Exhibit 99.1
BIOFIELD CORP.
SHARE OPTION AGREEMENT
Date of Grant: February 23, 2006
No. of Shares: 1,000,000
1. Grant of Option. For value received Biofield Corp., a Delaware
corporation (the "Company"), hereby grants to ▇▇▇▇ ▇▇▇▇▇▇▇▇ (the "Optionee"),
the following option (the "Option") to purchase an aggregate of 1,000,000 shares
(subject to adjustment as hereinafter provided, the "Option Shares") of the
Company's common stock, par value $.001 per share (the "Common Stock") at an
exercise price equal to $0.04 per share (the "Exercise Price"). It is understood
that the Option is not intended to constitute an incentive stock option as that
term is defined in Section 422A of the Internal Revenue Code of 1986, as
amended.
2. Exercise Period. The Optionee may exercise the option at any time until
its expiration. The option may be exercised by the Optionee for any number of
shares up to the total number of shares as to which the option has become
exercisable, less the number of shares as to which the option has been
previously been exercised, from time to time and at any time until the
termination or expiration of the Option. The Option shall expire and terminate
on February 23, 2011.
3. Procedure for Exercise. The Optionee may exercise the Option in whole or
in part, but not as to any fractional shares, by surrender of the Option,
properly endorsed if required, at the principal office of the Company, and by
delivering by certified check or bank check the aggregate Exercise Price for the
number of shares to be purchased pursuant to such exercise. At the time of
exercise, the Optionee shall deliver a letter to the Company agreeing that the
Optionee is purchasing the Common Stock for investment purposes and not with a
view to distribution otherwise than in compliance with the Securities Act of
1933, as amended (the "Securities Act") and agreeing not to offer to sell, sell
or otherwise dispose of any of such shares acquired by the Optionee pursuant to
the Option in violation of the Securities Act or any applicable state securities
laws. The Common Stock purchased shall be deemed to be issued to the Optionee on
and as of the date on which the Option is surrendered and payment is made for
the Common Stock. Certificates representing the Common Stock purchased shall be
delivered to the Optionee promptly, which usually is within ten days after the
rights represented by the Option have been properly exercised. Unless the Option
shall have expired or shall have been fully exercised, a new Share Option
Agreement in the same form as this Share Option Agreement representing any
number of shares for which the Option shall not have been exercised, shall also
be delivered to the Optionee within that time.
4. Shares to be Fully Paid; Reservation; Registration Rights.
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4.1 Shares to be Fully Paid. The Company covenants and agrees that
when issued and paid for in accordance with the terms of this Share Option
Agreement, the shares of common stock underlying the Option shall, on issuance,
be fully paid and non-assessable and free from all taxes, liens and charges
related to the issuance of the shares.
4.2 Reservation. The Company further covenants and agrees that
during the period within which the rights represented by the Option may be
exercised, the Company shall, at all times, have authorized and reserved for the
purpose of issuance or transfer on exercise of the Option a sufficient number of
shares subject to the Option to provide for its exercise.
4.3 Registration Rights. To the extent that the resale of the Option
Shares are not registered on a Registration Statement filed with the Securities
and Exchange Commission (the "SEC"), the Company further covenants that the
Optionee has the right to cause the Company to register the Option Shares issued
upon exercise hereof, under the Securities Act and any blue sky or securities
laws of any jurisdictions within the United States by filing a registration
statement with the SEC within ninety (90) days following the issuance of the
Option Shares, provided that such registration rights shall not be transferable,
shall be exercisable only by the Optionee, and shall apply only to the
registration of all of the Option Shares, and not any part thereof. The Company
may defer the filing (but not the preparation) of the registration statement or
suspend the Company's obligation to cause such registration statement to become
and remain effective if (i) at any time prior to the filing of such registration
statement with the SEC the Company is engaged in confidential negotiations or
other confidential business activities, disclosure of which, in the Company's
reasonable opinion, would be required in such registration statement and would
not be required if such registration statement were not filed, and the Company's
board of directors determines in good faith that such disclosure would be
materially detrimental to the Company and its stockholders or would have a
material adverse effect on any such confidential negotiations or other
confidential business activities, (ii) the Company is actively engaged in
discussions with underwriters with respect to a registered underwritten public
offering of the Company's securities for the Company's account and is proceeding
with reasonable diligence to effect such offering, or (iii) if there exists at
the time material non-public information relating to the Company, which in the
reasonable opinion of the Company should not be disclosed. If, after a
registration statement filed under this Section 4 becomes effective, the Company
advises Optionee (or its permitted assigns) that the Company considers it
appropriate for the registration statement to be amended, Optionee (or its
permitted assigns) shall suspend any further sales of its registered Option
Shares until the Company advises it that the registration statement has been
amended.
5. Adjustment Provisions Subsequent to the Trigger Event; Dissolution.
5.1 Adjustment for Distributions Other than Stock Dividends, Stock
Splits Subsequent to the Trigger Event. At any time subsequent to the Trigger
Event, if the holders of Common Stock shall have received, or (on or after the
record date fixed for the determination of shareholders eligible to receive)
shall have become entitled to receive, without payment therefor:
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(a) other or additional stock, other securities, or property (other
than cash) by way of dividend; or
(b) other or additional (or less) stock or other securities or
property (including cash) by way of spin-off, split-up, reclassification,
recapitalization, combination of shares or similar corporate restructuring;
other than additional shares of Common Stock issued as a stock dividend or in a
stock-split (adjustments in respect of which are provided for in Section 7
hereof), then and in each such case the Optionee, on the exercise of the Option
as provided in Section 3, shall be entitled to receive the amount of stock and
other securities and property (including cash in the case referred to in
subsection (b) of this Section 5) which such holder would have received prior to
or would have held on the date of such exercise if on the date hereof it had
been the holder of record of the number of shares of Common Stock called for on
the face of this Option and had thereafter, during the period from the date
hereof to and including the date of such exercise, retained such shares and all
such other or additional stock and other securities and property (including cash
in the case referred to in subsection (b) of this Section 5) receivable by such
holder as aforesaid during such period, without interest, giving effect to all
further adjustments called for during such period by Sections 6 and 7 hereof.
5.2 Adjustment for Stock Dividend and Stock-Splits Subsequent to the
Trigger Event. If at any time subsequent to the Trigger Event, there shall occur
any stock split, stock dividend, reverse stock split or other subdivision of the
Company's Common Stock ("Stock Event"), then the number of shares of Common
Stock to be received by the Optionee, on the exercise of the Option as provided
in Section 3, shall be appropriately adjusted such that the proportion of the
number of shares issuable hereunder to the total number of shares of the Company
(on a fully diluted basis prior to such Stock Event is equal to the proportion
of the number of shares issuable hereunder to the total number of shares of the
Company (on a fully-diluted basis) after such Stock Event and the Exercise Price
shall be appropriately adjusted such that the aggregate Exercise Price for the
total number of shares of the Company issuable hereunder prior to such Stock
Event (or any record date with respect thereto) is equal to the aggregate
Exercise Price for the total number of shares of the Company issuable hereunder
after such Stock Event (or any record date with respect thereto); provided that
(i) in no event will the Exercise Price be less than the par value of the Common
Stock and (ii) any adjustment contemplated by this Section 5.2 will take into
account any distributions of stock and other securities and property (including
cash) that Optionee may receive as a result of an adjustment made in accordance
with Section 5.1. Any adjustment made pursuant to this Section 5.2 shall be
become effective immediately after the effective date of such event retroactive
to the record date, if any, for such event.
5.3. Dissolution. In case at any time or from time to time other than
in connection with, or relating to, the Trigger Event, the Company shall
transfer all or substantially all of its properties or assets to any other
person under any plan or arrangement contemplating the dissolution of the
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Company, the Optionee, on the exercise of the Option as provided in Section 3 at
any time after the effective date of such dissolution, shall receive, in lieu of
the Common Stock (or Other Securities) issuable on such exercise prior to such
consummation or effective date, the stock and other securities and property
(including cash) to which the Optionee would have been entitled in connection
with such dissolution if the Optionee had so exercised this Option immediately
prior thereto, all subject to further adjustment thereafter as provided in
Sections 5 and 7 hereof.
6. Adjustment For Reorganization, Consolidation, Merger, Etc. Relating to
Trigger Event.
