Document:

Exhibit 10.1

DOMAIN
NAME PURCHASE AGREEMENT

This DOMAIN NAME PURCHASE
AGREEMENT (“Agreement”), dated as of June 15, 2007 (the “Effective
Date”), is entered into by and between Tucows.com Co, a Nova Scotia
corporation, Tucows Domain Holdings Co., a Nova Scotia corporation, and
Mailbank Nova Scotia Co., a Nova Scotia corporation, each having its principal
address at 96 Mowat Avenue, Toronto, ON, M6K 3M1, Canada, and their respective
affiliates (collectively the “Seller”), and Internet REIT, Inc., a
Delaware corporation having an office and place of business at 1233 West Loop
South, Ste 1400, Houston, TX 77027 (“Buyer”).

WHEREAS, Seller owns the
domain names set forth on Exhibit A (the “Domain Names”); and

WHEREAS,
Buyer wishes to purchase the Domain Names and all related rights thereto;

THEREFORE,
the parties agree as follows:

SECTION
1.                 SALE
OF DOMAIN NAMES

1.1           Transfer of Domain
Names, Websites and Related Rights. The Seller hereby sells, assigns and transfers to Buyer
all rights, title and interests in and to (a) the Domain Names; and (b)
all Intellectual Property, and the goodwill associated therewith, in the
Domain Names in any form, language, style or manner, subject to the terms
of this Agreement.  For the purpose of this Agreement, “Intellectual Property” means
all inventions, discoveries, trademarks, patents, trade names, copyrights,
moral rights, know-how, intellectual property, reports and other confidential
information, licenses, developments, and similar intangible property
rights, whether or not patentable or copyrightable (or otherwise subject
to legally enforceable restrictions or protections against unauthorized
third party usage), and any and all applications for, registrations of,
and extensions, divisions, renewals and reissuances of, any of the
foregoing, and the rights therein.

1.2           Closing Process.  Immediately upon the Effective Date, Seller
will transfer the Domain Names into Buyer’s reseller account at the Seller’s
registrar located at resellers.tucows.com, and lock the Domain Names to prevent
further transfer.  Buyer will thereafter wire the
Upfront Payment (as defined below) amount to Seller.  Upon confirmation of wire receipt by
Seller, Seller will unlock the Domain Names and fully cooperate with any
transfer requests made by Buyer or by any registrar appointed by Buyer to act
on its behalf.

1.3           Cooperation.  Each Party will execute in a timely manner
such documents and take all appropriate and reasonable actions as the other may
request necessary to transfer of the Domain Names to Buyer and to enable Buyer
to obtain and enforce proper protection of the Domain Names in all
jurisdictions throughout the world, including without limitation the execution
and delivery of a name change registration agreement or other electronic forms
required by the proper domain name registrar(s).  Upon the execution of this Agreement,
the parties will promptly initiate such transfer efforts with the proper domain
name registrar(s).  Each Party will cooperate fully with
the other to effectuate the transfer of the Domain Names and will fully perform
all of its covenants contained in this Agreement.  Each Party will fully cooperate with
the other during any audit or other accounting under this Agreement.

1.4           Payment.  In consideration for the sale of the Domain
Names and the Intellectual Property, Buyer hereby agrees to pay to the Seller
the following amounts : (a) on the date of this Agreement and, subject to
compliance of Seller’s obligations set forth in Section 1 hereto, Three Million
Dollars (US $3,000,000.00) (the “Upfront Payment”) plus (b) the amount which
results in the Holdback Payment (as defined and calculated in Exhibit B
herein), which shall be payable on the date which is 368 days from the
Effective Date of this Agreement.  The Upfront Payment plus the Holdback
Payment shall mean, together, the Purchase Price.

SECTION
2.                 CONFIDENTIALITY

2.1           Confidentiality.  Buyer and Seller each agree to maintain the
confidentiality of all Confidential Information of the other party (the “Protected
Party”). 
Neither party shall disclose any of such Confidential
Information of the Protected Party except (i) on a “need to know” basis to such
of its

employees, agents, or advisors who have a legitimate business
purpose in connection with the subject matter of this Agreement, or (ii) as and
to the extent reasonably required to be disclosed by applicable law, regulation
judicial process (but only (x) after providing the Protected Party reasonable
advance written notice of such potential disclosure, (y) pursuant to a protective
order or similar confidentiality arrangement that protects Protected Party’s
interests in the Confidential Information, and (z) subject to cooperation with
the Protected Party to obtain such protective order or similar confidential
treatment). 
For purposes of this Agreement, “Confidential Information”
means all non-public information of any kind, regardless of the form or medium,
that is obtained from, through, or delivered by or on behalf of the Protected
Party or its Related Parties relating to (A) the terms of this Agreement, or
(B) the business of the Protected Party or its Related Parties.  All
Confidential Information concerning a Protected Party shall be the property of
such Protected Party, and the receiving party shall have no right, title, or
interest in such Confidential Information or any intellectual property or
similar rights relating thereto.  Seller shall not under any
circumstances use, or disclose to third parties, any personally identifiable
information or data of any other individual or entity that is included within
or derived from Confidential Information.  Notwithstanding the foregoing,
Confidential Information shall not include information that is shown by clear
and convincing evidence to be publicly available without breach of the receiving
party’s obligations under this Agreement.

