TITAN OIL & GAS, INC. STOCK OPTION AGREEMENT
TITAN OIL
& GAS, INC.
This
Stock Option Agreement (this “Option”) is granted to the Optionee named below by
Titan Oil & Gas, Inc. (the “Corporation”) pursuant to the Titan Oil &
Gas, Inc. 2010 Stock Option Plan (the “Plan”) as of this __ day of _________,
2010, the date this Option was granted pursuant to the Plan. This
Option provides you an option to purchase the number of shares of the Common
Stock of the Corporation at the times and on the terms set forth
below.
1. Number of Shares and
Vesting. The total number of shares of Common Stock subject to
this Option is ___________________________ (_______) shares. Subject
to the other terms of this Option, this Option shall be exercisable with respect
to each installment shown below on or after the date of vesting applicable to
such installment as follows:
|
Number
of Shares
(Installment)
|
Date
of Earliest
Exercise (Vesting)
|
|
__________
|
___________
|
|
__________
|
___________
|
|
__________
|
___________
|
2. Exercise
Price. The exercise price of this Option is ($ ) per
share. The exercise price per share shall be paid upon exercise of
all or any part of each installment which has become exercisable by
you.
3. Minimum
Exercise. The minimum number of shares with respect to which
this Option may be exercised at any one time is the lesser of ( ) or the number of shares
as to which this Option is then exercisable.
4. Assurances Upon
Exercise. The Corporation may require you, or any person to whom this
Option is transferred under paragraph 7 of this Option, as a condition of
exercising this Option: (i) to give written assurances satisfactory to the
Corporation as to such person’s knowledge and experience in financial and
business matters and/or to employ a purchaser representative reasonably
satisfactory to the Corporation who is knowledgeable and experienced in
financial and business matters, and that he or she is capable of evaluating,
alone or together with the purchaser representative, the merits and risks of
exercising this Option; and (ii) to give written assurances satisfactory to
the Corporation stating that such person is acquiring the Common Stock subject
to this Option for such person’s own account and not with any present intention
of selling or otherwise distributing the stock. The foregoing
requirements, and any assurances given pursuant to such requirements, shall be
inoperative if: (i) the issuance of the shares of Common Stock upon the
exercise of this Option has been registered under a then currently effective
registration statement under the Securities Act of 1933, as amended (the
“Securities Act”); or (ii) as to any particular requirement, a
determination is made by counsel for the Corporation that such requirement need
not be met in the circumstances under the then applicable securities
laws. The Corporation may, upon advice of counsel to the Corporation,
place legends on stock certificates issued upon exercise of this Option as such
counsel deems necessary or appropriate in order to comply with applicable
securities laws, including, but not limited to, legends restricting the transfer
of the stock.
5. Term. The term of
this Option commences on the date hereof and, unless sooner terminated as set
forth below or in the Plan, terminates 5 years from the date it was
granted. This Option may terminate prior to the expiration of its
term as set forth in the Plan.
6. Notice of Exercise.
This Option may be exercised, to the extent specified above, by delivering
written notice of exercise together with the exercise price to the Secretary of
the Corporation, or to such other person as the Corporation may designate,
during regular business hours, together with such additional documents as the
Corporation may then require pursuant to the Plan. The notice must
specify the number of shares to be purchased upon exercise and a date within 15
days after receipt of the notice by the Corporation on which the purchase is to
be completed. The exercise price must be paid in cash.
7. Transferability. This
Option is not transferable, except by will or by the laws of descent and
distribution, or to a family trust owed by you, and shall be exercisable during
your life only by you. However, you may designate a third party who,
in the event of your death, would be entitled to exercise this Option, by
providing a written notice in a form satisfactory to the Secretary of the
Corporation.
8. State Securities
Laws. Notwithstanding the other provisions of this Option, in the event
that you are or become a resident of any state other than the State of Nevada,
the Corporation may, in its reasonable discretion, determine that the
registration or qualification of the shares of Common Stock covered by this
Option is necessary or desirable as a condition of or in connection with the
exercise of this Option. If the Corporation makes such a
determination, this Option may not be exercised in whole or in part unless and
until such registration or qualification shall have been effected or obtained
free of any conditions not acceptable to the Corporation, in its reasonable
discretion. The Corporation shall use good faith reasonable efforts
to obtain or effect such registration or qualification, but is not required to
obtain or effect such registration or qualification.
9. Notices. Any notices
provided for in this Option or the Plan shall be given in writing and shall be
deemed effectively given upon receipt or, in the case of notices delivered by
the Corporation to you, five days after deposit in the United States mail,
postage prepaid, addressed to you at the address specified below or at such
other address as you hereafter designate by written notice to the Secretary of
the Corporation.
10. Supremacy of the
Plan. This Option is subject to all the provisions of the Plan, a copy of
which is attached, and its provisions are hereby made a part of this Option,
including without limitation, the provisions of paragraph 6 of the Plan relating
to option provisions. This Option is further subject to all
interpretations, amendments, rules and regulations which may from time to time
be promulgated and adopted pursuant to the Plan. In the event of any
conflict between the provisions of this Option and those of the Plan, the
provisions of the Plan shall control.