6.1 Certain Adjustments Relating to the Trigger Event. In case at
any time or from time to time, in connection with, or relating to, the Trigger
Event, the Company shall (i) effect a capital reorganization, reclassification
or recapitalization, (ii) consolidate with or merge into any other person, or
(iii) transfer all or substantially all of its properties or assets to any other
person under any plan or arrangement, then in each such case, the Optionee, on
the exercise of the Option as provided in Section 3 at any time after the
consummation of such reorganization, recapitalization, consolidation or merger
or the effective date of such dissolution, as the case may be, shall be entitled
to receive, in lieu of the Common Stock (and any additional entitlements that
may otherwise accrue to a holder of this Option in connection with such
foregoing actions described in (i), (ii) or (iii)) issuable on such exercise
prior to such consummation or effective date, the common stock (and any other
equity securities offered by the Company in connection with, or relating to, the
Trigger Event) in the successor entity or holder(s) of the Company's assets (on
a fully-diluted basis), equal to the same percentage of Common Stock of the
Company (on a fully-diluted basis) that Optionee would have held at date of the
grant if Optionee had exercised this Option on the date of the grant.
6.2 Continuation of Terms. Upon any reorganization, consolidation,
merger or transfer (and any dissolution following any transfer) referred to in
this Section 6, this Option shall continue in full force and effect and the
terms hereof shall be applicable to the shares of stock and other securities and
property receivable on the exercise of this Option after the consummation of
such reorganization, consolidation or merger or the effective date of
dissolution following any such transfer, as the case may be, and shall be
binding upon the issuer of any such stock or other securities, including, in the
case of any such transfer, the person acquiring all or substantially all of the
properties or assets of the Company, whether or not such person shall have
expressly assumed the terms of this Option as provided in Section 8 hereof.
7. Adjustments For Issuance Of Other Securities or Common Stock Relating to
Trigger Event.
7.1. Issuance of Other Securities and Common Stock.
7.1.1 The term "Other Securities" means any stock (other than Common
Stock) and other securities of the Company or any other entity (corporate or
otherwise) (i) which the holder of this Option at any time shall be entitled to
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receive, or shall have received, on the exercise of this Option, in lieu of or
in addition to Common Stock, or (ii) which at any time shall be issuable or
shall have been issued in exchange for or in replacement of Common Stock or
Other Securities, in each case pursuant to Section 5 or 6 hereof.
7.1.2 If at any time in connection with, or relating to, the Trigger
Event, (A) any Other Securities shall have been issued, or shall then be subject
to issue upon the conversion or exchange of any stock (or Other Securities) of
the Company (or any other issuer of Other Securities or any other entity
referred to in Section 6 hereof) or to subscription, purchase or other
acquisition pursuant to any rights or options granted by the Company (or such
other issuer or entity), or (B) any issuance or sale by the Company of any
shares of Common Stock or of any securities convertible into or exchangeable for
shares of Common Stock or any Options, options, subscriptions or purchase rights
with respect to shares of Common Stock or securities convertible into or
exchangeable for shares of Common Stock (any of the foregoing events described
in (B) being referred to herein as a "Stock Sale Event") shall have occurred,
the Optionee, on the exercise of the Option as provided in Section 3, shall be
entitled to receive immediately after such issuance, distribution or
subscription, additional Other Securities or Common Stock, as the case may be,
(which may be exercised by Optionee without having to provide for any additional
consideration for any such distribution or subscription), equal to the same
percentage of Common Stock of the Company (on a fully-diluted basis) that
Optionee would have held at date of the grant if Optionee had exercised this
Option on the date of the grant, provided that any adjustment contemplated by
this Section 7.1.2 will take into account any common stock (and any other equity
securities offered by the Company in connection with, or relating to, the
Trigger Event) in the successor entity or holder(s) of the Company's assets (on
a fully-diluted basis) that the Optionee may receive as a result of an
adjustment made in accordance with Section 6.1.
