EXHIBIT 10.30
OPTION
WHEREAS, National Health Partners, Inc., an Indiana corporation (the
"Company"), and Trident Marketing International, Inc., a Florida corporation
("Holder"), are parties to that certain Marketing Incentive Plan, dated June 24,
2005 (the "Plan"), pursuant to which the Holder agreed to provide certain
services to the Company in consideration for which the Company agreed to grant
the Holder an option to acquire shares of the Company's common stock; and
WHEREAS, the Company wishes to grant such an option to the Holder in
satisfaction of its obligation under the Plan to grant the option to the Holder.
NOW, THEREFORE, in consideration of the foregoing, the agreement set
forth below and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, and intending to be legally bound
hereby, the parties hereby agree as follows:
1. Grant of Option. The Company hereby grants to the Holder on the date
hereof (the "Grant Date") an option (this "Option") to purchase 400,000 shares
("Shares") of the Company's common stock, par value $.001 per share ("Common
Stock"), on the terms and subject to the conditions set forth herein.
Capitalized terms not otherwise defined in this Option shall have the meanings
ascribed to such terms in the Plan.
2. Term of Option. This option shall have a maximum term of one (1)
year measured from the Grant Date (the "Expiration Date") and shall accordingly
expire at 5:00 p.m. eastern standard time on the Expiration Date.
3. Right to Exercise. This Option may be exercised in whole or in part
in accordance with the following schedule:
(a) 50,000 Shares upon the Company receiving aggregate Net
Monthly Revenues of at least $100,000 during its fiscal quarter ended September
30, 2005;
(b) 50,000 Shares upon the Company receiving aggregate Net
Monthly Revenues of at least $150,000 during its fiscal quarter ended September
30, 2005;
(c) 50,000 Shares upon the Company receiving aggregate Net
Monthly Revenues of at least $200,000 during its fiscal quarter ended December
31, 2005;
(d) 50,000 Shares upon the Company receiving aggregate Net
Monthly Revenues of at least $300,000 during its fiscal quarter ended December
31, 2005;
(e) 100,000 Shares upon the Company receiving aggregate Net
Monthly Revenues of at least $500,000 during its fiscal year ended December 31,
2005; and
(f) 100,000 Shares upon the Company receiving aggregate Net
Monthly Revenues of at least $750,000 during its fiscal year ended December 31,
2005.
In the event the Company receives aggregate Net Monthly Revenues of at
least $750,000 during its fiscal year ended December 31, 2005, this Option shall
be immediately exercisable in full into all 400,000 Shares. In no event shall
this Option be exercisable into more than 400,000 Shares.
4. Exercise Price. The exercise price per Share ("Exercise Price") at
which this Option may be exercised shall be $.50 per Share.
5. Method of Exercise.
(a) This Option shall be exercised by execution and delivery
of the Notice of Exercise annexed hereto ("Notice of Exercise") or any other
written notice approved for such purpose by the Company which shall state the
election of the Holder to exercise this Option, the number of Shares in respect
of which the Option is being exercised, and such other representations and
agreements as to the holder's investment intent with respect to such Shares as
may be required by the Company. The Notice of Exercise shall be accompanied by
payment of the Exercise Price. This Option shall be deemed to be exercised upon
receipt by the Company of the Notice of Exercise accompanied by payment of the
Exercise Price.
(b) No Shares shall be issued pursuant to the exercise of an
Option unless such issuance and such exercise shall comply with all relevant
provisions of applicable law, including the requirements of any stock exchange
upon which the Share may then be listed. Assuming such compliance, for income
tax purposes the Shares shall be considered transferred to the Holder on the
date on which this Option is exercised with respect to such Shares.
(c) This Option may not be exercised for a fractional Share or
scrip representing a fractional Share. In lieu of any fractional Share to which
the Holder would otherwise be entitled, the Company shall make a cash payment
equal to the Exercise Price multiplied by such fraction
(d) In no event may this Option be exercised after the
Expiration Date.
For the purpose of this Option, "Fair Market Value" shall mean:
(i) If the Common Stock is admitted to quotation on
the National Association of Securities Dealers Automated Quotation System
("NASDAQ"), the Fair Market Value on any given date shall be the average of the
highest bid and lowest asked prices of the Common Stock as reported for such
date or, if no bid and asked prices were reported for such date, for the last
day preceding such date for which such prices were reported;
(ii) If the Common Stock is admitted to trading on a
United States securities exchange or the NASDAQ National Market System, the Fair
Market Value on any date shall be the closing price reported for the Common
Stock on such exchange or system for such date or, if no sales were reported for
such date, for the last day preceding such date for which a sale was reported;
(iii) If the Common Stock is traded in the
over-the-counter market and not on NASDAQ, the NASDAQ National Market System or
any national securities exchange, the Fair Market Value shall be the average of
the mean between the last bid and ask prices per share as reported by the
National Quotation Bureau, Inc. or an equivalent generally accepted reporting
service, or if not so reported, the average of the closing bid and asked prices
of the Common Stock as furnished to the Company by any independent member of the
National Association of Securities Dealers, Inc., selected by the Company for
that purpose; or
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(iv) If the Fair Market Value of the Common Stock
cannot be determined on the basis previously set forth in this definition on the
date that the Fair Market Value is to be determined, the Board of Directors of
the Company shall in good faith determine the Fair Market Value of the Common
Stock on such date.
6. Method of Payment. Payment of the Exercise Price shall be made by
any of the following, or a combination thereof, at the election of the Holder,
to the extent permitted by law:
(a) cash;
(b) bank or certified check; or
(c) if there is a public market for the Shares and they are
registered under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), delivery of a properly executed Notice of Exercise together
with irrevocable instructions to a broker or dealer to deliver promptly to the
Company the amount of sale proceeds required to pay the Exercise Price.
7. Registration Rights. The Company covenants and agrees as follows:
7.1 Definitions. For the purpose of this Section 7, the
following definitions shall apply:
(a) "Person" shall mean an individual, partnership
(general or limited), corporation, limited liability company, joint venture,
business trust, cooperative, association or other form of business organization,
whether or not regarded as a legal entity under applicable law, a trust (inter
vivos or testamentary), an estate of a deceased, insane or incompetent person, a
quasi-governmental entity, a government or any agency, authority, political
subdivision or other instrumentality thereof, or any other entity.
(b) "Register," "registered," and "registration"
shall refer to a registration effected by preparing and filing a Registration
Statement in compliance with the Securities Act, and the declaration or order of
effectiveness of such Registration Statement or document.
(c) "Registration Statement" shall mean any
registration statement of the Company filed with the SEC, but excluding
registration statements on SEC Forms S-4, S-8 or any similar or successor forms,
that covers the resale of the Restricted Stock on an appropriate form then
permitted by the SEC to be used for such registration and the sales contemplated
to be made thereby under the Securities Act, or any similar rule that may be
adopted by the SEC, and all amendments and supplements to such registration
statement, including any pre- and post- effective amendments thereto, in each
case including the prospectus contained therein, all exhibits thereto and all
materials incorporated by reference therein.
(d) "Restricted Stock" shall mean: (i) all of the
Shares; and (iii) any additional shares of Common Stock issued or issuable after
the date hereof in respect of any of the Shares, by way of a stock dividend or
stock split; provided that, as to any particular shares of Restricted Stock,
such securities shall cease to constitute Restricted Stock when: (x) a
Registration Statement with respect to the sale of such securities shall have
become effective under the Securities Act under which such securities may be
disposed of, (y) such securities are permitted to be transferred pursuant to
Rule 144 (or any successor provision to such rule) under the Securities Act, or
(z) such securities are otherwise freely transferable to the public without
further registration under the Securities Act.
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(e) "Selling Stockholders" shall mean the Holder and
any of its successors and assigns.
7.2. Registration of the Shares.
(a) The Company shall prepare and file with the SEC,
within six (6) months of the date of this Option, a Registration Statement under
the Securities Act to permit the public sale of the Restricted Stock, and to
cause such Registration Statement to be declared effective as soon as reasonably
practicable thereafter. Purchaser shall furnish such information as may be
reasonably requested by the Company in order to include the Restricted Stock in
such Registration Statement.
(b) In the event that any registration pursuant to
Section 7.2(a) shall be, in whole or in part, an underwritten public offering of
Common Stock on behalf of the Company, all Holders proposing to distribute their
Restricted Stock through such underwriting shall enter into an underwriting
agreement in customary form with the underwriter or underwriters selected for
such underwriting by the Company. If the managing underwriter thereof advises
the Company in writing that in its opinion the number of securities requested to
be included in such registration exceeds the number that can be sold in an
orderly manner in such offering within a price range acceptable to the Company,
the Company shall include in such registration: (i) first, the securities the
Company proposes to sell, and (ii) second, the Restricted Stock and any other
registrable securities eligible and requested to be included in such
registration to the extent that the number of shares to be registered under this
clause (ii) will not, in the opinion of the managing underwriter, adversely
affect the offering of the securities pursuant to clause (i). In such a case,
shares shall be registered pro rata among the holders of such Restricted Stock
and registrable securities on the basis of the number of shares eligible for
registration that are owned by all such holders and requested to be included in
such registration.
