STOCK OPTION AGREEMENT
STOCK OPTION AGREEMENT, dated as of August 23, 1997 (the "Agreement"),
by and between PerSeptive Biosystems, Inc., a Delaware corporation
("Issuer"), and The Xxxxxx-Xxxxx Corporation, a New York corporation
("Grantee").
WHEREAS, Grantee, Issuer and Seven Acquisition Corp., a Delaware
corporation and a wholly-owned subsidiary of Grantee ("Sub"), are
concurrently herewith entering into an Agreement and Plan of Merger, dated as
of the date hereof (the "Merger Agreement"; capitalized terms not defined
herein shall have the meanings set forth in the Merger Agreement), providing
for, among other things, the merger of Sub with and into Issuer with Issuer
as the surviving corporation; and
WHEREAS, as a condition and inducement to Grantee's willingness to enter
into the Merger Agreement, Grantee has requested that Issuer agree, and
Issuer has agreed, to grant Grantee the Option (as defined below);
NOW, THEREFORE, in consideration of the foregoing and the respective
representations, warranties, covenants and agreements set forth herein and in
the Merger Agreement, Issuer and Grantee agree as follows:
1. Grant of Option. Subject to the terms and conditions set forth
herein, Issuer hereby grants to Grantee an irrevocable option (the "Option")
to purchase up to 4,478,308 (as adjusted as set forth herein) shares (the
"Option Shares") of Common Stock, par value $.01 per share, of Issuer (the
"Issuer Common Stock") at a purchase price of $13.00 per Option Share (the
"Purchase Price").
2. Exercise of Option. (a) If not in material breach of the Merger
Agreement, Grantee may exercise the Option, in whole or in part, at any time
(or, to the extent permitted pursuant to Section 2(c) hereof, from time to
time) following the occurrence of a Purchase Event (as defined below);
provided that, except as otherwise provided herein, the Option shall
terminate and be of no further force and effect upon the earliest to occur of
(i) the Effective Time of the Merger, (ii) 12 months after the first
occurrence of a Purchase Event or (iii) termination of the Merger Agreement
prior to the occurrence of a Purchase Event. The termination of the Option
shall not affect any rights hereunder which by their terms extend beyond the
date of such termination.
(b) As used herein, a "Purchase Event" means the termination of the
Merger Agreement under any circumstance which would entitle Grantee or Issuer
to receive any fee from Issuer pursuant to Section 8.02(a) of the Merger
Agreement, provided, however, that the termination of the Merger Agreement
(except pursuant to Section 7.01(b) thereof) after the occurrence of any
event described in Section 8.02(a)(i)(B)(x) thereof shall constitute a
Purchase Event hereunder whether or not any event described forth in Section
8.02(a)(i)(B)(y) of the Merger Agreement shall have occurred.
(c) Except as otherwise provided in this Section 2(c), Grantee shall
be entitled to exercise the Option, in whole or in part, on only one occasion
and, if Grantee elects to exercise the Option only in part, the unexercised
portion of the Option shall be forfeited and cancelled. Notwithstanding the
foregoing, in the event that by virtue of (i) any statute, law, rule or
regulation applicable to Grantee or Issuer, (ii) any order, decree or
injunction to which Grantee or Issuer is subject, (iii) any provision of
Issuer's Certificate of Incorporation or By-Laws, (iv) any agreement,
instrument or other document to which Issuer is a party or by which it is
bound or (v) the terms of any security issued by Issuer, (A) Grantee shall be
prohibited from acquiring or holding any of the Option Shares, (B) Grantee
shall be unable to exercise full rights of ownership with respect to any of
the Option Shares (including, without limitation, the right to vote such
Option Shares on all matters properly presented to the stockholders of
Issuer) or (C) any of such Option Shares shall be in any way distinguishable
from, or of lesser economic value than, any other shares of Issuer Common
Stock (any of the conditions described in clauses (A) through (C), an
"Impairment"; and the portion of the Option Shares affected by an Impairment,
the "Impaired Portion" of the Option Shares), then upon a partial exercise of
the Option by Grantee, the portion of the Option relating to the Impaired
Portion of the Option Shares shall not be forfeited or cancelled but shall
remain exercisable by Grantee in accordance with the terms of this Agreement.
