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Exhibit 10.24(c)
THE SECURITY REPRESENTED BY THIS CERTIFICATE HAS BEEN ACQUIRED FOR INVESTMENT
AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF.
NO SUCH SALE OR DISPOSITION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION
STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY
THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES ACT OF 1933.
DEMEGEN, INC.
NONQUALIFIED STOCK OPTION AGREEMENT
Demegen, Inc.. (the "Company") granted to the individual named below an
option to purchase certain shares of Common Stock of the Company, in the manner
and subject to the provisions of this Option Agreement.
I. Definitions:
A. "Optionee" shall mean Xxxxx Xxxxxx
A. "Date of Option Grant" shall mean February 19, 1999.
A. "Number of Option Shares" shall mean 25,000 shares of
Common Stock of the Company as adjusted from time to time pursuant to paragraph
10 below.
A. "Exercise Price" shall mean $0.45 per share as adjusted
from time to time pursuant to paragraph 10 below.
A. "Vesting Schedule" Except as provided in paragraph 9
below, the "Vesting Schedule shall be determined as follows:
Vested
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On Date of Option Grant All
On each subsequent N/A
A. "Option Term Date" shall mean the date five (5) years
after the Date of Option Grant.
A. "Code" shall mean the Internal Revenue Code of 1986, as
amended.
A. "Company" shall mean Demegen, Inc., a Colorado
corporation, and any successor corporation thereto.
A. "Plan" shall mean the Demegen, Inc. 1998 Stock Option
Plan.
I. Incorporation of Plan by Reference. This Option is
granted under the terms of the Plan, the terms of which are incorporated herein
by reference and are to be considered to be
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part of this Option Agreement as though set forth herein.
I. Status of the Option. This Option is intended to be a
nonqualified stock option and shall not be treated as an incentive stock option
as described in Section 422 of the Code.
I. Administration. All questions of interpretation
concerning this Option Agreement shall be determined by the Board of Directors
of the Company (the "Board") and/or by a duly appointed committee of the Board
having such powers as shall be specified by the Board. Any subsequent references
herein to the Board shall also mean the committee if such committee has been
appointed and, unless the powers of the committee have been specifically
limited, the committee shall have all of the powers of the Board granted in the
Plan, including, without limitation, the power to terminate or amend the Plan at
any time, subject to the terms of the Plan and any applicable limitations
imposed by law. All determinations by the Board shall be final and binding upon
all persons having an interest in the Option.
I. Exercise of the Option.
A. Right to Exercise. The Option shall first become
exercisable in accordance with the Vesting Schedule set forth in Section 1
above. In no event shall the Option be exercisable for more shares than the
Number of Option Shares.
A. Method of Exercise. The Option may be exercised by
written notice to the Company which must state the election to exercise the
Option, the number of shares for which the Option is being exercised and such
other representations and agreements as to the Optionee's investment intent with
respect to such shares and other administrative matters as may be required
pursuant to the provisions of this Option Agreement and the exercise form used
by the Company. The written notice must be signed by the Optionee and is not
effective until it is delivered in person or by certified or registered mail,
return receipt requested, to the President of the Company prior to the
termination of the Option as set forth in paragraph 7 below, accompanied by full
payment of the exercise price for the number of shares being purchased.
A. Form of Payment of Exercise Price. Such payment
shall be made in cash, by check, cash equivalent, or, at the sole discretion of
the Company, pursuant to a "cashless exercise" in which the appropriate number
of shares being purchased are retained by the Company in satisfaction of such
payment obligations.
A. Withholding. At the time the Option is exercised,
in whole or in part, or at any time thereafter as requested by the Company, the
Optionee hereby authorizes payroll withholding and otherwise agrees to make
adequate provision for foreign, federal and state tax withholding obligations of
the Company, if any, which arise in connection with the Option. The Optionee is
cautioned that the Option is not exercisable unless the Company's withholding
obligations are satisfied. Accordingly, the Optionee may not be able to exercise
the Option when desired even though the Option is vested and the Company shall
have no obligation to issue a certificate for such shares.
A. Certificate Registration. The certificate or
certificates for the shares as to which the Option shall be exercised shall be
registered in the name of the Optionee, or, if applicable, the heirs of the
Optionee.