(c) Notwithstanding anything to the contrary
contained herein, the Company's obligations under Sections 7.2(a) and (b) above
are subject to the following provisions: (i) the Company's obligations under
Sections 7.2(a) and (b) shall extend only to the inclusion of the Restricted
Stock in a Registration Statement; (ii) the Company's obligations under Sections
7.2(a) and (b) shall not extend to any initial public offering by the Company
("Primary Offering") unless (A) consented to in writing by the Company and, in
the case of an underwritten Primary Offering, the managing underwriter, or (B)
the shares of Common Stock owned by shareholders that have registration rights
similar to those provided in this Section 7 will be registered in the
Registration Statement; and (iii) the Company shall have no obligation to assure
the terms and conditions of distribution, to obtain a commitment from an
underwriter relative to the sale of the Restricted Stock or to otherwise assume
any responsibility for the manner, price or terms of the distribution of the
Restricted Stock.
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(d) The Company shall have the right to terminate or
withdraw any registration initiated by it under this Section 7.2 prior to the
effectiveness of such registration without thereby incurring liability to the
holders of the Restricted Stock, regardless of whether any holder has elected to
include securities in such registration. The Registration Expenses (as defined
in Section 7.5) of such withdrawn registration shall be borne by the Company in
accordance with Section 7.4 hereof.
7.3 Registration Procedures. Whenever it is obligated to
register any Restricted Stock pursuant to this Option, the Company shall:
(a) prepare and file with the SEC a Registration
Statement with respect to the Restricted Stock in the manner set forth in
Section 7.2 hereof and use its reasonable best efforts to cause such
Registration Statement to become effective as promptly as possible and to remain
effective until the earlier of (i) the sale of all shares of Restricted Stock
covered thereby, (ii) the availability under Rule 144 for the Selling
Stockholder to immediately, freely resell without restriction all Restricted
Stock covered thereby, or (iii) 180 days from the effective date of such
Registration Statement;
(b) prepare and file with the SEC such amendments
(including post-effective amendments) and supplements to such Registration
Statement and the prospectus used in connection therewith as may be necessary to
keep such Registration Statement effective for the period specified in Section
7.3(a) above and to comply with the provisions of the Securities Act with
respect to the disposition of all Restricted Stock covered by such Registration
Statement in accordance with the intended method of disposition set forth in
such Registration Statement for such period;
(c) furnish to the Selling Stockholders such number
of copies of the Registration Statement and the prospectus included therein
(including each preliminary prospectus) as such person may reasonably request in
order to facilitate the public sale or other disposition of the Restricted Stock
covered by such Registration Statement;
(d) use its reasonable best efforts to register or
qualify the Restricted Stock covered by such Registration Statement under the
state securities laws of such jurisdictions as any Selling Stockholder shall
reasonably request; provided, however, that the Company shall not for any such
purpose be required to qualify generally to transact business as a foreign
corporation in any jurisdiction where it is not so qualified or to consent to
general service of process in any such jurisdiction;
(e) in the event of any underwritten public offering,
enter into and perform its obligations under an underwriting agreement, in usual
and customary form, with the managing underwriter(s) of such offering. Each
Holder participating in such underwriting shall also enter into and perform its
obligations under such an agreement, as described in Section 7.2(b);
(f) immediately notify each Selling Stockholder at
any time when a prospectus relating thereto is required to be delivered under
the Act, of the happening of any event as a result of which the prospectus
contained in such Registration Statement, as then in effect, includes an untrue
statement of a material fact or omits to state a material fact required or
necessary to be stated therein in order to make the statements contained therein
not misleading in light of the circumstances under which they were made. The
Company will use reasonable efforts to amend or supplement such prospectus in
order to cause such prospectus not to include any untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading in the light of the circumstances
under which they were made;
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(g) prepare and file with the Commission such
amendments and supplements to such Registration Statement and the prospectus
used in connection with such Registration Statements as may be necessary to
comply with the provisions of the Securities Act with respect to the disposition
of all securities covered by such Registration Statement;
(h) use its reasonable best efforts to list the
Restricted Stock covered by such Registration Statement on each exchange or
automated quotation system on which similar securities issued by the Company are
then listed (with the listing application being made at the time of the filing
of such Registration Statement or as soon thereafter as is reasonably
practicable);
(i) notify each Selling Stockholder of any threat by
the SEC or state securities commission to undertake a stop order with respect to
sales under the Registration Statement; and
(j) cooperate in the timely removal of any
restrictive legends from the shares of Restricted Stock in connection with the
resale of such shares covered by an effective Registration Statement.
7.4. Delay of Registration. No Selling Stockholder shall have
any right to obtain or seek an injunction restraining or otherwise delaying any
such registration as the result of any controversy that might arise with respect
to the interpretation or implementation of this Section 7.
7.5 Expenses.
(a) For the purposes of this Section 7.5, the term
"Registration Expenses" shall mean: all expenses incurred by the Company in
complying with Section 7.2 of this Option, including, without limitation, all
registration and filing fees, printing expenses, fees and disbursements of
counsel and independent public accountants for the Company, reasonable fees and
disbursements of a single special counsel for the Selling Stockholders, fees
under state securities laws, fees of the National Association of Securities
Dealers, Inc., fees and expenses of listing shares of Restricted Stock on any
securities exchange or automated quotation system on which the Company's shares
are listed and fees of transfer agents and registrars. The term "Selling
Expenses" shall mean: all underwriting discounts and selling commissions and
expenses applicable to the sale of Restricted Stock. Any such Selling Expenses
incurred in connection with the use of an underwriter must be pre-approved in
writing by mutual consent of the underwriter and the Selling Stockholder. The
Selling Stockholder shall not be responsible for paying any fees and
disbursements of the counsel for the underwriter described above unless agreed
to in writing by mutual consent of the underwriter and the Selling Stockholder.
(b) Except as otherwise provided herein, the Company
will pay all Registration Expenses in connection with the Registration
Statements filed pursuant to Section 7.2 of this Option. All Selling Expenses in
connection with any Registration Statements filed pursuant to Section 7.2 of
this Option shall be borne by the Selling Stockholders pro rata on the basis of
the number of shares registered by each Selling Stockholder whose shares of
Restricted Stock are covered by such Registration Statement, or by such persons
other than the Company (except to the extent the Company may be a seller) as
they may agree.
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7.6. Obligations of the Selling Stockholders.
(a) In connection with each registration hereunder,
each Selling Stockholder shall furnish to the Company in writing such
information with respect to it and the securities held by it and the proposed
distribution by it, as shall be reasonably requested by the Company in order to
assure compliance with applicable federal and state securities laws as a
condition precedent to including the Selling Stockholder's Restricted Stock in
the Registration Statement. Each Selling Stockholder shall also promptly notify
the Company of any changes in such information included in the Registration
Statement or prospectus as a result of which there is an untrue statement of
material fact or an omission to state any material fact required or necessary to
be stated therein in order to make the statements contained therein not
misleading in light of the circumstances under which they were made.
(b) In connection with the filing of the Registration
Statement, each Selling Stockholder shall furnish to the Company in writing such
information and affidavits as the Company reasonably requests for use in
connection with such Registration Statement or prospectus.
(c) In connection with each registration pursuant to
this Option, each Selling Stockholder agrees that it will not effect sales of
any Restricted Stock until notified by the Company of the effectiveness of the
Registration Statement, and thereafter will suspend such sales after receipt of
telegraphic or written notice from the Company to suspend sales to permit the
Company to correct or update a Registration Statement or prospectus. At the end
of any period during which the Company is obligated to keep a Registration
Statement current, each Selling Stockholder shall discontinue sales of
Restricted Stock pursuant to such Registration Statement upon receipt of notice
from the Company of its intention to remove from registration the Restricted
Stock covered by such Registration Statement which remains unsold, and each
Selling Stockholder shall notify the Company of the number of shares registered
which remain unsold immediately upon receipt of such notice from the Company.
7.7. Indemnification.
(a) The Company agrees to indemnify, to the extent
permitted by law, each Selling Stockholder, such Selling Stockholder's
respective partners, officers, directors, underwriters and each Person who
controls any Selling Stockholder (within the meaning of the Securities Act)
against all losses, claims, damages, liabilities and expenses caused by (i) any
untrue statement of or alleged untrue statement of material fact contained in
the Registration Statement, prospectus or preliminary prospectus or any
amendment or supplement thereto, (ii) any omission of or alleged omission of a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or (iii) any violation or alleged violation by the
Company of the Securities Act, the Exchange Act, any state securities law or any
rule or regulation promulgated under the Securities Act, the Exchange Act or any
state securities law in connection with the offering covered by such
Registration Statement ("Violations"); provided, however, that the indemnity
agreement contained in this Section 7.7(a) shall not apply to amounts paid in
settlement of any such loss, claim, damage, liability or action if such
settlement is effected without the consent of the Company, which consent shall
not be unreasonably withheld, nor shall the Company be liable in for any loss,
claim, damage, liability or action to the extent that it arises out of or is
based upon a Violation which occurs in reliance upon and in conformity with
information furnished to the Company by such Selling Stockholder, partner,
officer, director, underwriter or controlling person of such Selling
Stockholder.
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(b) To the extent permitted by law, each Selling
Stockholder shall indemnify and hold harmless the Company, each of its
directors, its officers and each person, if any, who controls the Company within
the meaning of the Securities Act, any underwriter and any other Selling
Stockholder selling securities under such Registration Statement or any of such
other Selling Stockholder's partners, directors or officers or any person who
controls such Selling Stockholder, against any losses, claims, damages or
liabilities (joint or several) to which the Company or any such director,
officer, controlling person, underwriter or other such Selling Stockholder, or
partner, director, officer or controlling person of such other Selling
Stockholder, may become subject under the Securities Act, the Exchange Act or
other federal or state law, insofar as such losses, claims, damages or
liabilities (or actions in respect thereto) arise out of or are based upon any
Violation, in each case to the extent (and only to the extent) that such
Violation (i) occurs in reliance upon and in conformity with information
furnished by such Selling Stockholder to the Company; (ii) occurs as a result of
any failure by such Selling Stockholder to deliver a copy of the prospectus
relating to such Registration Statement, or (iii) occurs as a result of any
disposition of the Restricted Stock in a manner that fails to comply with the
permitted methods of distribution identified within the Registration Statement.
(c) Any Person entitled to indemnification hereunder
shall (i) give prompt written notice to the indemnifying party of any claim with
respect to which it seeks indemnification (provided that the failure to give
prompt notice shall not impair any Person's right to indemnification hereunder
to the extent such failure has not prejudiced the indemnifying party), and (ii)
unless in such indemnified party's reasonable judgment a conflict of interest
between such indemnified and indemnifying parties may exist with respect to such
claim, permit such indemnifying party to assume the defense of such claim with
counsel reasonably satisfactory to the indemnified party. If such defense is
assumed, the indemnifying party shall not be subject to any liability for any
settlement made by the indemnified party without its consent (but such consent
shall not be unreasonably withheld). An indemnifying party who is not entitled
to, or elects not to, assume the defense of a claim shall not be obligated to
pay the fees and expenses of more than one counsel for all parties indemnified
by such indemnifying party with respect to such claim, unless in the reasonable
judgment of any indemnified party a conflict of interest may exist between such
indemnified party and any other of such indemnified parties with respect to such
claim.
(d) If the indemnification provided for in this
Section 7.7 is held by a court of competent jurisdiction to be unavailable to an
indemnified party with respect to any losses, claims, damages or liabilities
referred to herein, the indemnifying party, in lieu of indemnifying such
indemnified party thereunder, shall to the extent permitted by applicable law
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability in such proportion as is appropriate to
reflect the relative fault of the indemnifying party on the one hand and of the
indemnified party on the other in connection with the violation(s) described in
Section 7.7(a) that resulted in such loss, claim, damage or liability, as well
as any other relevant equitable considerations. The relative fault of the
indemnifying party and of the indemnified party shall be determined by a court
of law by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission to state a material fact relates to
information supplied by the indemnifying party or by the indemnified party and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission; provided, that in no event
shall any contribution by a Selling Stockholder hereunder exceed the net
proceeds from the offering received by such Selling Stockholder.
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(e) The indemnification provided for under this
Option shall remain in full force and effect regardless of any investigation
made by or on behalf of the indemnified party or any officer, director or
controlling Person of such indemnified party and shall survive the transfer of
securities. The Company also agrees to make such provisions as are reasonably
requested by any indemnified party for contribution to such party in the event
the Company's indemnification is unavailable for any reason.
