, that if the offer and sale
of shares of Common Stock upon exercise of options granted under the Plan is
registered under the Act, the Optionee (or his personal representative, as the
case may be) need not furnish the certificate described in clause (i) of this
sentence. Certificates evidencing shares of Common Stock issued upon exercise of
the Option may contain such legends reflecting any restrictions upon sale or
transfer as in the view of counsel to the Company may be necessary to the lawful
and proper issuance of such certificates. If outstanding shares of the same
class as the shares subject to the option shall be listed on any stock exchange,
the Company shall not be obligated to deliver any shares until such shares have
been listed (or authorized for listing upon official notice of issuance) on each
such stock exchange. The Company shall use its best efforts to effect such
listing. Delivery of the shares of Common Stock may be made at the office of the
Company or at the office of a transfer agent appointed for the transfer of
shares of Common Stock.
7. In addition to and in furtherance of the provisions of the Plan, the
following terms and conditions shall apply to the exercise of the Option:
<PAGE>
(a) As this option is, and is intended to be, an Incentive Stock Option
under the Internal Revenue Code of 1986, as amended, in no event shall the
exercise price of the Option be less than 100% of the fair market value of the
shares of Common Stock subject to the Option on the date hereof.
(b) The Option shall not be transferable otherwise than by will or by
the laws of descent and distribution. The Option shall not be subject, in whole
or in part, to attachment, execution or levy of any kind.
(c) The Option shall expire and all rights thereunder shall end at the
expiration of such period (which the Board has set at ten years) after the date
hereof as fixed by the Board, subject in all cases to earlier expiration as
provided in subsections (d) and (e) of this Section 7 in the event of
termination of employment or death.
(d) During the lifetime of the Optionee, the Option shall be
exercisable only by him and only while continuously employed by the Company,
within three months after he ceases to be employed or if disabled (within the
meaning of Section 22 (e) (3) of the Code), within one year of such disability
(but, in either case, not later than the end of the period fixed by the Board in
accordance with the provisions of subsection (c) of this Section) if and to the
extent the Option was exercisable by him on the last day of such employment or
the last day before his disability began, as the case may be. Notwithstanding
the foregoing, in the event that the Optionee shall be terminated for cause, all
rights as to any outstanding unexercised and unexpired options or portions
thereof shall immediately terminate.
(e) If the Optionee dies within a period during which the Option could
have been exercised by him, the Option may be exercised within 12 months after
his death or such shorter period as the Board may determine (but not later than
the end of the period fixed by the Board in accordance with the provisions of
subsection (c) of this Section 7) by those entitled under his will or the laws
of descent and distribution (the "Recipients"), but only if and to the extent
the Option was exercisable by him immediately prior to his death.
(f) As this is an Incentive Stock Option, in no event shall the
Optionee, immediately after the Option is granted, own capital stock of the
Company or a Subsidiary possessing more than 10% of the total combined voting
power value of all classes of capital stock of the Company, unless the option
price at the time such Incentive Stock Option is granted is at least 110% of the
fair market value of the shares of common stock subject to the Incentive Stock
Option, and this Incentive Stock Option is not exercisable by its terms after
the expiration of five years from the date of grant.
8. The Optionee hereby agrees that if at any time the Company registers
any of its securities under the Act (other than pursuant to a registration
statement on form S-8 or similar or successor form) (a "Public Offering"), and
the representative of the underwriters involved in such registration requires
that the Optionee agree not to sell or otherwise transfer or dispose of his
Option Shares (a "Lock-up Agreement"), then the Optionee shall enter into such a
Lock-up Agreement in such form and on such terms as shall be approved by the
Board of Directors of the Company, which form and
<PAGE>
terms shall be similar to the forms and terms of any other Lock-up Agreements
entered into by the executive officers of the Company in connection with such
registration.
9. Neither the Optionee nor his legal representative shall be, nor have
any of the rights or privileges of, a shareholder of the Company in respect of
any of the shares of Common Stock issuable upon the exercise of this Option,
unless and until certificates representing such shares shall have been issued
and delivered to the Optionee (or his legal representative).
10. The Option may not be transferred in any manner otherwise than by
will or the laws of descent or distribution and may be exercised during the
lifetime of the Optionee only by him. The terms of this Option shall be binding
upon the Executors, administrators, heirs, successors and assigns of the
Optionee.
Dated as of: June 3, 1996
Sono-Tek Corporation
2012 Route 9W, Building 3
MILTON, NY 12547
ATTEST:_________________
By:_________________
Samuel Schwartz
Chairman
The Optionee hereby acknowledges receipt of a copy of the Plan, and
represents that he is familiar with the terms and provisions thereof and the
terms and provisions of this Option Agreement, including, but not limited to,
the terms and provisions of Section 8 hereof, and the Optionee hereby accepts
Option subject to all the terms and provisions thereof and herein. The Optionee
hereby agrees to accept as binding, conclusive and final all decisions or
interpretations of the Board of Directors, upon any questions arising under the
Plan. The Optionee hereby authorizes the Company to withhold, in accordance with
applicable law, from any compensation payable to him, any taxes required to be
withheld by federal, state or local law as a result of the exercise of the
Option.
Dated as of ____________________ ____________________
James L. Kehoe
