OPTION AGREEMENT
Exhibit
99.2
THIS OPTION AGREEMENT (the
“Agreement”) is made and entered into, effective as of December 11, 2009 (the
“Effective Date”), by and between SmartMetric, Inc., a Nevada
corporation with an address at 0000 Xxxx Xxxxxxxxx, Xxxxx 000, Xxx Xxxxxx
Xxxxxxx, XX 00000 (the “Optionor”), and Applied Cryptology, Inc., a
Nevada corporation with an address at _____________ (the “Optionee”), with
reference to the following facts:
WHEREAS, pursuant to the terms
of that certain Assignment and Assumption Agreement, dated dated as of December
__, 2009 (the “Assignment Agreement”), the Optionee assigned to Assignee all of
Assignor’s rights, title and interest to the certain technology which is the
subject of a Patent Cooperation Treaty Application filed on February 18, 2000
with the United States Patent and Trademark Office, and originally the subject
of an application filed on February 18, 1999 with the Australian Patent and
Trademark Office, a copy of which is annexed hereto and made a part hereof as
Exhibit A, and the recipient of a patent from the United States Patent and
Trademark office, dated December 4, 2001, a copy of which is annexed hereto and
made a part hereof as Exhibit B, including adaptations, derivatives of, and
current and future technological developments; and
WHEREAS, the Optionor has
agreed to grant to Optionee an option to purchase the Patent from Optionor for
100,000 shares of the Optionor’s Series B Preferred Stock, only in the event
that Optionor fails to generate at least $1,000,000 in gross revenues
attributable to the Patent at the conclusion of 24 months from the date of
Assignment Agreement in accordance with the terms hereof.
NOW, THEREFORE, FOR VALUABLE
CONSIDERATION, receipt which is hereby acknowledged, Optionor hereby
grant to Optionee the following option:
Section
1. Grant of
Option. Subject to the terms and conditions set forth below,
the Optionor hereby grants to Optionee the right to receive from the Optionor
(the “Option”) the Patent if, and only if, the Optionor fails to generate at
least $1,000,000 in gross revenues within twenty-four (24) months from the date
hereof.
Section
2. Termination
of Option. This Option will terminate in all respects, and all
rights and options to receive the Patent hereunder will terminate on the
twenty-four month anniversary of this Agreement.
Section
3. Rights of
Optionee. Optionee will
not, by virtue of the grant of this Option to the Optionee, be deemed to be the
owner of the Patent to be delivered under this Option or to be entitled to the
rights or privileges of a holder of such Patent unless and until this Option has
been exercised with respect to such Patent and it has been transferred pursuant
to the exercise of this Option. Nothing herein contained will impose
any obligation upon the Optionee to exercise this Option.
Section
4. Transfer
and Termination. Optionee
may not sell, pledge, assign, hypothecate, transfer, or otherwise dispose
of all or any portion of the Option other than by will or the laws of descent
and distribution.
Section
5. Tax
Withholding. To the extent
that the exercise of the Option gives rise to an obligation on the part of the
Optionor to withhold income tax from amounts otherwise to be paid to Optionee,
the Optionor shall do so on such terms and in accordance with such procedures as
may be required under applicable law.
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SECTION
6. MISCELLANEOUS.
(a) Notices. All notices
permitted or required by this Agreement shall be in writing and shall be deemed
to be delivered and received (i) when personally delivered, or (ii) on the day
on which sent by facsimile, electronic mail, or other similar device generating
a receipt evidencing a successful transmission (provided that on that same
date a copy of the notice is deposited in the United States mail,
first-class-certified mail, postage prepaid), or (iii) on the second (2nd)
business day after the day on which deposited in the United States mail,
first-class-certified mail, postage prepaid, transmitted or addressed to the
person for whom intended, at the facsimile number, email address, or mailing
address appearing in the preamble of this Agreement, or such other facsimile
number, email address, or mailing address, notice of which is given in the
manner contemplated by this Section 8(a).
(b) Governing
Law. This Option shall
be governed by the laws of the State of New York.
(c) Governmental
and Other Regulations Governing Law. The Option is
subject to all laws, regulations and orders of any governmental authority which
may be applicable thereto and, notwithstanding any of the provisions hereof, the
Optionee agrees that he will not exercise the Option sold hereby nor will the
Optionor be obligated to transfer any shares of stock hereunder if the exercise
thereof or the transfer of such shares, as the case may be, would constitute a
violation by the Optionee or the Optionor of any such law, regulation or order
or any provision thereof. The Optionor will not be obligated to take
any affirmative action in order to cause the exercise of this Option or the
issuance of shares pursuant hereto to comply with any such law, regulation,
order or provision.
(d) Successors
and Assigns. This Option and the rights and obligations
evidenced hereby shall inure to the benefit of and be binding upon the
successors of the Optionor and the successors and permitted assigns of
Holder.
(e) Amendment. This
Option may be modified or amended or the provisions hereof waived with the
written consent of the Optionor and the Optionee.
(f) Severability. Wherever
possible, each provision of this Option shall be interpreted in such manner as
to be effective and valid under applicable law, but if any provision of this
Option shall be prohibited by or invalid under applicable law, such provision
shall be ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provisions or the remaining provisions of
this Option.
[SIGNATURE
PAGE TO FOLLOW]
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IN WITNESS WHEREOF, the
parties have executed this Option, or caused this Agreement to be executed as of
the Effective Date.
|
OPTIONOR:
|
By:
|
/s/ | |
| Name | |||
| Title | |||
| APPLIED CRYPTOLOGY, INC. | |||
|
OPTIONEE:
|
By:
|
/s/ | |
| Name | |||
| Title | |||
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