8. Market Standoff. Notwithstanding any other provision of this
Option, Holder agrees to not sell, make any short sale of, loan, grant any
option for the purchase of, or otherwise dispose of any securities of the
Company during the 30 days prior to the commencement of the earlier to occur of:
(a) any Primary Offering, which may also include other
securities to be offered by persons other than the Company under any secondary
offering, or
(b) the first secondary offering of securities to be
offered exclusively by persons other than the Company ("Secondary Offering"),
and ending 90 days after completion of any such Primary Offering or Secondary
Offering, unless the Company, in the case of a non-underwritten Primary Offering
or Secondary Offering, or the managing underwriter, in the case of an
underwritten Primary Offering or Secondary Offering, otherwise agree in writing.
Holder agrees to execute an agreement reflecting the foregoing as may be
requested by the Company or the underwriters at the time of any such Primary
Offering or Secondary Offering.
9. Rights of Stockholder. The Holder shall not have any stockholder
rights with respect to any Shares until such Holder shall have exercised this
Option, paid the Exercise Price and become a holder of record of the purchased
Shares.
10. Adjustment of Exercise Price and Number of Shares. The number of
and kind of securities purchasable upon exercise of this Option and the Exercise
Price shall be subject to adjustment from time to time as follows:
(a) Subdivisions, Combinations and Other Issuances. If
the Company shall at any time prior to the expiration of this Option subdivide
its Common Stock, by split-up or otherwise, or combine its Common Stock, or
issue additional shares of its Common Stock or any preferred stock as a dividend
with respect to any shares of its Common Stock, then the number of Shares
issuable on the exercise of this Option shall forthwith be proportionately
increased in the case of a subdivision or stock dividend, or proportionately
decreased in the case of a combination. Appropriate adjustments shall also be
made to the Exercise Price, but the aggregate purchase price payable for the
total number of Shares purchasable under this Option (as adjusted) shall remain
the same. Any adjustment under this Section 10(a) shall become effective at the
close of business on the date the subdivision or combination becomes effective,
or as of the record date of such dividend, or in the event that no record date
is fixed, upon the making of such dividend.
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(b) Reclassification, Reorganization and Consolidation.
In the case of any reclassification, capital reorganization or change in the
Common Stock of the Company (other than as a result of a subdivision,
combination or stock dividend described in Section 10(a) above or as a result of
any "Fundamental Transaction" described in Section 10(c) below), then, as a
condition of such reclassification, reorganization or change, lawful provision
shall be made, and duly executed documents evidencing the same from the Company
or its successor shall be delivered to the Holder, so that the Holder shall have
the right at any time prior to the expiration of this Option to purchase, at a
total price equal to that payable upon the exercise of this Option, the kind and
amount of shares of stock and other securities and property receivable in
connection with such reclassification, reorganization or change by a holder of
the same number of shares of Common Stock as were purchasable by the Holder
immediately prior to such reclassification, reorganization or change. In any
such case, appropriate provisions shall be made with respect to the rights and
interest of the Holder so that the provisions hereof shall thereafter be
applicable with respect to any shares of stock or other securities and property
deliverable upon exercise hereof, and appropriate adjustments shall be made to
the Exercise Price payable hereunder, provided the aggregate purchase price
shall remain the same.
(c) Corporate Reorganizations, Consolidations or Mergers.
In the event of: (i) any consolidation or merger of the Company with or into
another entity (other than a merger in which the Company is the successor entity
that does not result in any capital reclassification, reorganization or
consolidation, or other change, in the Common Stock of the Company, or a
consolidation or merger between the Company and a wholly-owned subsidiary of the
Company) (ii) any sale, lease, transfer or conveyance to another entity of all
or substantially all of the property and assets of the Company (other than a
transfer to a wholly-owned subsidiary of the Company), or (iii) a liquidation or
dissolution of the Company (the events in subsections (i), (ii) and (iii)
collectively, a "Fundamental Transaction"), unless provision is made in
connection with such Fundamental Transaction for the assumption of this Option
or for the substitution of new like-kind options by the successor entity as a
result of such Fundamental Transaction, with appropriate adjustment as to the
number and kind of shares issuable upon exercise of the Option, and, if
appropriate, the per share exercise price, so as to enable the Holder after such
Fundamental Transaction to purchase the kind and amount of shares of stock and
other securities and property (including cash) receivable upon such
consolidation, merger, sale or conveyance by a holder of the number of shares of
Common Stock that would have been received upon exercise or exchange of this
Option immediately prior to such Fundamental Transaction, this Option shall,
upon no less than fifteen (15) days written notice, terminate upon the closing
of any such Fundamental Transaction.
