Exhibit 10.2

 

 

Black Ridge Oil & Gas, Inc.

 

STOCK OPTION AGREEMENT

(2012 Amended and Restated Stock Incentive Plan)

 

Black Ridge Oil & Gas, Inc. (the "Company"), pursuant to the 2012 Amended and
Restated Stock Incentive Plan (as such plan may be amended and/or restated, the
"Plan"), hereby grants to Optionee listed below ("Optionee"), an option to
purchase the number of shares of the Company's Common Stock ("Shares") set forth
below, subject to the terms and conditions of the Plan and this Stock Option
Agreement. Unless otherwise defined herein, the terms defined in the Plan shall
have the same defined meanings in this Stock Option Agreement.

 

BACKGROUND

 

       A.       Employee is serving as an associate for the Company and the
Company desires to award Employee for his or her services to the Company; and

 

       B.       The Company has adopted the 2012 Amended and Restated Stock
Incentive Plan (the “Plan”) pursuant to which shares of common stock, $0.001 par
value, of the Company have been reserved for issuance under the Plan.

 

I.        NOTICE OF STOCK OPTION GRANT

 

Optionee:   ________________       Date of Stock Option Agreement:   September
___, 2012       Date of Grant:   September ___, 2012       Vesting Commencement
Date:   September ___, 2013       Exercise Price per Share:   $[_____]      
Total Number of Shares Granted:     ___________        Shares       Total
Exercise Price:   $[_______]       Term/Expiration Date:   September ___, 2022  
    Type of Option: x   Incentive Stock Option    Non-Qualified Stock Option    
     

 

Vesting Schedule:       This Option shall vest and become exercisable only to
the extent that all, or any portion thereof, has vested. Except as otherwise
provided herein, the Option shall vest in three (3) annual installments,
commencing one year from the Date of Grant, as noted above, and continuing on
the next two (2) anniversaries thereof (hereinafter referred to singularly as a
“Vesting Date” and collectively as “Vesting Dates”), until the Option is fully
vested, as set forth in the following schedule:

 

No. of Shares to be Vested   Vesting Date       _________   September ___, 2013
      _________   September ___, 2014       _________   September ___, 2015    
  _________   September ___, 2016       _________   September ___, 2017

 

1

 

 

II.       AGREEMENT

 

1.       Grant of Option. The Company hereby irrevocably grants from the Plan to
Optionee an Option to purchase the number of Shares set forth in the Notice of
Grant, at the exercise price per Share set forth in the Notice of Grant (the
"Exercise Price"). Notwithstanding anything to the contrary anywhere else in
this Stock Option Agreement, the Option is subject to the terms, definitions and
provisions of the Plan adopted by the Company, which is incorporated herein by
reference.

 

If designated in the Notice of Grant as an Incentive Stock Option, this Option
is intended to qualify as an Incentive Stock Option as defined in Section 422 of
the Code; provided, however, that to the extent that the aggregate Fair Market
Value of stock with respect to which Incentive Stock Options (within the meaning
of Code Section 422, but without regard to Code Section 422(d)), including the
Option, are exercisable for the first time by Optionee during any calendar year,
exceeds $100,000, such options shall be treated as not qualifying under Code
Section 422, but rather shall be treated as Non-Qualified Stock Options to the
extent required by Code Section 422. The rule set forth in the preceding
sentence shall be applied by taking options into account in the order in which
they were granted. For purposes of these rules, the Fair Market Value of stock
shall be determined as of the time the option with respect to such stock is
granted.

 

2.       Exercise of Option. This Option is exercisable as follows:

 

(a)       Right to Exercise.

 

(i)       This Option shall be exercisable cumulatively according to the Vesting
Schedule set forth in the Notice of Grant. For purposes of this Stock Option
Agreement, Shares subject to this Option shall vest as provided in the Vesting
Schedule set forth in the Notice of Grant.

 

(ii)       This Option may not be exercised for a fraction of a Share.

 

(iii)       In the event of Optionee's death, disability or other termination of
Optionee's status as an employee, officer or Board Member, the exercisability of
the Option is governed by Section 7 below and the Termination Provisions set
forth in the Notice of Grant.

 

(iv)       In no event may this Option be exercised after the date of expiration
of the term of this Option as set forth in the Notice of Grant.

 

(b)       Method of Exercise. This Option shall be exercisable by written Notice
(substantially in the form attached as Exhibit A). The Notice must state the
number of Shares for which the Option is being exercised, and such other
representations and agreements with respect to such Shares as may be required by
the Company pursuant to the provisions of the Plan. The Notice must be signed by
Optionee and shall be delivered in person or by certified mail to the Secretary
of the Company. The Notice must be accompanied by payment of the Exercise Price
plus payment of any applicable withholding tax. This Option shall be deemed to
be exercised upon receipt by the Company of such written Notice accompanied by
the Exercise Price and payment of any applicable withholding tax. No Shares
shall be issued pursuant to the exercise of an Option unless such issuance and
such exercise comply with all relevant provisions of law and the requirements of
any stock exchange upon which the Shares may then be listed. Assuming such
compliance, for income tax purposes the Shares shall be considered transferred
to Optionee on the date on which the Option is exercised with respect to such
Shares.

 

3.       Optionee's Representations. If the Shares purchasable pursuant to the
exercise of this Option have not been registered under the Securities Act or any
applicable state laws at the time this Option is exercised, Optionee shall, if
required by the Company, concurrently with the exercise of all or any portion of
this Option, deliver to the Company his or her Investment Representation
Statement in the form attached hereto as Exhibit B and shall make such other
written representations as are deemed necessary or appropriate by the Company
and/or its counsel.

 

2

 

 

4.       Lock-Up Period. Optionee hereby agrees that, if so requested by the
Company or any representative of the underwriters (the "Managing Underwriter")
in connection with any registration of the offering of any securities of the
Company under the Securities Act or any applicable state laws, Optionee shall
not sell or otherwise transfer any Shares or other securities of the Company
during the 180-day period (or such longer period as may be requested in writing
by the Managing Underwriter and agreed to in writing by the Company) (the
"Market Standoff Period") following the effective date of a registration
statement of the Company filed under the Securities Act; provided, however, that
such restriction shall apply only to the first registration statement of the
Company to become effective under the Securities Act that includes securities to
be sold on behalf of the Company to the public in an underwritten public
offering under the Securities Act. The Company may impose stop-transfer
instructions with respect to securities subject to the foregoing restrictions
until the end of such Market Standoff Period and these restrictions shall be
binding on any transferee of such Shares.

 

5.       Method of Payment. Payment of the Exercise Price shall be payable in US
dollars by any of the following, or a combination thereof, at the election of
Optionee:

 

(a)           cash;

 

(b)           uncertified, or certified check; bank draft; or

 

(c)           with the consent of the Board,

 

(i)       by delivery of shares of Common Stock in payment of all or any part of
the option price, which shares shall b valued for this purpose at the Fair
Market Value (as such term is defined in the Plan) on the date such option is
exercised; or;

 

(ii)      by instructing the Company to withhold from the shares of Common Stock
issuable upon exercise of the stock option shares of Common Stock in payment of
all or any part of the exercise price and/or any related withholding tax
obligations, which shares shall be valued for this purpose at the Fair Market
Value or in such other manner as may be authorized from time to time by the
Board (Cashless Exercise);

 

All shares that shall be purchased upon the exercise of the Option as provided
herein shall be fully paid and non-assessable.

 

6.       Restrictions on Exercise. If the issuance of Shares upon such exercise
or if the method of payment for such shares would constitute a violation of any
applicable federal or state securities or other law or regulation, then the
Option may not be exercised. The Company may require Optionee to make any
representation and warranty to the Company as may be required by any applicable
law or regulation before allowing the Option to be exercised.

