Document:

ex10_2.htm

Exhibit 10.2

SHARE EXCHANGE AGREEMENT

THIS Agreement made as of the 5th day of September, 2007

 

	
BETWEEN:
	
GLOBAL BIODIESEL LTD., a corporation duly constituted under the laws of the state of Nevada, USA, and having an office at 1, place Ville Marie, suite 2818, Montreal (Quebec), H3B 4R4

	 	 
	 	(hereinafter “Global”)                                                OF THE FIRST PART
	 	 
	
AND:
	
_____________, a resident of the province of ________, residing at __________________________

	 	 
	 	(hereinafter “Shareholder”)                                      OF THE SECOND PART

 

WHEREAS:

 

	
A.
	
The Shareholder holds a total of ________ shares of common stock (the “Methes  Shares”) of Methes Energies Inc. (“Methes”), a corporation duly constituted under the laws of the province of Ontario;

 

	
B.
	
Global wishes to purchase from the Shareholder, and the Shareholder wishes to sell to Global, the Methes Shares in exchange for an equal number of shares of common stock of Global, (the “Global
Shares”)  subject to the terms and conditions set forth in this Agreement.

 

NOW THEREFORE in consideration of the covenants, representations and warranties set forth herein and as such other further consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

	
1.
	
Purchase and Sale. The Shareholder hereby agrees to sell and transfer to Global, and Global hereby agrees to acquire from the Shareholder,
the Methes Shares in exchange for the Global Shares which Global agrees to deliver to the Shareholder.

 

	
2.
	
Covenants of Global. Global covenants and agrees with the Shareholder to
do the following at or prior to the Closing Date (as hereinafter defined) and prior to the completion of the transactions contemplated in section 1:

 

to comply with all applicable securities and corporate laws and regulatory requirements.

 

	
3.
	
Representations and Warranties of Global. Global represents and warrants the following to the Shareholder:

 

a.           Global is duly incorporated under the laws of the State of Nevada, United States of America, is validly existing and in good standing under such laws, and has
no subsidiaries or equity interests in any other companies or entities;

 

b.           the authorized capital of Global consists of 75,000,000 common shares, $0.001 par value (the “Global  Shares” herein);

 

 

 

 

 

c.           all of the currently issued and outstanding shares of Global have been issued in compliance with applicable federal and state securities laws, including but limited to
the registration requirements of Section 5 of the United States Securities Act of 1933, as amended (the “1933 Act”) or an exemption therefrom;

 

d.           all of the currently issued Methes Shares are validly issued and are fully paid and non-assessable and the Global Shares to be issued at Closing (as hereinafter
defined) will, on issuance, be validly issued as fully paid and non-assessable and the Global Shares will at Closing be free and clear of all restrictions on transfer (other than restrictions under applicable securities laws or as otherwise contemplated in this Agreement), liens, charges and encumbrances;

 

e.            it is the intent of Global to apply to have the Global Shares quoted on the National Association of Securities Dealer’s (“NASD”) Over The Counter
Bulletin Board (“OTCBB”);

 

f.            Global has the power and authority to carry on its business as and where it is presently conducted;

 

g.           Global has good and sufficient authority to enter into this Agreement on the terms and conditions set forth herein;

 

h.           the execution and delivery of this Agreement and the transactions contemplated herein have been duly authorized and approved by the board of directors and the shareholders of Global.  No other corporate act
or proceeding on the part of Global is necessary to authorize this Agreement.  This Agreement constitutes a legal, valid and binding agreement of Global enforceable in accordance with its terms;

 

i.            neither the execution nor delivery of this Agreement nor the consummation of the transactions contemplated hereby will conflict in any material respect with, or result in any material breach of, the terms, conditions, or provisions of or will constitute a material default
under the Articles of Incorporation or resolutions of Global or any instrument, agreement or contract to which it is party or by which it is bound;

 

j.            no consent, approval or authorization of, or declaration, filing or registration with, any governmental or regulatory authority is required in connection with the execution, delivery and performance of this Agreement by Global and
the consummation of the transactions contemplated hereby, except for such notices of the transactions contemplated herein as may be required by the OTCBB;

