EXHIBIT 10.41
LAS VEGAS ENTERTAINMENT NETWORK, INC.
OPTION AGREEMENT
Dated December 11, 1996
LAS VEGAS ENTERTAINMENT NETWORK, INC., a Delaware corporation (the
"Company") hereby grants to Xxxxxx X. XxXxxxxx ("Holder") an option (the
"Option") to purchase 1,500,000 shares of the Company's Common Stock (the
"Shares") at a purchase price and on the terms set forth herein.
1. Exercise.
(a) Purchase Price. This Option, or any portion hereof, is exercisable at a
purchase price of $1.00 per Share (the "Purchase Price").
(b) Time of Exercise. Subject to Section 2(c), this Option may
be exercised in whole or in part (but not as to a fractional shares) at the
office of the Company, at any time or from time to time, commencing on the date
first written above, provided, however, that this Option shall expire and be
null and void if not exercised in the manner herein provided, by 5:00 p.m.,
local time, on the ____________ anniversary hereof (the "Expiration Date").
(c) Manner of Exercise. This Option is exercisable at the
Purchase Price, payable, in cash or by check, to the order of the Company,
subject to adjustment as provided in Section 2 hereof. Upon surrender of this
Option, or a portion hereof, with the annexed Subscription Form duly executed,
together with payment of the Purchase Price for the Shares purchased (and any
applicable transfer taxes) at the Company's principal executive offices, the
Holder shall be entitled to receive a certificate or certificates for the Shares
so purchased.
(d) Delivery of Stock Certificates. As soon as practicable,
but not exceeding 30 days, after complete or partial exercise of this Option,
the Company, at its expense, shall cause to be issued in the name of the Holder
(or upon payment by the Holder of any applicable transfer taxes, the Holder's
assigns) a certificate or certificates for the number of fully paid and
non-assessable Shares to which the Holder shall be entitled upon such exercise,
together with such other stock or securities or property or combination thereof
to which the Holder shall be entitled upon such exercise, determined in
accordance with Section 2 hereof.
(e) Record Date of Issuance of Shares. Irrespective of the
date of issuance and delivery of certificates for any stock or securities
issuable upon the exercise of this Option, or any portion hereof, each person
(including a corporation or partnership) in whose name any such certificate is
to be issued shall for all purposes be deemed to have become the holder of
record of the stock or other securities represented thereby immediately prior to
the close of business on the date on which a duly executed Subscription Form
containing notice of exercise of this Option, or any portion hereof, and payment
of the Purchase Price is received by the Company.
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2. Adjustments.
(a) Adjustment for Subdivisions, Combinations or Dividends. In
case the Company shall, at any time or from time to time, subdivide or combine
the outstanding shares of Common Stock or declare a dividend payable in Common
Stock, the exercise price of this Option in effect immediately prior to the
subdivision, combination or record date for such dividend payable in Common
Stock shall forthwith be proportionately increased, in the case of combination,
or decreased, in the case of subdivision or dividend payable in Common Stock,
and each share of Common Stock purchasable upon exercise of the Option shall be
changed to the number determined by dividing the then current exercise price by
the exercise price as adjusted after the subdivision, combination or dividend
payable in Common Stock.
(b) Adjustment for Certain Dividends and Distributions. In the
event the Company, at any time or from time to time, makes or fixes a record
date for the determination of holders of Common Stock, entitled to receive a
dividend or other distribution payable in securities of the Company, other than
shares of Common Stock, then and in each such event provisions shall be made so
that the Holder shall receive upon exercise of the Option, or any portion
hereof, in addition to the number of shares of Common Stock receivable
thereupon, the amount of securities of the Company which the Holder would have
received had its Option, or any portion hereof, been exercised into Common Stock
on the date of such event and had it thereafter, during the period from the date
of such event to and including the date of exercise, retained such securities
receivable by it as aforesaid during such period, subject to all other
adjustments called for during such period under this Section 2 with respect to
the rights of the Holder of the Option.
(c) Adjustment for Reclassification, Exchange and
Substitution. If the Common Stock issuable upon the exercise of the Option, or
any portion hereof, is changed into the same or a different number of shares of
any class or classes of stock, whether by recapitalization, reclassification or
otherwise (other than a subdivision or combination of shares or stock dividend
or a reorganization, merger, consolidation or sale of assets, provided for
elsewhere in this Section 2), then and in any such event the, Holder shall have
the right thereafter, upon exercise of the Option, or any portion hereof, to
receive the kind and amount of stock and other securities and property
receivable upon such recapitalization, reclassification or other change, in an
amount equal to the amount that the Holder would have been entitled to had the
Holder exercised the Option, or any portion hereof, immediately prior to such
recapitalization, reclassification or other change, but only to the extent the
Option, or any portion hereof, is actually exercised, all subject to further
adjustment as provided herein.
(d) Reorganizations, Mergers, Consolidations or Sales of
Assets. If at any time or from time to time there is a capital reorganization of
the Common Stock (other than a subdivision, combination, recapitalization,
reclassification or exchange of the Common Stock provided for elsewhere in this
Section 2) or merger or consolidation of the Company with or into another
corporation, or a sale of all or substantially all of the Company's properties
and assets to any other person then, as a part of such reorganization, merger,
consolidation or sale, provision shall be made so that the Holder shall
thereafter be entitled to receive, upon exercise of the Option, or any portion
hereof, (and only to the extent the Option is exercised), the number of shares
of stock or other securities or property of the Company, or of the successor
corporation resulting from such merger or consolidation or sale, to which a
holder of Common Stock, or other securities, deliverable upon the
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exercise of this Option, or any portion hereof, would otherwise have been
entitled on such capital reorganization, merger, consolidation, or sale.