 

7.       Termination of Relationship. If Optionee ceases to be a Board Member,
Officer or Employee for any reason other than death, disability or termination
for cause, Optionee shall have the right to exercise the Option at any time
within twelve (12) months after the date Optionee ceased to be a Non-Employee
Director or Employee to the extent of the full number of shares exercisable by
Optionee on the date he or she ceased to be a Non-Employee Director or Employee,
and the unvested portion shall not vest and all of Optionee’s rights to such
unvested parts of the Option shall terminate. Upon the expiration of such twelve
(12) month period, or, if earlier, upon the expiration date of the Options as
set forth above, the Options shall terminate and become null and void.

 

8.       Non-Transferability of Option. This Option may not be transferred in
any manner except by will or by the laws of descent or distribution. It may be
exercised during the lifetime of Optionee only by Optionee. The terms of this
Option shall be binding upon the executors, administrators, heirs, successors
and assigns of Optionee.

 

9.       Term of Option. This Option may be exercised only within the term set
forth in the Notice of Grant.

3

 

 

10.       Restrictions on Shares. Optionee hereby agrees that Shares purchased
upon the exercise of the Option shall be subject to such terms and conditions as
the Administrator shall determine in its sole discretion, including, without
limitation, restrictions on the transferability of Shares, the right of the
Company to repurchase Shares, the right of the Company to require that Shares be
transferred in the event of certain transactions, a right of first refusal in
favor of the Company with respect to permitted transfers of Shares, tag-along
rights and take-along rights. Such terms and conditions may, in the
Administrator's sole discretion, be contained in the Exercise Notice with
respect to the Option or in such other agreement as the Administrator shall
determine and which Optionee hereby agrees to enter into at the request of the
Company.

 

11.       No Right to Employment. Nothing in the Plan or in this Stock Option
Agreement shall confer upon Optionee any right to serve or continue as an
Employee, Director or Consultant of the Company or any Parent or Subsidiary, or
shall interfere with or restrict in any way the rights of the Company or any
Parent or Subsidiary, which are hereby expressly reserved, to discharge Optionee
at any time for any reason whatsoever, with or without Cause, except to the
extent expressly provided otherwise in a written employment agreement between
Optionee and the Company or any Parent or Subsidiary.

 

This Stock Option Agreement may be executed in two or more counterparts, each of
which shall be deemed an original and all of which shall constitute one
document.

 

 

  Black Ridge Oil & Gas, Inc.       By:     Name: Kenneth DeCubellis   Title:
Chief Executive Officer

 

OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO THE
OPTION HEREOF IS EARNED ONLY BY CONTINUING AS A BOARD MEMBER OR EXECUTIVE
OFFICER AT THE WILL OF THE COMPANY (NOT THROUGH THE ACT OF BEING HIRED, BEING
GRANTED THIS OPTION OR ACQUIRING SHARES HEREUNDER). OPTIONEE FURTHER
ACKNOWLEDGES AND AGREES THAT NOTHING IN THIS STOCK OPTION AGREEMENT, NOR IN THE
COMPANY'S 2010 STOCK INCENTIVE PLAN WHICH IS INCORPORATED HEREIN BY REFERENCE,
SHALL CONFER UPON OPTIONEE ANY RIGHT WITH RESPECT TO CONTINUATION AS A BOARD
MEMBER OR EXECUTIVE OFFICER OF THE COMPANY OR ANY PARENT OR SUBSIDIARY, NOR
SHALL IT INTERFERE IN ANY WAY WITH OPTIONEE'S RIGHT OR THE COMPANY'S RIGHT TO
TERMINATE OPTIONEE'S BOARD MEMBER OR EXECUTIVE OFFICER RELATIONSHIP AT ANY TIME,
WITH OR WITHOUT CAUSE AND WITH OR WITHOUT PRIOR NOTICE.

 

Optionee acknowledges receipt of a copy of the Plan and represents that he or
she is familiar with the terms and provisions thereof. Optionee hereby accepts
this Option subject to all of the terms and provisions hereof. Optionee has
reviewed the Plan and this Option in their entirety, has had an opportunity to
obtain the advice of counsel prior to executing this Option and fully
understands all provisions of the Option. Optionee hereby agrees to accept as
binding, conclusive and final all decisions or interpretations of the
Administrator upon any questions arising under the Plan or this Option. Optionee
further agrees to notify the Company upon any change in the residence address
indicated below.