 

k.           there are no suits, actions, litigation, arbitration proceedings or government or regulatory proceedings or investigations outstanding, in progress, pending or, to the best of Global ’s knowledge, threatened against
or relating to Global which might materially and adversely affect Global ;

 

l.            Global is not subject to any judgment, order or decree entered in any lawsuit or proceeding which might materially and adversely affect Global ;

 

m.          all material transactions of Global have been properly recorded or filed in or with its books and records and the minute book of Global contains records of all meetings
and proceedings of the shareholders and directors of Global ;

 

 

2

 

 

n.           Global has duly filed all federal, state, local and foreign tax report’s and returns required to be filed by it and has duly paid all taxes and other charges due or claimed to be due from it by federal, state,
local and foreign taxing authorities. Further, there are no tax liens upon any property or assets of Global. No state of facts exist which would constitute grounds for the assessment of any tax liability by the state, local, or foreign tax authorities. All deficiencies and assessments, if any, resulting from any examination of state, local and foreign tax returns and reports of Global, if any, have
been paid. There are no outstanding agreements or waivers extending the statutory period of limitation applicable to any federal, state, local, or foreign tax return or report for any period;

 

o.           Global is in compliance with all laws, regulations and orders applicable to its business. Global has not received any notification that it is in violation of any law,
regulation or order and no such violation exists. Neither Global nor any of its employees or agents, to the best of their knowledge, has made any payments to any persons which violate any statute or law;

 

p.           all agreements, understandings, instruments, contracts or proposed transactions to which Global is a party or by which it or any of its assets is bound which may involve any material obligations outside the ordinary
course of its business have been disclosed to the Shareholder;

 

q.   Global is not in violation of or in default under its constating documents, or any material provision of any contract, sales commitment, licence, purchase order, encumbrances, note, deed, lease, agreement or instrument,
or any order, judgment or decree, relating to its business or the issued Methes  share, or by which Global is bound, or in the payment of any of the monetary obligations of Global or debts relating to its business and there exists no condition or event which, after notice or lapse of time or both, would result in any such violation or default;

 

r.   Global is managed by its directors and officers, but has no employees and has no employee retirement or employee benefit or welfare plans; and

 

s.   Global acknowledges that the Global Shares have not been and will not be registered under the 1933 Act and that the Global
Shares are being transferred to the Shareholder in reliance on exemptions from such registration and that the Global Shares may not be offered or sold in the United States or to U.S. Persons without registration under the 1933 Act or compliance with requirements of an exemption from registration;

 

t.   Global is acquiring the Methes Shares as principal for its own account for investment only, not for the benefit of any other person, and not with a view to
the resale or distribution of all or any of the Methes  Shares;

 

u.           Global has such knowledge and experience in financial and business affairs so as to be capable of evaluating the merits and risks of its investment in Methes  Shares and
is able to bear the economic risk of loss of such investment;

 

v.           Global has been provided with the opportunity to ask questions and solicit information concerning the business and financial condition of Methes Energies Inc.., has utilized such access to its full satisfaction, and
has received from Methes Energies Inc. all information that it has requested; and

 

w.          None of the representations or warranties to the Shareholder contained herein contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements contained therein not
misleading.

 

 

3

 

 

	
4.
	
Shareholder Representations and Warranties.  The Shareholder hereby represents and warrants the following to Global:

 

a.           Shareholder has good and sufficient authority to enter into this Agreement on the terms and conditions set forth herein;

 

b.           neither the execution nor delivery of this Agreement nor the consummation of the transactions contemplated hereby will conflict in any material respect with, or result in any material breach of, the terms, conditions, or provisions of or will constitute a material default
under any instrument, agreement or contract to which the Shareholder is a party or by which it is bound;

 

c.           no consent, approval or authorization of, or declaration, filing or registration with, any governmental or regulatory authority is required in connection with the execution, delivery and performance of this Agreement by Shareholder and
the consummation of the transactions contemplated hereby;

