STOCK OPTION AGREEMENT

DYNASTAR HOLDINGS, INC.

THIS AGREEMENT is entered into as of the ___ day of _______, 201_ (the “Date of
Grant”)

 

BETWEEN:

DYNASTAR HOLDINGS, INC., a company incorporated pursuant to the laws of the
State of Nevada,

 

(the “Company”)

 

AND: 

______________________, of [address]

 

(the “Optionee”).

WHEREAS:

 

A.      The Board of Directors of the Company (the “Board”) has approved and
adopted the Dynastar Holdings, Inc., 2011 Equity Incentive Plan (the “2011
Plan”), pursuant to which the Board is authorized to grant to employees and
other selected persons stock options to purchase common shares of the Company
(the “Common Stock”);

 

B.     The 2011 Plan provides for the granting of stock options that either (i)
are intended to qualify as “Incentive Stock Options” within the meaning of
Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”), or
(ii) do not qualify under Section 422 of the Code (“Non-Qualified Stock
Options”); and

 

C.     The Board has authorized the grant to Optionee of options to purchase a
total of ___________________ (_________) shares of Common Stock (the “Options”),
which Options are intended to be (select one):

 

x Incentive Stock Options;

¨ Non Qualified Stock Options

  

NOW THEREFORE, the Company agrees to offer to the Optionee the option to
purchase, upon the terms and conditions set forth herein and in the Plan,
___________ (___________) shares of Common Stock. Capitalized terms not
otherwise defined herein shall have the meanings ascribed thereto in the 2011
Plan.

 

1.       Exercise Price. The exercise price of the options shall be US$____ per
share.

 

2.       Limitation on the Number of Shares. If the Options granted hereby are
Incentive Stock Options, the number of shares which may be acquired upon
exercise thereof is subject to the limitations set forth in Section 7(a) of the
2011 Plan.

 

 

 

 

3.        Vesting Schedule. The Options shall vest in accordance with Exhibit A.

 

4.       Options not Transferable. The Options may not be transferred, assigned,
pledged or hypothecated in any manner (whether by operation of law or otherwise)
other than by will, by applicable laws of descent and distribution or, in the
case of a Non-Qualified Stock Option, pursuant to a qualified domestic relations
order, and shall not be subject to execution, attachment or similar process;
provided, however, that if the Options represent a Non-Qualified Stock Option,
such Option is transferable without payment of consideration to immediate family
members of the Optionee or to trusts or partnerships established exclusively for
the benefit of the Optionee and Optionee’s immediate family members. Upon any
attempt to transfer, pledge, hypothecate or otherwise dispose of any Option or
of any right or privilege conferred by the 2011 Plan contrary to the provisions
thereof, or upon the sale, levy or attachment or similar process upon the rights
and privileges conferred by the 2011 Plan, such Option shall thereupon terminate
and become null and void.

 

5.       Investment Intent. By accepting the Options, the Optionee represents
and agrees that none of the shares of Common Stock purchased upon exercise of
the Options will be distributed in violation of applicable federal and state
laws and regulations. In addition, the Company may require, as a condition of
exercising the Options, that the Optionee execute an undertaking, in such a form
as the Company shall reasonably specify, that the Stock is being purchased only
for investment and without any then-present intention to sell or distribute such
shares.

 

6.      Termination of Employment and Options. Vested Options shall terminate,
to the extent not previously exercised, upon the occurrence of the first of the
following events:

 

(a)          Expiration. Ten (10) years from the Date of Grant.

 

(b)         Termination for Cause. The date of the first discovery by the
Company of any reason for the termination of an Optionee’s employment or
contractual relationship with the Company or any related company for cause (as
determined in the sole discretion of the 2011 Plan administrator), and, if an
Optionee’s employment is suspended pending any investigation by the Company as
to whether the Optionee’s employment should be terminated for cause, the
Optionee’s rights under this Agreement and the 2011 Plan shall likewise be
suspended during the period of any such investigation.

 

(c)          Termination Due to Death or Disability. The expiration of one (1)
year from the date of the death of the Optionee or cessation of an Optionee’s
employment or contractual relationship by reason of Disability (within the
meaning of Section 22(e) of the Code). If an Optionee’s employment or
contractual relationship is terminated by death, any Option held by the Optionee
shall be exercisable only by the person or persons to whom such Optionee’s
rights under such Option shall pass by the Optionee’s will or by the laws of
descent and distribution.

