EXHIBIT 4.1
FORM OF CONSULTANT'S OPTION AGREEMENT AND CERTIFICATE
OPTION AGREEMENT
This OPTION AGREEMENT (the "Agreement") is dated as of June 1, 1999,
by and between INTERNET SPORTS NETWORK, INC. (the "Company"), and __________
("______").
WHEREAS, the Company proposes to issue to ______ ______ options (the
"Options"), each such Option entitling the holder thereof to purchase one
share of Common Stock, $.001 par value, of the Company (the "Shares") at an
exercise price of $____ per share.
AGREEMENT
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereto agree as follows:
SECTION A. OPTION CERTIFICATES. The Option Certificates to be delivered
pursuant to this Agreement (the "Option Certificates") shall be in the form set
forth in EXHIBIT A, attached hereto and made a part hereof. The Option
Certificates shall be executed on behalf of the Company by its Chief Executive
Officer, President, or any Vice President under its corporate seal reproduced
thereon and attested by its corporate secretary or one of its assistant
secretaries. Option Certificates may be exchanged at the Optionholder's option,
when surrendered to the Company for another Option Certificate or other Option
Certificates of like tenor and representing in the aggregate a like number of
Options.
SECTION B. RIGHT TO EXERCISE OPTIONS. Each Option may be exercised
immediately after each vesting date (hereinafter defined) until 11:59 P.M.
(Pacific Standard time) on the date that is two years after the date of this
Agreement (the "Expiration Date"). Each Option not exercised on or before the
Expiration Date shall expire. Subject to the provisions of this Option
Agreement, including Section 10 hereof, the holder of each Option shall have the
right to purchase from the Company, and the Company shall issue and sell to each
such Optionholder, at an initial exercise price per share of $____, subject to
adjustment as provided herein (the "Exercise Price"), one fully paid and
nonassessable Share upon surrender to the Company of the Option Certificate
evidencing such Option, with the form of election to purchase duly completed and
signed and evidence of payment of the Exercise Price. Payment of the Exercise
Price shall be made by wire transfer or check to the Company. A check for the
option price shall not be considered delivered until good funds are received by
the Company.
Upon surrender of such Option Certificate and payment of the Exercise
Price, the Company shall cause to be issued and delivered promptly to the Option
holder a certificate for the Shares issuable upon the exercise of the Option or
Options evidenced by such Option Certificate. The Options evidenced by an Option
Certificate shall be exercisable at the election of the Option holder thereof,
either as an entirety or from time to time for less than all of the number of
Options specified in the Option Certificate.
SECTION C. VESTING. Although granted as of the date of this Agreement,
the Options shall vest over a six month period. On the date of this Agreement
the initial ______ Options shall vest immediately. The second ______ options
shall vest only upon the conclusion of _________'s Consulting Agreement with the
Company and then only upon the terms contained therein. The Company shall issue
two option certificates. The first option certificate shall be delivered with
this Agreement. The second option certificate shall be held by the Company until
satisfaction of the conditions of its exercise.
SECTION D. RESERVATION OF SHARES. The Company will at all times reserve
and keep available, free from preemptive rights, out of the aggregate of its
authorized but unissued Shares or its authorized and issued Shares held in its
treasury for the purpose of enabling it to satisfy any obligation to issue
Shares upon exercise of Options, the full number of Shares deliverable upon the
exercise of all outstanding Options. The Company covenants that all Shares which
may be issued upon exercise of Options will be validly issued, fully paid and
nonassessable outstanding Shares of the Company.
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SECTION E. REGISTRATION UNDER THE SECURITIES ACT OF 1933.
__________ represents and warrants to the Company that ___________ is
acquiring the Options for investment and with no present intention of
distributing or reselling any of the Options. The Shares and the certificate
or certificates evidencing any such Shares shall bear the following legend:
"THE SHARES (OR OTHER SECURITIES) REPRESENTED BY THIS CERTIFICATE HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933. THE SHARES MAY
NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
OPINION OF COUNSEL THAT AN EXEMPTION FROM REGISTRATION UNDER SUCH
ACT IS AVAILABLE."