 

d.           Shareholder is not a “U.S. Person” as defined under Regulation S made under the 1933 Act;

 

e.           Shareholder was outside the United States at the time of execution and delivery of this Agreement;

 

f.            no offers to sell the Global  Shares were made by any person to Shareholder while Shareholder was
in the United States;

 

g.           the Global Shares are not being acquired, directly or indirectly, for the account or benefit of a U.S. Person or a person in the United States;

 

h.           Shareholder acknowledges that the Global Shares have not been and will not be registered under the 1933 Act and that the Global
Shares are being issued to Shareholder in reliance on exemptions from such registration and that the Global Shares may not be offered or sold in the United States or to U.S. Persons without registration under the 1933 Act or compliance with requirements of an exemption from registration;

 

i.            Shareholder agrees that all of the certificates representing the Global Shares shall be endorsed thereon with a legend to the following effect:

 

“THE SECURITIES HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “1933 ACT”) OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES AND MAY BE OFFERED FOR SALE, SOLD OR OTHERWISE TRANSFERRED OR ASSIGNED ONLY (i) TO THE COMPANY, (ii) OUTSIDE THE UNITED
STATES IN COMPLIANCE WITH REGULATION S UNDER THE 1933 ACT, (iii) IN ACCORDANCE WITH RULE 144 UNDER THE 1933 ACT, OR (iv) IN A TRANSACTION THAT IS OTHERWISE EXEMPT FROM REGISTRATION UNDER THE 1933 ACT AND APPLICABLE STATE SECURITIES LAWS, PROVIDED, PRIOR TO ANY SUCH SALE, TRANSFER OR ASSIGNMENT, THE COMPANY SHALL HAVE RECEIVED AN OPINION OF COUNSEL, IN FORM ACCEPTABLE TO THE COMPANY, THAT NO VIOLATION OF SUCH REGISTRATION PROVISIONS WOULD RESULT FROM ANY PROPOSED TRANSFER OR
ASSIGNMENT.  HEDGING TRANSACTIONS INVOLVING THE SECURITIES REPRESENTED HEREBY MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE 1933 ACT.”

 

4

 

 

And that Global will refuse to register any transfer of the Global Shares not made (i) in accordance with Regulation S, (ii) pursuant to registration under the 1933 Act or (iii) pursuant to an available
exemption from registration under the 1933 Act;

j.            Shareholder is acquiring the Global Shares as principal for its own account for investment only, not for the benefit of any other person, and not with a view
to the resale or distribution of all or any of the Global Shares;

 

k.           Shareholder has such knowledge and experience in financial and business affairs so as to be capable of evaluating the merits and risks of its investment in Global Shares and
is able to bear the economic risk of loss of such investment; and

 

l.   Shareholder has been provided with the opportunity to ask questions and solicit information concerning the business and financial condition of Global, has
utilized such access to its full satisfaction, and has received from Global all information that it has requested.

 

	
5.
	
Conditions for the Benefit of Global.  The obligations of Global to complete the transactions as contemplated herein shall be subject to the following conditions:

 

a.           this Agreement shall have been duly executed by the Shareholder;

 

b.           all the representations and warranties of the Shareholder set forth in section 4 shall be true and correct as of the Closing Date;

 

c.           the covenants of Shareholder set forth in this Agreement shall have been completed in full to Global ’s satisfaction as at the Closing Date;

 

d.           there shall have been no material adverse change in the financial condition or assets of Methes;

 

e.           completion of due diligence by Global in regard to Methes with results satisfactory to Global;

 

f.           The delivery by Shareholder at Closing of the documents listed in section 9.

 

	
6.
	
Conditions for the Benefit of Shareholder. The obligations of Shareholder to complete the transactions as contemplated herein shall be subject to the following conditions:

 

a.           this Agreement shall have been duly executed by Global;

 

b.           all the representations and warranties of Global set forth in section 3 shall be true and correct as at the Closing Date;

 

 

5

 

 

c.           all of the covenants of Global set forth in this Agreement shall have been completed in full to Shareholder satisfaction as at the Closing Date;

 

d.           the delivery by Global at Closing of the documents listed in section 8.