When all Impairments relating to any Impaired Portion of the Option Shares
have been eliminated, Grantee may from time to time exercise the Option with
respect to Option Shares previously affected by such Impairment and upon any
such exercise, the unexercised portion of the Option (other than any
remaining Impaired Portion) shall be forfeited and cancelled.
(d) In the event Grantee wishes to exercise the Option, it shall
send to Issuer a written notice (the date of which being herein referred to
as the "Notice Date") specifying (i) the total number of Option Shares it
intends to purchase pursuant to such exercise and (ii) a place and date not
earlier than three business days nor later than 20 business days from the
Notice Date for the closing of such purchase (the "Closing"; and the date of
such Closing, the "Closing Date"); provided that the Closing shall be held
only if (i) such purchase would not otherwise violate or cause the violation
of applicable law (including the HSR Act) and (ii) no statute, rule,
regulation, decree, order or injunction shall have been promulgated, enacted,
entered into, or enforced by any Governmental Entity which prohibits delivery
of the Option Shares, whether temporary, preliminary or permanent (provided,
however, that the parties hereto shall use their best efforts to have any
such decree, order or injunction vacated or reversed). If the Closing cannot
be consummated by reason of a restriction set forth in clause (i) or (ii)
above, notwithstanding the provisions of Section 2(a), the Closing Date shall
be within 10 business days following the elimination of such restriction.
3. Payment and Delivery of Certificates. (a) On each Closing
Date, Grantee shall pay to Issuer in immediately available funds by wire
transfer to a bank account designated by Issuer an amount equal to the
Purchase Price multiplied by the Option Shares to be purchased on such
Closing Date.
(b) At each Closing, simultaneously with the delivery of
immediately available funds as provided in Section 3(a), Issuer shall deliver
to Grantee a certificate or certificates representing the Option Shares to be
purchased at such Closing, which Option Shares shall be free and clear of all
Liens, and Grantee shall deliver to Issuer a letter agreeing that Grantee
shall not offer to sell or otherwise dispose of such Option Shares in
violation of applicable law or the provisions of this Agreement. If at the
time of issuance of any Option Shares pursuant to an exercise of all or part
of the Option hereunder, Issuer shall not have redeemed the Rights, or shall
have issued any similar securities, then each Option Share issued pursuant to
such exercise shall also represent a corresponding Right or new rights with
terms substantially the same as and at least as favorable to Grantee as are
provided under the Rights Agreement or any similar agreement then in effect.
(c) Certificates for the Option Shares delivered at each Closing
shall be endorsed with a restrictive legend which shall read substantially as
follows:
THE TRANSFER OF THE STOCK REPRESENTED BY THIS CERTIFICATE IS
SUBJECT TO RESTRICTIONS ARISING UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND PURSUANT TO THE TERMS OF A STOCK OPTION AGREEMENT DATED
AS OF AUGUST 23, 1997. A COPY OF SUCH AGREEMENT WILL BE PROVIDED TO
THE HOLDER HEREOF WITHOUT CHARGE UPON RECEIPT BY THE ISSUER OF A
WRITTEN REQUEST THEREFOR.
It is understood and agreed that (i) the reference to restrictions arising
under the Securities Act in the above legend shall be removed by delivery of
substitute certificate(s) without such reference if Grantee shall have
delivered to Issuer a copy of a letter from the staff of the SEC, or an
opinion of counsel in form and substance reasonably satisfactory to Issuer
and its counsel, to the effect that such legend is not required for purposes
of the Securities Act and (ii) the reference to restrictions pursuant to this
Agreement in the above legend shall be removed by delivery of substitute
certificate(s) without such reference if the Option Shares evidenced by
certificate(s) containing such reference have been sold or transferred in
compliance with the provisions of this Agreement under circumstances that do
not require the retention of such reference.
4. Authorized Stock. Issuer hereby represents and warrants to
Grantee that Issuer has taken all necessary corporate and other action to
authorize and reserve and to permit it to issue, and, at all times from the
date hereof until the obligation to deliver Issuer Common Stock upon the
exercise of the Option terminates, will have reserved for issuance, upon
exercise of the Option, shares of Issuer Common Stock necessary for Grantee
to exercise the Option, and Issuer will take all necessary corporate action
to authorize and reserve for issuance all additional shares of Issuer Common
Stock or other securities which may be issued pursuant to Section 6 upon
exercise of the Option. The shares of Issuer Common Stock to be issued upon
due exercise of the Option, including all additional shares of Issuer Common
Stock or other securities which may be issuable upon exercise of the Option
pursuant to Section 6, upon issuance pursuant hereto, shall be duly and
validly issued, fully paid and nonassessable, and shall be delivered free and
clear of all Liens, including any preemptive rights of any stockholder of
Issuer.