 

Dated:       By:           Name:                       Address:              

 

4

 

 

EXHIBIT A

 

Black Ridge Oil & Gas, Inc.

 

2012 Amended and Restated Stock Incentive Plan

 

EXERCISE NOTICE

 

Black Ridge Oil & Gas, Inc. Attention: CFO

 

1.       Exercise of Option. Effective as of today,                       , the
undersigned ("Optionee"), hereby elects to exercise Optionee's option to
purchase _________ shares of the Common Stock (the "Shares") of Black Ridge Oil
& Gas, Inc. (the "Company") under and pursuant to the 2012 Amended and Restated
Stock Incentive Plan (as such plan may be amended and/or restated, the "Plan")
and the Stock Option Agreement dated _________, 201_ (the "Option Agreement"). 
Capitalized terms used herein without definition shall have the meanings given
in the Option Agreement.

 

  Date of Grant: September ___, 2012                  Number of Shares as to
which Option is Exercised: _________                 Exercise Price per Share:
$[____]                 Total Exercise Price: __________                
Certificate to be issued in name of:                   Cash Payment delivered
herewith:   $               Type of Option: [x]  Incentive Stock Option [  ] 
Non-Qualified Stock Option                    

 

2.       Representations of Optionee. Optionee acknowledges that Optionee has
received, read and understood the Plan and the Option Agreement. Optionee agrees
to abide by and be bound by their terms and conditions.

 

3.       Rights as Stockholder. Until the stock certificate evidencing such
Shares is issued (as evidenced by the appropriate entry on the books of the
Company or of a duly authorized transfer agent of the Company), no right to vote
or receive dividends or any other rights as a stockholder shall exist with
respect to Shares subject to the Option, notwithstanding the exercise of the
Option. The Company shall issue (or cause to be issued) such stock certificate
promptly after the Option is exercised.

 

No adjustment will be made for a dividend or other right for which the record
date is prior to the date the stock certificate is issued, except as provided in
Section 14 of the Plan. Optionee shall enjoy rights as a stockholder until such
time as Optionee disposes of the Shares or the Company and/or its
assignee(s) exercises the Right of First Refusal or the Take-Along Right
hereunder (each as defined below).  Upon such exercise, Optionee shall have no
further rights as a holder of the Shares so purchased except the right to
receive payment for the Shares so purchased in accordance with the provisions of
this Exercise Notice, and Optionee shall forthwith cause the certificate(s)
evidencing the Shares so purchased to be surrendered to the Company for transfer
or cancellation.

 

4.       Company's Right of First Refusal. Before any Shares held by Optionee
(including, for purposes of Sections 4 and 5 hereof, any permitted transferee
holding Shares) may be sold, pledged, assigned, hypothecated, transferred, or
otherwise disposed of (including transfer by gift or operation of law)
(collectively, "Transfer" or "Transferred"), the Company or its
assignee(s) shall have a right of first refusal to purchase the Shares on the
terms and conditions set forth in this Section 4 (the "Right of First Refusal").

 

5

 

 

(a)       Notice of Proposed Transfer. Optionee shall deliver to the Company a
written notice (the "Notice") stating: (i) Optionee's bona fide intention to
sell or otherwise Transfer such Shares; (ii) the name of each proposed purchaser
or other transferee ("Proposed Transferee"); (iii) the number of Shares to be
Transferred to each Proposed Transferee; and (iv) the bona fide cash price or
other consideration for which Optionee proposes to Transfer the Shares (the
"Offered Price"), and Optionee shall offer the Shares at the Offered Price to
the Company or its assignee(s).

 

(b)       Exercise of Right of First Refusal. Within thirty (30) days after
receipt of the Notice, the Company and/or its assignee(s) may elect in writing
to purchase all, but not less than all, of the Shares proposed to be transferred
to any one or more of the Proposed Transferees. The purchase price will be
determined in accordance with subsection (c) below.