A. Restrictions on Grant of the Option and Issuance
of Shares. The grant of the Option and the issuance of the shares upon exercise
of the Option shall be subject to compliance with all applicable requirements of
federal, state or foreign law with respect to such securities. The Option may
not be exercised if the issuance of shares upon such exercise would constitute a
violation of any applicable federal, state or foreign securities laws or other
law or regulations. In addition, the Option may not be exercised unless (i) a
registration statement under the Securities Act of 1933, as
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amended (the "Securities Act"), shall at the time of exercise of the Option be
in effect with respect to the shares issuable upon exercise of the Option or
(ii) in the opinion of legal counsel to the Company, the shares issuable upon
exercise of the Option may be issued in accordance with the terms of an
applicable exemption from the registration requirements of the Securities Act.
The Optionee is cautioned that the Option may not be exercisable unless the
foregoing conditions are satisfied. Accordingly, the Optionee may not be able to
exercise the Option when desired even though the Option is vested. Questions
concerning this restriction should be directed to the President of the Company.
As a condition to the exercise of the Option, the Company may require the
Optionee to satisfy any qualifications that may be necessary or appropriate, to
evidence compliance with any applicable law or regulation and to make any
representation or warranty with respect thereto as may be requested by the
Company.
A. Fractional Shares. The Company at its discretion
shall determine whether to issue fractional shares upon the exercise of the
Option.
I. Non-Transferability of the Option. The Option may be
exercised during the lifetime of the Optionee only by the Optionee or the
Optionee's guardian or legal representative and may not be assigned or
transferred in any manner except by will or by the laws of descent and
distribution. Following the death of the Optionee, the Option, to the extent
unexercised and exercisable by the Optionee on the date of death, may be
exercised by the Optionee's legal representative or by any person empowered to
do so under the deceased Optionee's will or under the then applicable laws of
descent and distribution.
I. Termination of the Option. The Option shall terminate
and may no longer be exercised on the first to occur of (a) the Option Term Date
as defined above, (b) one year after the optionee ceases being a director or,
(c) upon a Transfer of Control to the extent provided in paragraph 9 below.
I. Ownership Change and Transfer of Control. An
"Ownership Change" shall be deemed to have occurred in the event any of the
following occurs with respect to the Company:
A. the direct or indirect sale or exchange by the
shareholders of the Company of all or substantially all of the stock of the
Company where shareholders of the Company before such sale or exchange do not
retain, directly or indirectly, at least a majority of the beneficial interest
in the voting stock of the Company after such sale or exchange;
A. a merger or consolidation involving the Company in
which the Company is not the surviving entity;
A. the sale, exchange, or transfer of all or substantially
all of the assets of the Company (other than a sale, exchange, or transfer to
one or more parent or subsidiary corporations of the Company); or
A. A liquidation or dissolution of the Company.
In the event of an Ownership Change, the Option shall (i) become fully vested to
the extent it is not otherwise fully vested and (ii) terminate and cease to be
outstanding effective as of the date of the Ownership Change to the extent that
the Option is neither assumed or substituted for in connection with the
Ownership Change nor exercised as of the date of the Ownership Change.
I. Effect of Change in Stock Subject to the Option.
Appropriate adjustments shall be made in the number, exercise price and class of
shares of stock subject to the Option in the event of a stock dividend, stock
split, reverse stock split, recapitalization, combination, reclassification, or
like change in the capital structure of the Company. In the event a majority of
the shares which are of the same class as the shares that are subject to the
Option are exchanged for, converted into, or otherwise
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become shares of another corporation (the "New Shares"), the Company may
unilaterally amend the Option to provide that the Option is exercisable for New
Shares. In the event of any such amendment, the number of shares and the
exercise price shall be adjusted in a fair and equitable manner.
I. Rights as a Shareholder The Optionee shall have no
rights as a shareholder with respect to any shares covered by the Option until
the date of the issuance of a certificate or certificates for the shares for
which the Option has been exercised. No adjustment shall be made for dividends
or distributions or other rights for which the record date is prior to the date
such certificate or certificates are issued, except as provided in paragraph 10
above.
I. Right of First Refusal.
A. Right of First Refusal. In the event the Optionee
proposes to sell, pledge, or otherwise transfer any shares acquired upon the
exercise of the Option (the "Transfer Shares") to any person or entity, the
Company shall have the right to repurchase the Transfer Shares under the terms
and subject to the conditions set forth in this paragraph 11 (the "Right of
First Refusal").
A. Notice of Proposed Transfer. Prior to any proposed
transfer of the Transfer Shares, the Optionee shall give a written notice (the
"Transfer Notice") to the Company describing fully the proposed transfer,
including the number of Transfer Shares, the name and address of the proposed
transferee (the "Proposed Transferee") and, if the transfer is voluntary, the
proposed transfer price and containing such information necessary to show the
bona fide nature of the proposed transfer. In the event of a bona fide gift or
involuntary transfer, the proposed transfer price shall be deemed to be the fair
market value of the Transfer Shares as determined by the Company in good faith.