11. Optionee
Acknowledgments. By executing this Option, you acknowledge and agree as
follows:
11.1. The
Corporation does not warrant that this Option granted herein constitutes an
“Incentive Stock Option” within the meaning of that section, or that the
transfer of stock acquired pursuant to this Option will be treated for Federal
Income Tax purposes as specified in Code § 421.
11.2. You
understand that if, among other things, you dispose of shares of Common Stock
granted to you pursuant to this Option within two years of the granting of this
Option to you or within one year of the transfer of such shares to you, or you
exercise this Option more than three months after termination of employment,
then such shares will not qualify for the beneficial treatment which you might
otherwise receive under Code §§ 421 and 422.
11.3. You
further understand that upon exercise of this Option you may be subject to
alternative minimum tax as a result of such exercise.
11.4. You and
your transferees have no rights as a shareholder with respect to any shares of
Common Stock covered by this Option until the date of the issuance of a stock
certificate for such shares.
11.5. The
Corporation is not providing you with advice, warranties or representations
regarding any of the legal or tax effects to you with respect to this
grant.
11.6. You
acknowledge that you are familiar with the terms of the grant made to you under
this Option and the Plan, that you have been encouraged by the Corporation to
discuss the grant and the Plan with your own legal and tax advisers, and that
you agree to be bound by the terms of the grant and the Plan.
11.7. I
represent and warrant that I am acquiring and will hold the Option and the
shares received upon exercise of such option for investment for my account only,
and not with a view to, or for resale in connection with, any "distribution" of
the option and the shares within the meaning of the Securities Act.
11.8. I
understand that the option and the shares to be issued upon exercise of the
Option have not been registered under the Securities Act or any state securities
laws by reason of a specific exemption therefrom and that the option and the
shares must be held indefinitely, unless they are subsequently registered under
the Securities Act or I obtain an opinion of counsel (in form and substance
satisfactory to the Corporation and its counsel) that registration is not
required.
11.9. I
acknowledge that the Corporation is under no obligation to register the option
or the shares subject to the Option.
11.10. I am
aware of the adoption of Rule 144 by the Securities and Exchange Commission
under the Securities Act, which permits limited public resales of securities
acquired in a non-public offering, subject to the satisfaction of certain
conditions. These conditions include (without limitation) that certain current
public information about the issuer is available and that the resale occurs only
after the holding period required by Rule 144 has been satisfied. I understand
that the conditions for resale set forth in Rule 144 have not been satisfied and
that the Corporation has no plans to satisfy these conditions in the foreseeable
future.
11.11. I will
not sell, transfer or otherwise dispose of the option and the shares subject
thereto in violation of the Securities Act, the Securities Exchange Act of 1934,
or the rules promulgated thereunder, including Rule 144 under the Securities Act
or any blue sky or state securities laws or regulations.
11.12. I
acknowledge that I have received and had access to such information as I
consider necessary or appropriate for deciding whether to invest in the option
and the shares subject thereto and that I had an opportunity to ask questions
and receive answers from the Corporation regarding the terms and conditions of
the issuance of the option and the shares subject thereto.
11.13. I am
aware that my investment in the Corporation is speculative and subject to the
risk of complete loss.
11.14. I
acknowledge that I am acquiring the option and the shares subject thereto to all
the terms of the Plan and this Agreement.
12. Withholding. You
acknowledge that federal and state income and payroll tax may apply upon
exercise of this Option. If the Corporation determines, in its sole
discretion, that withholding is required, you agree that such withholding may be
accomplished with respect to the cash compensation (if any) due to you from the
Corporation. If withholding pursuant to the foregoing sentence is
insufficient (in the sole judgment of the Corporation) to satisfy the full
withholding obligation, you agree that you will pay over to the Corporation the
amount of cash or, if acceptable to the Corporation in its sole discretion,
property with a value necessary to satisfy such remaining withholding obligation
on the date this Option is exercised or at a time thereafter specified in
writing by the Corporation.
13. Entire
Agreement. This Option and the Plan constitute the entire
agreement between the parties pertaining to the subject matter contained herein
and they supersede all prior and contemporaneous agreements, representations,
and understandings of the parties. No supplement, modification, or
amendment of this Option shall be binding unless executed in writing by all of
the parties. No waiver of any of the provisions of this Option shall
be deemed or shall constitute a waiver of any other provisions, whether or not
similar, nor shall any waiver constitute a continuing waiver. No
waiver shall be binding unless executed in writing by the party making the
waiver.
14. Governing
Law. This Option shall be construed according to the laws of
the State of Nevada and federal law, as applicable. Any dispute
relating to this Option shall be brought and heard only in a court of competent
jurisdiction in the State of Nevada.
Dated as
of the date first written above.
TITAN OIL & GAS, INC.
By:
Its:
Date:
The
undersigned:
(a) Acknowledges
receipt of the foregoing Option, agrees to its terms and understands that all
rights and liabilities with respect to this Option are set forth in this Option
and the Plan; and
(b) Acknowledges
that as of the date of grant of this Option, it sets forth the entire
understanding between the undersigned and the Corporation and its affiliates
regarding the acquisition of the Common Stock of the Corporation covered by this
Option and supersedes all prior oral and written agreements on that
subject.
OPTIONEE:
Name:
Address:
Soc. Sec.
#:
Date:
