Common use of the Exercise Price Clause in Contracts

the Exercise Price. and the number of shares issuable upon exercise of each of the Options, shall be subject to adjustment, as follows: (a) In the event that Licensee shall, at any time after the date hereof, declare a dividend or distribution on the outstanding shares of the class issuable upon exercise of an Option, payable in such shares, or subdivide or combine such shares or issue any such shares by reclassification of such shares (including any such reclassification in connection with a consolidation or merger in which Licensee is the continuing corporation), then, in each case, the Exercise Price per share in effect at the time of the record date for the determination of stockholders entitled to receive such dividend or distribution or upon the effective date of such subdivision, combination, or reclassification shall be adjusted so that it shall equal the price determined by multiplying such Exercise Price by a fraction, the numerator of which shall be the number of shares of such class outstanding immediately prior to such action, and the denominator of which shall be the number of shares of such class outstanding after giving effect to such action. The number of shares issuable upon exercise of each of the Options shall simultaneously be adjusted by multiplying the number of shares theretofore issuable upon exercise of each such Option by the Exercise Price in effect on the date hereof and dividing the product so obtained by the Exercise Price, as adjusted. (b) In the event of any transaction, including, without limitation, any conversion of Licensee or a recapitalization or reorganization of the class of shares issuable upon exercise of an Option, in which the previously outstanding shares of such class shall be changed or converted into or exchanged for different securities of Licensee, or if any dividend or distribution shall be declared in respect of the class of shares issuable upon exercise of an Option or any combination of any of the foregoing (but excluding any Acquisition Transaction and any transaction covered by Section 3.6(a)) (each such transaction being herein referred to as a "Non-Acquisition Transaction" and the date of consummation of the Non-Acquisition Transaction being herein referred to as the "Consummation Date"), then, lawful and adequate provision shall be made so that Licensor, upon the exercise of either or both of the Options at any time on or after the Consummation Date, shall be entitled to receive, in lieu of the shares issuable upon such exercise prior to the Consummation Date, the amount of securities or other property to which Licensor would actually have been entitled as a stockholder upon the consummation of the Non-Acquisition Transaction if Licensor had exercised such Option immediately prior thereto (or, if earlier, immediately prior to any applicable record date with respect thereto) and (if applicable) had carried out the terms for the receipt of securities and/or property in connection with such Non-Acquisition Transaction. In each such case, appropriate adjustment shall be made in the application of the provisions herein set forth herein with respect to the Exercise Price and the number of shares or other securities or property issuable upon the exercise of an Option. (c) The provisions of this Section 3.6 shall similarly apply to successive events of the type described in subsection (a) or (b) above. (d) On the business day immediately prior to the consummation of an Acquisition Transaction, (or, if earlier, on the business day immediately prior to any applicable record date with respect thereto), Licensor shall be deemed to have exercised the Contingent Option and shall receive the amount of securities other property to which it was entitled as a stockholder holding the class of shares for which the Contingent Option was exercisable upon such date and as if it had carried out the terms for the receipt of such securities and/or property in connection with such Acquisition Transaction. Upon exercise of the Contingent Option in accordance with this Section 6(d), Licensor shall be deemed to have paid the aggregate Exercise Price for such exercise to Licensee by offsetting against such payment Licensee's obligation to pay the milestone fee due pursuant to Section 4.0; provided, that if such milestone fee has been paid prior to such date, Licensor shall be indebted to Licensee in the amount of such Exercise Price, shall receive the securities and other property in accordance with the preceding sentence and shall pay such Exercise Price to Licensee within 30 days following the consummation of any Non-Acquisition Transaction.