5. Purchase Not for Distribution. Grantee hereby represents
and warrants to Issuer that any Option Shares or other securities acquired by
Grantee upon exercise of the Option will not be taken with a view to the
public distribution thereof and will not be transferred or otherwise disposed
of except in a transaction registered or exempt from registration under the
Securities Act.
6. Adjustment upon Changes in Capitalization, etc. (a) In the
event of any change in Issuer Common Stock by reason of a stock dividend,
split-up, recapitalization, combination, exchange of shares or similar
transaction, the type and number of shares or securities subject to the
Option, and the Purchase Price therefor, shall be adjusted appropriately, and
proper provision shall be made in the agreements governing such transaction,
so that Grantee shall receive upon exercise of the Option the number and
class of shares or other securities or property that Grantee would have
received in respect of Issuer Common Stock if the Option had been exercised
immediately prior to such event or the record date therefor, as applicable.
If any additional shares of Issuer Common Stock are issued after the date of
this Agreement at a price per share less than the Purchase Price, the number
of shares of Issuer Common Stock subject to the Option shall be adjusted so
that, after such issuance, it equals 19.9% of the number of shares of Issuer
Common Stock then issued and outstanding, without giving effect to any shares
subject to or issued pursuant to the Option.
(b) In the event that Issuer shall enter into an agreement (i)
to consolidate with or merge into any person, other than Grantee or one of
its subsidiaries, and shall not be the continuing or surviving corporation of
such consolidation or merger, (ii) to permit any person, other than Grantee
or one of its subsidiaries, to merge into Issuer and Issuer shall be the
continuing or surviving corporation, but, in connection with such merger, the
shares of Issuer Common Stock outstanding immediately prior to the
consummation of such merger shall be changed into or exchanged for stock or
other securities of Issuer or any other person or cash or any other property,
or the shares of Issuer Common Stock outstanding immediately prior to the
consummation of such merger shall after such merger represent less than 50%
of the outstanding voting securities of the merged company, or (iii) to sell
or otherwise transfer all or substantially all of its assets to any person,
other than Grantee or one of its subsidiaries, then, and in each such case,
the agreement governing such transaction shall make proper provisions so that
the Option shall, upon the consummation of any such transaction and upon the
terms and conditions set forth herein, be converted into, or exchanged for,
an option (the "Substitute Option"), at the election of Grantee, of either
(I) the Acquiring Corporation (as defined below) or (II) any person that
controls the Acquiring Corporation (any such person specified in clause (I)
or (II) being referred to as "Substitute Option Issuer").
(c) The Substitute Option shall have the same terms as the
Option; provided that the exercise price therefor and number of shares
subject thereto shall be as set forth in this Section 6 and the repurchase
rights relating thereto shall be as set forth in Section 8; provided,
further, that the Substitute Option shall be exercisable immediately upon
issuance without the occurrence of a Purchase Event with respect to the
Substitute Option; and provided, further, that if the terms of the Substitute
Option cannot, for legal reasons, be the same as the Option (subject to the
variations described in the foregoing provisos), such terms shall be as
similar as possible and in no event less advantageous to Grantee. Substitute
Option Issuer shall also enter into an agreement with Grantee in
substantially the same form as this Agreement (subject to the variations
described in the foregoing provisos), which shall be applicable to the
Substitute Option.
(d) The Substitute Option shall be exercisable for such number
of shares of Substitute Common Stock (as defined below) as is equal to the
Assigned Value (as defined below) multiplied by the number of shares of
Issuer Common Stock for which the Option was theretofore exercisable, divided
by the Average Price (as defined below), rounded up to the nearest whole
share. The exercise price per share of Substitute Common Stock of the
Substitute Option (the "Substitute Option Price") shall then be equal to the
Purchase Price multiplied by a fraction in which the numerator is the number
of shares of Issuer Common Stock for which the Option was theretofore
exercisable and the denominator is the number of shares of Substitute Common
Stock for which the Substitute Option is exercisable.