Certificates for Shares without such legend shall be issued if such shares
are sold pursuant to an effective registration statement under the Act or if
the Company has received an opinion from counsel reasonably satisfactory to
counsel for the Company, that such legend is no longer required under the
Act. Certificates for Options or Shares shall also bear such legends as may
be required from time to time by law.
SECTION F. REGISTRATION RIGHTS.
A. PIGGYBACK REGISTRATION RIGHTS. If the Company at any time proposes
to register any of its securities under the Act, including an SB-2 Registration
Statement or otherwise, it will each such time give written notice to all
holders of outstanding Shares and Options of its intention so to do. The Shares
underlying these options shall be registered to the extent required to permit
the sale or other disposition by ___________ of the Shares so registered;
provided, however, that the Company may, as a condition precedent to the
effectiveness of such registration, require ___________ to agree with the
Company and the managing underwriter or underwriters of the offering to be made
by the Company in connection with such registration that ___________ will not
sell any securities of the same class or convertible into the same class as
those registered by the Company (including any class into which the securities
registered by the Company are convertible) for such reasonable period after such
registration becomes effective (not exceeding 120 days) as shall then be
specified in writing by such underwriter or underwriters if in the opinion of
such underwriter or underwriters the Company's offering would be materially
adversely affected in the absence of such an agreement. All expenses incurred by
the Company in complying with this Section, including without limitation all
registration and filing fees, listing fees, printing expenses, fees and
disbursements of all independent accounts, or counsel for the Company and or
counsel for the sellers and the expense of any special audits incident to or
required by any such registration and the expenses of complying with the
securities or blue sky laws of any jurisdiction shall be paid by the Company.
Notwithstanding the foregoing, sellers shall pay all underwriting discounts or
commissions with respect to shares sold by the sellers.
B. INDEMNIFICATION.
(i) In the event of any registration of any of its Shares
under the Act pursuant to this Section, the Company hereby indemnifies and
holds harmless the sellers of such Shares (which phrase shall include any
underwriters of such Shares), their respective directors and officers, and
each other person who participates, in the offering of such Shares and each
other person, if any, who controls such sellers, or such participating
persons within the meaning of the Act, against any losses, claims, damages or
liabilities, joint or several, to which each such seller or any such director
or officer or participating person or controlling person may become subject
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of any material fact
contained, on the effective date thereof, in any registration statement under
which such Shares were registered under the Act, any preliminary prospectus
or final prospectus contained therein, or any amendment or supplement
thereto, or arise out of or are based upon any omission or alleged omission
to state therein an material fact required to be stated therein or necessary
to make the statements therein not misleading; and will reimburse each such
Seller and each director, officer or participating or controlling person for
any legal or any other expenses reasonably incurred by such Seller or such
director, officer or participating or controlling person in connection with
investigating or defending any such loss, claim, damage, liability or action;
provided, however, that the Company shall not be liable in any such case to
the extent that any such loss, claim, damage or liability arises out of is
based upon an untrue statement or
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alleged untrue statement or omission or alleged omission made in such
registration statement, preliminary prospectus or prospectus or amendment or
supplement in reliance upon and in conformity with written information
furnished to the Company through an instrument duly executed by such Seller
specifically stating that it is for use therein. Such indemnity shall remain
in full force and effect regardless of any investigation made by or on behalf
of such Seller or such directors, officer or participating or controlling
person, and shall survive the transfer of such Shares by such Seller.