 

(d)         Termination for Any Other Reason. The expiration of three (3) months
from the date of an Optionee’s termination of employment or contractual
relationship with the Company or any affiliated company or subsidiary of the
Company (a “Related Corporation”) for any reason whatsoever other than
termination of service for cause, death or Disability.

 

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Each unvested Option granted pursuant hereto shall terminate immediately upon
termination of the Optionee’s employment or contractual relationship with the
Company for any reason whatsoever, including Disability unless otherwise
provided by the Administrator.

 

7.      Stock. In the case of any stock split, stock dividend or like change in
the nature of shares of Stock covered by this Agreement, the number of shares
and exercise price shall be proportionately adjusted as set forth in Section
14(a) of the 2011 Plan.

 

8.      Exercise of Option. Options shall be exercisable, in full or in part, at
any time after vesting, until termination; provided, however, that any Optionee
who is subject to the reporting and liability provisions of Section 16 of the
Securities Exchange Act of 1934 with respect to the Common Stock shall be
precluded from selling or transferring any Common Stock or other security
underlying an Option during the six (6) months immediately following the grant
of that Option. If less than all of the shares included in the vested portion of
any Option are purchased, the remainder may be purchased at any subsequent time
prior to the expiration of the Option term. No portion of any Option for less
than fifty (50) shares (as adjusted pursuant to Section 14(a) of the 2011 Plan)
may be exercised; provided, that if the vested portion of any Option is less
than fifty (50) shares, it may be exercised with respect to all shares for which
it is vested. Only whole shares may be issued pursuant to an Option, and to the
extent that an Option covers less than one (1) share, it is unexercisable.

 

Each exercise of the Option shall be by means of delivery of a notice of
election to exercise (which may be in the form attached hereto as Exhibit B) to
the CEO of the Company at its principal executive office, specifying the number
of shares of Common Stock to be purchased and accompanied by payment in cash by
certified check or cashier’s check in the amount of the full exercise price for
the Common Stock to be purchased. In addition to payment in cash by certified
check or cashier’s check, an Optionee or transferee of an Option may pay for all
or any portion of the aggregate exercise price by complying with one or more of
the following alternatives:

 

(a)          by delivering to the Company shares of Common Stock previously held
by such person, duly endorsed for transfer to the Company, or by the Company
withholding shares of Common Stock otherwise deliverable pursuant to exercise of
the Option, which shares of Common Stock received or withheld shall have a fair
market value at the date of exercise (as determined by the 2011 Plan
administrator) equal to the aggregate purchase price to be paid by the Optionee
upon such exercise;

 

Solely for the purposes of this paragraph, “fair market value” per share of
Common Stock shall mean (A) the average of the closing sales prices, as quoted
on the primary national or regional stock exchange on which the Common Stock is
listed, or, if not listed, the OTC Markets if quoted thereon, on the twenty (20)
trading days immediately preceding the date on which the notice of election to
exercise is deemed to have been sent to the Company, or (B) if the Common Stock
is not publicly traded as set forth above, as reasonably and in good faith
determined by the Board of Directors of the Company as of the date which the
notice of election to exercise is deemed to have been sent to the Company.

  

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For purposes of Rule 144 promulgated under the Securities Act, it is intended,
understood and acknowledged that the shares of Common Stock issued in a cashless
exercise transaction shall be deemed to have been acquired by the Optionee, and
the holding period for such shares shall be deemed to have commenced, on the
date the Options were originally issued; or

 

(b)         by complying with any other payment mechanism approved by the 2011
Plan administrator at the time of exercise.

 

It is a condition precedent to the issuance of shares of Common Stock that the
Optionee execute and/or deliver to the Company all documents and withholding
taxes required in accordance with Sections 15 of the 2011 Plan.

 

9.       Holding period for Incentive Stock Options. In order to obtain the tax
treatment provided for Incentive Stock Options by Section 422 of the Code, the
shares of Common Stock received upon exercising any Incentive Stock Options
received pursuant to this Agreement must be sold, if at all, after a date which
is later of two (2) years from the date of this agreement is entered into or one
(1) year from the date upon which the Options are exercised. The Optionee agrees
to report sales of shares prior to the above determined date to the Company
within one (1) business day after such sale is concluded. The Optionee also
agrees to pay to the Company, within five (5) business days after such sale is
concluded, the amount necessary for the Company to satisfy its withholding
requirement required by the Code in the manner specified in Section 15 of the
2011 Plan. Nothing in this Section 9 is intended as a representation that Common
Stock may be sold without registration under state and federal securities laws
or an exemption therefrom or that such registration or exemption will be
available at any specified time.