 

	
7.
	
Closing. The transactions contemplated herein (the “Closing”) shall be pursuant to the execution of this Agreement and the delivery and exchange of the Methes Shares for the Global Shares.

 

	
8.
	
Delivery by Global.  At the Closing, Global shall deliver to Shareholder the following:

 

a.           a certified true copy of a resolution of the board of directors of Global evidencing its approval of this Agreement and all transactions contemplated hereunder, including the issuance of the Global Shares to Shareholder;

 

b.           a certificate of Global that all the representations and warranties of Global set forth in section 3 are true and correct as at the Closing Date; and

 

c.           a share certificate registered in the name of Shareholder for the Global Shares.

 

	
9.
	
Delivery by Shareholder.  At the Closing, Shareholder shall deliver to Global the following:

 

a.           a share certificate of  Methes duly endorsed for transfer to Global; and

 

b.           a representation in the form attached hereto that the Shareholder has the valid right to enter into this Agreement.

 

	
10.
	
Binding Agreement.  Upon acceptance of the terms of this Agreement by the parties hereto, this Agreement shall be deemed to constitute and shall be a legally valid and binding agreement.

 

	
11.
	
Further Assurances.  The parties hereto agree to execute and deliver or cause to be executed and delivered all such further documents and instruments and do all such acts and things as either party may reasonably request to give full effect to the terms and conditions, intent and meaning of this Agreement.

 

	
12.
	
Entire Agreement.  This Agreement constitutes the entire agreement between the parties hereto and in respect of the matters referred to herein and there are no representations, warranties, covenants, agreements, express or implied, collateral hereto other than as expressly set forth or referred to herein.

 

	
13.
	
Time of the Essence.  Time shall be of the essence of this Agreement.

 

	
14.
	
Applicable Law and Attornment.  This Agreement shall be governed and interpreted in accordance with the laws of the State of Nevada and the parties hereto irrevocably attorn to the non-exclusive jurisdiction of the courts of the State of Nevada.

 

	
15.
	
Enurement.  This Agreement shall enure to the benefit of and be binding upon the parties hereto and their respective successors and assigns.

 

 

6

 

 

	
16.
	
Notice.  Any notice, request, demand or other communication to be given under this Agreement will be in writing and shall be delivered by hand or by telecopy to the party at the following respective addresses:

 

	
To Global:
	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	To Shareholder:   	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	 	 	 
	With a copy to: 	 	 
	 	 	 
	 	 	 
	 	 	 

 

	
17.
	
Counterparts.  This Agreement may be executed in any number of counterparts with the same effect as if all the parties hereto had signed the same agreement and all counterparts will be construed together and constitute one and the same instrument.

 

INTENTIONALLY LEFT BLANK

 

 

7

 

 

IN WITNESS WHEREOF the parties hereto have executed this Agreement as of the day and year first above written.

 

 

	 	 	 	 	 GLOBAL BIODIESEL LTD.	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	Witness:	 	 	 	 	 
	 	 	 	Per:	 	 
	 	 	 	 	Michel Laporte	 
	 	 	 	 	President	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	Witness:  	 	 	 	 	 
	 	 	 	 	 	 	 

  

 

 

 

8

 

CERTIFICATION OF SHAREHOLDER

I, _________________, hereby certify that I have good and sufficient authority to enter into this Agreement on the terms and conditions set forth herein and that neither the execution nor delivery of this Agreement nor the consummation of the transactions contemplated hereby will conflict in any material respect with, or result in any material
breach of, the terms, conditions, or provisions of or will constitute a material default under any instrument, agreement or contract to which I am a party or to which I am bound.

 

I make this certification with the full and complete understanding that Global will rely on this certification to be true and correct in completing the share exchange contemplated by this Agreement.

 

 

	 	 
	 	 	 	 

 

9ex10_3.htm

Exhibit 10.3

METHES ENERGIES INTERNATIONAL LTD.