(e) In no event, pursuant to any of the foregoing paragraphs,
shall the Substitute Option be exercisable for more than 19.9% of the
aggregate of the shares of Substitute Common Stock outstanding prior to
exercise of the Substitute Option. In the event that the Substitute Option
would be exercisable for more than 19.9% of the aggregate of the shares of
outstanding Substitute Common Stock but for the limitation in the first
sentence of this Section 6(e), Substitute Option Issuer shall make a cash
payment to Grantee equal to the excess of (i) the value of the Substitute
Option without giving effect to the limitation in the first sentence of this
Section 6(e) over (ii) the value of the Substitute Option after giving effect
to the limitation in the first sentence of this Section 6(e). This
difference in value shall be determined by a nationally recognized investment
banking firm selected by Grantee.
(f) Issuer shall not enter into any transaction described in
Section 6(b) unless the Acquiring Corporation and any person that controls
the Acquiring Corporation assume in writing all the obligations of Issuer
hereunder and take all other actions that may be necessary so that the
provisions of this Agreement are given full force and effect (including,
without limitation, any action that may be necessary so that the holders of
the other shares of common stock issued by Substitute Option Issuer are not
entitled to exercise any rights comparable to the Rights by reason of the
issuance or exercise of the Substitute Option and the shares of Substitute
Common Stock are otherwise in no way distinguishable from or have lesser
economic value than other shares of common stock issued by Substitute Option
Issuer (other than any diminution in value resulting from the fact, if
applicable, that the shares of Substitute Common Stock are restricted
securities, as defined in Rule 144 under the Securities Act or any successor
provision)).
(g) For purposes of this Agreement, the following terms have the
following meanings:
(1) "Acquiring Corporation" means (i) the continuing or
surviving corporation of a consolidation or merger with Issuer (if
other than Issuer), (ii) Issuer in a merger in which Issuer is the
continuing or surviving corporation and (iii) the transferee of all
or substantially all of Issuer's assets.
(2) "Assigned Value" means the highest of (w) the price per
share of Issuer Common Stock at which a tender offer or exchange
offer for Issuer Common Stock has been made after the date hereof and
prior to the consummation of the consolidation, merger or sale
referred to in Section 6(b), (x) the price per share to be paid by
any third party or the consideration per share to received by holders
of Issuer Common Stock, in each case pursuant to the agreement with
Issuer with respect to the consolidation, merger or sale referred to
in Section 6(b), (y) the highest closing sales price per share for
Issuer Common Stock quoted on the NYSE (or if such Issuer Common
Stock is not quoted on the NYSE, the highest bid price per share as
quoted on the National Association of Securities Dealers Automated
Quotation System or, if the shares of Issuer Common Stock are not
quoted thereon, on the principal trading market on which such shares
are traded as reported by a recognized source) during the 12-month
period immediately preceding the consolidation, merger or sale
referred to in Section 6(b) and (z) in the event the transaction
referred to in Section 6(b) is a sale of all or substantially all of
Issuer's assets, an amount equal to (i) the sum of the price paid in
such sale for such assets and the current market value of the
remaining assets of Issuer, as determined by a nationally recognized
investment banking firm selected by Grantee divided by (ii) the
number of shares of Issuer Common Stock outstanding at such time. In
the event that a tender offer or exchange offer is made for Issuer
Common Stock or an agreement is entered into for a merger or
consolidation involving consideration other than cash, the value of
the securities or other property issuable or deliverable in exchange
for Issuer Common Stock shall be determined by a nationally
recognized investment banking firm selected by Grantee.
(3) "Average Price" means the average closing sales price
per share of a share of Substitute Common Stock quoted on the NYSE
(or if such Substitute Common Stock is not quoted on the NYSE, the
highest bid price per share as quoted on the National Association of
Securities Dealers Automated Quotation System or, if the shares of
Substitute Common Stock are not quoted thereon, on the principal
trading market on which such shares are traded as reported by a
recognized source) for the twenty trading days immediately preceding
the fifth business day prior to the consolidation, merger or sale in
question, but in no event higher than the closing price of the shares
of Substitute Common Stock on the day preceding such consolidation,
merger or sale; provided that if Substitute Option Issuer is Issuer,
the Average Price shall be computed with respect to a share of common
stock issued by Issuer, the person merging into Issuer or by any
company which controls such person, as Grantee may elect.