(d) Notice of Adjustment. When any adjustment is required
to be made in the number or kind of shares purchasable upon exercise of the
Option, or in the Exercise Price, the Company shall promptly notify the Holder
of such event and of the number of shares of Common Stock or other securities or
property thereafter purchasable upon exercise of this Option.
(e) No Impairment. The Company and the Holder will not,
by any voluntary action, avoid or seek to avoid the observance or performance of
any of the terms to be observed or performed hereunder by the Company or the
Holder, respectively, but will at all times in good faith assist in the carrying
out of all the provisions of this Section 10 and in the taking of all such
action as may be necessary or appropriate in order to protect the rights or the
Company and the Holder against impairment.
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11. Investment Intent.
(a) The Holder of this Option, by acceptance hereof,
acknowledges that this Option and the Shares to be issued upon exercise hereof
(collectively, the "Securities") are being acquired for the Holder's own account
for investment purposes only and not with a view to, or with any present
intention of, distributing or reselling any of such Securities. The Holder
acknowledges and agrees that the Securities have not been registered under the
Securities Act or under any state securities laws, and that the Securities may
not be, directly or indirectly, sold, transferred, offered for sale, pledged,
hypothecated or otherwise disposed of without registration under the Securities
Act and applicable state securities laws, except pursuant to an available
exemption from such registration. The Holder also acknowledges and agrees that
neither the SEC nor any securities commission or other governmental authority
has (a) approved the transfer of the Securities or passed upon or endorsed the
merits of the transfer of the Securities; or (b) confirmed the accuracy of,
determined the adequacy of, or reviewed this Option. The Holder has such
knowledge, sophistication and experience in financial, tax and business matters
in general, and investments in securities in particular, that it is capable of
evaluating the merits and risks of this investment in the Securities, and the
Holder has made such investigations in connection herewith as it deemed
necessary or desirable so as to make an informed investment decision without
relying upon the Company for legal or tax advice related to this investment.
(b) The certificates evidencing any Shares issued upon
the exercise of this Option shall have endorsed thereon (except to the extent
that the restrictions described in any such legend are no longer applicable) the
following legend, appropriate notations thereof will be made in the Company's
stock transfer books, and stop transfer instructions reflecting these
restrictions on transfer will be placed with the transfer agent of the Shares.
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR
APPLICABLE STATE SECURITIES LAWS. THESE SECURITIES MAY NOT BE SOLD,
TRANSFERRED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO REGISTRATION
UNDER THE SECURITIES ACT AND REGISTRATION OR QUALIFICATION UNDER
APPLICABLE STATE SECURITIES LAWS, OR PURSUANT TO AN AVAILABLE EXEMPTION
THEREFROM. NO TRANSFER OF THE SECURITIES REPRESENTED HEREBY MAY BE MADE
IN THE ABSENCE OF SUCH REGISTRATION OR QUALIFICATION UNLESS THERE SHALL
HAVE BEEN DELIVERED TO THE ISSUER A WRITTEN OPINION OF UNITED STATES
COUNSEL OF RECOGNIZED STANDING, IN FORM AND SUBSTANCE SATISFACTORY TO
THE ISSUER, TO THE EFFECT THAT SUCH TRANSFER MAY BE MADE WITHOUT
REGISTRATION OF SUCH SECURITIES UNDER THE SECURITIES ACT AND
REGISTRATION OR QUALIFICATION UNDER APPLICABLE STATE SECURITIES LAWS.
11
12. Indemnification. Holder agrees to indemnify, defend and hold
harmless the Company and its respective affiliates and agents from and against
any and all demands, claims, actions or causes of action, judgments,
assessments, losses, liabilities, damages or penalties and reasonable attorneys'
fees and related disbursements incurred by the Company that arise out of or
result from a breach of any representations, warranties, covenants or agreements
made by Holder herein, and Holder agrees that in the event of any breach of any
representations, warranties, covenants or agreements made by Holder herein, the
Company may, at its option, forthwith rescind the issuance of this Option to
Holder.
13. Covenants of the Company. The Company covenants and agrees that the
Shares have been duly authorized and, when issued and paid for in accordance
with this Option, will be validly issued, fully paid and non-assessable shares
of Common Stock with no personal liability resulting solely from the ownership
of such shares and will be free and clear of all liens, charges, restrictions,
claims and encumbrances imposed by or through the Company.