 

INCENTIVE STOCK OPTION AGREEMENT

 

This Agreement is between Methes Energies International Ltd., a Nevada corporation (the “Company”), and __________________________ (the “Optionee”), pursuant to the Company’s Amended and Restated 2008 Directors, Officers and Employees Stock Option Plan (the “Plan”).  The Company and the
Optionee agree as follows:

 

1.           Option Grant.  The Company grants to the Optionee on the terms and conditions of this Agreement the right and the option (the “Option”) to purchase all or any part of _______ shares of the Company’s
Common Stock at a purchase price of $______ per share.  The terms and conditions of the Option grant set forth in attached Exhibit A are incorporated into and made a part of this Agreement.  The Option is intended to be an Incentive Stock Option as defined in Section 422 of the Internal Revenue Code of 1986, as amended.

 

2.           Grant Date; Expiration Date.   The Grant Date for this Option is _____________.  The Option shall continue in effect until the tenth anniversary of the Grant Date (the “Expiration Date”)
unless earlier terminated as provided in Sections 2, 7 or 8 of Exhibit A.  The Option shall not be exercisable on or after the Expiration Date.

 

3.           Exercise of Option.  The Vesting Reference Date of this Option is ____________. The Option will become exercisable in accordance with Section 1 of Exhibit A.

 

The parties have executed this Agreement in duplicate as of the Grant Date.

 

	
Methes Energies International Ltd.
	  	
Optionee

	 	 	 
	 	 	 
	 	 	 
	By:  	 	  	 
	Title:	 	  	 
	  	  	
[print name]

	 	  	 
	
[address]
	  	
[address]

	  	  	  
	 	  	 

 

 

 

 

 

Methes Energies International Ltd.

Exhibit A to

Stock Option Agreement

 

1.           Time of Exercise of Option.

 

  1.1            Vesting Schedule.  Until it expires or is terminated as provided in Sections 2, 7 or 8 of this Exhibit A, this Option may be exercised
from time to time to purchase whole shares up to the following limits:

 

 

	
Months After Vesting
	 
	
Reference Date
	
Percentage Exercisable

	 	 
	 	
Less than 3
	
0%
	 
	 	
3 
	12.5%	 
	 	
6 
	25%	 
	 	
9 
	37.5%	 
	 	
12 
	50%	 
	 	
15 
	62.5%	 
	 	
18 
	75%	 
	 	
21 
	87.5%	 
	 	
24 or more 
	100%	 

 

1.2           Special Acceleration Of Option.

(a) This option, to the extent outstanding at the time of a Corporate Transaction but not otherwise fully exercisable, shall automatically accelerate so that this option shall, immediately prior to the effective date of such Corporate Transaction, become exercisable for all of the Option shares at the time subject to this option and may be
exercised for any or all of those Option shares as fully vested shares of Common Stock. No such acceleration of this option shall occur, however, if and to the extent: (i) this option is, in connection with the Corporate Transaction, to be assumed by the successor company (or parent thereof) or (ii) this option is to be replaced with a cash incentive program of the successor company which preserves the spread existing at the time of the Corporate Transaction on the Option shares for which this option is not otherwise
at that time exercisable (the excess of the Fair Market Value of those Option shares over the aggregate Exercise Price payable for such shares) and provides for subsequent payout in accordance with the same option exercise/vesting schedule set forth in this Agreement.

(b) Immediately following the Corporate Transaction, this option shall terminate and cease to be outstanding, except to the extent assumed by the successor company (or parent thereof) in connection with the Corporate Transaction.

(c) If this option is assumed in connection with a Corporate Transaction, then this option shall be appropriately adjusted, immediately after such Corporate Transaction, to apply to the number and class of securities which would have been issuable to Optionee in consummation of such Corporate
Transaction had the option been exercised immediately prior to such Corporate Transaction, and appropriate adjustments shall also be made to the Exercise Price, PROVIDED the aggregate Exercise Price shall remain the same.  (d) This Agreement shall not in any way affect the right of the Company to adjust, reclassify, reorganize or otherwise change its capital or business structure or to merge, consolidate, dissolve, liquidate or sell or transfer all or any part of its business or assets.

