EXHIBIT 4.2
THE OUTDOOR CHANNEL, INC.
STOCK OPTION AGREEMENT
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NO. _____
TYPE OF OPTION (CHECK ONE): |_| INCENTIVE |_| NONQUALIFIED
This Stock Option Agreement (the "Agreement") is entered into effective
as of _______________, by and between THE OUTDOOR CHANNEL, INC., a Nevada
corporation (the "Company), and ________________ (the "Optionee") pursuant to
the Company's 1997 Stock Option Plan (the "Plan").
1. GRANT OF OPTION. The Company hereby grants to Optionee an option
(the "Option") to purchase all or any portion of a total of ________ shares (the
"Shares") of the Common Stock of the Company at a purchase price of $_____per
share (the "Exercise Price"). The Optionee has been granted _______ options for
services performed as ___________ of the Company. The Option granted to the
Optionee is subject to the terms and conditions set forth in this Agreement and
the provisions of the Plan. If the box marked "Incentive" above is checked, then
this Option is intended to qualify as an "incentive stock option" as defined in
Section 422 of the Internal Revenue Code of 1986, as amended (the "Code"). If
this Option fails in whole or in part to qualify as an incentive stock option,
or if the box marked "Nonqualified" is checked, then this Option shall to that
extent constitute a nonqualified stock option.
2. VESTING OF OPTION. Subject to the provisions of Section 3 below, the
Optionee has an immediate vested right to exercise the Option and purchase
____________ percent (___%) of all Shares, and the remainder of such Shares
shall vest as follows: _______________________________. The vested portion of
this Option shall be fully exercisable from time to time in whole or in part
during its term.
3. TERM OF OPTION. Optionee's right to exercise this Option shall
terminate on __________________.
4. EXERCISE OF OPTION. On or after the vesting of any portion of this
Option in accordance with Section 2 above, and until termination of this Option
in accordance with Section 3 above, the portion of this Option which has vested
may be exercised in whole or in part by the Optionee (or, after his or her
death, by the person designated in Section 5 below) upon delivery of the
following to the Company at its principal executive offices:
(a) a written notice of exercise which identifies this
Agreement and states the number of Shares then being purchased (but no
fractional Shares may be purchased);
(b) a check or cash in the amount of the Exercise Price or, in
lieu of exercising this Option by payment of check or cash, the Optionee may
elect to allow the Company, at the Company's sole discretion, to withhold from
issuance a number of Shares with an aggregate fair market value (as determined
by the Board) equal to the aggregate Exercise Price payable by Optionee or, in
the event the Company becomes a public reporting company under the 1933
Securities Act, at the Company's sole discretion, to withhold from issuance a
number of Shares with an aggregate fair market value equal to the aggregate
Exercise Price payable by Optionee, provided that the fair market value of each
Share shall be the last trade price per share of Common Stock on the last
trading day prior to the exercise date as may reported by Nasdaq or the NASD OTC
Bulletin Board or at such other price that may be reasonably determined by the
Administrator or, at the Company's sole discretion, payment of the Exercise
Price in such other form of lawful consideration as the Administrator may
approve from time to time under the provisions of Section 5.3 of the Plan;
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(c) a check or cash in the amount reasonably requested by the
Company to satisfy the Company's withholding obligations under federal, state or
other applicable tax laws with respect to the taxable income, if any, recognized
by the Optionee in connection with the exercise of this Option (unless the
Company and Optionee shall have made other arrangements for deductions or
withholding from Optionee's wages, bonus or other compensation payable to
Optionee, or by the withholding of Shares issuable upon exercise of this Option
or the delivery of Shares owned by the Optionee in accordance with Section 9.1
of the Plan, provided such arrangements satisfy the requirements of applicable
tax laws); and
(d) a letter, if requested by the Company, in such form and
substance as the Company may require, setting forth the investment intent of the
Optionee, or person designated in Section 5 below, as the case may be.
5. ASSIGNMENT AND DEATH OF OPTIONEE. The rights of the Optionee under
this Agreement may be assigned or transferred to a third party. At the
Optionee's death, and provided Optionee's rights hereunder shall have vested
pursuant to Section 2, Optionee's legal representative, his or her legatee, or
the person who acquired the right to exercise this Option by reason of the death
of the Optionee (individually, a "Successor") shall succeed to the Optionee's
rights and obligations under this Agreement.
6. REPRESENTATIONS AND WARRANTIES OF OPTIONEE.
(a) Optionee represents and warrants that this Option is being
acquired by Optionee for Optionee's personal account, for investment purposes
only, and not with a view to the distribution, resale or other disposition
thereof.