SECTION
3.                 REPRESENTATIONS
AND WARRANTIES

3.1           Representations,
Warranties and Covenants of Seller. 
Seller, jointly and severally, represents, warrants and covenants to
Buyer the following:

(a)           Seller is a corporation
duly organized, validly existing, and in good standing under the laws of Nova
Scotia.

(b)           Seller has all
necessary corporate power and authority to make, execute, deliver and
consummate  this Agreement, and has taken all
necessary action required to be taken to authorize Seller to execute and
deliver this Agreement and to perform all of its obligations, undertakings, and
agreements to be observed and performed under this Agreement.  This
Agreement has been duly executed and delivered by Seller and is a valid and
binding agreement of Seller.  The execution and delivery of this
Agreement by Seller does not, and the consummation by Seller of the
transactions contemplated hereby will  not, breach,
violate, or otherwise conflict with any provision of Seller’s governing
documents or any agreement, law, regulation, order, or judgment to which Seller
is a party or by which Seller, or any of Domain Names or Intellectual Property,
is bound.

(c)           Except as expressly
set forth on Schedule 1, Seller is the sole and exclusive registrant and
owner of the entire right, title, and interest in the Domain Names and the
Intellectual Property.  Seller has not sold, assigned,
licensed, sublicensed, pledged, escrowed, or granted the use of any Domain Name
or Intellectual Property to any person or entity other than Buyer, or entered
into any agreement to do any of the foregoing. Each of the Domain Names and
Intellectual Property are free of any liens, security interests, or other
encumbrances, or restrictions. Seller shall deliver to Buyer clear and
marketable title to the Domain names and Intellectual Property. Neither this
Agreement nor any of the transactions contemplated herein shall cause Buyer or
any of its subsidiaries or affiliates to assume or remain liable in respect of
any indebtedness of the Seller or any other obligation of the Seller.

(d)           To the best of
Seller’s knowledge, the registration and use of the Domain Names and the
Intellectual Property, (i) are in compliance with all laws and regulations of
the jurisdictions in which Seller conducts business, (ii) do not violate any
procedures or policies of, and were registered without fraud on or
misrepresentation to, (a) the Internet Corporation for Assigned Names and
Numbers, or (b) any applicable domain name registry or registrar, and (iii) do
not infringe, misappropriate, or otherwise violate any Person’s intellectual
property rights, and there has been no such claim asserted or threatened
against the Seller except as set forth in Schedule 2. All domain name
registration fees due for domain names scheduled to expire on or before the
Effective Date have been paid.

(e)           The Seller will not
directly or indirectly oppose any existing or future applications or
registrations of Buyer for the Domain Names, or attempt to cancel or oppose any
existing or future application or registration of Buyer for the Domain Names.

(f)            Buyer is placing
considerable value on the Internet traffic and users associated with the Domain
Names. 
Seller represents that it is not engaging in “click fraud” or
activities of any kind to artificially inflate the apparent amount or value of
the traffic or revenue statistics of any Domain Name, including but not limited
to (i) purchasing traffic and directing it to any Domain Name, (ii) utilizing
or engaging “bots” to automatically visit any of the Domain names, or (iii)
employing, engaging, or contracting with any person or entity to manually visit
any of the Domain Names.

(g)           Seller does not own
or control any other domain names or websites or banners that are driving
Internet visitors or traffic in any way (including but not limited to by
linking, pointing, redirecting) to any of the Domain Names, other than those
listed on Schedule 3..

(h)           Except as described
on Schedule 4, Seller has not engaged in any other activities intended
to or having the effect of automating, incentivizing, or increasing the amount
or value of the traffic or revenue associated with any of the Domain Names,
including but not limited to (i) key word submissions with any search engine,
(ii) search engine optimization, (iii) any other incentives paid or promised to
any search program, or (iv) any advertising in any medium, including pop-up or
pop-under advertising. With respect to any activities required to be described
on Schedule 4, Schedule 4 shall also include the period of such
activity and the revenue paid or received in connection with such activity.

3.2           Representations and
Warranties of Buyer. 
Buyer represents and warrants to Seller the following:

(a)           Buyer is a
corporation duly organized, validly existing, and in good standing under the
laws of the State of Delaware.

(b)           Buyer has all
necessary power and authority to make, execute, deliver and consummate this
Agreement, and has taken all necessary action required to be taken to authorize
Buyer to execute and deliver this Agreement and to perform all of its
obligations, undertakings, and agreements to be observed and performed under
this Agreement.  This Agreement has been duly executed
and delivered by Buyer and is a valid and binding agreement of Buyer.  The
execution and delivery of this Agreement by Buyer does not, and the
consummation by Buyer of the transactions contemplated hereby will  not, violate any provision of Buyer’s governing documents
or violate or result in a violation of any provisions of any agreement, law,
regulation, order, or judgment to which Buyer is a party or by which Buyer is
bound.

(c)           Buyer will assume
the obligation for all domain name registration fees for Domains Names
scheduled to expire after the Effective Date.

SECTION
4.                 INDEMNIFICATIONS
& MISCELLANEOUS

4.1           Indemnity.  Each party will defend, reimburse, indemnify,
and hold the other party, and the other party’s affiliates, partners,
directors, officers, employees, representatives, licensees, and customers (“Related
Parties”), harmless from any and all losses, liabilities, damages,
settlements, judgments, interest, penalties, and claims and all related costs
and expenses, including reasonable legal fees and disbursements and reasonable
costs of investigation, litigation, and settlement, arising
from any breach by such party of its covenants, representations, or warranties
under this Agreement or from any third party claim based on any act or omission
of such party.  If a Person is seeking indemnification
from a party pursuant to this Section 4.1, such Person shall promptly
notify the indemnifying party of a claim or action for which indemnity is
claimed, allow the indemnifying party to control the defense or settlement of
the claim or action, and reasonably cooperate with the indemnifying party, at
the indemnifying party’s expense, with respect thereto; provided  that
the indemnified party may be represented by counsel of its choice at its own
expense; and provided  further that without the indemnified party’s
prior written consent (such consent not to be unreasonably withheld), the
indemnifying party shall not enter into, and the indemnified party shall not be
bound by, any such settlement.

4.2           Governing Law, Jury
Waiver, Consent to Jurisdiction. 
This Agreement shall be governed by the internal laws of the State of
Delaware applicable to agreements made and to be performed wholly in the State
of Delaware (excluding any such law which may direct the application of the
laws of any other jurisdiction), except that any questions governed by the
trademark, domain name, copyright, or patent statutes of the United States of
America shall be governed by the applicable federal statutes.  EACH OF

THE PARTIES HERETO UNCONDITIONALLY WAIVES ITS RIGHTS TO A JURY TRIAL OF
ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT AND/
OR THE RELATIONSHIP BETWEEN THE PARTIES. 
THE SCOPE OF THIS WAIVER IS INTENDED TO BE ALL ENCOMPASSING OF ANY AND
ALL DISPUTES THAT MAY BE FILED IN ANY COURT.  IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE
FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.  The parties agree that any such action or
proceeding shall be litigated in state or federal courts located in Wilmington,
Delaware and the parties further consent to the jurisdiction of any such court.

4.3           Disclaimer of
Consequential Damages. 
EXCEPT IN THE EVENT OF A BAD FAITH MATERIAL BREACH OF THIS AGREEMENT BY
THE OTHER PARTY, EACH PARTY HERETO SHALL NOT ASSERT, AND HEREBY WAIVES, ANY
CLAIM AGAINST THE OTHER PARTY FOR SPECIAL, INDIRECT, CONSEQUENTIAL, EXEMPLARY,
OR PUNITIVE DAMAGES (AS OPPOSED TO DIRECT OR ACTUAL DAMAGES) ARISING OUT OF OR
RELATING TO THIS AGREEMENT (OR BREACH); PROVIDED  THAT AMOUNTS FOR
WHICH A PERSON IS ENTITLED TO INDEMNIFICATION UNDER SECTION 5 SHALL BE DEEMED
DIRECT AND ACTUAL DAMAGES.

4.4           No Partnership or
Agency.  Buyer and Seller are
independent contractors, and neither party is, nor represents itself to be, the
joint venturer, franchiser, franchisee, partner, broker, employee, servant,
agent, or representative of the other party for any purpose.  Neither
party shall have the authority to make any representations or incur any
obligations on behalf of the other party.

4.5           Entire Agreement.  This Agreement is the complete agreement
between the parties with respect to the subject matter hereof, and replaces and
supersedes all prior oral and written communications and negotiations in
connection therewith.  This Agreement is the result of arm’s
length negotiations between the parties and shall be construed to have been
drafted by both parties such that any ambiguities in this Agreement shall not
be construed against either party.

4.6           Amendment; Waiver.  This Agreement may be modified, changed, or
amended only in a writing signed by both parties.  The delay or failure of either party
to exercise any right provided herein shall in no way affect its rights at a
later time to enforce that right or any other rights under this Agreement.  No waiver
shall be effective unless in writing signed by the waiving party.

4.7           Headings;
Severability.  The headings
and titles used in this Agreement are for convenience only, and shall not
expand or otherwise affect any of its terms.  If any provision of this Agreement is
declared invalid under applicable law, it shall be deemed adjusted to conform
to the legal requirements, or if no adjustment can be made, the provision shall
be deleted, unless such adjustment or deletion materially frustrates the
purpose of the parties in entering this Agreement.

4.8           Notices.  All notices required to be given hereunder
shall be in writing.  All notices hereunder of a breach,
termination, indemnity claim, Exercise Notice, regarding an approval or
consent, or any other notice of any event or development material to this
Agreement shall be delivered to the other designated party at the above-stated
address (and in the case of Buyer, to the attention of its “General Partner”)
(i) personally, (ii) by certified or registered mail, return receipt requested,
or (iii) by a recognized national overnight courier service, and the date of
service of notice shall be: (i) the date such notice is personally delivered;
(ii) three (3) business days after the date of mailing, if sent by registered
or certified mail; or (iii) the next business day after delivery to a reputable
overnight courier.  Either party may change the address
to which notice or payment is to be sent by written notice to the other in
accordance with the provisions of this Section.

4.9           Expenses. Except as
specifically provided in this Agreement, each party shall bear all of its own
expenses incurred in the negotiation, preparation, or performance of this
Agreement. Seller shall be solely responsible for any taxes, fees, or
commissions due to any third party or governmental body arising from the
transactions contemplated by this Agreement, including without limitation any
fees payable to any registrar to effect the transfer of ownership and
registration of the Domain Names.