(ii) Each holder of any Shares or Options shall by
acceptance thereof indemnify and hold harmless the Company and its directors
and officers, and each person, if any who controls the Company, against any
losses, claims, damages or liabilities, joint or several, to which the
Company or any director or officer or any such person may become subject
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of any material fact
contained, on the effective date thereof, in any registration statement under
which Shares were registered under the Act at the request of such holder, any
preliminary prospectus or final prospectus contained therein, or any
amendment or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, in
each case to the extent, but only to the extent, that such untrue statement
or alleged untrue statement or omission or alleged omission was made in such
registration statement, preliminary prospectus, prospectus, amendment or
supplement in reliance upon and in conformity with written information
furnished to the Company through an instrument duly executed by or on behalf
of such holder specifically stating that it is for use therein; and will
reimburse the Company or such director, officer or person for any legal or
any other expense reasonably incurred in connection with investigation or
defending any such loss, claim, damage, liability or action.
C. RULE 144. If the Company shall be subject to the reporting
requirements of Section 13 of the 1934 Act, the Company will use its best
efforts timely to file all reports required to be filed from time to time with
the Commission (including but not limited to the reports under Section 13 and
15(d) of the 1934 Act referred to in subparagraph (c)(1) of Rule 144 adopted by
the Commission under the Act). If there is a public market for any Shares of the
Company at any time that the Company is not subject to the reporting
requirements of either of said Section 13 or 15(d), the Company will, upon the
request of any holder of any Shares or Options, use its best efforts to make
publicly available the information concerning the Company referred to in
subparagraph (c)(2) of said Rule 144. The Company will furnish to each holder of
any shares or Options, promptly upon request, (i) a written statement of the
Company's compliance with the requirements of subparagraphs (c)(1) or (c)(2), as
the case may be, of said Rule 144, and (ii) written information concerning the
Company sufficient to enable such holder to complete any Form 144 required to be
filed with the Commission pursuant to said Rule 144.
SECTION G. NOTICES TO COMPANY AND ___________. Any notice or demand
authorized by this Agreement to be given or made by any registered holder of any
Option Certificate to or on the Company shall be sufficiently give or made if
sent by registered mail, postage prepaid, addressed (until another address is
filed in writing by the Company with the holders) to the Company as in the
address set forth in the execution block of this Agreement.
SECTION H. SUPPLEMENTS AND AMENDMENTS. The Company and ___________ may
from time to time supplement or amend this Agreement without the approval of any
Optionholders (other than ___________) in order to cure any ambiguity, to
correct or supplement any provision contained herein which may be defective or
inconsistent with any provisions herein, or to make any other provisions in
regard to matters or questions arising hereunder which the Company and
___________ may deem necessary or desirable and which the Company and
___________ deem shall not adversely affect the interests of the Optionholders.
SECTION I. SUCCESSORS. All the covenants and provisions of this
Agreement by or for the benefit of the Company or ___________ shall bind and
inure to the benefit of their respective successors and assigns hereunder.
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SECTION J. GOVERNING LAW. This Agreement and each Option
Certificate issued hereunder shall be deemed to be a contract made under the
laws of the State of California and for all proposes shall be governed by and
construed in accordance with the laws of said State.
SECTION K. COUNTERPARTS. This Agreement may be executed
simultaneously in one or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument. The Parties agree that facsimile signatures of this Agreement
shall be deemed a valid and binding execution of this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed, as of the date and year first above written.
INTERNET SPORTS NETWORK, INC.
By:______________________________ By:_____________________________
Xxx Xxxxx
Its: Chief Executive Officer
Address: Address:
00 Xxxxxxxxx Xx., 0xx Xxxxx _________________________________
Xxxxxxx, Xxxxxxx, Xxxxxx X0X 0X0 _________________________________
_________________________________
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OPTION CERTIFICATE
THE OPTIONS REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK (OR
OTHER SECURITIES) ISSUABLE UPON EXERCISE THEREOF HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933. THE OPTIONS, SHARES OR OTHER SECURITIES MAY NOT BE
SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN OPINION OF COUNSEL
THAT AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS AVAILABLE.
EXERCISABLE FROM 12:00 P.M. PACIFIC STANDARD TIME,
ON JUNE 1, 1999 UNTIL
11:59 P.M., PACIFIC STANDARD TIME ON MAY 31, 2001
No. ___ ______ Options
OPTION CERTIFICATE
INTERNET SPORTS NETWORK, INC.
