EXHIBIT 10.6

 

 [image_001.jpg]

 

FIRST stock option agreement

 

This First Stock Option Agreement (“Agreement”) is made as of the 10th day of
March, 2015 (“Effective Date”) between PharmaCyte Biotech, Inc. (“Company”) and
Gerald W. Crabtree (“Participant”).

 

1. Award. The Company has granted to the Participant an option (“Option”) to
purchase up to 10,000,000 shares of the Company’s common stock, par value
$0.0001 per share (“Share” or “Shares”), subject to the terms and conditions of
this Agreement. The purchase price per Share (“Exercise Price”) is $0.11, which
represents the fair market value of the shares on the date of the grant. This
grant is in satisfaction of the Company’s obligation to the Participant with
respect to the Option Award pursuant to the Executive Compensation Agreement
between the Company and the Participant entered into as of March 10, 2015,
effective as of January 1, 2015 (“Compensation Agreement”).

 

2. Incentive Stock Option Status. The Option is not intended to be treated as an
“incentive stock option” within the meaning of Section 422 of the Internal
Revenue Code of 1986.

 

3. Option Term. Unless terminated sooner in accordance with this Agreement, the
Option shall expire if and to the extent it is not exercised within five years
from the Effective Date.

 

4. Vesting of Option. Subject to the provisions hereof, the Option will be fully
vested and exercisable from and after the Effective Date.

 

5. Forfeiture Events. If a “Forfeiture Event” occurs, then, to the extent not
previously exercised, the Agreement shall thereupon terminate and be of no
further force or effect. For the purposes of this Agreement, the term
“Forfeiture Event” means any of the following events: (i) termination of the
Compensation Agreement for Cause; or (ii) the failure by Participant to provide
or be available to provide post-termination consulting services as and to the
extent such availability and/or services are reasonably required by the
Compensation Agreement.

 

6. Exercise Procedures. The Participant may exercise the Option (to the extent
otherwise exercisable) by transmitting to the Secretary of the Company (or
another person designated by the Company for this purpose) a written notice
specifying the number of whole Shares to be purchased pursuant to such exercise,
together with payment in full of the aggregate Exercise Price payable for such
Shares and the amount of applicable withholding taxes and execution and/or
delivery of such representations, releases and other documents as the Board of
Directors of the Company (“Board”) may prescribe. The Exercise Price and the
minimum required tax withholding amount shall be payable in cash or by check,
provided that, at the Participant’s request and subject to the provisions of
applicable law, Participant may satisfy such payments (in whole or in part): (i)
by the Participant’s surrender of previously-owned Shares, or by the Company’s
withholding Shares that otherwise would be issued if the Exercise Price had been
paid in cash, according to the formula below:

 

 

 

 

  X =  (A-B)(Y)
      A Where X =  the number of Shares to be issued to the Participant.   Y = 
the number of Shares issuable upon exercise of this Option, assuming a cash
exercise   A =  Fair Market Value   B =  the Exercise Price

 

in each case having a “Fair Market Value” (as defined below) on the date the
Option is exercised equal to the amount of the Exercise Price and/or tax
withholding obligation that is being satisfied with such Shares; (ii) by payment
to the Company pursuant to a broker-assisted cashless exercise program
arrangement that may be made available by the Company; or (iii) by any
combination of the foregoing. For this purpose, “Fair Market Value” means, as of
any relevant date, the value of the Company’s Shares determined as follows: (a)
if the Shares are admitted to trading on a national securities exchange on such
date, the closing price per Share on such date on the principal securities
exchange on which the Shares are traded or, if no Shares are traded on that
date, the closing price per Share on the next preceding date on which Shares are
traded; (b) if the Shares are not admitted to trading on a national securities
exchange on such date but are traded on the electronic quotation system operated
by OTC Markets Group, Inc. (“OTCQB”), the last closing price for a Share as
reported by the OTCQB (or similar organization or agency succeeding to its
functions of reporting prices) at the close of business on such date, or if
there is no closing price on such date, then the closing bid price on such date;
or (c) if the Shares are not listed on a national securities exchange or traded
on the OTCQB or other service, the fair market value per Share as determined by
the Board, acting in its discretion in accordance with the requirements of
applicable tax law.

 

7. Adjustments for Capital Changes. The Exercise Price and the number of Shares
purchasable upon the exercise of this Option shall be subject to adjustment from
time to time as set forth in this Section 7. The Company shall give Participant
notice of any event described below which requires an adjustment pursuant to
this Section 7 in accordance with the notice provisions set forth in Section
7(e).