[Signatures on following page]

IN WITNESS WHEREOF, the parties hereto have caused
this instrument to be duly executed as of the Effective Date.

	
  

  	
  Internet REIT, Inc.

  
	
   

  	
  By:

  	
  /s/ Craig Snyder

  	
   

  
	
   

  	
  Craig Snyder

  
	
   

  	
  Title: CEO

  
	
   

  	
  Date: June 14,
  2007

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Tucows.com Co.

  
	
   

  	
  By:

  	
  /s/ Elliot Noss

  	
   

  
	
   

  	
  Elliot Noss

  
	
   

  	
  Title: President
  & CEO

  
	
   

  	
  Date: June 14,
  2007

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Tucows Domain
  Holdings Co.

  
	
   

  	
  By:

  	
  /s/ Elliot Noss

  	
   

  
	
   

  	
  Elliot Noss

  
	
   

  	
  Title: President
  & CEO

  
	
   

  	
  Date: June 14,
  2007

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Mailbank Nova
  Scotia Co.

  
	
   

  	
  By:

  	
  /s/ Elliot Noss

  	
   

  
	
   

  	
  Elliot Noss

  
	
   

  	
  Title: President
  & CEO

  
	
   

  	
  Date: June 14,
  2007Exhibit 10.1

ARTISTDIRECT, INC.

NOTICE OF GRANT OF STOCK OPTION

Notice
is hereby given of the following option grant (the “Option”) to purchase shares
of the Common Stock of ARTISTdirect, Inc. (the “Corporation”):

Optionee: Nicholas Turner

Grant Date: January 1, 2005

Vesting Commencement Date: January 1, 2005

Exercise Price: $0.79 per share

Number of Option Shares: 92,000 shares

Expiration Date: January 1, 2012

	
  Type of Option:

  	
  o

  	
  Incentive Stock Option

  
	
   

  	
   

  
	
   

  	
  x

  	
  Non-Statutory Stock Option

  

 

Date
Exercisable: None of the Option Shares are vested and exercisable on the Grant
Date. The options shall become exercisable each month in equal installments
over a twelve (12) month period measured from the Vesting Commencement Date.

Optionee
and the Corporation hereby agree to be bound by all the terms and conditions of
the Option as set forth in the Stock Option Agreement attached hereto as
Exhibit A.

All capitalized terms in this Notice shall have the
meaning assigned to them in this Notice or in the attached Stock Option
Agreement. This Notice of Grant supercedes the prior Notice of Grant for
120,000 options to Optionee dated March 29, 2005 in its entirety.

DATED AS OF: April 29, 2005

	
  

  	
  ARTISTDIRECT, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert Weingarten

  	
   

  
	
   

  	
  Name: Robert Weingarten

  
	
   

  	
  Title: CFO

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Nicholas Turner

  	
   

  
	
   

  	
   

  
	
   

  	
  Optionee: Nicholas Turner

  
	
   

  	
   

  
	
   

  	
  Address:

  	
  20132 Pacific Coast Highway

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Malibu CA 90265

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
						

 

ATTACHMENT:

EXHIBIT
A - NON-STATUTORY STOCK OPTION AGREEMENT

EXHIBIT A

STOCK OPTION AGREEMENT

ARTISTDIRECT, INC.

NON-STATUTORY STOCK OPTION AGREEMENT

RECITALS

A.                                   The
Board, including a majority of the independent directors (as defined in Nasdaq Marketplace
Rule 4200(a)(14)), of the Corporation and the Board’s Compensation Committee, comprised
of a majority of independent directors, have approved a stock option grant to
Optionee as an inducement material to Optionee’s employment with the
Corporation.

B.                                     Optionee
has not previously been an Employee or director of the Corporation, and the
option evidenced by this Agreement (the “Option”) is granted to Optionee in
order to attract and retain Optionee to serve the Corporation in the capacity
of Chief Financial Officer.

C.                                     The
Option is granted to Optionee in consideration of the services Optionee is to render
the Corporation and not for any capital-raising purposes or in connection with
any capital-raising activities.

D.                                    The
Option is intended to be a Non-Statutory Option which does NOT satisfy the requirements
of Section 422 of the Code.

E.                                      All
capitalized terms in this Agreement shall have the meaning assigned to them in the
attached Appendix.

NOW,
THEREFORE, it is hereby agreed as follows:

1.                   GRANT
OF OPTION. The Corporation hereby grants to Optionee, as of the Grant Date, an
Option to purchase up to the number of Option Shares specified in the Grant
Notice attached hereto. The Option Shares shall be purchasable at any time or
from time to time during the Option term specified in Paragraph 2 at the
Exercise Price.

2.                   OPTION
TERM. The Option shall have a term set forth in the Notice of Grant (“Expiration
Date”) and shall accordingly expire at the close of business on the Expiration
Date, unless sooner terminated in accordance with Paragraphs 5 or 6.