8. No Dilution Or Impairment. The Company will not, by amendment of its
charter or through any reorganization, transfer of assets, consolidation,
merger, dissolution, issue or sale of securities or any other voluntary action,
avoid or seek to avoid the observance or performance of any of the terms of this
Option, but will at all times in good faith assist in the carrying out of all
such terms and in the taking of all such action as may be necessary or
appropriate in order to protect the rights of the holder of the Option as
described herein against dilution. Without limiting the generality of the
foregoing, the Company (i) will not increase the par value of any shares of
stock receivable on the exercise of the Option above the amount payable therefor
on such exercise, (ii) will take all such action as may be necessary or
appropriate in order that the Company may validly and legally issue fully paid
and non-assessable shares of stock on the exercise of the Option from time to
time outstanding, and (iii) will not transfer all or substantially all of its
properties and assets to any other entity (corporate or otherwise), or
consolidate with or merge into any other entity or permit any such entity to
consolidate with or merge into the Company (if the Company is not the surviving
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entity), unless such other entity shall expressly assume in writing and will be
bound by all the terms of this Option Agreement.
9. Termination of Anti-Dilution Rights and Covenants. It is expressly
understood and agreed between the parties that, notwithstanding anything to the
contrary, all of the Company's obligations and Optionee's rights set forth in
Sections 6, 7, 8 and 9 shall terminate immediately after the occurrence of the
Trigger Event.
"Trigger Event" shall mean the consummation of any transaction or series
of transactions by which any person not affiliated with ▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇.
("Long") or Long's affiliates (including without limitation, any trusts for the
benefit of Long or any of his family members) (Long and such affiliates, the
"Long Group") directly or indirectly, obtains or otherwise controls an amount of
equity securities (or securities convertible into equity securities) of the
Company that is greater than the equity securities held or controlled by the
Long Group as of the date of this grant.
10. Legend. The Optionee consents to the placement of any legend required by
applicable state securities laws and of the following legends on each
certificate representing the Common Stock:
"THE SHARES EVIDENCED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
AND MAY NOT BE SOLD, TRANSFERRED, EXCHANGED OR OTHERWISE
DISPOSED OF UNLESS A REGISTRATION STATEMENT UNDER SUCH ACT IS
THEN IN EFFECT WITH RESPECT THEREOF, OR A WRITTEN OPINION FROM
COUNSEL ACCEPTABLE TO THE ISSUER HAS BEEN OBTAINED TO THE
EFFECT THAT NO SUCH REGISTRATION IS REQUIRED THEREWITH."
"THESE SECURITIES HAVE BEEN ISSUED OR SOLD IN
RELIANCE ON PARAGRAPH (13) OF THE CODE SECTION 10-5-9 OF THE
GEORGIA SECURITIES ACT OF 1973 AND MAY NOT BE SOLD OR
TRANSFERRED EXCEPT IN A TRANSACTION WHICH IS EXEMPT UNDER SUCH
ACT OR PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
SUCH ACT."
11. Assignment. The Option, may not be assigned or otherwise transferred
other than by will or the laws of descent and may be exercised during the
Optionee's lifetime only by the Optionee or the Optionee's guardian or legal
representative.
12. No Shareholder Rights. The Optionee shall have no rights as a
shareholder of the Company with respect to shares of Common Stock covered by
this Option until payment for such shares shall have been made in full and until
the date of issuance of a stock certificate for such shares.
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13. Miscellaneous.
13.1 Governing Law. This Agreement shall be construed in accordance
with, and governed by, the laws of the State of Delaware (without giving effect
to principles of conflicts of law).
13.2 Modification. This Agreement may only be modified by a writing
signed by each of the parties hereto.
13.3 Notices. All notices hereunder shall be in writing and if to the
Company, shall be delivered personally to the Secretary of the Company or
mailed, by certified mail, return receipt requested or by guaranteed next
business day delivery service to its principal office, addressed to the
attention of the Secretary, and if to the Optionee, shall be delivered
personally or mailed, by certified mail, return receipt requested or by
guaranteed next business day delivery service to the address noted on the
signature page of this Share Option Agreement. Either party may change its
address for receipt of notices by advising the other party of such change in
writing in accordance with the preceding sentence.
13.4 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be an original, and both of which shall
together constitute one and the same instrument.
13.5 Entire Agreement. This Agreement set forth the entire agreement
between the Company and the Optionee with respect to the subject matter hereto
and supercedes all prior understandings, whether oral or written.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of this 23rd day of February 2006.
BIOFIELD CORP.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇ ▇▇. M.D.
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Name: ▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇ ▇▇. M.D. PhD.
Title: CEO
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ 02/23/06
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▇▇▇▇ ▇▇▇▇▇▇▇▇
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Address:
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Social Security Number:
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