In the event the Optionee proposes to transfer any shares acquired upon the
exercise of the Option to more than one (1) Proposed Transferee, the Optionee
shall provide a separate Transfer Notice for the proposed transfer to each
Proposed Transferee. The Transfer Notice shall be signed by both the Optionee
and the Proposed Transferee and must constitute a binding commitment of the
Optionee and the Proposed Transferee for the transfer of the Transfer Shares to
the Proposed Transferee subject only to the Right of First Refusal.
A. Bona Fide Transfer. In the event that the Company
shall determine that the information provided by the Optionee in the Transfer
Notice is insufficient to establish the bona fide nature of a proposed voluntary
transfer, the Company shall give the Optionee written notice of the Optionee's
failure to comply with the procedure described in this paragraph 11 and the
Optionee shall have no right to transfer the Transfer Shares without first
complying with the procedure described in this paragraph 11. The Optionee shall
not be permitted to transfer the Transfer Shares if the proposed transfer is not
bona fide.
A. Exercise of the Right of First Refusal. In the
event the proposed transfer is deemed to be bona fide, the Company shall have
the right to purchase all or a portion of the Transfer Shares at the purchase
price and on the terms set forth in the Transfer Notice by delivery to the
Optionee of a notice of exercise of the Right of First Refusal within thirty
(30) days after the date the Transfer Notice is delivered to the Company. The
Company's exercise or failure to exercise the Right of First Refusal with
respect to any proposed transfer described in a Transfer Notice shall not affect
the Company's ability to exercise the Right of First Refusal with respect to any
proposed transfer described in any other Transfer Notice, whether or not such
other Transfer Notice is issued by the Optionee or issued by a person other than
the Optionee with respect to a proposed transfer to the same Proposed
Transferee. If the Company exercises the Right of First Refusal, the Company and
the Optionee shall thereupon consummate the sale of the Transfer Shares to the
Company on the terms set forth in the Transfer Notice within sixty (60) days
after the date of the Transfer Notice is delivered to the Company (unless a
longer period is offered by the Proposed Transferee); provided, however, that in
the event the Transfer Notice provides for the payment for the Transfer Shares
other than in cash, the Company shall
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have the option of paying for the Transfer Shares by the discounted cash
equivalent of the consideration described in the Transfer Notice as reasonably
determined by the Company. For purposes of the foregoing, cancellation of any
indebtedness of the Optionee to any Participating Company shall be treated as
payment to the Optionee in cash to the extent of the unpaid principal and any
accrued interest canceled.
A. Failure to Exercise the Right of First Refusal. If
the Company fails to exercise the Right of First Refusal in full within the
period specified in paragraph 12(d) above, the Optionee may conclude a transfer
to the Proposed Transferee of the Transfer Shares on the terms and conditions
described in the Transfer Notice, provided such transfer occurs not later than
one hundred twenty (120) days following delivery to the Company of the Transfer
Notice. The Company shall have the right to demand further assurances from the
Optionee and the Proposed Transferee (in a form satisfactory to the Company)
that the transfer of the Transfer Shares was actually carried out on the terms
and conditions described in the Transfer Notice. No Transfer Shares shall be
transferred on the books of the Company until the Company has received such
assurances, if so demanded, and has approved the proposed transfer as bona fide.
Any proposed transfer on terms and conditions different from those described in
the Transfer Notice, as well as any subsequent proposed transfer by the
Optionee, shall again be subject to the Right of First Refusal and shall require
compliance by the Optionee with the procedure described in this paragraph 11.
A. Transferees of the Transfer Shares. All
transferees of the Transfer Shares or any interest therein, other than the
Company, shall be required as a condition of such transfer to agree in writing
(in a form satisfactory to the Company) that such transferee shall receive and
hold such Transfer Shares or interests subject to the provisions of this
paragraph 11 providing for the Right of First Refusal with respect to any
subsequent transfer. Any sale or transfer of any shares acquired upon exercise
of the Option shall be void unless the provisions of this paragraph 11 are met.
A. Assignment of the Right of First Refusal. The
Company shall have the right to assign the Right of First Refusal at any time,
whether or not the Optionee has attempted a transfer, to one (1) or more persons
as may be selected by the Company.