3.                   LIMITED
TRANSFERABILITY. The Option shall be neither transferable nor assignable by
Optionee other than by will or by the laws of descent and distribution
following Optionee’s death and may be exercised, during Optionee’s lifetime,
only by Optionee or as otherwise set forth herein. However, the Option may, in
connection with the Optionee’s estate plan, be assigned in whole or in part
during Optionee’s lifetime to one or more members of the Optionee’s immediate
family or to a trust established for the exclusive benefit of one or more such

family members. The
assigned portion shall be exercisable only by the person or persons who acquire
a proprietary interest in the Option pursuant to such assignment or as set
forth herein. The terms applicable to the assigned portion shall be the same as
those in effect for the Option immediately prior to such assignment and shall
be set forth in such documents issued to the assignee as the Board may deem
appropriate.

4.                   DATES
OF EXERCISE. The Option shall be exercisable in accordance with the Notice of
Grant, and shall remain exercisable for all of the Option Shares as to which it
has not been exercised until the Expiration Date or sooner termination of the
Option term under Paragraphs 5 or 6.

5.                   CESSATION
OF SERVICE. The Option term specified in Paragraph 2 shall terminate (and the Option shall cease to be outstanding)
prior to the Expiration Date in accordance with the following provisions:

 (a)       Should Optionee cease
Service by reason of an Involuntary Termination or Permanent Disability, then
Optionee’s right to exercise the Option shall lapse, and the Option shall cease
to be outstanding, upon the expiration of the twelve (12)-month period measured
from the date of Optionee’s cessation of Service, In no event, however, shall
the Option be exercisable at any time after the Expiration Date. In the event
that such Permanent Disability prevents Optionee from personally exercising the
Option, the Option may be exercised by Optionee’s personal authorized representative
to the same extent that Optionee could otherwise exercise the Option.

 (b)      Should Optionee cease
Service on or prior to the two-year anniversary of the Grant Date for any
reason other than (i) an Involuntary Termination, (ii) a termination for Cause
or (iii) Optionee’s death or Permanent Disability, then Optionee’s right to
exercise the Option shall lapse, and the Option shall cease to be outstanding,
upon the earlier of (x) the expiration of the ninety (90)-day period measured
from the date of Optionee’s cessation of Service or (y) the Expiration Date.

 (c)       Should Optionee cease
Service after the two-year anniversary of the Grant Date for any reason other
than (i) an Involuntary Termination, (ii) a termination for Cause or (iii)
Optionee’s death or Permanent Disability, then Optionee’s right to exercise the
Option shall lapse, and the Option shall cease to be outstanding, upon the
earlier of (x) the expiration of the twelve (12)-month period measured from the
date of Optionee’s cessation of Service or (y) the Expiration Date.

 (d)      Should Optionee’s Service be
terminated for Cause, then the Option shall terminate immediately and cease to
be outstanding.

 (e)       Should Optionee cease
Service by reason of his death, then the personal representative of Optionee’s
estate or the person or persons to whom the Option is transferred pursuant to
Optionee’s will or in accordance with the laws of descent and distribution or,
if the Option has been transferred to a trust in accordance with the terms
herein, the trustee of such trust, shall have the right to exercise the Option.
Such right shall lapse, and the Option shall cease to be outstanding, upon the
earlier of (i) the expiration
of the twelve (12)-month period measured from the date of Optionee’s death or
(ii) the Expiration Date.

 (f)         During the applicable
post-Service exercise period, the Option may not be exercised in the aggregate
for more than the number of Option Shares that are vested at the time of
Optionee’s cessation of Service, except that, if Optionee ceases Service by
reason of an Involuntary Termination, Optionee thereupon shall be deemed to be
fully vested in all of the Option Shares. Upon the expiration of the applicable
post-Service exercise period or (if earlier) upon the Expiration Date, the
Option shall terminate and cease to be outstanding for any vested Option Shares
for which the Option has not been exercised. However, the Option shall,
immediately upon Optionee’s cessation of Service for any reason, terminate and
cease to be outstanding with respect to any Option Shares in which Optionee is
not at that time vested (under the first sentence of this paragraph 5(f) or otherwise).

6.                   CORPORATE
TRANSACTION

 (a)       The Option, to the extent
outstanding at the time of a Corporate Transaction, shall automatically
accelerate immediately prior to the effective date of such Corporate
Transaction so that all of the Option Shares shall be deemed to be fully
vested. No such acceleration of vesting of the Option shall occur, however, if
and to the extent: (i) the Option is, in connection with the Corporate
Transaction, to be assumed by the surviving or successor entity (or parent
thereof) or (ii) the Option is to be replaced with a cash incentive program of
the surviving or successor entity (or parent thereof) which provides Optionee
with substantially equivalent economic benefits by preserving the spread
existing at the time of the Corporate Transaction on the Option Shares for
which the Option is not otherwise at that time vested (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 vesting schedule set forth in the Grant Notice.

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

 (c)       If the Option is assumed in
connection with a Corporate Transaction, then the 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 per share to provide that the
aggregate Exercise Price shall remain the same as before such Corporate
Transaction.

 (d)      To the extent the Option is
to be assumed by the surviving or successor entity (or parent thereof) in
connection with a Corporate Transaction, or a substitute option is issued to
the Optionee as provided above, vesting of the Option shall not accelerate upon
the occurrence of that Corporate Transaction, and the Option shall accordingly
continue, over Optionee’s period of Service after the Corporate Transaction, to
vest in one or more installments in accordance with the provisions of the Grant
Notice, subject to acceleration upon an Involuntary Termination as provided in
Paragraph 5(f) above.