14. Replacement of Option. On receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Option and, in the case of loss, theft or destruction, on delivery of an
indemnity agreement reasonably satisfactory in form and substance to the Company
or, in the case of mutilation, on surrender and cancellation of this Option, the
Company at its expense shall execute and deliver, in lieu of this Option, a new
Option of like tenor and amount.
15. Notices. All notices hereunder shall be sufficiently given for all
purposes hereunder if in writing and delivered personally, sent by documented
overnight delivery service or, to the extent receipt is confirmed, telecopy,
telefax or other electronic transmission service to the appropriate address or
number as set forth below:
If to the Company:
National Health Partners, Inc.
120 Gibraltar Road
Suite 107
Horsham, PA 19044
Attention: Chief Financial Officer
If to the Holder:
To that address indicated on the signature page hereof.
16. Amendment and Waiver. This Option may not be amended, modified
or supplemented except by an instrument or instruments in writing signed by the
party against whom enforcement of any such amendment, modification or supplement
is sought. The parties hereto entitled to the benefits of a term or provision
may waive compliance with any obligation, covenant, agreement or condition
contained herein. Any agreement on the part of a party to any such waiver shall
be valid only if set forth in an instrument or instruments in writing signed by
the party against whom enforcement of any such waiver is sought. No failure or
delay on the part of any party hereto in the exercise of any right hereunder
shall impair such right or be construed to be a waiver of, or acquiescence in,
any breach of any representation, warranty, covenant or agreement contained
herein.
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17. Headings; Definitions. The Section headings contained in this
Option are inserted for convenience of reference only and will not affect the
meaning or interpretation of this Option. All references to Sections contained
herein mean Sections of this Option unless otherwise stated. All capitalized
terms defined herein are equally applicable to both the singular and plural
forms of such terms.
18. Successors and Assigns. This Option shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns, and the Holder may transfer or assign all or any portion of its rights,
remedies, obligations or liabilities hereunder to any individual or entity if
such transfer or assignment does not violate any state or federal securities
laws and any terms of this Option. Nothing in this Option is intended to confer
upon any person not a party hereto (and their successors and assigns) any
rights, remedies, obligations or liabilities under or by reason of this Option.
19. Severability. If any provision of this Option or the
application thereof to any person or circumstance is held to be invalid or
unenforceable to any extent, the remainder of this Option shall remain in full
force and effect and shall be reformed to render the Option valid and
enforceable while reflecting to the greatest extent permissible the intent of
the parties.
20. Governing Law. This Option shall be governed by and construed
in accordance with the laws of the Commonwealth of Pennsylvania, without regard
to the laws that might otherwise govern under applicable principles of conflicts
of laws thereof.
21. Counterparts. This Option may be executed and delivered by
facsimile in two or more counterparts, each of which shall be deemed to be an
original, but all of which together shall constitute one and the same agreement.
[Remainder of page intentionally left blank]
13
IN WITNESS WHEREOF, the Company and Holder have caused this Option to
be executed this 24th day of June, 2005.
National Health Partners, Inc.
By: /s/ David M. Daniels
-----------------------------
David M. Daniels
Chief Executive Officer
AGREED AND ACCEPTED:
Trident Marketing International, Inc.
By: /s/ David Reilly
----------------------------------
David Reilly
President / CEO
14
NOTICE OF EXERCISE
To: National Health Partners, Inc.
120 Gibraltar Road
Suite 107
Horsham, PA 19044
Attention: Chief Financial Officer
(1) The undersigned hereby elects to purchase ___________ shares of
Common Stock of National Health Partners, Inc. pursuant to the terms of the
attached Option, and tenders herewith payment of the purchase price for such
shares in full in the following manner (please check one of the following
choices):
[ ] Cash or check; or
[ ] Cashless exercise through a broker.
(2) In exercising this Option, the undersigned hereby confirms and
acknowledges that the shares of Common Stock to be issued upon conversion
thereof are being acquired solely for the account of the undersigned and not as
a nominee for any other party, and for investment (unless such shares are
subject to resale pursuant to an effective prospectus), and that the undersigned
will not offer, sell or otherwise dispose of any such shares of Common Stock
except under circumstances that will not result in a violation of the Securities
Act of 1933, as amended, or any state securities laws.
(3) Terms not otherwise defined in this Notice of Exercise shall have
the meanings ascribed to such terms in the attached Option.
(4) Please issue a certificate or certificates representing said shares
of Common Stock in the name of the undersigned.
_________________________
________________________ _________________________
(Date) (Signature)