 

 

 

 

(d)  Certain Definitions.

(i)  “Corporate Transaction” shall mean either of the following stockholder-approved transactions to which the Company is a party: (i) a merger or consolidation in which securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s
outstanding securities are transferred to a person or persons different from the persons holding those securities immediately prior to such transaction, or (ii) the sale, transfer or other disposition of all or substantially all of the Company’s assets in complete liquidation or dissolution of the Company.

(ii) “Exercise Price” shall mean the exercise price per Option Share as specified in this Agreement.

(iii)  “Fair Market Value” per share of Common Stock on any relevant date shall be the closing price of the Common Stock last reported before the time in question if the Common Stock is publicly traded, or another value of the Common Stock as specified by the Board of
Directors.

(iv) “Option Shares” shall mean the number of shares of Common Stock subject to the option as specified in this Agreement.

2.           Termination of Employment or Service.

 

2.1           General Rule.  Except as provided in this Section 2, the Option may not be exercised unless at the time of exercise the Optionee is employed by or in the service of the Company and shall have been so employed
or provided such service continuously since the Grant Date.  For purposes of this Exhibit A, the Optionee is considered to be employed by or in the service of the Company if the Optionee is employed by or in the service of the Company or any parent or subsidiary of the Company (an “Employer”).

 

2.2           Termination Generally.  If the Optionee’s employment or service with the Company terminates for any reason other than because of total disability or death as provided in Sections 2.3 or 2.4, the Option
may be exercised at any time before the Expiration Date or the expiration of 90 days after the date of termination, whichever is the shorter period, but only if and to the extent the Optionee was entitled to exercise the Option at the date of termination, provided however, if the Optionee's is terminated for Misconduct, then this option shall terminate immediately and cease to remain outstanding on the date of termination. “Misconduct” shall mean the commission of any act of fraud, embezzlement
or dishonesty by Optionee, any unauthorized use or disclosure by Optionee of confidential information or trade secrets of the Company (or any parent or subsidiary), or any other intentional misconduct by Optionee adversely affecting the business or affairs of the Company (or any parent or subsidiary) in a material manner. The foregoing definition shall not be deemed to be inclusive of all the acts or omissions which the Company (or any parent or subsidiary) may consider as grounds for the dismissal or discharge
of Optionee or any other individual in the service of the Company (or any parent or subsidiary).

 

 

2

 

 

2.3           Termination Because of Total Disability.  If the Optionee’s employment or service with the Company terminates because of total disability, the Option may be exercised at any time before the Expiration
Date or before the date 12 months after the date of termination, whichever is the shorter period, but only if and to the extent the Optionee was entitled to exercise the Option at the date of termination.  The term “total disability” means a medically determinable mental or physical impairment that is expected to result in death or has lasted or is expected to last for a continuous period of 12 months or more and that, in the opinion of the Company and two independent physicians,
causes the Optionee to be unable to perform duties as an employee, director, officer or consultant of the Employer and unable to be engaged in any substantial gainful activity.  Total disability shall be deemed to have occurred on the first day after the two independent physicians have furnished their written opinion of total disability to the Company and the Company has reached an opinion of total disability.

 

2.4           Termination Because of Death.  If the Optionee dies while employed by or in the service of the Company, the Option may be exercised at any time before the Expiration Date or before the date 12 months
after the date of death, whichever is the shorter period, but only if and to the extent the Optionee was entitled to exercise the Option at the date of death and only by the person or persons to whom the Optionee’s rights under the Option shall pass by the Optionee’s will or by the laws of descent and distribution of the state or country of domicile at the time of death.

 

2.5           Leave of Absence.  Absence on leave approved by the Employer or on account of illness or disability shall not be deemed a termination or interruption of employment or service.  Vesting of the Option
shall continue during a medical, family or military leave of absence, whether paid or unpaid, and vesting of the Option shall be suspended during any other unpaid leave of absence.