 

(a) Stock Splits, etc. The number of Shares purchasable upon the exercise of
this Option and the Exercise Price shall be subject to adjustment from time to
time upon the happening of any of the following: In case the Company shall: (i)
pay a dividend in Shares or make a distribution in Shares to holders of its
outstanding Shares; (ii) subdivide its outstanding Shares into a greater number
of Shares; (iii) combine its outstanding Shares into a smaller number of Shares;
or (iv) issue any Shares in a reclassification of the Shares, then the number of
Shares purchasable upon exercise of this Option immediately prior thereto shall
be adjusted so that the Participant shall be entitled to receive the kind and
number of Shares or other securities which it would have owned or have been
entitled to receive had such Option been exercised in advance thereof. Upon each
such adjustment of the kind and number of Shares or other securities of the
Company which are purchasable hereunder, the Participant shall thereafter be
entitled to purchase the number of Shares or other securities resulting from
such adjustment at an Exercise Price per Share or other security obtained by
multiplying the Exercise Price in effect immediately prior to such adjustment by
the number of Shares purchasable pursuant hereto immediately prior to such
adjustment and dividing by the number of Shares or other securities of the
Company that are purchasable pursuant hereto immediately thereafter. An
adjustment made pursuant to this paragraph shall become effective immediately
after the effective date of such event retroactive to the record date, if any,
for such event.

 

2

 

 

(b) Recapitalization, Reorganization, Reclassification, Consolidation, Merger or
Sale. In case the Company shall reorganize its capital, reclassify its capital
stock, consolidate or merge with or into another corporation (where the Company
is not the surviving corporation or where there is a change in or distribution
with respect to the Shares of the Company), or sell, transfer or otherwise
dispose of any of its property, assets or business to another corporation and,
pursuant to the terms of such reorganization, reclassification, merger,
consolidation or disposition of assets, shares of common stock of the successor
or acquiring corporation, or any cash, shares of stock or other securities or
property of any nature whatsoever (including warrants or other subscription or
purchase rights) in addition to or in lieu of common stock of the successor or
acquiring corporation (“Other Property”), are to be received by or distributed
to the holders of the Company, then the Participant shall have the right
thereafter to receive, upon exercise of this Option, the number of shares of
common stock of the successor or acquiring corporation or of the Company’s
Shares, if it is the surviving corporation, and Other Property receivable upon
or as a result of such reorganization, reclassification, merger, consolidation
or disposition of assets by the Participant of the number of Shares of for which
this Option is exercisable immediately prior to such event. In case of any such
reorganization, reclassification, merger, consolidation or disposition of
assets, the successor or acquiring corporation (if other than the Company) shall
expressly assume the due and punctual observance and performance of each and
every covenant and condition of this Option to be performed and observed by the
Company and all the obligations and liabilities hereunder, subject to such
modifications as may be deemed appropriate (as determined in good faith by
resolution of the Board of the Company) in order to provide for adjustments of
Shares for which this Option is exercisable which shall be as nearly equivalent
as practicable to the adjustments provided for in this Section 7 of this Option.
For purposes of this Section 7(b), “common stock of the successor or acquiring
corporation” shall include stock of such corporation of any class which is not
preferred as to dividends or assets over any other class of stock of such
corporation and which is not subject to redemption and shall also include any
evidences of indebtedness, shares of stock or other securities which are
convertible into or exchangeable for any such stock, either immediately or upon
the arrival of a specified date or the happening of a specified event and any
warrants or other rights to subscribe for or purchase any such stock. The
foregoing provisions of this Section 7 shall similarly apply to successive
reorganizations, reclassifications, mergers, consolidations or disposition of
assets.

 