 (e)       This Agreement shall not in
any way affect the right of the Corporation 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.

7.                   ADJUSTMENT
IN OPTION SHARES. Should any change be made to the Common Stock by reason of
any stock split, stock dividend, recapitalization, combination of shares,
exchange of shares or other change affecting the outstanding Common Stock as a
class without the Corporation’s receipt of consideration, in order to reflect
such change and thereby preclude a dilution or enlargement of benefits
hereunder appropriate adjustments shall be made to (i) the number and/or class
of securities subject to the Option and (ii) the Exercise Price, but no change
shall be made in the aggregate Exercise Price.

8.                   STOCKHOLDER
RIGHTS. The holder of the Option shall not have any stockholder rights with
respect to the Option Shares until such person shall have exercised the Option,
paid the Exercise Price and become a holder of record of the purchased shares.

9.                   MANNER
OF EXERCISING OPTION.

 (a)       In order to exercise the
Option with respect to all or any part of the Option Shares for which the
Option is at the time exercisable, Optionee (or any other person or persons
exercising the Option) must take the following actions:

(i)                                     Execute
and deliver to the Corporation a Notice of Exercise for the number of Option
Shares for which the Option is exercised.

(ii)                                  Pay
the aggregate Exercise Price for the purchased shares in one or more of the
following forms:

 (A)                           cash or
check made payable to the Corporation;

 (B)                             shares
of Common Stock held by Optionee (or any other person or persons exercising the
Option) for the requisite period necessary to avoid a charge to the Corporation’s
earnings for financial reporting purposes and valued at Fair Market Value on
the Exercise Date; or

 (C)                             through
a special sale and remittance procedure pursuant to which optionee (or any
other person or persons exercising the Option) shall concurrently provide
irrevocable instructions (a) to a brokerage firm, not arranged by and not
having any pre-existing business relationship with the Corporation, to effect
the immediate sale of all or some of the purchased shares and remit to the
Corporation, out of the sale proceeds available on the settlement date, not
later than three (3) days after the Exercise Date, sufficient funds to cover
the aggregate Exercise Price payable for the purchased shares plus all
applicable federal, state and local income and employment taxes required to be
withheld by the Corporation by reason of

                such exercise and (b) to the
Corporation to deliver the certificates for the purchased shares directly to
such brokerage firm in order to complete the sale

 (D)         through a “cashless exercise” in which
the optionee may elect to receive shares equal to the value (as determined
below) of this option (or the portion thereof being cancelled) by surrender of
this option at the principal office of the Corporation together with the
properly endorsed form in which event the Corporation shall issue to the holder
a number of shares of 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 the option or, if only a
portion of the option is being exercised, the portion of the option being
exercised (at the date of such calculation)

 A=                            the
market value of one share of the Corporation’s Common Stock (at the date of
such calculation as determined by the closing price of the Common Stock on the
date immediately prior to the Exercise Date)

 B=                              Purchase
Price (as adjusted to the date of such calculation)

Except to the extent the
sale and remittance procedure or the cashless exercise procedure is utilized in
connection with the Option exercise, payment of the Exercise Price must
accompany the Notice of Exercise.

(iii) Furnish to the
Corporation appropriate documentation that the person or persons exercising the
Option (if other than Optionee) have the right to exercise the Option.

(iv) Execute and deliver to the Corporation such written
representations as may be requested by the Corporation in order for it
to comply with the applicable requirements of federal and state securities
laws.

(v)   Make appropriate arrangements with the
Corporation (or Parent or Subsidiary employing or retaining Optionee) for the
satisfaction of all federal, state and local income and employment tax
withholding requirements applicable to the Option exercise.

(b)           As soon as practical
after the Exercise Date, the Corporation shall issue to or on behalf of
Optionee (or any other person or persons exercising the Option) a certificate
for the purchased Option Shares.

(c)            In no event may the
Option be exercised for any fractional shares.

10.             LOCK-UP.
Optionee agrees that prior to the one-year anniversary of the Grant Date (or
any earlier date upon which Optionee’s Service ceases by reason of an
Involuntary Termination), he will not sell, make any short sale of, hedge,
loan, hypothecate, pledge, grant any option for the purchase of, or otherwise
dispose of or transfer for value or otherwise agree to engage in any of the
foregoing transactions with respect to the Option Shares without the written
consent of the Corporation’s Board.

11.             COMPLIANCE
WITH LAWS AND REGULATIONS.

 (a)       The exercise of the Option
and the issuance of the Option Shares upon such exercise shall be subject to
compliance by the Corporation and Optionee with all applicable requirements of
law relating thereto and with all applicable regulations of any stock exchange
(or the Nasdaq Stock Market or other national market, if applicable, or the
Over-The-Counter Bulletin Board) on which the Common Stock may be listed for
trading at the time of such exercise and issuance. The Corporation and Optionee
shall use reasonable efforts to comply with all such requirements of law and
applicable regulations.

 (b)      The inability of the
Corporation to obtain approval from any regulatory body having authority deemed
by the Corporation to be necessary to the lawful issuance and sale of any
Common Stock pursuant to the Option shall relieve the Corporation of any
liability with respect to the non-issuance or sale of the Common Stock as to
which such approval shall not have been obtained. The Corporation however,
shall use its best efforts to obtain all such approvals.