 

(c)       Purchase Price. The purchase price (the "ROFR Purchase Price") for the
Shares repurchased under this Section shall be the Offered Price. If the Offered
Price includes consideration other than cash, the cash equivalent value of the
non-cash consideration shall be determined by the Board in good faith.

 

(d)       Payment. Payment of the ROFR Purchase Price shall be made, at the
option of the Company or its assignee(s), in cash (by check), by cancellation of
all or a portion of any outstanding indebtedness of Optionee to the Company (or,
in the case of repurchase by an assignee, to the assignee), or by any
combination thereof within thirty (30) days after receipt of the Notice or in
the manner and at the times set forth in the Notice.

 

(e)       Optionee's Right to Transfer. If all of the Shares proposed in the
Notice to be transferred to a given Proposed Transferee are not purchased by the
Company and/or its assignee(s) as provided in this Section, then Optionee may
sell or otherwise Transfer such Shares to that Proposed Transferee at the
Offered Price or at a higher price, provided that such sale or other Transfer is
consummated within one hundred twenty (120) days after the date of the Notice
and provided further that any such sale or other Transfer is effected in
accordance with any applicable securities laws and the Proposed Transferee
agrees in writing that (i) the provisions hereof, including without limitation
the provisions of Sections 4 and 5 shall continue to apply to the Shares in the
hands of such Proposed Transferee and (ii) that such Proposed Transferee will
not transfer the Shares any other purchaser or transferee unless such future
purchase or transferee agrees in writing to be bound by the provisions hereof,
including without limitation the provisions of Sections 4 and 5 hereof. If the
Shares described in the Notice are not Transferred to the Proposed Transferee
within such period, a new Notice shall be given to the Company, and the Company
and/or its assignees shall again be offered the Right of First Refusal as
provided herein before any Shares held by the Holder may be sold or otherwise
Transferred.

 

(f)       Exception for Certain Family Transfers.  Anything to the contrary
contained in this Section 4 notwithstanding, the Transfer of any or all of the
Shares during Optionee's lifetime or on Optionee's death by will or intestacy to
Optionee's Immediate Family or a trust for the benefit of Optionee's Immediate
Family shall be exempt from the Right of First Refusal.  As used herein,
"Immediate Family" shall mean spouse, lineal descendant or antecedent, father,
mother, brother or sister or stepchild (whether or not adopted).  In such case,
the transferee or other recipient shall receive and hold the Shares so
Transferred subject to the provisions hereof, including without limitation the
provisions of Sections 4 and 5 hereof, and there shall be no further Transfer of
such Shares except in accordance with the terms hereof.

 

(g)       Termination of Right of First Refusal.  The Right of First Refusal
shall terminate as to the Shares upon the Public Trading Date of the Shares. For
the purposes of the Stock Option Agreement and this Exercise Notice, the “Public
Trading Date” of the Shares is the date on which the Shares first become freely
tradeable under the Securities Act of 1933, as amended (the “Act”), either
pursuant to Rule 144 or another provision of the Act. The holder of the Shares
may apply to have all restrictive transfer legends removed from the certificates
evidencing the Shares without delivering a notice to the Company pursuant to
Section 4(a) of this Exercise Notice, provided that the request for legend
removal is made at such times and in such manner that removal is accomplished in
compliance with the Act and the rules and regulations promulgated under the Act.

 

5.       Company Take-Along Right.

 

(a)       Approved Sale. If the Board shall deliver a notice to Optionee (a
"Sale Event Notice") stating that the Board has approved a sale of all or a
portion of the Company (an "Approved Sale") and specifying the name and address
of the proposed parties to such transaction and the consideration payable in
connection therewith, Optionee shall (i) consent to and raise no objections
against the Approved Sale or the process pursuant to which the Approved Sale was
arranged, (ii) waive any dissenter's rights and other similar rights, and (iii)
if the Approved Sale is structured as a sale of securities, agree to sell
Optionee's Shares on the terms and conditions of the Approved Sale which terms
and conditions shall treat all stockholders of the Company equally (on a pro
rata basis), except that shares having a liquidation preference may receive an
amount of consideration equal to such liquidation preference in addition to the
consideration being paid to the holders of shares not having a liquidation
preference.  Notwithstanding the foregoing, the sale of the Shares in an
Approved Sale shall be further subject to the terms of the Plan.