(c) Adjustment for Other Dividends and Distributions. If the Company shall, at
any time or from time to time, make or issue or set a record date for the
determination of holders entitled to receive a dividend or other distribution
payable in: (i) cash; (ii) any evidences of indebtedness, or any other
securities of the Company or any property of any nature whatsoever, other than,
in each case, Shares; or (iii) any warrants or other rights to subscribe for or
purchase any evidences of indebtedness, or any other securities of the Company
or any property of any nature whatsoever, other than, in each case, Shares,
then, and in each event, (A) the number of Shares for which this Option shall be
exercisable shall be adjusted to equal the product of the number of Shares for
which this Option is exercisable immediately prior to such adjustment multiplied
by a fraction (1) the numerator of which shall be the Fair Market Value of the
Shares at the date of taking such record and (2) the denominator of which shall
be such Fair Market Value of the Shares minus the amount allocable to one Share
of any such cash so distributable and of the fair value (as determined in good
faith by the Board) of any and all such evidences of indebtedness, Shares, other
securities or property or warrants or other subscription or purchase rights so
distributable, and (B) the Exercise Price then in effect shall be adjusted to
equal (1) the Exercise Price then in effect multiplied by the number of Shares
for which this Option is exercisable immediately prior to the adjustment divided
by (2) the number of Shares for which this Option is exercisable immediately
after such adjustment. A reclassification of the Shares (other than a change in
par value, or from par value to no par value or from no par value to par value)
into Shares and shares of any other class of stock shall be deemed a
distribution by the Company to the holders of such Shares of such other class of
shares within the meaning of this Section 7(c) and, if the outstanding Shares
shall be changed into a larger or smaller number of Shares as a part of such
reclassification, such change shall be deemed a subdivision or combination, as
the case may be, of the outstanding Shares within the meaning of Section 7(a).

 

3

 

 

(d) Form of Option after Adjustments. The form of this Option need not be
changed because of any adjustments in the Exercise Price or the number and kind
of securities purchasable upon the exercise of this Option.

 

(e) Notice of Adjustments. Whenever the number of Shares or number or kind of
securities or other property purchasable upon the exercise of this Option or the
Exercise Price is adjusted, as herein provided, the Company shall give notice
thereof to the Participant, which notice shall state the number of Shares (and
other securities or property) purchasable upon the exercise of this Option and
the Exercise Price of such Shares (and other securities or property) after such
adjustment, setting forth a brief statement of the facts requiring such
adjustment and setting forth the computation by which such adjustment was made.

 

8. Transfer Restrictions. Except as may otherwise be expressly permitted by the
Board, the Option is not assignable or transferable other than to a beneficiary
designated to receive the Option upon the Participant’s death or by will or the
laws of descent and distribution, and the Option shall be exercisable during the
lifetime of the Participant only by the Participant (or, in the event of the
Participant’s incapacity, the Participant’s legal representative or guardian).
Any attempt by the Participant or any other person claiming against, through or
under the Participant to cause the Option or any part of it to be transferred or
assigned in any manner and for any purpose not permitted under this Agreement
shall be null and void and without effect.

 

9. Rights as a Stockholder. No Shares shall be sold, issued or delivered
pursuant to the exercise of the Option until full payment for such Shares has
been made or provided for (including, for this purpose, satisfaction of all
applicable withholding taxes). The Participant shall have no rights as a
stockholder with respect to any Shares covered by the Option unless and until
the Option is exercised and the Shares purchased pursuant to such exercise are
issued in the name of the Participant. Except as otherwise specified, no
adjustment shall be made for dividends or distributions of other rights for
which the record date is prior to the date such Shares are issued.

 

4

 

 

10. Tax Withholding. The Company’s obligation to issue Shares pursuant to the
exercise of the Option shall be subject to and conditioned upon the satisfaction
by the Participant of applicable tax withholding obligations in accordance with
Section 6 of this Agreement. If and to the extent the applicable withholding
obligations is payable in cash, the Participant hereby authorizes the Company to
satisfy all or part of such tax withholding obligations by deductions from cash
compensation or other payments that would otherwise be owed to the Participant.

 

11. No Other Rights Conferred. Nothing contained herein shall be deemed to give
the Participant a right to be retained in the employ or other service of the
Company or any affiliate or to affect the right of the Company and its
affiliates to terminate, or modify the terms and conditions of, the
Participant’s employment or other service.

 

12. Successors. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and permitted
assigns.

 

13. Entire Agreement. This Agreement constitutes the entire agreement between
the parties with respect to the subject matter hereof and may not be modified
except by written instrument executed by the parties.

 

14. Governing Law. This Agreement shall be governed by the laws of the State of
Nevada, without regard to its principles of conflict of laws.

 

15. Counterparts. This Agreement may be executed in separate counterparts, each
of which will be an original and all of which taken together shall constitute
one and the same agreement.

 

IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date
first above written.

 

PharmaCyte Biotech, Inc.

 

 

By: /s/ Kenneth L. Waggoner           
Name: Kenneth L. Waggoner

Title: Chairman of the Board and Chief Executive Officer

 

 

 

Gerald W. Crabtree

 

 

By: /s/ Gerald W. Crabtree                
Name: Gerald W. Crabtree

 

5