(4) "Substitute Common Stock" means the shares of capital
stock (or similar equity interest) with the greatest voting power in
respect of the election of directors (or persons similarly
responsible for the direction of the business and affairs) of the
Substitute Option Issuer.
7. Repurchase of Option and Option Shares. (a) Notwithstanding
the provisions of Section 2(a), at any time commencing upon the first
occurrence of a Repurchase Event (as defined below) and ending 12 months
after the occurrence of a Purchase Event, Issuer (or any successor entity
thereof) shall:
(i) at the request of Grantee, repurchase from Grantee the
Option (if and to the extent not previously terminated) at a price
equal to the excess, if any, of (x) the Applicable Price (as defined
below) as of the Section 7 Request Date (as defined below) for a
share of Issuer Common Stock over (y) the Purchase Price (subject to
adjustment pursuant to Section 6(a)), multiplied by the number of
shares of Issuer Common Stock with respect to which the Option has
not been exercised (the "Option Repurchase Price"); and
(ii) at the request of an owner of Option Shares from time
to time, repurchase such number of Option Shares as such owner shall
designate at a price equal to the Applicable Price as of the Section
7 Request Date multiplied by the number of Option Shares requested to
be repurchased by such owner (the "Option Share Repurchase Price").
(b) If Grantee or an owner of Option Shares exercises its rights
under this Section 7, Issuer shall, within 10 business days after the Section
7 Request Date, pay the Option Repurchase Price or Option Share Repurchase
Price, as the case may be, in immediately available funds, and Grantee or
such owner, as the case may be, shall surrender to Issuer the Option or
Option Shares, as the case may be.
(c) For purposes of this Agreement, the following terms have the
following meanings:
(i) "Applicable Price," as of any date, means the highest
of (A) the highest price per share at which a tender offer or
exchange offer has been made for shares of Issuer Common Stock after
the date hereof and on or prior to such date, (B) the price per share
to be paid by any third party for shares of Issuer Common Stock or
the consideration per share to be received by holders of Issuer
Common Stock, in each case pursuant to an agreement for a merger or
other business combination transaction with Issuer entered into on or
prior to such date or (C) the highest closing sales price per share
of Issuer Common Stock quoted on the NYSE (or if Issuer Common Stock
is not quoted on the NYSE, the highest bid price per share as quoted
on the National Association of Securities Dealers Automated
Quotations System or, if the shares of Issuer Common Stock are not
quoted thereon, on the principal trading market on which such shares
are traded as reported by a recognized source) during the 60 business
days preceding such date. If the consideration to be offered, paid
or received pursuant to either of the foregoing clauses (A) or (B)
shall be other than in cash, the value of such consideration shall be
determined in good faith by an independent nationally recognized
investment banking firm selected by Grantee and reasonably acceptable
to Issuer, which determination shall be conclusive for all purposes
of this Agreement.
(ii) "Repurchase Event" means the occurrence of a Purchase
Event followed by the consummation of any transaction the proposal of
which would constitute a Transaction Proposal; and
(iii) "Section 7 Request Date" means the date on which
Grantee or an owner of Option Shares exercises its rights under this
Section.
8. Repurchase of Substitute Option. (a) At any time after
issuance of the Substitute Option, Substitute Option Issuer (or any successor
entity thereof) shall:
(i) at the request of Grantee, repurchase from Grantee the
Substitute Option (if and to the extent not previously terminated) at
a price equal to the excess, if any, of (x) the Highest Closing Price
as of the Section 8 Request Date (as defined below) for a share of
Substitute Common Stock over (y) the Purchase Price (subject to
adjustment pursuant to Section 6(a)), multiplied by the number of
shares of Substitute Common Stock with respect to which the
Substitute Option has not been exercised (the "Substitute Option
Repurchase Price"); and
(ii) at the request of an owner of shares of Substitute
Common Stock issued upon exercise of the Substitute Option,
repurchase such number of shares of Substitute Common Stock as such
owner shall designate at a price equal to the Highest Closing Price
as of the Section 8 Request Date multiplied by the number of shares
of Substitute Common Stock requested to be repurchased by such owner
(the "Substitute Share Repurchase Price").
(b) If Grantee or an owner of shares of Substitute Common Stock
issued upon exercise of the Substitute Option exercises its rights under this
Section 8, Issuer shall, within 10 business days after the Section 8 Request
Date, pay the Option Repurchase Price or Option Share Repurchase Price, as
the case may be, in immediately available funds, and Grantee or such owner,
as the case may be, shall surrender to Issuer the Option or shares of
Substitute Common Stock, as the case may be.
