Consulting and Stock Option Agreement with Gary Gillman
CONSULTING AND STOCK OPTION AGREEMENT
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THIS CONSULTING AND STOCK OPTION AGREEMENT (the "Agreement") dated as of
the 8th day of March, 1996, but effective as of November 21, 1991 (the
"Effective/Grant Date") is made and entered into by and between DCC COMPACT
CLASSICS, INC., a Colorado corporation with its principal offices located at 903
Jordan Avenue, Suite 105, Chatsworth, California 91311 (the "Company") and Gary
Gillman, ("Gillman") whose address is 6345 Balboa Boulevard, Suite 145, Encino,
California 91316.
W I T N E S S E T H:
WHEREAS, Gillman is knowledgeable in all material aspects of accounting
and particularly in the accounting practices of the Company; and
WHEREAS, from time to Gillman will provide certain accounting and
financial services to the Company, on an as needed basis; and
WHEREAS, in consideration for the services to be provided by Gillman to
the Company, Gillman shall be granted the option for certain shares of common
stock, par value $.005 per share ("Common Stock") of the Company as described
herein, subject to the terms and conditions of this Agreement; and
WHEREAS, Gillman desires to accept the grant of such option in
consideration for his providing certain accounting and financial services to the
Company, subject to the terms and conditions of this Agreement.
NOW, THEREFORE, the Company and Gillman hereby agree as follows:
Section 1. Services of Gillman. Gillman shall provide such administrative,
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financial and accounting services to the Company as may be required by the
Company from time to time, and particularly, to provide such services as may be
required of a chief financial officer of the Company.
Section 2. Grant of Option. Subject to the provisions of this Agreement,
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in consideration for the services to be provided by Gillman on behalf of the
Company as described in Section 1, the Company hereby grants to Gillman an
option (the "Option") to purchase from the Company at any time and from time to
time, up to 25,000 shares of Common Stock (the "Option Shares") of the Company
at $.10 per share (the "Exercise Price"), subject to the terms of this
Agreement.
Section 3. Exercise of Option. The Option may be exercised in whole or in
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part in accordance with the provisions of this Agreement by Gillman's tendering
the Exercise Price (or a proportionate part thereof if the Option is partially
exercised), in cash equal in value to the Exercise Price to the Company together
with a written notice specifying the number of the Option Shares Gillman wishes
to purchase pursuant to the terms of the Option. Optionee shall not, however,
purchase fewer than One Hundred (100) of the Option Shares at any one time
unless such lesser number of shares constitutes the remaining Option Shares
subject to the Option.
Section 3. Share Certificates. Upon receipt of payment in full of the
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Exercise Price, and after taking such steps as it deems necessary to satisfy
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any withholding tax obligations imposed upon it by any level of government, the
Company will cause one or more stock certificates evidencing Gillman's ownership
of the Option Shares so purchased by Gillman to be issued to Gillman.
Section 4. Termination of Options. The options shall terminate on
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November 20, 1996, at 12:00 midnight.
Section 5. Restrictions. The Option and the Option Shares have not been
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registered under the Securities Act of 1933, as amended (the "Act"). The Company
may, in its sole discretion , register all or a portion of the Option Shares
underlying the Option but it shall have no obligation to do so. All shares
acquired upon the exercise of the Option shall be "restricted securities" as
that term is defined in Rule 144 promulgated under the Act. The certificate
representing the shares shall bear an appropriate legend restricting their
transfer. Such shares cannot be sold, transferred, assigned or otherwise
hypothecated without registration under the Act or unless a valid exemption from
registration is then available under applicable federal and state securities
laws and Gillman has furnished the Company with an opinion of counsel
satisfactory in form and substance to Company's counsel that such registration
is not required.
Section 6. Share Adjustments. If there is any change in the number of
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shares of Common Stock on account of the declaration of stock dividends,
recapitalization resulting in stock split-ups, or combinations or exchanges
of shares of Common Stock, or otherwise, the number of Option Shares available
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for purchase by the exercise of the Option, and the Exercise Price, shall be
proportionately adjusted by the Company.
Section 7. Miscellaneous Provisions.
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(a) Notices. Unless otherwise specifically provided herein, all notices to
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be given hereunder shall be in writing and sent to the parties by certified
mail, return receipt requested, which shall be addressed to each party's
respective address, as set forth in the first paragraph of this Agreement, or to
such other address as such party shall give to the other party hereto by a
notice given in accordance with this Section and, except as otherwise provided
in this Agreement, shall be effective when deposited in the United States mails
properly addressed and postage prepaid. If such notice is sent other than by the
United States mail, such notice shall be effective when actually received by the
party being noticed.
(b) Assignment. This Agreement and the rights granted hereunder may not be
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assigned in whole or in part by Optionee except by will or the laws of descent
and distribution, and the Option is exercisable during Optionee's lifetime only
by Optionee. This Agreement may be assigned by the Company without the consent
of Gillman.
(c) Further Assurances. Both parties hereto shall execute and deliver
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such other instruments and do such other acts as may be necessary to carry out
the intent and purposes of this Agreement.
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(d) Gender. Whenever the context may require, any pronouns used herein
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shall include the corresponding masculine, feminine or neuter forms and the
singular form of nouns and pronouns shall include the plural and vice versa.
(e) Captions. The captions contained in this Agreement are inserted only
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as a matter of convenience and in no way define, limit, extend or prescribe the
scope of this Agreement or the intent of any of the provisions hereof.
(f) Completeness and Modification. This Agreement and the Option Plan
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constitute the entire understanding between the parties hereto superseding all
prior and contemporaneous agreements or understandings among the parties hereto
concerning the grant of stock options to Gillman. This Agreement shall not be
terminated, except in accordance with its terms, or amended in a writing
executed by all of the parties hereto.
(g) Waiver. The waiver of a breach of any term or condition of this
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Agreement shall not be deemed to constitute the waiver of any other breach of
the same or any other term or condition.
(h) Severability. The invalidity or unenforceability, in whole or in part,
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of any covenant, promise or undertaking, or any section, subsection, paragraph,
sentence, clause, phrase or word or of any provision of this Agreement shall not
affect the validity or enforceability of the remaining portions thereof.
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(i) Binding Effect. This Agreement shall be binding upon and inure to the
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benefit of the heirs, successors, estate and personal representatives of
Gillman and upon the successors and assigns of the Company.
(j) Cancellation of Existing Options. Optionee hereby acknowledges that
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upon receipt of this Option, 25,000 options representing the right to purchase
25,000 shares, exercisable at a price of $.10 per share, are in all respects
cancelled and of no further effect.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year set forth in the first paragraph of this Agreement above.
DCC COMPACT CLASSICS, INC.
a Colorado corporation.
By: /s/Marshall Blonstein
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Marshall Blonstein, President
GILLMAN:
/s/Gary Gillman
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Gary Gillman
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