Lebow Bennett S – ‘SC 13D/A’ on 10/16/98 re: Vector Group Ltd – EX-6

As of:  Friday, 10/16/98   ·   Accession #:  950144-98-11546   ·   File #:  5-06295

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Amendment to General Statement of Beneficial Ownership   —   Schedule 13D
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: SC 13D/A    Brooke Group Ltd/ Bennett S. Lebow SC 13D Amendt.5     4     21K 
 2: EX-6        Stock Option Agreement                                 6     21K 

EX-6   —   Stock Option Agreement

EX-6
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                                                                       EXHIBIT 6
                                                                       ---------

 BROOKE GROUP LTD.
100 S.E. SECOND STREET, 32ND FLOOR
MIAMI, FLORIDA 33131

 July 20, 1998

Mr. Bennett S. LeBow                                                            
5203 Fisher Island Drive                                                        
Fisher Island, Florida 33109                                                    

Dear Mr. LeBow:                                                                 

         We are pleased to inform you that Brooke Group Ltd. (the "Company") has
granted you a nonqualified option (the "Option") to purchase 2,500,000 shares of
the Company's common stock, par value $.10 per share (the "Common Stock"), at a 
purchase price of $9.75 per share, subject to adjustment (any of the underlying 
shares of Common Stock to be issued upon exercise of the Option are referred to 
hereinafter as the "Shares"), pursuant to the Company's 1998 Long-Term Incentive
Plan, as may be and is in effect and as amended from time to time (the "Plan"). 
This agreement is conditioned upon the approval of the Plan by the Company's    
stockholders and is subject in all respects to the terms and provisions of the  
Plan, all of which terms and provisions are made a part of and incorporated in  
this agreement as if they were each expressly set forth herein. In the event of 
any conflict between the terms of this agreement and the terms of the Plan, the 
terms of the Plan shall control.                                                

        1. The Option may be exercised on or prior to the tenth anniversary of
the date of grant (after which date the Option will, to the extent not          
previously exercised, expire), provided the Option shall only vest and become   
exercisable as to one-fourth of the aggregate shares covered thereby on each of 
the first four anniversaries of the date of this agreement. However, any then   
unexercisable portion of the Option shall immediately vest and become           
exercisable upon (i) the occurrence of a "Change in Control" as defined in      
Section 6(f) of the Employment Agreement dated as of June 1, 1995, as amended as
of January 1, 1996, by and between you and New Valley Corporation, regardless of
whether the Employment Agreement is then in effect (the "Employment Agreement"),
or (ii) the termination of your employment with the Company due to death or     
Disability (as defined in Section 2.8 of the Plan).                             

         2. The Option, from and after the date it vests and becomes exercisable
pursuant to Section 1 hereof, may be exercised in whole or in part by delivering
to the Company a written notice of exercise in the form attached hereto as      
Exhibit A, specifying the number of the Shares                                  

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Mr. Bennett S. LeBow                                                            
July 20, 1998                                                                   
Page 2                                                                          

to be purchased and the purchase price therefor, together with payment of the   
purchase price of the Shares to be purchased. The purchase price is to be paid  
in cash or by delivering shares of Common Stock already owned by you for at     
least six months and having a fair market value on the date of exercise equal to
the purchase price of the Option being exercised, or a combination of such      
shares and cash.                                                                

                  In addition, payment of the purchase price of the Shares to be
purchased may also be made by delivering a properly executed notice to the      
Company, together with a copy of the irrevocable instructions to a broker to    
deliver promptly to the Company the amount of sale or loan proceeds necessary to
pay the purchase price, and, if required, the amount of any federal, state or   
local withholding taxes.                                                        

                  No Shares shall be issued until full payment therefor has been
made. You shall have all of the rights of a stockholder of the Company holding  
the Common Stock that is subject to the Option (including, if applicable, the   
right to vote the Shares and the right to receive dividends thereon), when you  
have given written notice of exercise, have paid in full for such Shares and, if
requested, have given the certificate described in Section 9 hereof.            

        3. In the event your employment with the Company is terminated for any
reason, the Option shall forthwith terminate, provided that you may exercise any
then unexercised portion of the Option then vested and exercisable pursuant to  
Section 1 hereof at any time prior to the earlier of nine months after the      
termination of your employment (one year in the event of death or Disability),  
or the expiration of the Option.                                                

        4. The Option is not transferable except (i) by will or the applicable
laws of descent and distribution, (ii) as a gift to a foundation, charity or    
other not-for-profit organization, or (iii) for transfers to your family members
or trusts or other entities whose beneficiaries are your family members,        
provided that such transfer is being made for estate, tax and/or personal       
planning purposes.                                                              

5. In the event of your death or Disability, the Option may be
exercised by your personal representative or representatives, or by the person  
or persons to whom your rights under the Option shall pass by will or by the    
applicable laws of descent and distribution, within the one year period         
following termination due to death or Disability.                               

      6. In the event of any change in capitalization affecting the Common
Stock of the Company, including, without limitation, a stock dividend or other  
distribution, stock split, reverse stock split, recapitalization, consolidation,
subdivision, split-up, spin-off, split-off, combination or exchange of shares or
other form of reorganization or recapitalization, or any other change affecting 
the Common Stock, the aggregate number of shares of Common Stock                

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Mr. Bennett S. LeBow                                                            
July 20, 1998                                                                   
Page 3                                                                          

covered by the Option and the exercise price per share of Common Stock subject  
to the Option shall be proportionately adjusted by the Company.                 

         7. The grant of the Option does not confer on you any right to continue
in the employ of the Company or any of its subsidiaries or affiliates or        
interfere in any way with the right of the Company or its subsidiaries or       
affiliates to terminate the term of your employment.                            