(c) For purposes of this Agreement, the following terms have the
following meanings:
(i) "Highest Closing Price" means the highest closing sales
price for shares of Substitute Common Stock quoted on the NYSE (or if
the Substitute Common Stock is not quoted on the NYSE, the highest
bid price per share as quoted on the National Association of
Securities Dealers Automated Quotations System or, if the shares of
Substitute Common Stock are not quoted thereon, on the principal
trading market on which such shares are traded as reported by a
recognized source) during the six-month period preceding the Section
8 Request Date; and
(ii) "Section 8 Request Date" means the date on which
Grantee or an Owner exercises its rights under this Section.
9. Registration Rights. Issuer shall, if requested by Grantee
or any owner of Option Shares (collectively with Grantee, the "Owners") at
any time and from time to time within two years of the first exercise of the
Option, as expeditiously as possible prepare and file up to two registration
statements under the Securities Act if such registration is necessary in
order to permit the sale or other disposition of any or all shares of
securities that have been acquired by or are issuable to such Owners upon
exercise of the Option in accordance with the intended method of sale or
other disposition stated by such Owners, including a "shelf" registration
statement under Rule 415 under the Securities Act or any successor provision,
and Issuer shall use its best efforts to qualify such shares or other
securities under any applicable state securities laws. Issuer shall use all
reasonable efforts to cause each such registration statement to become
effective, to obtain all consents or waivers of other parties which are
required therefor and to keep such registration statement effective for such
period not in excess of 180 days from the day such registration statement
first becomes effective as may be reasonably necessary to effect such sale or
other disposition. The obligations of Issuer hereunder to file a
registration statement and to maintain its effectiveness may be suspended for
one or more periods of time not exceeding 30 days in the aggregate if the
Board of Directors of Issuer shall have determined that the filing of such
registration statement or the maintenance of its effectiveness would require
disclosure of nonpublic information that would materially and adversely
affect Issuer. Any registration statement prepared and filed under this
Section 9, and any sale covered thereby, shall be at Issuer's expense except
for underwriting discounts or commissions, brokers' fees and the fees and
disbursements of Owners' counsel related thereto. The Owners shall provide
all information reasonably requested by Issuer for inclusion in any
registration statement to be filed hereunder. If during the time period
referred to in the first sentence of this Section 9 Issuer effects a
registration under the Securities Act of Issuer Common Stock for its own
account or for any other stockholders of Issuer (other than on Form S-4 or
Form S-8, or any successor form), it shall allow the Owners the right to
participate in such registration, and such participation shall not affect the
obligation of Issuer to effect two registration statements for the Owners
under this Section 9; provided that, if the managing underwriters of such
offering advise Issuer in writing that in their opinion the number of shares
of Issuer Common Stock requested to be included in such registration exceeds
the number which can be sold in such offering, Issuer shall include the
shares requested to be included therein by the Owners pro rata with the
shares intended to be included therein by Issuer. In connection with any
registration pursuant to this Section 9, Issuer and the Owners shall provide
each other and any underwriter of the offering with customary
representations, warranties, covenants, indemnification and contribution in
connection with such registration.
10. Listing. If Issuer Common Stock or any other securities to
be acquired upon exercise of the Option are then listed on the NYSE, Issuer,
upon the request of any Owner, will promptly file an application to list the
shares of Issuer Common Stock or other securities to be acquired upon
exercise of the Option on the NYSE and will use its best efforts to obtain
approval of such listing as soon as practicable.
11. Loss, Theft, Etc. of Agreement. Upon receipt by Issuer of
evidence reasonably satisfactory to it of the loss, theft, destruction or
mutilation of this Agreement, and (in the case of loss, theft or destruction)
of reasonably satisfactory indemnification, and upon surrender and
cancellation of this Agreement, if mutilated, Issuer will execute and deliver
a new Agreement of like tenor and date. Any such new Agreement executed and
delivered shall constitute an additional contractual obligation on the part
of Issuer, whether or not the Agreement so lost, stolen, destroyed or
mutilated shall at any time be enforceable by anyone.