3. Restriction on Transfer.
(a) The Holder, by its acceptance hereof, represents, warrants,
covenants and agrees that (i) the Holder has knowledge of the business and
affairs of the Company, and (ii) this Option and the Shares issuable upon the
exercise of this Option, or any portion hereof, are being acquired for
investment and not with a view to the distribution hereof, and that absent an
effective registration statement under the Securities Act of 1933 ("Act"),
covering the disposition of this Option, or any portion hereof, or the Shares
issued or issuable upon exercise of this Option, or any portion hereof, they
will not be sold, transferred, assigned, hypothecated or otherwise disposed of
without first providing the Company with an opinion of counsel (which may be
counsel for the Company) or other evidence, reasonably acceptable to the
Company, to the effect that such sale, transfer, assignment, hypothecation or
other disposal will be exempt from the registration and prospectus delivery
requirements of the Act. The Holder consents to the making of a notation in the
Company's records or giving to any transfer agent of the Option or the Shares an
order to implement such restriction on transferability.
This Option and the Shares issuable upon the exercise of this Option,
or any portion hereof, shall bear the following legend or a legend of similar
import, provided, however, that such legend shall be removed, or not placed upon
the Option or the certificate or other instrument representing the Shares, as
the case may be, if such legend is no longer necessary to assure compliance with
the Act:
THESE SECURITIES HAVE NOT BEEN REGISTERED WITH THE UNITED STATES
SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE
BECAUSE THEY ARE BELIEVED TO BE EXEMPT FROM REGISTRATION UNDER SECTION 4(2) OF
THE ACT. THE SECURITIES ARE "RESTRICTED" AND MAY NOT BE RESOLD OR TRANSFERRED
EXCEPT AS PERMITTED UNDER THE SECURITIES ACT OF 1933, AS AMENDED PURSUANT TO
REGISTRATION OR EXEMPTION THEREFROM.
(b) The Company agrees to register the Shares under the Act, at the
Company's cost and expense on a Form S-8 registration statement.
4. Payment of Taxes. All Shares issued upon the exercise of this
Option, or any portion hereof, shall be validly issued, fully paid and
non-assessable and the Company shall pay all taxes and other governmental
charges (other than income tax) that may be imposed in respect of the issue or
delivery thereof. The Company shall not be required, however, to pay any tax or
other charge imposed
in connection with any transfer involved in the issue of any certificate for
Shares in any name other than that of the Holder surrendered in connection with
the purchase of such Shares, and in such case, the Company shall not be required
to issue or deliver any stock certificate until such tax or other charge has
been paid or it has been established to the Company's satisfaction that no tax
or other charge is due.
5. Reservation of Common Stock. The Company shall at all times reserve
and keep available out of its authorized but unissued shares of Common Stock,
solely for the purpose of issuance upon the exercise of this Option, or any
portion hereof, such number of shares of Common Stock as shall be issuable upon
the exercise hereof. The Company covenants and agrees that, upon exercise of
this Option, or any portion hereof, and payment of the Purchase Price thereof,
all shares of Common Stock issuable upon such exercise shall be duly and validly
issued, fully paid and non-assessable.
6. Notices to Holder. Nothing contained in this Option shall be
construed as conferring upon the Holder hereof the right to vote or to consent
or to receive notice as a shareholder in respect of any meetings of shareholders
for the election of directors or any other matter or as having any rights
whatsoever as a shareholder of the Company. All notices, requests, consents and
other communications hereunder shall be in writing and shall be deemed to have
been duly made when delivered or mailed by registered or certified mail, postage
prepaid, return receipt requested:
(a) If to the Holder, to the address of such Holder as shown on the books of
the Company; or
(b) If to the Company, to 0000 Xxxxxxx Xxxx Xxxx, Xxxxx 0000, Xxx Xxxxxxx,
Xxxxxxxxxx 00000.
7. Replacement of Option. Upon receipt of evidence reasonably
satisfactory to the Company of the ownership of and the loss, theft, destruction
or mutilation of this Option and (in case of loss, theft or destruction) upon
delivery of an indemnity agreement in an amount reasonably satisfactory to the
Company, or (in the case of mutilation) upon surrender and cancellation of the
mutilated Option, the Company will execute and deliver, in lieu thereof, a new
Option of like tenor.
8. Successors. All the covenants, agreements, representations and warranties
contained in this Option shall bind the parties hereto and their respective
heirs, executors, administrators, distributees, successors and assigns.
9. Change; Waiver. Neither this Option nor any term hereof may be changed,
waived, discharged or terminated orally but only by an instrument in
writing signed by the party against which enforcement of the change,
waiver, discharge or termination is sought.
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10. Headings. The section headings in this Option are inserted for purposes of
convenience only and shall have no substantive effect.
11. Law Governing. This Option shall for all purposes be construed and enforced
in accordance with, and governed by, the internal laws of the State of
Delaware, without giving effect to principles of conflict of laws.
IN WITNESS WHEREOF, the Company has caused this Option to be signed by
its duly authorized officer and this Option to be dated as of the date first
above written.
LAS VEGAS ENTERTAINMENT NETWORK, INC.
By: /S/ Xxxxxx X. Xxxxxxx
President
EXHIBIT A
SUBSCRIPTION FORM
(To be Executed by the Holder
in order to Exercise the Option)
The undersigned hereby irrevocably elects to exercise the right to
purchase ________ of the Shares covered by this Option, according to the
conditions hereof and herewith makes payment of the Purchase Price of such
Shares in full.
Signature
Name
Address:
Dated: _________________, 19__.
