exhibit_42.htm - Generated by SEC Publisher for SEC Filing










 








NON-QUALIFIED STOCK OPTION AGREEMENT


 


 


            THIS
NON-QUALIFIED STOCK OPTION AGREEMENT (“Agreement”) is made by and between Brazil
Minerals, Inc., a Nevada corporation (the “Corporation”), and ______________
(the “Optionee”).


 


NOW, THEREFORE, in consideration of the mutual benefit to be derived
herefrom, the Corporation and Optionee agree as follows:


 


            1.         Grant
of Option. The Corporation hereby grants to Optionee, subject to all the
terms and provisions of the Brazil Minerals, Inc. 2013 Stock Incentive Plan, as
such Plan may be hereinafter amended, a copy of which is attached hereto and
incorporated herein by this reference (the “Plan”), the right, privilege and
option (“Option”) to purchase ___________ (________) shares of its common stock
(“Stock”) at $.01 per share, in the manner and subject to the conditions
provided hereinafter and in the Plan and any amendments thereto and any rules
and regulations thereunder. 


 


            2.         Time
of Exercise of Option.   Options to purchase all _____________ shares of
Stock shall be immediately and fully vested on grant. Any exercise may be with
respect to any part or all of the shares then exercisable pursuant to this
Option. Except as otherwise provided in the Plan, this Option must be exercised
within five (5) years after the date of the grant.  In no event shall the
Corporation be required to transfer fractional shares to Optionee or those
entitled to Optionee's rights herein.


 


            3.         Method
of Exercise.   (a) The Option shall be exercised by payment of the Option
Exercise Price in cash by the Optionee or by cashless exercise as provided in
Section 3(b), unless another form of payment is authorized by the Committee. 
In the event of payment of the Option exercise price by check, the Option shall
not be considered exercised until receipt of cleared funds by the Corporation
upon deposit of the check.


 


                        (b)
The Optionee may elect to receive shares of Common Stock equal to the value of
the entire unexercised portion of the option determined in the manner described
below (or any portion of the Option remaining unexercised) upon delivery of 
Notice of Cashless Exercise Form annexed hereto duly executed.  In such event
the Corporation shall issue to the optionee a number of shares of the
Corporation's Common Stock computed using the following formula:


 


X = Y
(A-B)


A


Where X =     
the number of shares of Common Stock to be issued to the Optionee.


Y =      the number of shares of Common Stock
purchasable under this option for which the Optionee elects a cashless
exercise.









 










 








 








A =      the Market Value of the
Corporation's Common Stock on the business day immediately preceding the day on
which the Notice of Cashless Exercise is received by the Corporation.


B =       $.01
(as adjusted to the date of such calculation).


                                 
(c) For purposes of this Agreement, the Market
Value of a share of Common Stock on any date shall be equal to (i) the closing
bid price per share as published by a national securities exchange on which
shares of Common Stock (or other units of the security) are traded (an
"Exchange") on such date or, if there is no bid for Common Stock on
such date, the bid price on such Exchange at the close of trading on the next
earlier date or, (ii) if shares of Common Stock are not listed on a
national securities exchange on such date, the closing bid price per share as
published on the National Association of Securities Dealers Automatic Quotation
System ("NASDAQ") National Market System if the shares are quoted on
such system on such date, or (iii) the closing bid price in the over‐the‐counter
market at the close of trading on such date if the shares are not traded on an
Exchange or listed on the NASDAQ National Market System, or (iv) if the Common
Stock is not traded on a national securities exchange or in the over‐the‐counter
market, the fair market value of a share of Common Stock on such date as
determined in good faith by the Board of Directors. If the optionee disagrees
with the determination of the Market Value of any securities of the Corporation
determined by the Board of Directors under Section 3(c)(iv), the Market Value
of such securities shall be determined by an independent appraiser acceptable
to the Corporation and the optionee (or, if they cannot agree on such an
appraiser, by an independent appraiser selected by each of them, and Market
Value shall be the median of the appraisals made by such appraisers).  If there
is one appraiser, the cost of the appraisal shall be shared equally between the
Corporation and the optionee.  If there are two appraisers, each the
Corporation and the optionee shall pay for its own appraisal.


 


            4.         Restrictions
on Exercise and Delivery.  The exercise of each Option shall be subject to
the condition that, if at any time the Board of Directors or Committee
administering the Plan (the “Committee”) shall determine, in its sole and
absolute discretion, 


 


                        (a)   
the satisfaction of any withholding tax or other withholding liabilities, is
necessary as a condition of, or in connection with, such exercise or the
delivery or purchase of Stock pursuant thereto,


 


                        (b)
   the listing, registration, or qualification of any shares deliverable upon
such exercise is necessary, under any state or federal law, as a condition of,
or in connection with, such exercise or the delivery or purchase of shares
pursuant thereto, or 


 


                        (c)   
the consent or approval of any regulatory body is necessary as a condition of,
or in connection with, such exercise or the delivery or purchase of shares
pursuant thereto,


 


then in any such
event, such exercise shall not be effective unless such withholding, listing,
registration, qualification, consent or approval shall have been effected or obtained free of any conditions not acceptable to the
Committee. Optionee shall execute such documents and take such other actions as
are required by the Committee to enable it to effect or obtain such
withholding, listing, registration, qualification, consent or approval. Neither
the Corporation nor any officer or director, or member of the Committee, shall
have any liability with respect to the non-issuance or failure to sell shares
as the result of any suspensions of exercisability imposed pursuant to this
Section.







 










 








 










 


            5.         Termination
of Option.           Except as otherwise provided in this Agreement or the
Plan, to the extent not previously exercised, the Option shall terminate upon
the first to occur of any of the following events: 


 


                        (a)        the
dissolution or liquidation of the Corporation; 


 


                        (b)        except
in the case of death of the Optionee, the expiration of five years from the
date of the grant of  the Option hereunder;


 


                        (c)   
    the breach by Optionee of any provision of this Agreement; 


 


                        (d)   
   one year after the Optionee’s death; provided, however, that any
option that has not vested in the Optionee as of the date of death shall
immediately expire and shall be null and void; or


 


                        (e)        one
year after the Optionee shall cease to be an officer or director of the
Corporation.


 


            6.         Nonassignability.        Options
may not be sold, pledged, assigned or transferred in any manner other than by
will or by the laws of intestate succession, and may be exercised during the
lifetime of Optionee only by Optionee. Any transfer by Optionee of any Option
granted under the Plan or this Agreement shall void such Option and the
Corporation shall have no further obligation with respect to such Option. No
Option shall be pledged or hypothecated in any way, nor shall any Option be
subject to execution, attachment or similar process.


 


            7.         Representation
Letter.             Upon the grant of the Option and execution of this
Agreement, the Optionee will deliver to the Corporation the grant
representation letter set forth on Exhibit “A” hereto. Upon exercise of the
Option, the Optionee will deliver to the Corporation the exercise representation
letter set forth on Exhibit “B” hereto, as such Exhibit may be amended by the
Committee from time to time. Optionee also agrees to make such other
representations as are deemed necessary or appropriate by the Corporation and
its counsel.


 


            8.         Rights
as Shareholder. Neither Optionee nor Optionee’s executor, administrator, heirs
or legatees, shall be, or have any rights or privileges of a shareholder of the
Corporation in respect of the Stock unless and until certificates representing
such Stock shall have been issued in Optionee's name. 


 









 










 








 








            9.         No Right of Employment.      Neither
the grant nor exercise of any Option


nor anything in
the Plan or this Agreement shall impose upon the Corporation or any other
corporation any obligation to employ or continue to employ or retain any
Optionee. The right of the Corporation and any other corporation to terminate
any employee shall not be diminished or affected because an Option has been
granted to such employee.


 


            10.       Mandatory
Arbitration.           In the event of any dispute between the Corporation
and Optionee regarding this Agreement or the Plan, the dispute and any issue as
to the arbitrability of such dispute, shall be settled to the exclusion of a
court of law, by arbitration in Los Angeles, California, by a panel of three
arbitrators (each party shall choose one arbitrator and the third shall be
chosen by the two arbitrators so selected) in accordance with the Commercial
Arbitration Rules of the American Arbitration Association then in effect. The
decision of a majority of the arbitrators shall be final and binding upon the
parties. All costs of the arbitration and the fees of the arbitrators shall
beallocated between the parties as determined by a majority of the arbitrators,
it being the intention of the parties that the prevailing party in such a
proceeding be made whole with respect to its expenses. 


 


            11.       Definitions.
Capitalized terms shall have the meaning set forth in the Plan unless otherwise
defined herein. 


 


            12.       Notices.
Any notice to be given under the terms of this Agreement shall be addressed to
the Corporation in care of its Secretary at its principal office, and any
notice to be given to Optionee shall be addressed to such Optionee at the
address maintained by the Corporation for such person or at such other address
as the Optionee may specify in writing to the Corporation.


 


            13.       Binding
Effect. This Agreement shall be binding upon and inure to


the benefit of
Optionee, such Optionee’s heirs and successors, and of the Corporation, its
successors and assigns.