 

10.       Resale restrictions may apply. Any resale of the shares of Common
Stock received upon exercising any Options will be subject to resale
restrictions contained in the securities legislation applicable to the Optionee.
The Optionee acknowledges and agrees that the Optionee is solely responsible
(and the Company is not in any way responsible) for compliance with applicable
resale restrictions.

 

11.       Subject to 2011 Plan. The terms of the Options are subject to the
provisions of the 2011 Plan, as the same may from time to time be amended, and
any inconsistencies between this Agreement and the 2011 Plan, as the same may be
from time to time amended, shall be governed by the provisions of the 2011 Plan,
a copy of which has been delivered to the Optionee, and which is available for
inspection at the principal offices of the Company.

 

12.       Professional Advice. The acceptance of the Options and the sale of
Common Stock issued pursuant to the exercise of Options may have consequences
under federal and state tax and securities laws which may vary depending upon
the individual circumstances of the Optionee. Accordingly, the Optionee
acknowledges that he or she has been advised to consult his or her personal
legal and tax advisor in connection with this Agreement and his or her dealings
with respect to Options. Without limiting other matters to be considered with
the assistance of the Optionee’s professional advisors, the Optionee should
consider: (a) whether upon the exercise of Options, the Optionee will file an
election with the Internal Revenue Service pursuant to Section 83(b) of the Code
and the implications of alternative minimum tax pursuant to the Code; (b) the
merits and risks of an investment in the underlying shares of Common Stock; and
(c) any resale restrictions that might apply under applicable securities laws.

 

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13.       No Employment Commitment. The grant of the Options shall in no way
constitute any form of agreement or understanding binding on the Company or any
Related Company, express or implied, that the Company or any Related Company
will employ or contract with the Optionee, for any length of time, nor shall it
interfere in any way with the Company’s or, where applicable, a Related
Company’s right to terminate Optionee’s employment at any time, which right is
hereby reserved.

 

14.       Entire Agreement. This Agreement is the only agreement between the
Optionee and the Company with respect to the Options, and this Agreement and the
2011 Plan supersede all prior and contemporaneous oral and written statements
and representations and contain the entire agreement between the parties with
respect to the Options.

 

15.       Notices. Any notice required or permitted to be made or given
hereunder shall be mailed or delivered personally to the addresses set forth
below, or as changed from time to time by written notice to the other:

   

  The Company: Dynastar Holdings, Inc.     1311 Herr Lane, Suite 205    
Louisville, KY 40222     Attention:  CEO   With a copy to: Gottbetter &
Partners, LLP           488 Madison Avenue, 12th Floor     New York, NY 10022  
  Attention: Adam S. Gottbetter         The Optionee: [address]

 

DYNASTAR HOLDINGS, INC.         Per:       Authorized Signatory  

 

    [Optionee]  

 

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EXHIBIT A

 

TERMS OF THE OPTION

  

Name of the Optionee: ____________     Date of Grant: __________ ___, 201_    
Designation: Incentive Stock Options     1.      Number of Options granted:
___________ shares     2.      Purchase Price: $____ per share    
3.      Vesting Dates:

__________ shares __________ ___, 201_

 

__________ shares __________ ___, 201_

__________ shares __________ ___, 201_

__________ shares __________ ___, 201_ 

    4.       Expiration Date: __________ ___, 201_

 

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EXHIBIT B

To:         Dynastar Holdings, Inc.

 

Attention: CEO

 

Notice of Election to Exercise

 

This Notice of Election to Exercise shall constitute proper notice under the
Dynastar Holdings, Inc.’s (the “Company”) 2011 Equity Incentive Plan (the “2011
Plan”) pursuant to Section 8 of that certain Stock Option Agreement (the
“Agreement”) dated as of the ___ day of _______, 201_, between the Company and
the undersigned.

 

The undersigned hereby elects to exercise Optionee’s option to purchase
__________________ shares of the common stock of the Company at a price of
US$____ per share, for aggregate consideration of US$__________, on the terms
and conditions set forth in the Agreement and the 2011 Plan. Such aggregate
consideration, in the form specified in Section 8 of the Agreement, accompanies
this notice.

  

The Optionee hereby directs the Company to issue, register and deliver the
certificates representing the shares as follows:

  

Registration Information:   Delivery Instructions:       Name to appear on
certificates   Name       Address   Address                       Telephone
Number

  

DATED at ____________________________________, the _______ day of
________________________, 20___.

 

      (Name of Optionee – Please type or print)       (Signature and, if
applicable, Office)       (Address of Optionee)       (City, State, and Zip Code
of Optionee)

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