 

2.6           Failure to Exercise Option.  To the extent that following termination of employment or service, the Option is not exercised within the applicable periods described above, all further rights to purchase shares
pursuant to the Option shall cease and terminate.

 

3.           Method of Exercise of Option. The Option may be exercised only by notice in writing from the Optionee to the Company of the Optionee’s binding
commitment to purchase shares, specifying the number of shares the Optionee desires to purchase under the Option and the date on which the Optionee agrees to complete the transaction, which may not be more than 30 days after delivery of the notice, and, if required to comply with the Securities Act of 1933, containing a representation that it is the Optionee’s intention to acquire the shares for investment and not with a view to distribution. On or before the date specified for completion of the purchase,
the Optionee must pay the Company the full purchase price of those shares in cash or by check, or in whole or in part in Common Stock of the Company valued at fair market value provided such Common Stock has been previously acquired and held by the Optionee for at least six months. The fair market value of Common Stock provided in payment of the purchase price shall be the closing price of the Common Stock last reported before the time payment in Common Stock is made or, if earlier, committed to be made, if the
Common Stock is publicly traded, or another value of the Common Stock as specified by the Company.  No shares shall be issued until full payment for the shares has been made, including all amounts owed for tax withholding.  The Optionee shall, immediately upon notification of the amount due, if any, pay to the Company in cash or by check amounts necessary to satisfy any applicable federal, state and local tax withholding requirements.  If additional withholding is or becomes
required (as a result of exercise of the Option or as a result of disposition of shares acquired pursuant to exercise of the Option) beyond any amount deposited before delivery of the certificates, the Optionee shall pay such amount to the Company, in cash or by check, on demand.  If the Optionee fails to pay the amount demanded, the Company or the Employer may withhold that amount from other amounts payable to the Optionee, including salary, subject to applicable law.

 

 

3

 

 

4.           Disqualifying Disposition.  If the Option is an Incentive Stock Option and if within two years after the Grant Date or within 12 months
after the exercise of the Option, the Optionee sells or otherwise disposes of Common Stock acquired on exercise of the Option, the Optionee shall within 30 days of the sale or disposition notify the Company in writing of (i) the date of the sale or disposition, (ii) the amount realized on the sale or disposition and (iii) the nature of the disposition (e.g., sale, gift, etc.).

 

5.           Nontransferability.  The Option is nonassignable and nontransferable by the  Optionee, either voluntarily or by operation of law,
except by will or by the laws of descent and distribution of the state or country of the Optionee’s domicile at the time of death, and during the Optionee’s lifetime, the Option is exercisable only by the Optionee.

 

6.           Stock Splits, Stock Dividends.  If the outstanding Common Stock of the Company is hereafter increased or decreased or changed into or exchanged
for a different number or kind of shares or other securities of the Company by reason of any stock split, combination of shares, dividend payable in shares, recapitalization or reclassification, appropriate adjustment shall be made by the Company in (i) the number and kind of shares subject to the Option, or the unexercised portion thereof, and (ii) the Option price per share, so that the Optionee’s proportionate interest before and after the occurrence of the event is maintained.   Notwithstanding
the foregoing, the Company shall have no obligation to effect any adjustment that would or might result in the issuance of fractional shares, and any fractional shares resulting from any adjustment may be disregarded or provided for in any manner determined by the Company.  Any such adjustments made by the Company shall be conclusive.

 

7.           Mergers, Reorganizations, Etc.  In the event of a merger, consolidation, plan of exchange, acquisition of property or stock, split-up, split-off,
spin-off, reorganization or liquidation to which the Company is a party or any sale, lease, exchange or other transfer (in one transaction or a series of related transactions) of all, or substantially all, of the  assets of the Company (each, a “Transaction”), the Company shall, in its sole discretion and to the extent possible under the structure of the Transaction, select one of the following alternatives for treating the Option:

 

7.1           The Option shall remain in effect in accordance with its terms.

 

 

4

 

 

7.2           The Option shall be converted into an option to purchase stock in one or more of the corporations, including the Company, that are the surviving or acquiring corporations in the Transaction.  The amount, type of securities subject thereto and exercise price of
the converted Options shall be determined by the Company, taking into account the relative values of the companies involved in the Transaction and the exchange rate, if any, used in determining shares of the surviving corporation(s) to be held by holders of shares of the Company following the Transaction.  The converted Option shall be vested only to the extent that the vesting requirements relating to the Option have been satisfied.