 


            14.       Governing
Law. This Agreement shall be governed by the laws of the State of California.


 


            15.       Descriptive
Headings. Titles to Sections are solely for informational purposes.


 


            16.       Application
of Plan.    The Corporation has delivered and the Optionee hereby
acknowledges receipt of a copy of the Plan. The parties agree and acknowledge
that the Option granted hereunder is granted pursuant to the Plan and subject
to the terms and provisions thereof, and the rights of the Optionee are subject
to modifications and termination in certain events as provided in the Plan.


 


            IN
WITNESS WHEREOF, this Agreement is effective as of, and the date of grant shall
be April 9, 2013.


 









 










 








 








 


                                                BRAZIL
MINERALS, INC.,


                                                a
Nevada corporation


 


                                                By:
_____________________________


 


 


                                                Its:______________________________


 


 


                                                OPTIONEE


 


 


                                                _________________________________


 


 


                                                __
_____________________ 


                                                Print
Name












 










 








 








 


EXHIBIT A


 


 


 


 


 


 


 


 


                                                                                    [Date]


 


 


 


Brazil Minerals,
Inc.


324 South
Beverly Drive, Suite 118


Beverly Hills,
California 90212


 


            Re:       2013
Flexible Stock Plan. 


 


To Whom It May
Concern:


 


            This
letter is delivered to Brazil Minerals, Inc., a Nevada corporation (the
“Corporation”), in connection with the grant to ______________ (the “Optionee”)
of an option (the “Option”) to purchase ___________ shares of common stock of
the Corporation (the “Stock”) pursuant to the Brazil Minerals, Inc. 2013
Flexible Stock Plan (the “Plan”). The Optionee understands that the
Corporation's receipt of this letter executed by the Optionee is a condition to
the Corporation's willingness to grant the Option to the Optionee.


 


            In
addition, the Optionee makes the following representations and warranties with
the understanding that the Corporation will rely upon them. 


 


            1.         The
Optionee acknowledges receipt of a copy of the Plan and Agreement. The Optionee
has carefully reviewed the Plan and Agreement.


 


            2.         The
Optionee understands and acknowledges that the Option and the Stock are subject
to the terms and conditions of the Plan.


 


            3.         The
Optionee understands and agrees that, at the time of exercise of any part of
the Option for Stock, the Optionee may be required to provide the Corporation
with additional representations, warranties and/or covenants similar to those
contained in this letter.


 


            5.         The
Optionee is a resident of the State of ________________.


 









 










 








 








            6.         The Optionee will notify the Corporation
immediately of any change in the above information which occurs before the
Option is exercised in full by the Optionee.


 


            The
foregoing representations and warranties are given on April 9, 2013, 


 


                                                                        OPTIONEE:


 


 


 


                                                                        _______________________________


                                                                         


 


 












 










 








 








 


EXHIBIT B


 


 


 


                                                                                    ______________,
20__


 


 


 


Brazil Minerals,
Inc.


324 South
Beverly Drive, Suite 118


Beverly Hills,
California 90212


 


            Re:       2013
Stock Incentive Plan


 


To Whom It May
Concern:


 


            I
(the “Optionee”) hereby exercise my right to purchase ________ shares of common
stock (the “Stock”) of Brazil Minerals, Inc., a Nevada corporation (the
“Corporation”), pursuant to, and in accordance with, the Brazil Minerals, Inc. 2013
Stock Incentive Plan (the “Plan”) and the Non-Qualified Stock Option Agreement
(the “Agreement”) dated April 9, 2013.  As provided in such Agreement, I
deliver herewith payment as set forth in the Agreement in the amount of the
aggregate option exercise price.  Please deliver to me at my address as set
forth above stock certificates representing the subject shares registered in my
name.


 


            The
Optionee hereby represents and agrees as follows:


 


            1.         The
Optionee acknowledges receipt of a copy of the Plan and Agreement. The Optionee
has carefully reviewed the Plan and Agreement. 


 


            2.         The
Optionee is a resident of the State of __________.


 


            3.         The
Optionee represents and agrees that if the Optionee is an “affiliate” (as
defined in Rule 144 under the Securities Act of 1933) of the Corporation at the
time the Optionee desires to sell any of the Stock, the Optionee will be
subject to certain restrictions under, and will comply with all of the
requirements of, applicable federal and state securities laws.


 


            The
foregoing representations and warranties are given on ________ at
_____________________.


 


 


                                                                        OPTIONEE:   


 


                                                                        ____________________________