f10q1111ex10xvii_loto.htm
Exhibit 10.17
STOCK OPTION AGREEMENT
THIS AGREEMENT (this "Agreement"), is effective as of November 29, 2011 (the "Date of Grant"), between Loto
Inc. (the "Company"), and the individual set forth on the signature page hereto (the "Optionee").
WHEREAS, the Optionee is a Member of the Company's Board of Directors;
NOW, THEREFORE, in consideration of the mutual covenants hereinafter set forth and for other good
and valuable consideration, the parties hereto agree as follows:
1. Grant of Option. Effective
as of the Date of Grant, the Company hereby grants to the Optionee the right and option (the
"Option") to purchase all or any part of an aggregate of three hundred thousand (300,000) shares
(each a "Share" and collectively the "Shares") of the Company's common stock, par value $.0001 per
share (the "Common Stock"), subject to, and in accordance with, the terms and conditions set forth
in this Agreement.
2. Purchase Price. The price at
which the Optionee shall be entitled to purchase each Share shall be US $.75 (Seventy-Five Cents)
per Share, the purchase price being determined by the Company's Board of Directors and bearing no
relation to any publicly quoted price of the Company's common stock.
3. Vesting and Exercise of Option.
The Option shall vest and be fully exercisable on November
29, 2011.
4. Duration of Option.
(a) The Option shall be exercisable to the extent
vested and in the manner provided herein until the third anniversary of the date hereof so long as
Optionee remains in good standing with the Company. Nothing in this Agreement shall be
interpreted or construed to confer upon the Optionee any right with respect to continuance of
services as a director, employee or consultant with the Company, nor shall this Agreement interfere
in any way with the right of the Company to terminate the Optionee's services as a director,
employee or consultant at any time.
(b) Notwithstanding any provision to the contrary
herein, in the event of Optionee's death, his Option shall terminate on the date of death, provided
that all or any portion of the Option to the extent that the right is exercisable but not exercised
on the date of death may be exercised by Optionee's estate. Such Option must be
exercised by the Optionee's estate, if at all, within six (6) months after the date of death of
Optionee or, if earlier, within the originally prescribed term of the Option, notwithstanding that
the decedent might have been able to exercise the Option as to some or all of the Shares on a later
date if the Optionee were alive and had continued to be an employee or consultant of the Company or
of an affiliate thereof.
5. Manner of Exercise; Payment and/or
Cashless Exercise.
5.1 Subject to the terms and
conditions of this Agreement the Option may be exercised by delivery of written notice to the
Company in the form attached hereto, at its principal executive office. Such notice
shall state that the Optionee is electing to exercise the Option and the number of Shares in
respect of which the Option is being exercised and shall be signed by the person or persons
exercising the Option. If requested by the Company, such person or persons shall (i)
deliver this Agreement to an Officer of the Company who shall endorse thereon a notation of such
exercise; and (ii) provide satisfactory proof as to the right of such person or persons to exercise
the Option.
5.2 The notice of exercise
described in Section 5.1 shall be accompanied by payment of the full purchase price for the Shares
in respect of which the Option is being exercised, in cash, by check or any other form as the
Company may require from time to time.
5.3 Upon receipt of the notice of
exercise and any payment or other documentation as may be necessary pursuant to Section 5.2
relating to the Shares in respect of which the Option is being exercised, the Company shall,
subject to this Agreement, take such action as may be necessary to effect the transfer to the
Optionee of the number of Shares as to which such exercise was effective.
5.4 The Optionee shall not be
deemed to be the holder of, or to have any of the rights of a holder with respect to any Shares
subject to the Option until (i) the Option shall have been exercised pursuant to the terms of this
Agreement and the Optionee shall have paid the full purchase price for the number of Shares in
respect of which the Option was exercised; (ii) the Company shall have issued and delivered the
Shares to the Optionee; and (iii) the Optionee's name shall have been entered as a stockholder
of record on the books of the Company, whereupon the Optionee shall have full voting and other
ownership rights with respect to such Shares during the period of ownership thereof.
5.5 In lieu of payment upon
exercise of the Option as set forth above in this Section 5, the Optionee may alternatively
surrender to the Company for cancellation a portion of this Option representing that number of
unissued Shares underlying this Option which is equal to the quotient obtained by dividing (A) the
product obtained by multiplying the purchase price by the number of Shares of stock being purchased
underlying the Option upon such exercise, by (B) the difference
-- END OF PREVIEW --