12.             SUCCESSORS
AND ASSIGNS. Except to the extent otherwise provided in Paragraphs 3 and 6, the
provisions of this Agreement shall inure to the benefit of, and be binding
upon, the Corporation and its successors and assigns and Optionee, Optionee’s
assigns and the legal representatives, heirs and legatees of Optionee’s estate,

13.             GOVERNING
LAW. The interpretation, performance and enforcement of this Agreement shall be
governed by the laws of the State of California without resort to that State’s
conflict-of-laws rules.

14.             NOTICES.
Any notice required to be given or delivered to the Corporation under the terms
of this Agreement shall be in writing and addressed to the Corporation at its
principal corporate offices. Any notice required to be given or delivered to
Optionee shall be in writing and addressed to Optionee at the address indicated
below Optionee’s signature line on the Grant Notice. All notices shall be
deemed effective upon personal delivery or upon deposit in the U.S. mail,
postage prepaid and properly addressed to the party to be notified.

15.             REGISTRATION
RIGHTS. The Corporation shall file a registration statement on S-8 relating to
the Option Shares and shall file any and all amendments to such registration
statement in order that the Optionee may sell or otherwise transfer the Option Shares upon exercise to the
fullest extent permitted under applicable federal and state securities laws.

EXHIBIT
1

NOTICE
OF EXERCISE

I
hereby notify ARTISTdirect, Inc. (the “Corporation”) that I elect to purchase
                            
shares of the Corporation’s Common Stock (the “Purchased Shares”) at the option
exercise price of $                                              per
share (the “Exercise Price”) pursuant to that certain option (the “Option”)
granted to me on                                        ,
20     .

Concurrently with the
delivery of this Exercise Notice to the Corporation, I shall hereby pay to the
Corporation the Exercise Price for the Purchased Shares in accordance with the
provisions of my agreement with the Corporation (or other documents) evidencing
the Option and shall deliver whatever additional documents may be required by
such agreement as a condition for exercise. Alternatively, I may utilize the
special broker-dealer sale and remittance procedure or cashless exercise procedure
specified in my agreement to effect payment of the Exercise Price.

	
  

  	
  , 

  	
  20

  	
   

  	
   

  	
   

  	
   

  
	
  Date

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Optionee

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Address:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Print name in exact manner it is to

  	
   

  	
   

  
	
  appear on the stock certificate:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Address to which certificate is to be

  	
   

  	
   

  
	
  sent, if different from address above:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Social Security Number:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Employee Number:

  	
   

  	
   

  	
   

  
																

 

APPENDIX

The following definitions shall be in effect under the
Agreement:

A.            AGREEMENT
shall mean this Stock Option Agreement.

B.              BOARD
shall mean the Corporation’s Board of Directors.

C.              CAUSE
shall mean Optionee is terminated because Optionee shall have (i) been
convicted of, or pleaded nolo contendere to, any felony or lesser crime
involving fraud, embezzlement or misappropriation of the property of the
Corporation or any of its Subsidiaries; (ii) engaged in gross negligence or
willful misconduct in the performance of Optionee’s duties hereunder that has
resulted in material injury to the Corporation; (iii) materially and willfully
breached any material provision hereof; or (iv) misappropriated for his own
purpose and benefit any material property of Corporation or any Subsidiary or
misappropriated for his own purpose and benefit, in violation of his fiduciary
obligation to the Corporation, any material opportunity of the Corporation or
any Subsidiary, Notwithstanding anything to the contrary contained herein, none
of the events or circumstances described in clauses (ii), (iii) or (iv) above
shall constitute “Cause” for purposes of this Agreement unless the Corporation
gives Optionee written notice delineating the claimed event or circumstance and
setting forth the Corporation’s intention to terminate Optionee’s employment if
such claimed event or circumstance is not capable of remedy or is not duly
remedied within thirty (30) days following such notice, if capable of remedy,
and Optionee fails to remedy such event or circumstance within such thirty
(30)-day period.

D.           CODE
shall mean the Internal Revenue Code of 1986, as amended.

E.             COMMON
STOCK, shall mean the Corporation’s common stock.

F.               CORPORATE
TRANSACTION shall mean any of the following transactions effecting a change in
control or ownership of the Corporation:

(i)     a stockholder-approved merger or
consolidation in which the Corporation is merged into or consolidated with any
other corporation or entity and immediately following consummation of the
transaction the persons who held the Corporation’s capital stock immediately
prior to such transaction hold less than an aggregate of fifty percent (50%) of
the total combined voting power of the surviving entity’s outstanding
securities, or

(ii)    a stockholder-approved sale, transfer or
other disposition of all or substantially ail of the Corporation’s assets, or

(iii)   the acquisition, directly or indirectly, by
any person or related group of persons (other than the Corporation or a person
that directly or indirectly controls, is controlled by, or is under common
control with, the Corporation), of beneficial ownership (within the meaning of
Rule 13d-3 of the Securities Exchange Act of 1934, as amended) of securities
possessing more than fifty percent (50%) of the total combined voting power of
the Corporation’s outstanding securities pursuant to a tender or exchange offer
made directly to the Corporation’s stockholders.

G.              CORPORATION
shall mean ARTISTdirect, Inc., a Delaware corporation,

H.             EMPLOYEE
shall mean the Optionee in his capacity as an employee of the Corporation (or
any Parent or Subsidiary), subject to the control and direction of the employer
entity as to both the work to be performed and the manner and method of
performance.

