Exhibit
10.12
STOCK OPTION
AGREEMENT
This STOCK OPTION AGREEMENT (the "
Agreement ") is effective this 17 th day of Decemberr_2008,
between GLOBAL DIVERSIFIED INDUSTRIES, INC., a Nevada corporation,
(the " Company ") and Phillip Hamilton (the "
Executive ").
BACKGROUND
INFORMATION
The Company desires to promote the
long-term interests of the Company by retaining the
Executive. In order to achieve such goal, the Company
has determined to provide Executive with compensation opportunities
based on the performance of the Company. To that end,
the Company has decided to grant the Executive a right to acquire
an option to purchase common shares of the Company (the "Shares")
under this Agreement. Accordingly, in consideration of
the mutual covenants hereinafter set forth and for other good and
valuable consideration, the parties hereto agree as
follows:
OPERATIVE
PROVISIONS
Section 1.
Grant of Option . The Company hereby irrevocably
grants to the Executive the right and option (the " Option
"), subject to Section 4 below, to purchase all or any part of an
aggregate of 68,168,164 Shares on the terms and conditions
herein set forth.
Section 2.
Exercise Price . The exercise price
for each Share shall be five cents ($0.05) per share.
Section 3.
Term of the Option . The maximum term of the
Option shall be for a period of seven (7) years after the date of
this Agreement. The Option, when and if vested, shall
expire on the seventh (7 th )
anniversary of this agreement (the “ Expiration Date
”).
Section 4.
Vesting . The Option shall vest and become
exercisable upon the satisfaction in full (inclusive of all
principal, interest and penalties) of the six million and 00/100
U.S. Dollar ($6,000,000.00) loan made to the Company by Debt
Opportunity Fund, LLP (“ DOF ”), under the terms
of that certain Loan and Securities Agreement by and between the
Company and DOF, of even date herewith,
Section 5.
Exercise Procedure .
5.1
Manner of Exercise
. Subject to Section 4 above, the Executive
shall be entitled to exercise this Option, in whole or in part at
any time or times in accordance with the provisions of this Section
5, by delivering written notice of such exercise to the office of
the Secretary of the Company or to such other location as may be
designated by the Company, specifying therein the number of Shares
with respect to which the Option is being exercised, which notice
shall be accompanied by payment in full of the purchase price of
the Shares being acquired.
5.2
Payment of Exercise Price . Payment
shall be made in cash. No Shares shall be issued until
full payment therefore has been made in the manner set forth
above.
Section 6.
Transferability of Option . The Option shall not
be transferable otherwise than by will or by the laws of descent
and distribution, and shall be exercised during the lifetime of the
Executive only by the Executive or by the Executive’s
guardian or legal representative. Notwithstanding the
preceding provisions of this Section, the Executive, at any time
prior to his death, may assign all or any portion of an Option
granted to him to (i) his spouse or lineal descendant, (ii) the
trustee of a trust established for the primary benefit of his
spouse or lineal descendant, (iii) a partnership of which his
spouse and lineal descendants are the only partners. In
such event, the spouse, lineal descendants, trustee, or partnership
will be entitled to all the rights of the Executive with respect to
the assigned portion of the Option, and such portion of the Option
will continue to be subject to all of the terms, conditions and
restrictions applicable to the Option as set forth herein
immediately prior to the effective date of the
assignment. Any such assignment will be permitted only
if (i) the Executive does not receive any consideration therefore,
and (ii) the assignment is expressly approved by the
Company. Any such assignment shall be evidenced by an
appropriate written document executed by the Executive and a copy
thereof shall be delivered to the Company on or prior to the
effective date of the assignment.
Section 7
Stock Certificates . Upon exercise of the Option
and payment of the exercise price, the Company shall deliver a
certificate or certificates representing such Shares as soon as
practicable after the notice shall be received. The
certificate or certificates for the Shares as to which the Option
shall have been so exercised shall be registered in the name of the
person so exercising the Option (or, if the Option shall be
exercised by the Executive and if the Executive shall so request in
the notice exercising the Option, shall be registered in the name
of the Executive and another person jointly, with right of
survivorship) and shall be delivered upon the written order of the
person exercising the Option. In the event the Option
shall be exercised by any person other than the
Executive, such notice shall be accompanied by appropriate proof of
the right of such person to exercise the Option. All
shares that shall be purchased upon the exercise of the Option as
provided herein shall be fully paid and no assessable.
Section 8.
No Additional Rights . The Executive shall have
no right to be employed by the Company under the terms
of this Agreement or interfere in any way with the right of the
Company to terminate any employment of the Executive at any
time. Neither the Executive nor any other person
entitled to exercise the Option under the terms hereof shall be, or
have any of the rights or privileges of, a shareholder of the
Company with respect to any of the shares of common stock issuable
upon exercise of the Option,