12. Limitation of Grantee Profit. (a) Notwithstanding any other
provision herein, in no event shall Grantee's Total Profit (as defined below)
exceed $11,000,000, and, if it otherwise would exceed such amount, Grantee,
at its sole discretion, shall either (i) reduce the number of shares subject
to the Option, (ii) deliver to Issuer for cancellation shares of Issuer
Common Stock (or other securities into which such Option Shares are converted
or exchanged), (iii) pay cash to Issuer, or (iv) any combination of the
foregoing, so that Grantee's actually realized Total Profit shall not exceed
$11,000,000 after taking into account the foregoing actions.
(b) For purposes of this Agreement, "Total Profit" shall
mean: (i) the aggregate amount of (A) the excess of (x) the net cash amounts
received by Grantee pursuant to a sale of Option Shares (or securities into
which such shares are converted or exchanged) to any unaffiliated third party
within 12 months after the exercise of the Option, over (y) the Grantee's
purchase price of such Option Shares (or other securities), plus (B) any
amounts received by Grantee on the transfer of the Option, plus (C) any
equivalent amounts with respect to the Substitute Option, plus (D) the amount
received by Grantee pursuant to Section 8.02(a) of the Merger Agreement,
minus (ii) the amount of cash paid to Issuer pursuant to this Section 12 plus
the value of the Option Shares (or other securities) delivered to Issuer for
cancellation pursuant to this Section 12.
(c) If Grantee receives cash or other consideration in the
aggregate, pursuant to Section 8.02(a) of the Merger Agreement together with
proceeds in connection with any sales or dispositions of the Option, Option
Shares and any dividends received by Grantee declared on Option Shares, more
than the sum of (i) $22,000,000 and (ii) the Purchase Price multiplied by the
number of Option Shares purchased by Grantee pursuant to the Option, than all
proceeds of Grantee in excess of such sum shall be remitted to Issuer within
30 days of the receipt of such cash or other consideration.
(c) Notwithstanding any other provision of this Agreement,
nothing in this Agreement shall affect the ability of Grantee to receive, nor
relieve Issuer's obligation to pay, the fee pursuant to Section 8.02(a) of
the Merger Agreement; provided that if and to the extent the Total Profit
received by Grantee would exceed $11,000,000 following receipt of such fee,
without limiting Issuer's right of set-off, Grantee shall be obligated to
comply with the terms of Section 12(a) within 30 days of the latest of (i)
the date of receipt of such fee, (ii) the date of receipt of the net cash by
Grantee pursuant to the sale of Option Shares (or securities into which such
Option Shares are converted or exchanged) to any unaffiliated party within 12
months after the exercise of this Option with respect to such Option Shares,
(iii) the date of receipt of net cash from disposition of the Option and (iv)
the date of receipt of equivalent amounts pursuant to the sale of the
Substitute Option or shares of Substitute Common Stock (or other securities
into which such Substitute Common Stock is converted or exchanged).
(d) For purposes of Section 12(a) and clause (ii) of
Section 12(b), the value of any Option Shares delivered to Issuer shall be
the Assigned Value of such Option Shares and the value of any Substitute
Common Stock delivered to Issuer shall be the Highest Closing Price of such
Substitute Common Stock.
13. Miscellaneous. (a) Expenses. Except as otherwise provided
in Section 9 hereof, each of the parties hereto shall bear and pay all costs
and expenses incurred by it or on its behalf in connection with the
transactions contemplated hereunder, including fees and expenses of its own
financial consultants, investment bankers, accountants and counsel.
(b) Waiver and Amendment. Any provision of this Agreement may
be waived at any time by the party that is entitled to the benefits of such
provision. This Agreement may not be modified, amended, altered or
supplemented except upon the execution and delivery of a written agreement
executed by the parties hereto.
(c) Entire Agreement; No Third-Party Beneficiary; Severability.
Except as otherwise set forth in the Merger Agreement, this Agreement,
together with the Merger Agreement, (a) constitutes the entire agreement and
supersedes all prior agreements and understandings, both written and oral,
between the parties with respect to the subject matter hereof and (b) is not
intended to confer upon any person other than the parties hereto any rights
or remedies hereunder. If any term, provision, covenant or restriction of
this Agreement is held by a court of competent jurisdiction or a federal or
state regulatory agency to be invalid, void or unenforceable, the remainder
of the terms, provisions, covenants and restrictions of this Agreement shall
remain in full force and effect and shall in no way be affected, impaired or
invalidated. If for any reason such court or regulatory agency determines
that the Option does not permit Grantee to acquire, or does not require
Issuer (or Substitute Option Issuer) to repurchase, the full number of shares
of Issuer Common Stock (or Substitute Common Stock) as provided in Sections 2
and 7 (or in the case of Substitute Common Stock Sections 2 and 8), as
adjusted pursuant to Section 6, it is the express intention of Issuer to
allow Grantee to acquire or to require Issuer to repurchase such lesser
number of shares as may be permissible without any amendment or modification
hereof.