 

Optionee will take all necessary and desirable lawful actions as directed by the
Board and the stockholders of the Company approving the Approved Sale in
connection with the consummation of any Approved Sale, including without
limitation, the execution of such agreements and such instruments and other
actions reasonably necessary to (A) provide the representations, warranties,
indemnities, covenants, conditions, non-compete agreements, escrow agreements
and other provisions and agreements relating to such Approved Sale and, (B)
effectuate the allocation and distribution of the aggregate consideration upon
the Approved Sale, provided, that this Section 5 shall not require Optionee to
indemnify the purchaser in any Approved  Sale for breaches of the
representations, warranties or covenants of the Company or any other
stockholder, except to the extent (x) Optionee is not required to incur more
than its pro rata share of such indemnity obligation (based on the total
consideration to be received by all stockholders that are similarly situated and
hold the same class or series of capital stock) and (y) such indemnity
obligation is provided for and limited to a post-closing escrow or holdback
arrangement of cash or stock paid in connection with the Approved Sale.

 

(b)       Costs. Optionee will bear Optionee's pro rata share (based upon the
amount of consideration to be received) of the reasonable costs of any sale of
Shares pursuant to an Approved Sale to the extent such costs are incurred for
the benefit of all selling stockholders of the Company and are not otherwise
paid by the Company or the acquiring party. Costs incurred by Optionee on
Optionee's own behalf will not be considered costs of the transaction hereunder.

 

(c)       Share Delivery. At the consummation of the Approved Sale, Optionee
shall, if applicable, deliver certificates representing the Shares to be
transferred, duly endorsed for transfer and accompanied by all requisite stock
transfer taxes, if any, and the Shares to be transferred shall be free and clear
of any liens, claims or encumbrances (other than restrictions imposed by this
Agreement) and Optionee shall so represent and warrant.

 

(d)       Termination of Company Take-Along Right. The Take-Along Right shall
terminate as to the Shares upon the Public Trading Date of the Shares, as
defined in Section 4(g) of this Exercise Notice.

 

6.       Tax Consultation. Optionee understands that Optionee may suffer adverse
tax consequences as a result of Optionee's purchase or disposition of the
Shares.  Optionee represents that Optionee has consulted with any tax
consultants Optionee deems advisable in connection with the purchase or
disposition of the Shares and that Optionee is not relying on the Company for
any tax advice.

 

7.       Lock-Up Period. Optionee hereby agrees that if so requested by the
Company or any representative of the underwriters (the "Managing Underwriter")
in connection with any registration of the offering of any securities of the
Company under the Securities Act or any applicable state laws, Optionee shall
not sell or otherwise transfer any Shares or other securities of the Company
during the 180-day period (or such longer period as may be requested in writing
by the Managing Underwriter and agreed to in writing by the Company) (the
"Market Standoff Period") following the effective date of a registration
statement of the Company filed under the Securities Act; provided, that such
restriction shall apply only to the first registration statement of the Company
to become effective under the Securities Act that includes securities to be sold
on behalf of the Company to the public in an underwritten public offering under
the Securities Act.  The Company may impose stop-transfer instructions with
respect to securities subject to the foregoing restrictions until the end of
such Market Standoff Period.

 

8.       Restrictive Legends and Stop-Transfer Orders.

 

(a)       Legends. Optionee understands and agrees that the Company shall cause
the legends set forth below or legends substantially equivalent thereto, to be
placed upon any certificate(s) evidencing ownership of the Shares together with
any other legends that may be required by state or federal securities laws:

 

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933 (THE "ACT") OR ANY APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE
OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL
REGISTERED UNDER THE ACT AND SUCH LAWS OR, IN THE OPINION OF COUNSEL IN FORM AND
SUBSTANCE SATISFACTORY TO THE ISSUER OF THESE SECURITIES, SUCH OFFER, SALE OR
TRANSFER, PLEDGE OR HYPOTHECATION IS IN COMPLIANCE THEREWITH.