I.                  EXERCISE
DATE shall mean the date on which the Option shall have been exercised in
accordance with Paragraph 9 of the Agreement.

J.                 EXERCISE
PRICE shall mean the exercise price per share as specified in the Grant Notice.

K.             EXPIRATION
DATE shall mean the date on which the Option expires as specified in the Grant
Notice.

L.               FAIR
MARKET VALUE per share of Common Stock on any relevant date, for purposes of
Paragraph 9 only, shall be determined in accordance with the following
provisions:

(i)     If the Common Stock is at the time traded
on the Nasdaq National or SmallCap Markets, then the Fair Market Value shall be
the average of the high and low selling prices per share of Common Stock on the
date in question, as such prices are reported by the National Association of
Securities Dealers on the Nasdaq National or SmallCap Markets (or, if not
listed on such market, any other national market) and published in The Wall
Street Journal. If there are no selling prices quoted for the Common Stock on
the date in question, then the Fair Market Value shall be the average of the
high and low selling prices on the last preceding date for which such
quotations exist.

(ii)    If the Common Stock is at the time listed on
any Stock Exchange, then the Fair Market Value shall be the average high and
low selling prices per share of Common Stock on the date in question on the
Stock Exchange determined by the Compensation Committee to be the primary
market for the Common Stock, as such prices are officially quoted in the
composite tape of transactions on such exchange and published in The Wall
Street Journal. If there are no selling prices quoted for the Common Stock on
the date in question, then the Fair Market Value shall be the average of the
high and low selling prices on the last preceding date for which such
quotations exist.

(iii)   If the Common Stock is at the time traded on
the over-the-counter market, then the Fair Market Value shall be the average of
the closing bid prices over the 30-day period prior to the date in question, as
such prices are reported on the Over The Counter Bulletin Board.

(iv)   If the Common Stock is not at the time traded
on the over-the-counter market, a Stock Exchange or the Nasdaq National or
SmallCap Markets, then the Fair Market Value shall be as determined in good
faith by the Corporation’s Board of Directors.

M. GOOD REASON shall mean the occurrence of any of the
following; (i) a material and substantial reduction in Optionee’s title,
responsibilities or duties (including, but not limited to, any such reduction
following a change in control of the Corporation); (ii) a reassignment of
Optionee to a geographic location in excess of thirty-five (35) miles from the
Corporation’s current principal offices; or (iii) a material breach by the
Corporation of any of its obligations to Optionee hereunder, including, but not
limited to, the Corporation’s failure to timely make any payment due to
Optionee hereunder. Notwithstanding anything to the contrary contained herein,
none of the foregoing events or circumstances shall constitute “Good Reason”
for purposes of this Agreement unless Optionee gives the Corporation written
notice delineating the claimed event or circumstance and setting forth Optionee’s
intention to terminate his employment if such claimed event or circumstance is
not capable of remedy or is not duly remedied within a reasonable period
following such notice (not to exceed thirty (30) days), if capable of remedy,
and the Corporation fails to remedy such event or circumstance within such
reasonable period.

N.             GRANT
DATE shall mean the date of grant of the Option as specified in the Grant
Notice.

O.             GRANT
NOTICE shall mean the Notice of Grant of Stock Option accompanying the
Agreement, pursuant to which Optionee has been informed of the basic terms of
the Option evidenced hereby.

P.               INVOLUNTARY
TERMINATION shall mean the termination of Optionee’s Service by reason of:

(i)                                     Optionee’s
involuntary dismissal or discharge by the Corporation for reasons other than
(X) for Cause or (Y) by reason of death or Permanent Disability, or

(ii)                                  Optionee’s
voluntary resignation for Good Reason.

Q.             NON-STATUTORY
OPTION shall mean an option not intended to satisfy the requirements of Code
Section 422.

R.              NOTICE
OF EXERCISE shall mean the written notice of exercise in the form attached
hereto as Exhibit 1.

S.               OPTION
SHARES shall mean the number of shares of Common Stock subject to the Option as
specified in the Grant Notice.

T.              OPTIONEE
shall mean the person to whom the Option is granted as specified in the Grant
Notice.

U.             PARENT
shall mean any corporation (other than the Corporation) in an unbroken chain of
corporations ending with the Corporation, provided each corporation in the
unbroken chain (other than the Corporation) owns, at the time of the
determination, stock possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one of the other corporations
in such chain.

V.              PERMANENT
DISABILITY shall mean the inability of Optionee to engage in any substantial
gainful activity by reason of any medically determinable physical or mental
impairment which is expected to result in death or has lasted or can be
expected to last for a continuous period of twelve (12) months or more.

W.         SERVICE
shall mean the Optionee’s performance of services for the Corporation (or any
Parent or Subsidiary) in the capacity of an Employee, a non-employee member of
the board of directors or an independent consultant.

X.             STOCK
EXCHANGE shall mean the American Stock Exchange or the New York Stock Exchange.

Y.              SUBSIDIARY
shall mean any corporation (other than the Corporation) in an unbroken chain of
corporations beginning with the Corporation, provided each corporation (other
than the last corporation) in the unbroken chain owns, at the time of the
determination, stock possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one of the other corporations
in such chain.

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