 

7.3           The Company shall provide a period of 30 days or less before the completion of the Transaction during which the Option may be exercised to the extent then exercisable, and upon the expiration of that period, the Option shall immediately terminate.  The Company
may, in its sole discretion, accelerate the exercisability of the Option so that the Option is exercisable in full during that period.

 

8.           Dissolution.  In the event of the dissolution of the Company, the Company shall provide a period of 30 days or less before the dissolution
of the Company during which the Option may be exercised to the extent then exercisable, and upon the expiration of that period, the Option shall immediately terminate.  The Company may, in its sole discretion, accelerate the exercisability of the Option so that the Option is exercisable in full during that period.

 

9.           Conditions on Obligations.  The Company shall not be obligated to issue shares of Common Stock upon exercise of the Option if the Company is
advised by its legal counsel that such issuance would violate applicable state or federal laws, including securities laws.  The Company will use its best efforts to take steps required by state or federal law or applicable regulations in connection with issuance of shares upon exercise of the Option.

 

10.         No Right to Employment or Service.  Nothing in the Plan or this Agreement shall (i) confer upon the Optionee any right to be continued in the employment of
an Employer or interfere in any way with the Employer’s right to terminate the Optionee’s employment at will at any time, for any reason, with or without cause, or to decrease the Optionee’s compensation or benefits, or (ii) confer upon the Optionee any right to be retained or employed by the Employer or to the continuation, extension, renewal or modification of any compensation, contract or arrangement with or by the Employer.

 

11.         Successors of Company.  This Agreement shall be binding upon and shall inure to the benefit of any successor of the Company but, except as provided herein,
the Option may not be assigned or otherwise transferred by the Optionee.

 

12.         Notices.  Any notices under this Agreement must be in writing and will be effective when actually delivered or, if mailed, three days after deposit into
the United States mail by registered or certified mail, postage prepaid.  Mail shall be directed to the addresses stated on the face page of this Agreement or to such address as a party may certify by notice to the other party.

 

13.         Rights as a Shareholder.  The Optionee shall have no rights as a shareholder with respect to any shares of Common Stock until the date the Optionee becomes
the holder or record of those shares.  No adjustment shall be made for dividends or other rights for which the record date occurs before the date the Optionee becomes the holder of record.

 

 

5

 

 

14.         Amendments.   The Company may at any time amend this Agreement if the amendment does not adversely affect the Optionee.  Otherwise, this
Agreement may not be amended without the written consent of the Optionee and the Company.

 

15.         Governing Law.  This Agreement shall be governed by the laws of the state of Nevada.

 

16.         Complete Agreement.  This Agreement constitutes the entire agreement between the Optionee and the Company, both oral and written concerning the matters
addressed herein, and all prior agreements or representations concerning the matters addressed herein, whether written or oral, express or implied, are terminated and of no further effect.

 

17.         Tax Treatment.  The Optionee is encouraged to consult with his or her attorney to determine the tax treatment of the Options granted to him or her.  The Company has no responsibility whatsoever of any nature
for any treatment the IRS or any state tax authority may apply to the Options.  The Company makes no representations, warranties or covenants regarding the tax status of the Options granted to the Optionee.

 

18.         No Modification of Grant.  The Options that are the subject of this Agreement were granted to the Optionee on December 5, 2007.  The parties to this Agreement intend this Agreement to memorialize and not to
amend or alter the Agreement with respect to the Options.  In the event that a provision of this Agreement or the Plan would be deemed to be a “modification” in the terms of the options as defined under Section 424(h) of the Internal Revenue Code of 1986, as amended, such provision shall have effect only to the extent it does not trigger such “modification” of the terms of the Option.

 

6

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00163-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00163-of-00352.parquet"}]]