 

THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS
ON TRANSFER AND RIGHT OF FIRST REFUSAL OPTIONS HELD BY THE ISSUER OR ITS
ASSIGNEE(S) AS SET FORTH IN THE EXERCISE NOTICE BETWEEN THE ISSUER AND THE
ORIGINAL HOLDER OF THESE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE
PRINCIPAL OFFICE OF THE ISSUER. SUCH TRANSFER RESTRICTIONS AND RIGHT OF FIRST
REFUSAL ARE BINDING ON TRANSFEREES OF THESE SHARES UNTIL THE SHARES FIRST BECOME
FREELY TRADEABLE IN OPEN MARKET TRANSACTIONS IN A PUBLIC TRADING MARKET UNDER
THE ACT.

6

 

 

(b)       Stop-Transfer Notices.  Optionee agrees that, in order to ensure
compliance with the restrictions referred to herein, the Company may issue
appropriate "stop transfer" instructions to its transfer agent, if any, and
that, if the Company transfers its own securities, it may make appropriate
notations to the same effect in its own records.

 

(c)       Refusal to Transfer.  The Company shall not be required (i) to
transfer on its books any Shares that have been sold or otherwise transferred in
violation of any of the provisions of this Agreement or (ii) to treat as owner
of such Shares or to accord the right to vote or pay dividends to any purchaser
or other transferee to whom such Shares shall have been so transferred.

 

9.       Successors and Assigns.  The Company may assign any of its rights under
this Agreement to single or multiple assignees, and this Agreement shall inure
to the benefit of the successors and assigns of the Company.  Subject to the
restrictions on transfer herein set forth, this Agreement shall be binding upon
Optionee and his or her heirs, executors, administrators, successors and
assigns.

 

10.       Interpretation. Any dispute regarding the interpretation of this
Agreement shall be submitted by Optionee or by the Company forthwith to the
Administrator, which shall review such dispute at its next regular meeting.  The
resolution of such a dispute by the Administrator shall be final and binding on
the Company and on Optionee.

 

11.       Governing Law; Severability. This Agreement shall be governed by and
construed in accordance with the laws of the State of Nevada excluding that body
of law pertaining to conflicts of law.  Should any provision of this Agreement
be determined by a court of law to be illegal or unenforceable, the other
provisions shall nevertheless remain effective and shall remain enforceable.

 

12.       Notices. Any notice required or permitted hereunder shall be given in
writing and shall be deemed effectively given upon personal delivery or upon
deposit in the United States mail by certified mail, with postage and fees
prepaid, addressed to the other party at its address as shown below beneath its
signature, or to such other address as such party may designate in writing from
time to time to the other party.

 

13.       Further Instruments. The parties agree to execute such further
instruments and to take such further action as may be reasonably necessary to
carry out the purposes and intent of this Agreement.

 

14.       Delivery of Payment. Optionee herewith delivers to the Company the
full Exercise Price for the Shares, as well as any applicable withholding tax.

 

15.       Entire Agreement. The Plan and Option Agreement are incorporated
herein by reference. This Agreement, the Plan, the Option Agreement and the
Investment Representation Statement constitute the entire agreement of the
parties and supersede in their entirety all prior undertakings and agreements of
the Company and Optionee with respect to the subject matter hereof.

 

 

Accepted by:  Submitted by:        BLACK RIDGE OIL & GAS, INC.  OPTIONEE       
By:   By:                Address: 10275 Wayzata Boulevard, Suite 310
Minnetonka, MN 55305  

Address:

 

             

 

7

 

 

EXHIBIT B

 

INVESTMENT REPRESENTATION STATEMENT

 

OPTIONEE : ___________________       COMPANY : Black Ridge Oil & Gas, Inc.      
SECURITY : Options to purchase Common Stock       AMOUNT : _________ shares    
  DATE :  

 

In connection with the purchase of the above-listed shares of Common Stock (the
"Securities") of Black Ridge Oil & Gas, Inc. (the "Company"), the undersigned
(the "Optionee") represents to the Company the following:

 

(a)       Optionee is aware of the Company's business affairs and financial
condition and has acquired sufficient information about the Company to reach an
informed and knowledgeable decision to acquire the Securities.  Optionee is
acquiring these Securities for investment for Optionee's own account only and
not with a view to, or for resale in connection with, any "distribution" thereof
within the meaning of the Securities Act of 1933, as amended (the "Securities
Act").