This Option Certificate certifies that __________ ("___________") or
registered assigns, is the registered holder of 25,000 Options (the "Options")
expiring March 31, 2001 (the "Expiration Date"), to purchase shares of Common
Stock (the "Shares") of INTERNET SPORTS NETWORK, INC., a Florida corporation
(the "Company"). Each Option entitles the holder to purchase from the Company
before 11:59 p.m. (Pacific Standard time) on the "Expiration Date" one fully
paid and nonassessable share of Common Stock of the Company at the initial
exercise price for each Option of $____ per share (the "Exercise Price"), upon
surrender of this Option Certificate and payment of the Exercise Price at an
office or agency of the Company, but only subject to the terms and conditions
set forth herein and in the Option Agreement. Payment of the Exercise Price may
be permitted by check or wire transfer. Payment shall be deemed accepted only
upon the receipt of good funds by the Company. As used herein, "Share" or
"Shares" refers to the Common Stock of the Company. In the event that upon any
exercise of Options evidenced hereby, the number of Options exercised shall be
less than the total number of Options evidence hereby, there shall be issued to
the holder hereof or his or her assignee a new Option Certificate evidencing the
number of Options not exercised. No adjustment shall be made for any cash
dividends on any Shares issuable upon exercise of this Option.
No Option may be exercised after 11:59 P.M. (Pacific Standard Time)
on the Expiration Date. All Options evidenced hereby shall thereafter be
void.
The Options evidenced by this Option Certificate are part of a duly
authorized issue of Options issued pursuant to an Option Agreement, dated
effective as of June 1, 1999 (the "Option Agreement"), duly executed by the
Company and ___________ which Option Agreement and the Consulting Agreement by
and between Company and ___________ which are both hereby incorporated by
reference herein and made a part of this instruments and are hereby referred to
for a description of the rights, limitation of rights, obligations, duties and
immunities thereunder of the Company and the holders (the words "holders" or
"holder" meaning the registered holders or registered holder of the Option
Certificates of Shares).
The Company may deem and treat the person(s) registered in the
Company's register as the absolute owner(s) of this Option Certificate
(notwithstanding any notation of ownership or other writing hereon made by
anyone), for the purpose of any exercise hereof, and of any distribution to the
holder(s) hereof, and for all purposes, and the Company shall not be affected by
any notice to the contrary.
All terms used in this Option Certificate which are defined in the
Option Agreement shall have the meaning assigned to them in the Option
Agreement.
THE OPTIONS REPRESENTED BY THIS CERTIFICATE AND THE SHARES OF COMMON STOCK (OR
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OTHER SECURITIES) ISSUABLE UPON EXERCISE THEREOF HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933. THE OPTIONS, SHARES OR OTHER SECURITIES MAY NOT BE
SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN OPINION OF COUNSEL
THAT AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS AVAILABLE.
IN WITNESS WHEREOF, the Company has caused this Option Certificate
to be duly executed under its corporate seal.
Dated: June 1, 1999 INTERNET SPORTS NETWORK, INC.
By:____________________________
Xxx Xxxxx
ITS: Chief Executive Officer
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ELECTION TO PURCHASE
(To be executed upon exercise of Option)
The undersigned hereby irrevocably elects to exercise the right,
represented by this Option Certificate, to purchase ______ Shares and
herewith authorizes payment for such Shares in the amount of $_____ all in
accordance with the terms hereof. The undersigned requests that certificates
for such Shares be registered as follows:
NAME NUMBER OF SHARES
---- ----------------
all of whose addresses are ____________________________________________________,
and that such certificates be delivered to _______________________ whose address
is _______________________________. If said number of Shares is less than all of
the Shares purchasable hereunder, the undersigned requests that a new Option
Certificate representing the remaining balance of the Shares be registered in
the name of __________, whose address is ___________________________________
________________ and that such Certificates be delivered to the attention of
___________________ at the above address.
Dated:____________________ By:______________________________________
Its:_____________________________________
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