UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) September 2, 2004
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FIRST MONTAUK FINANCIAL CORP.
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(Exact name of Registrant as specified in its charter)
New Jersey 0-6729 22-1737915
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(State or other jurisdic- (Commission (IRS Employer
tion of incorporation) File Number) Identification No.)
Parkway 109 Office Center, 328 Newman Springs Road, Red Bank, N.J. 07701
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (732) 842-4700
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(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
02
Item 1.01: Entry into a Material Definitive Agreement.
On September 2, 2004, pursuant to its Non-Executive Director Stock Option
Plan, First Montauk Financial Corp. ("First Montauk") granted the following
non-executive directors options to purchase 20,000 shares of First Montauk's
common stock (the "Options") at an exercise price of $0.25 per share, which
represents the closing bid price per share of First Montauk's common stock on
the OTC Bulletin Board on September 2, 2004: Mr. Ward R. Jones, Jr. and Mr.
Barry Shapiro. The Options are governed by our standard form stock option
agreement, a copy of which is filed as an exhibit to this Current Report on Form
8-K, and the terms of our 2000 Non-Executive Director Stock Option Plan (the
"Director Plan"). The Options are immediately vested, exercisable for a period
of five years (subject to earlier termination under certain circumstances) and
were granted on a non-discretionary basis pursuant to our Director Plan. These
Options are evidenced by an option agreement substantially in the form attached
hereto as Exhibit 10.1.
Item 9.01: Financial Statements and Exhibits.
Exhibit No.
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10.1 Form of Non-Executive Director Stock Option
Award.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report on Form 8-K to be signed on its
behalf by the undersigned hereunto duly authorized.
Dated: September 27, 2004 First Montauk Financial Corp.
(Registrant)
By /s/ William J. Kurinsky
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William J. Kurinsky
Chief Financial Officer
EXHIBIT INDEX
Exhibit
Number Description
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10.1 Form of Non-Executive Director Stock Option Award
03 Exhibit 10.1
FIRST MONTAUK FINANCIAL CORP.
2002 DIRECTOR PLAN OPTION
NON-QUALIFIED STOCK OPTION AGREEMENT
Name: <<Name>>
Date of Grant: <<DateofGrant>>
Option No.: <<OptionNo>>
Number of Options: <<NumberofOptions>>
Exercise Price Per Share: <<ExercisePrice>>
Expiration Date: <<ExpirationDate>>
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We are pleased to notify you that in accordance with the terms of the
2002 Non-Executive Director Stock Option Plan (the "Plan") of FIRST MONTAUK
FINANCIAL CORP. (the "Company") a stock option to purchase shares of the Common
Stock no par value per share, of the Company has been granted to you under the
Plan. This option may be exercised only upon the terms and conditions set forth
below. The following is a brief summary of the Plan and this Option is subject
to all of the terms and conditions of the Plan.
1. Purpose of Option
The purpose of the Plan under which this stock option has been
granted is to enable the Company to attract and retain the services of qualified
independent persons to serve on the Company's Board of Directors by providing an
opportunity to acquire a proprietary interest in the Company.
2. Acceptance of Option Agreement
Your acceptance of this stock option agreement will indicate
your acceptance of and your agreement to be bound by its terms and the terms of
the Plan. It imposes no obligation upon you to purchase any of the shares
subject to the option. Your obligation to purchase shares can arise only upon
your exercise of the option in the manner set forth in paragraph 4 hereof. This
stock option agreement shall be subject in all respects to the terms and
conditions of the Plan and in the event of any question or controversy relating
to the terms of the Plan, the decision of the Board of Directors shall be final.
3. When Option May Be Exercised; Vesting
Except as otherwise provided herein, this option shall be
exercisable at any time after the Date of Grant and prior to the Expiration
Date, as hereafter defined and except as provided in Sections 7 and 8 hereof.
This option may not be exercised for less than ten shares at any one time (or
the remaining shares then purchasable if less than ten) and expires at 5:00 pm
(eastern standard time) (the "Expiration Date") whether or not it has been duly
exercised, unless sooner terminated as provided in paragraphs 7, 9 or 13 hereof.
4. Exercise Procedure
This option is exercisable by a written notice signed by you
and delivered to the Company at its executive offices, signifying your election
to exercise the option. The notice must state the number of shares of Common
Stock you are exercising under this option and must contain a statement by you
(in the form annexed to this option) that such shares are being acquired by you
for investment and not with a view to their distribution or resale (unless a
Registration Statement covering the shares purchasable has been declared
effective by the Securities and Exchange Commission).
Payment shall be made in cash, or by certified or bank
cashier's check payable to the order of the Company, free from all collection
charges.
If notice of the exercise of this option is given by a person
or persons other than you, the Company may require, as a condition to the
exercise of this option, the submission to the Company of appropriate proof of
the right of such person or persons to exercise this option.
04
5. Issuance of Shares
Certificate for shares of the Common Stock so purchased will
be issued as soon as practicable. The Company, however, shall not be required to
issue or deliver a certificate for any shares until it has complied with all
requirements of the Securities Act of 1933, the Securities Exchange Act of 1934,
any stock exchange on which the Company's Common Stock may then be listed and
all applicable state laws in connection with the issuance or sale of such shares
or the listing of such shares on said exchange.
6. No Rights as Shareholder
Until the date that the conditions to exercise are, in the
Company's sole determination, satisfied, you (or such other person as may be
entitled to exercise this option) shall have none of the rights of a shareholder
with respect to Common Stock upon exercise of this option.
7. Termination of Directorship and Options
Nothing in this option agreement shall entitle you to continue to serve as
a director. If your service as a member of the Board of Directors of the Company
is terminated for any reason other than by death or retirement, this option
shall lapse and expire the earlier of seven months from the date such
termination or the Expiration Date; provided, however, in the event that the
directorship is terminated prior to the date that the option may be first
exercised as set forth in Section 3 hereof, the option shall be exercisable
commencing on the date of termination until a date which is seven months after
termination.
8. Acceleration of Options
Notwithstanding any contrary installment period with respect to this
option and unless the Board of Directors determine otherwise, this outstanding
option shall become exercisable in full for the aggregate number of shares
covered thereby in the event: (i) the Board of Directors (or, if approval of the
stockholders is required as a matter of law, the stockholders of the Company)
shall approve (a) any consolidation or merger of the Company in which the
Company is not the continuing or surviving corporation or pursuant to which
shares of Common Stock would be converted into cash, securities or other
property, other than a merger of the Company in which the holders of Common
Stock immediately prior to the merger have the same proportionate ownership of
common stock of the surviving corporation immediately after the merger, or (b)
any sale, lease, exchange, or other transfer (in one transaction or a series of
related transactions) of all, or substantially all, of the assets of the
Company, or (c) the adoption of any plan or proposal for the liquidation or
dissolution of the Company; or (ii) any person (as such term is defined in
Sections 13(d)(3) and 14(d)(2) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act")), corporation or other entity (other than the
Company or any employee benefit plan sponsored by the Company or any Subsidiary)
(a) shall purchase any Common Stock (or securities convertible into the
Company's Common Stock) for cash, securities or any other consideration pursuant
to a tender offer or exchange offer, without the prior consent of the Board of
Directors, or (b) shall become the "beneficial owner" (as such term is defined
in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of
the Company representing twenty-five percent (25%) or more of the combined
voting power of the then outstanding securities of the Company ordinarily (and
apart from rights accruing under special circumstances) having the right to vote
in the election of Directors (calculated as provided in paragraph (d) of such
Rule 13(d)(3) in the case of rights to acquire the Company's Securities); or
(iii) during any period of two consecutive years or less, individuals who at the
beginning of such period constitute the entire Board of Directors shall cease
for any reason to constitute a majority thereof unless the election, or the
nomination for election by the Company's stockholders, of each new director was
approved by a vote of at least a majority of the directors then still in office.
Notwithstanding the foregoing, if the acceleration of this option, either alone
or together with other payments which the holder has the right to receive from
the Company, would constitute an "excess parachute payment" as defined in
Section 280G of the Code, such acceleration shall be reduced to the largest
amount as will result in no portion of the acceleration under this Section 8
being subject to the excise tax imposed by Section 4999 of the Code.
05
9. Death
If you die while serving as a member of the Board of Directors
of the Company, any option which was exercisable by you at the date of your
death may be exercised by your legatee or legatees under your Will, or by your
personal representatives or distributees, within one year from the date of your
death, but in no event after the Expiration Date.
10. Non-Transferability of Option
This option shall not be transferable except by will or the
laws of descent and distribution, and may be exercised during your lifetime only
by you. Notwithstanding the foregoing, any proposed transfer shall be subject to
the Internal Revenue Code, the rules and regulations promulgated thereunder and
the federal securities laws and regulations.
11. Adjustments Upon Changes in Capitalization
If at any time after the date of grant of this option, the
Company shall, by stock dividend, split-up, combination, reclassification or
exchange, or through merger or consolidation, or otherwise, change its shares of
Common Stock into a different number or kind or class of shares or other
securities or property, then the number of shares covered by this option and the
price of each such share shall be proportionately adjusted for any such change
by the Board of Directors whose determination shall be conclusive. Any fraction
of a share resulting from any adjustment shall be eliminated through the payment
of cash based upon the fair market value (determined in accordance with the
definition in Section 4) of the Common Stock.
12. Withholding
The Company shall have the power and the right to deduct or
withhold, or require an Optionee to remit to the Company as a condition
precedent for the fulfillment of any Option Exercise, an amount sufficient to
satisfy Federal, state, and local taxes, domestic or foreign, required by law or
regulation to be withheld with respect to any taxable event arising as a result
of the exercise of Options. Whenever Shares are to be issued or cash paid to a
Optionee upon exercise of an Option, the Company shall have the right to require
the Optionee to remit to the Company, as a condition of exercise of the Option,
an amount sufficient to satisfy federal, state and local withholding tax
requirements at the time of exercise.
13. Tax Treatment
This option is not intended to qualify for "incentive stock
option" treatment under the provisions of Section 422 of the Internal Revenue
Code of 1986, as amended. You are urged to consult with your individual tax
advisor prior to exercising this option. As a condition to the exercise of this
option, you agree to notify the Company promptly upon the sale or other
disposition of the shares of Common Stock you received upon exercise of this
option.
Sincerely yours,
FIRST MONTAUK FINANCIAL CORP.
By:--------------------------------
Name: Victor K. Kurylak
Title: President
Corporate Seal
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William J. Kurinsky, Secretary
06
OPTION EXERCISE FORM
<<Name>>
<<OptionNo>>
TO: FIRST MONTAUK FINANCIAL CORP.
Parkway 109 Office Center
328 Newman Springs Road
Red Bank, NJ 07701
Attn: General Counsel
Ladies/Gentlemen:
The undersigned holder hereby irrevocably elects to exercise the right
to purchase _________ shares of Common Stock covered by this Option Agreement
according to the conditions hereof and herewith makes full payment of the
Exercise Price of such shares as follows (PLEASE CHOOSE FORM OF PAYMENT).
___. Cash Purchase. The undersigned hereby elects to pay the exercise
price in cash, and encloses a CERTIFIED CHECK OR BANK CASHIER'S CHECK (or has
wired payment) in the amount of $____________.
The undersigned understands and agrees that the Company shall have the
power and the right to deduct or withhold, or require a Optionee to remit to the
Company as a condition precedent for the fulfillment of any Option exercise, an
amount sufficient to satisfy Federal, state, and local taxes, domestic or
foreign, required by law or regulation to be withheld with respect to any
taxable event arising as a result of this Option. Whenever Shares are to be
issued or cash paid to a Optionee upon exercise of an Option, the Company shall
have the right to require the Optionee to remit to the Company, as a condition
of exercise of the Option, an amount sufficient to satisfy federal, state and
local withholding tax requirements at the time of exercise.
Further, the undersigned hereby covenants and agrees to promptly notify
the Company of the sale of any Shares during the one year period commencing on
the date hereof.
The Shares are being acquired by the undersigned for investment
purposes, and not with a view to their distribution or resale unless otherwise
permitted under law.
07
Kindly deliver to the undersigned a certificate representing the Shares
as follows.
INSTRUCTIONS FOR DELIVERY
Name: ____________________________________________________________
(please type or print in block letters)
Address: ____________________________________
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Social Security No.: ____________________________
Dated: _________________________
Signature ________________________________
Print Name:______________________________