(D) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD
TO ANY APPLICABLE CONFLICTS OF LAW RULES.
(e) Descriptive Headings. The descriptive headings contained
herein are for convenience of reference only and shall not affect in any way
the meaning or interpretation of this Agreement.
(f) Notices. All notices and other communications hereunder
shall be in writing and shall be deemed given if delivered personally,
telecopied (with confirmation) or mailed by registered or certified mail
(return receipt requested) to the parties at the following addresses (or at
such other address for a party as shall be specified by like notice):
If to Grantee to:
The Xxxxxx-Xxxxx Corporation
000 Xxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxxx 00000
Attention: Chief Executive Officer
Telecopier No.: 0-000-000-0000
with a copy to:
Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxx, Esq.
Xxxxxxx X. Xxxxxx, Esq.
Telecopier No.: (000) 000-0000
If to Issuer to:
PerSeptive Biosystems, Inc.
000 Xxx Xxxxxxxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxxxxxxx 00000
Attention: Chief Executive Officer
Telecopier No.: 0-000-000-0000
with a copy to:
Xxxxx, Xxxxxxx & Xxxxxxxxx, LLP
000 Xxxx Xxxxxx
Xxxx Xxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxxx Xxxxx, Esq.
Xxxxx X. Xxxx, Esq.
Telecopier No.: 0-000-000-0000
(g) Counterparts. This Agreement and any amendments hereto may
be executed in two counterparts, each of which shall be considered one and
the same agreement and shall become effective when both counterparts have
been signed by each of the parties and delivered to the other party, it being
understood that both parties need not sign the same counterpart.
(h) Assignment. Grantee may assign this Agreement in whole to
any affiliate of Grantee at any time. Except as provided in the next
sentence, Grantee may not, without the prior written consent of Issuer (which
shall not be unreasonably withheld), assign this Agreement to any other
person. Upon the occurrence of a Purchase Event, Grantee may sell, transfer,
assign or otherwise dispose of, in whole at any time, its rights and
obligations hereunder. In the case of any sale, transfer, assignment or
disposition of this Option, Issuer shall do all things reasonably necessary
to facilitate such transaction. This Agreement shall not be assignable by
Issuer except by operation of law. Subject to the preceding sentence, this
Agreement shall be binding upon, inure to the benefit of and be enforceable
by the parties and their respective successors and assigns.
(i) Representations and Warranties. The representations and
warranties contained in Sections 3.01(a) and 3.02(a) of the Merger Agreement,
and, to the extent they relate to this Stock Option Agreement, in Sections
3.01(d), (p), (q) and (r) and 3.02(c) of the Merger Agreement, are
incorporated herein by reference.
(j) Further Assurances. In the event of any exercise of the
Option by Grantee, Issuer and Grantee shall execute and deliver all other
documents and instruments and take all other action that may be reasonably
necessary in order to consummate the transactions provided for by such
exercise.
(k) Specific Performance. The parties hereto agree that this
Agreement may be enforced by either party through specific performance,
injunctive relief and other equitable relief. Both parties further agree to
waive any requirement for the securing or posting of any bond in connection
with the obtaining of any such equitable relief and that this provision is
without prejudice to any other rights that the parties hereto may have for
any failure to perform this Agreement.
IN WITNESS WHEREOF, Issuer and Grantee have caused this Stock Option
Agreement to be signed by their respective officers thereunto duly authorized
as of the day and year first written above.
PERSEPTIVE BIOSYSTEMS, INC.
by /s/ Xxxxx Xxxxxxx
____________________________
Name: Xxxxx Xxxxxxx
Title: Vice President
THE XXXXXX-XXXXX CORPORATION
by /s/ Xxxxxx X. Xxxxxx
____________________________
Name: Xxxxxx X. Xxxxxx
Title: Chief Executive
Officer and Chairman
of the Board of Directors