 

(b)       Optionee acknowledges and understands that the Securities constitute
"restricted securities" under the Securities Act and have not been registered
under the Securities Act in reliance upon a specific exemption therefrom, which
exemption depends upon, among other things, the bona fide nature of Optionee's
investment intent as expressed herein. Optionee understands that the Securities
must be held indefinitely unless they are subsequently registered under the
Securities Act or an exemption from such registration is available.  Optionee
further acknowledges and understands that the Company is under no obligation to
register the Securities.  Optionee understands that the certificate evidencing
the Securities will be imprinted with a legend which prohibits the transfer of
the Securities unless they are registered or such registration is not required
in the opinion of counsel satisfactory to the Company and any other legend
required under applicable state securities laws.

 

(c)       Optionee is familiar with the provisions of Rule 701 and Rule 144,
each promulgated under the Securities Act, which, in substance, permit limited
public resale of "restricted securities" acquired, directly or indirectly from
the issuer thereof, in a non-public offering subject to the satisfaction of
certain conditions.  Rule 701 provides that if the issuer qualifies under
Rule 701 at the time of the grant of the Option to Optionee, the exercise will
be exempt from registration under the Securities Act.

 

       In the event the Company becomes subject to the reporting requirements of
Section 13 or 15(d) of the Securities Exchange Act of 1934, ninety (90) days
thereafter (or such longer period as any market stand-off agreement may require)
the Securities exempt under Rule 701 may be resold, subject to the satisfaction
of certain of the conditions specified by Rule 144, including, in the case of an
affiliate, (i) the resale being made through a broker in an unsolicited
"broker's transaction" or in transactions directly with a market maker (as said
term is defined under the Securities Exchange Act of 1934), (ii) the
availability of certain public information about the Company, (iii) the amount
of Securities being sold during any three (3) month period not exceeding the
limitations specified in Rule 144(e), and (iv) the timely filing of a Form 144,
if applicable.

 

       In the event that the Company does not qualify under Rule 701 at the time
of grant of the Option, then the Securities may be resold beginning ninety (90)
days after the Company becomes subject to the reporting requirements of
Section 13 or 15(d) of the Securities Exchange Act of 1934 in certain limited
circumstances subject to the provisions of Rule 144, which requires the resale
to occur not less than six months  after the later of the date the Securities
were sold by the Company or the date the Securities were sold by an affiliate of
the Company, within the meaning of Rule 144 and the availability of certain
public information about the Company (subject to certain exceptions); and, in
the case of a sale of the Securities by an affiliate,  the satisfaction of the
conditions set forth in sections (i), (ii), (iii) and (iv) of the paragraph
immediately above.

 

(d)       Optionee further understands that in the event all of the applicable
requirements of Rule 701 or 144 are not satisfied, registration under the
Securities Act, compliance with Regulation A, or some other registration
exemption will be required; and that, notwithstanding the fact that Rules 144
and 701 are not exclusive, the Staff of the Securities and Exchange Commission
has expressed its opinion that persons proposing to sell private placement
securities other than in a registered offering and otherwise than pursuant to
Rules 144 or 701 will have a substantial burden of proof in establishing that an
exemption from registration is available for such offers or sales, and that such
persons and their respective brokers who participate in such transactions do so
at their own risk. Optionee understands that no assurances can be given that any
such other registration exemption will be available in such event.

 

(e)       Optionee understands and acknowledges that the Company will rely upon
the accuracy and truth of the foregoing representations and Optionee hereby
consents to such reliance.

 

  Signature of Optionee:                 Date:          ,