(b) Optionee acknowledges that the Company may issue Shares
upon the exercise of the Option without registering such Shares under the
Securities Act of 1933, as amended (the "Act"), on the basis of certain
exemptions from such registration requirement. Accordingly, Optionee agrees that
his or her exercise of the Option may be expressly conditioned upon his or her
delivery to the Company of an investment certificate including such
representations and undertakings as the Company may reasonably require in order
to assure the availability of such exemptions, including a representation that
Optionee is acquiring the Shares for investment and not with a present intention
of selling or otherwise disposing thereof and an agreement by Optionee that the
certificates evidencing the Shares may bear a legend indicating such
non-registration under the Act and the resulting restrictions on transfer.
Optionee acknowledges that, because Shares received upon exercise of an Option
may be unregistered, Optionee may be required to hold the Shares indefinitely
unless they are subsequently registered for resale under the Act or an exemption
from such registration is available.
(c) Optionee acknowledges receipt of a copy of the Plan and
understands that all rights and obligations connected with this Option are set
forth in this Agreement and in the Plan.
7. RESTRICTIVE LEGENDS. Optionee hereby acknowledges that federal
securities laws and the securities laws of the state in which he or she resides
may require the placement of certain restrictive legends upon the Shares issued
upon exercise of this Option, and Optionee hereby consents to the placing of any
such legends upon certificates evidencing the Shares as the Company, or its
counsel, may deem necessary or advisable; PROVIDED, HOWEVER, that the Company
represents to Optionee that, upon exercise of the Option, the Shares may, at the
Company's sole discretion, be registered and issued pursuant to an applicable
Registration Statement.
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8. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
(a) The Company represents and warrants that this Agreement
has been duly executed and delivered by a duly authorized officer of the Company
and constitutes the valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms, except as the enforceability
thereof may be subject to or limited by (a) bankruptcy, insolvency, fraudulent
conveyance, reorganization, arrangement, moratorium, marshalling or other
similar laws relating to or affecting the rights or remedies of creditors and
(b) general equitable principles including those affecting the availability of
specific performance, injunctive relief or other equitable remedies, regardless
of whether the issue of enforceability is considered in a proceeding in equity
or at law; and
(b) All corporate actions of the Company and its directors and
stockholders required in order to authorize the execution and delivery by the
Company of this Agreement and the performance of its respective obligations
hereunder, have been duly and validly taken in accordance with applicable laws
and the Articles of Incorporation and Bylaws of the Company.
9. ADJUSTMENTS UPON CHANGES IN CAPITAL STRUCTURE. In the event that the
outstanding shares of Common Stock of the Company are 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 a recapitalization, stock split,
combination of shares, reclassification, stock dividend or other change in the
capital structure of the Company, then appropriate adjustment shall be made by
the Administrator to the number of Shares subject to the unexercised portion of
this Option and to the Exercise Price per share, in order to preserve, as nearly
as practical, the benefits of the Optionee under this Option, in accordance with
the provisions of Section 4.2 of the Plan.
10. NO EMPLOYMENT CONTRACT CREATED. Neither the granting of this Option
nor the exercise hereof shall be construed as granting to the Optionee any right
with respect to continuance of employment by the Company or any of its
subsidiaries.
11. RIGHTS AS SHAREHOLDER. The Optionee (or transferee of this option
by will or by the laws of descent and distribution) shall have no rights as a
shareholder with respect to any Shares covered by this Option until the date of
the issuance of a stock certificate or certificates to him or tier for such
Shares, notwithstanding the exercise of this Option.
12. INTERPRETATION. This Option is granted pursuant to the terms of the
Plan, and shall in all respects be interpreted in accordance therewith. The
Administrator shall interpret and construe this Option and the Plan, and any
action, decision, interpretation or determination made in good faith by the
Administrator shall be final and binding on the Company and the Optionee. As
used in this Agreement, the term "Administrator" shall refer to the committee of
the Board of Directors of the Company appointed to administer the Plan, and if
no such committee has been appointed, the term Administrator shall mean the
Board of Directors.
13. NOTICES. Any notice, demand or request required or permitted to be
given under this Agreement shall be in writing and shall be deemed given when
delivered personally or three days after being deposited in the United States
mail, as certified or registered mail, with postage prepaid, and addressed, if
to the Company, at its principal place of business, Attention: the Chief
Executive Officer, and if to the Optionee, at his most recent address as shown
in the employment or stock records of the Company.
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14. ANNUAL AND OTHER PERIODIC REPORTS. During the term of this
Agreement, the Company will be made available to the Optionee copies of all
annual and other periodic financial and informational reports that the Company
distributes generally to its shareholders.
15. GOVERNING LAW. The validity, construction, interpretation, and
effect of this Option shall be governed by and determined in accordance with the
laws of the State of California.
16. SEVERABILITY. Should any provision or portion of this Agreement be
held to be unenforceable or invalid for any reason, the remaining provisions and
portions of this Agreement shall be unaffected by such holding.
17. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original and all of which
together shall be deemed one instrument.
IN WITNESS WHEREOF, the parties have executed this Agreement effective
as of the date first above written.
OPTIONEE:
__________________________________________ Date: _______________
COMPANY:
__________________________________________ Date: _______________
By:
Its:
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