STOCK OPTION AGREEMENT
Exhibit
2(iii)
STOCK
OPTION AGREEMENT
This
Stock Option Agreement ("Stock Option Agreement") is granted this
25th
day of
August 2005 by Xxxxxxx Xxxxxx ("Xxxxxx") to Nexia Holdings, Inc.
("Optionee").
PREMISES
|
X.
|
Xxxxxx
wishes to grant Optionee the right to purchase up to Eight Million
(8,000,000) shares of Nexia Holdings, Inc.=s
shares of Class B Preferred Stock (the "Preferred
Stock").
|
|
B.
|
The
exercise price of the Preferred Stock transferable on exercise of
the
Option at the date of this grant shall be a cash payment in the sum
of
Five Hundred Thousand dollars ($500,000) and delivery of 5% of the
outstanding and issued common shares of Nexia Holdings, Inc. on the
date
of exercise.
|
GRANT
|
1.
|
Grant
of Options.
Xxxxxx hereby irrevocably grants Optionee the right and option ("Option")
to purchase all of the above described Eight Million (8,000,000)
shares of
Class B Preferred Stock, on the terms and conditions set forth
herein.
|
|
2.
|
Term
of Option.
This Option may only be exercised in whole at any time after Nexia
obtains
funding in the minimum amount of $1,500,000 for the operations of
Axis
Labs, Inc. and the divestiture or spin off of Nexia’s subsidiary
Diversified Holdings I, Inc. has taken place, but before Three (3)
Years
have elapsed from the date of this Option. No rights to exercise
this
option may be sold or transferred by
Optionee.
|
|
3.
|
Method
of Exercising.
This Option may be exercised in accordance with all the terms and
conditions set forth in this Option, by delivery of a notice of exercise
a
form of which is attached hereto as Exhibit "A" and incorporated
herein by
this reference, setting forth the exercise of the Option along with
a
signed letter of instruction indicating that the specified exercise
price
shall be paid within 10 days of the notice of
exercise.
|
| 4. |
Availability
of Shares.
During the term of this Option, Xxxxxx shall not transfer or encumber
any
portion of the Eight Million (8,000,000) shares of Nexia Holdings,
Inc.
Class B Preferred Stock.
|
|
5.
|
Adjustments
to Number of Shares.
The number of shares of Class B Preferred Stock subject to this Option
shall be adjusted to take into account any stock splits, stock dividends,
recapitalization of the capital stock of Nexia Holdings,
Inc.
|
|
6.
|
Restrictions
on Transfer.
The Option has not been registered under the Securities Act of 1933,
as
amended (the "Securities Act"), or any state securities statutes.
Optionee
acknowledges that unless a registration statement with respect to
the
Option is filed and declared effective by the Securities and Exchange
Commission and the appropriate state governing agency, the Option
has or
will be granted and issued in reliance on specific exemptions from
such
registration requirements for transaction by an issuer not involving
a
public offering and specific exemptions under the state statutes.
Any
disposition of the Option may, under certain circumstances, be
inconsistent with such exemption therefrom after the person desiring
to
sell provides an opinion of counsel or other evidence satisfactory
to
Nexia Holdings, Inc. to the effect that registration is not required.
In
some such states, specific conditions must be met or approval of
the
securities regulatory authorities required before any such offer
or sale
or other transfer thereof:
|
1
THE
SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND ARE "RESTRICTED
SECURITIES" WITHIN THE MEANING OF RULE 144 PROMULGATED UNDER THE SECURITIES
ACT.
THE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD OR
TRANSFERRED WITHOUT COMPLYING WITH RULE 144 IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION OR OTHER COMPLIANCE UNDER THE SECURITIES ACT.
|
7.
|
Record
Owner.
Xxxxxx is currently the record owner of the Eight Million (8,000,000)
shares of Nexia Holdings, Inc. Series B Preferred stock. This Option
is
exercisable by the Optionee.
|
|
8.
|
Validity
and Construction.
The validity and construction of this Agreement shall be governed
by the
laws of the State of Utah.
|
2
IN
WITNESS WHEREOF,
the
below signatures evidence the execution of this Option by the parties on the
date first appearing herein.
| Xxxxxxx Xxxxxx | Nexia Holdings, Inc. | ||
| /s/ Xxxxxxx Xxxxxx | /s/ Xxxxxx Xxxxxxx | ||
|
Xxxxxxx Xxxxxx |
Xxxxxx
Xxxxxxx
Vice-President
|
3
NOTICE
OF EXERCISE
(To
be
signed only upon exercise of Option)
|
TO:
|
Xxxxxxx
Xxxxxx
|
The
undersigned, the owner of the attached Option, hereby irrevocably elects to
exercise the rights to purchase thereunder
( )
shares of Series B Preferred Stock of Nexia Holdings, Inc. and herewith pays
for
the shares in the manner specified in the Option. The undersigned requests
that
the certificates for such shares be delivered to them according to instructions
indicated below. If such shares are not all of the shares purchasable under
the
Option, the undersigned further requests that a new option certificate be issued
and delivered to the undersigned for the remaining shares purchasable under
the
Option.
DATED
this
_______ day of
,
200 .
By:_________________________________
|
|
Optionee
|
4