I. Stock Dividends Subject to Option Agreement. If, from
time to time, there is any stock dividend, stock split, or other change in the
character or amount of any of the outstanding stock of the corporation the stock
of which is subject to the provisions of this Option Agreement, then in such
event any and all new substituted or additional securities to which the Optionee
is entitled by reason of the Optionee's ownership of the shares acquired upon
exercise of the Option shall be immediately subject to the Right of First
Refusal with the same force and effect as the shares subject to the Right of
First Refusal immediately before such event.
I. Legends. The Company may at any time place legends
referencing the Right of First Refusal set forth in paragraph 11 above and any
applicable federal or state securities law restrictions on all certificates
representing shares of stock subject to the provisions of this Option Agreement.
The Optionee shall, at the request of the Company, promptly present to the
Company any and all certificates representing shares acquired pursuant to the
Option in the possession of the Optionee in order to effectuate the provisions
of this paragraph 14. Unless otherwise specified by the Company, legends placed
on such certificates may include, but shall not be limited to, the following:
(a) "THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD,
TRANSFERRED, ASSIGNED OR HYPOTHECATED UNLESS THERE IS AN EFFECTIVE REGISTRATION
STATEMENT UNDER SUCH ACT COVERING SUCH SECURITIES, THE SALE IS MADE IN
ACCORDANCE WITH RULE 144 OR RULE 701 UNDER THE ACT, OR THE COMPANY RECEIVES AN
OPINION OF COUNSEL FOR THE HOLDER OF THESE SECURITIES REASONABLY SATISFACTORY TO
THE COMPANY, STATING THAT SUCH SALE, TRANSFER, ASSIGNMENT OR
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HYPOTHECATION IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY
REQUIREMENTS OF SUCH ACT."
(b) Any legend required to be placed thereon by applicable law.
(c) "THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A
RIGHT OF FIRST REFUSAL OPTION IN FAVOR OF THE CORPORATION OR ITS ASSIGNEE SET
FORTH IN AN AGREEMENT BETWEEN THE CORPORATION AND THE REGISTERED HOLDER, OR SUCH
HOLDER'S PREDECESSOR IN INTEREST, A COPY OF WHICH IS ON FILE AT THE PRINCIPAL
OFFICE OF THIS CORPORATION."
I. Initial Public Offerings. The Optionee hereby agrees
that in the event of any underwritten public offering of stock, including an
initial public offering of stock, made by the Company pursuant to an effective
registration statement filed under the Securities Act, the Optionee shall not
offer, sell, contract to sell, pledge, hypothecate, grant any option to purchase
or make any short sale of, or otherwise dispose of any shares of stock of the
Company or any rights to acquire stock of the Company for such period of time
from and after the effective date of such registration statement as may be
established by the underwriter for such public offering; provided, however, that
such period of time shall not exceed one hundred eighty (180) days from the
effective date of the registration statement to be filed in connection with such
public offering. The foregoing limitation shall not apply to shares registered
in the initial public offering under the Securities Act. The Optionee shall be
subject to this paragraph provided and only if the officers and directors of the
Company are also subject to similar arrangements.
I. Binding Effect. This Option Agreement shall inure to
the benefit of and be binding upon the parties hereto and their respective
heirs, executors, administrators, successors and assigns.
I. Termination or Amendment. The Board, including any duly
appointed committee of the Board, may terminate or amend the Plan and/or the
Option at any time; provided, however, that no such action shall deprive any
person, without such person's consent, of any rights previously granted pursuant
to this Option Agreement.
I. Integrated Agreement. This Option Agreement constitutes
the entire understanding and agreement of the Optionee and the Company with
respect to the subject matter contained herein, and there are no agreements,
understandings, restrictions, representations, or warranties among the Optionee
and the Company other than those as set forth or provided for herein. To the
extent contemplated herein, the provisions of this Option Agreement shall
survive any exercise of the Option and shall remain in full force and effect.
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II. Applicable Law. This Option Agreement shall be governed
by and construed in accordance with the laws of the State of Pennsylvania
without regard to its choice of law provisions.
DEMEGEN, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
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Title: President & CEO
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The Optionee represents that the Optionee is familiar with the terms and
provisions of this Option Agreement, including, without limitation, (i) the
Right of First Refusal set forth in paragraph 12 and (ii) the terms of the
Demegen, Inc. 1998 Stock Option Plan, the terms of which are incorporated
therein, and hereby accepts the Option subject to all of the terms and
provisions thereof.
Date: May 5, 1999 /s/ Xxxxx Colkerll
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