    8. The Company shall require as a condition to the exercise of any
portion of the Option that you pay to the Company, or make other arrangements   
regarding the payment of, any federal state or local taxes required by law to be
withheld as a result of such exercise.                                          

      9. Unless at the time of the exercise of any portion of the Option a
registration statement under the Securities Act of 1933, as amended (the "Act"),
is in effect as to the Shares, the Shares shall be acquired for investment and  
not for sale or distribution, and if the Company so requests, upon any exercise 
of the Option, in whole or in part, you agree to execute and deliver to the     
Company a reasonable certificate to such effect.                                

      10. You understand and acknowledge that: (i) any Shares purchased by
you upon exercise of the Option may be required to be held indefinitely unless  
such Shares are subsequently registered under the Act or an exemption from such 
registration is available; (ii) any sales of such Shares made in reliance upon  
Rule 144 promulgated under the Act may be made only in accordance with the terms
and conditions of that Rule (which, under certain circumstances, restrict the   
number of shares which may be sold and the manner in which shares may be sold); 
(iii) certificates for Shares to be issued to you hereunder shall bear a legend 
to the effect that the Shares have not been registered under the Act and that   
the Shares may not be sold, hypothecated or otherwise transferred in the absence
of an effective registration statement under the Act relating thereto or an     
opinion of counsel satisfactory to the Company that such registration is not    
required; and (iv) the Company shall place an appropriate "stop transfer" order 
with its transfer agent with respect to such Shares.                            

     11. The Company represents and warrants to you as follows: (i) this
agreement and the grant of the Option hereunder have been authorized by all     
necessary corporate action by the Company and this letter agreement is a valid  
and binding agreement of the Company enforceable against the Company in         
accordance with its terms; (ii) the grant of the Option to you on the terms set 
forth herein will be exempt from the provisions of Section 16(b) of the         
Securities Exchange Act of 1934, as amended, pursuant to Rule 16b-3(d)          
thereunder; (iii) the Company will obtain, at its expense, any regulatory       
approvals necessary or advisable in connection with the grant of the Option or  
the issuance of the Shares; and (iv) the Company currently has reserved and     
available, and will continue to have reserved and available during the term of  
the Option, sufficient authorized and issued shares of its Common Stock for     
issuance upon exercise of the Option.                                           

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Mr. Bennett S. LeBow                                                            
July 20, 1998                                                                   
Page 4                                                                          

        12. Promptly following the date hereof, the Company shall use its best
efforts to file and keep in effect a Registration Statement on Form S-8, Form   
S-3 or other applicable form to register under the Act the Shares issuable to   
you upon exercise of the Option and the resale thereof by you.                  

       13. This letter agreement contains all the understandings between the
Company and you pertaining to the matters referred to herein, and supercedes all
undertakings and agreements, whether oral or in writing, previously entered into
by the Company and you with respect hereto. No provision of this letter         
agreement may be amended or waived unless such amendment or waiver is agreed to 
in writing signed by you and a duly authorized officer of the Company. No waiver
by the Company or you of any breach by the other party hereto of any condition  
or provision of this letter agreement to be performed by such other party shall 
be deemed a waiver of a similar or dissimilar condition or provision at the same
time, any prior time or any subsequent time. If any provision of this letter    
agreement or the application of any such provision to any party or circumstances
shall be determined by any court of competent jurisdiction to be invalid and    
unenforceable to any extent, the remainder of this letter agreement or the      
application of such provision to such person or circumstances other than those  
to which it is so determined to be invalid and unenforceable, shall not be      
affected thereby, and each provision hereof shall be validated and shall be     
enforced to the fullest extent permitted by law. This letter agreement will be  
governed by and construed in accordance with the laws of the State of Delaware, 
without regard to its conflicts of laws principles. This letter agreement may be
executed in counterparts, each of which shall be deemed an original, but all of 
which together shall constitute one and the same instrument.                    

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Mr. Bennett S. LeBow                                                            
July 20, 1998                                                                   
Page 5                                                                          

  Would you kindly evidence your acceptance of the Option and your
agreement to comply with the provisions hereof by executing this letter         
agreement in the space provided below.                                          

                           Very truly yours,

                           BROOKE GROUP LTD.

                                   By: /s/ Richard J. Lampen
                                                 -------------------------------
                                   Richard J. Lampen
                                          Executive Vice President

AGREED TO AND ACCEPTED:                                                         

/s/ Bennett S. LeBow                                                            
-------------------------------                                                 
Bennett S. LeBow                                                                

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                                                                       EXHIBIT A
                                                                       ---------

Brooke Group Ltd.                                                               
100 S. E. Second Street, 32nd Floor                                             
Miami, Florida 33131                                                            

Gentlemen:                                                                      

       Notice is hereby given of my election to purchase _________ shares of
Common Stock, $.10 par value (the "Shares"), of Brooke Group Ltd., at a price of
$9.75 per Share, pursuant to the provisions of the stock option granted to me on
July 20, 1998. Enclosed in payment for the Shares is:                           

               [ ] my check in the amount of $_________________.

               [ ] ______________ Shares having a total value of
                    $______________, such value being based on the
                        closing price(s) of the Shares on the date hereof.

The following information is supplied for use in issuing and  
registering the Shares purchased hereby:                                        

Number of Certificates                      
                     and Denominations               ---------------------------

                  Name                               ---------------------------

                  Address                            ---------------------------

                                                     ---------------------------

                                                     ---------------------------

                  Social Security No.                ---------------------------

Dated:                                                                          

                                                             Very truly yours,

                                                            Bennett S. LeBow

Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘SC 13D/A’ Filing		Date		First		Last			Other Filings
Filed on:		10/16/98							424B3
		7/20/98		1		6
		1/1/96		1
		6/1/95		1
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