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Option Agreement

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Title:

Option Agreement

Entities:

Life Systems Corp

Date:

2001

Size:

Preview shows 7KB of 24KB total

Price:

$35

ID:

#1334011

► Miscellany ► Option Agreements

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OPTION AGREEMENT

Neither the options granted hereby nor the underlying shares of common stock have been registered under the Securities Act of 1933, as amended ("Securities Act"). These options or the underlying common shares may not be sold or transferred unless: (i) there is an effective registration covering the option or shares, as the case may be, under the Securities Act and applicable states securities laws; (ii) Life Systems Corp. first receives a letter from an attorney, acceptable to the board of directors or its agents, stating that in the opinion of the attorney the proposed transfer is exempt from registration under the Securities Act and applicable states securities laws; or, (iii) the transfer is made pursuant to rule 144 under the Securities Act.

BETWEEN:

John Pia, or Assigns ("Investor")

AND:

Ian Middleton and Alexander von Kleist, or Assigns ("Grantors")

Suite 201 - 1166 Melville St.

Vancouver, B.C.

Canada V6E 4P5

WHEREAS,

Investor is subscribing for 670,000 units from Life Systems Corp. ("LIFS") at a subscription price of US $1.50 per unit (the "Unit Financing"), where each unit consists of one share ("Share") in the common stock of LIFS and one share purchase warrant pursuant to the terms of a subscription agreement dated for reference the 1st day of June, 2001 (the "Subscription Agreement");
Grantors are registered shareholders holding Shares of LIFS and are desirous of providing additional consideration to Investor so that the Unit Financing will be closed;

NOW, THEREFORE, THE PARTIES AGREE AS FOLLOWS:

1.0 PRIMARY OPTION TO PURCHASE SHARES

1.1 Subject to this Agreement, Grantors grant to the Investor named above an option (the "Primary Option"), until May 31, 2003 (the "Expiration Date"), to purchase 100,000 Shares at a price of $1.50 per Share ("Primary Exercise Price") for a total purchase price of $150,000. The Primary Option shall expire on the Expiration Date, unless the parties mutually agree in writing to extend the Expiration Date.

2.0 SECONDARY OPTIONS TO PURCHASE SHARES; SALE OF SHARES BY GRANTORS

2.1 Subject to this Agreement, Grantors shall grant to the Investor named above additional options (the "Secondary Options") to purchase a total of up to 250,000 Shares. The Secondary Options shall be granted in three tranches commencing on the earlier of 90, 120, and 180 days after LIFS files a Registration Statement with the Securities and Exchange Commission or 120, 150 and 210 days after the date of execution of this Agreement. All Secondary Options granted shall expire on the Expiration Date, unless the parties mutually agree in writing to extend the Expiration Date. The timing for the granting of the Secondary Options, and the number of options granted, shall be as follows:

Tranche	Number of Days after Filing of Registration Statement/ Number of Days after Execution of this Agreement	Number of Options Granted	Exercise Price	Total Consideration
1	90/120	125,000	$0.05	$6,250
2	120/150	100,000	$0.25	$25,000
3	180/210	25,000	$0.05	$25,000
TOTAL:		250,000		$56,250

The Grantors shall cease granting Secondary Options, and any unexercised Secondary Options granted shall be cancelled, if the Investor has sold sufficient of the Shares that the Investor will acquire pursuant to the Unit Financing, at a price of $1.50 per Share or greater, so as to result in total proceeds to the Investor of at least $1,005,000 or more.

The Grantors agree to use their reasonable best efforts to sell the Investor's Shares for him at prices in excess of $1.50 and in this regard the Grantors shall keep the Investor apprised of their selling efforts from time to time, including providing the Investors with copies of term sheets or other proposals they may make or receive from potential investors.

2.2 Grantors further agree that, without the written consent of the Investor, they will not sell any Shares that they are, or subsequently become the "beneficial owner" of (as that term is defined in Rule 16a-1 of the Securities Exchange Act of 1934) until after the Investor has sold sufficient Shares as set out above for total proceeds to the Investor of $1,005,000 or more. Thereafter, if Grantors have an opportunity to sell Shares, the Investor at his election shall be entitled to sell Shares with them, on a pro-rata basis, whereby for every two (2) Shares the Grantors sell, the Investor shall be entitled to sell one (1) Share.

2.3 The Grantors represent to the Investor that the following comprises all shares of Company stock they beneficially own:

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