EXHIBIT 7
[FORM OF]
NORTH AMERICAN VACCINE, INC.
STOCK OPTION AGREEMENT
GOVERNED BY THE 1995 NON-EMPLOYEE
DIRECTOR AND SENIOR EXECUTIVE
STOCK OPTION PLAN
This STOCK OPTION AGREEMENT ("Agreement") is made as of this 1st day of
January, _____, between North American Vaccine, Inc., a Canadian corporation
(the "Company"), and Xxxxxxx Xxxxx ("Optionee").
1. NATURE OF OPTION
This Stock Option (the "Option") is NOT intended to qualify as an
incentive stock option as defined in Section 422 of the Internal Revenue Code of
1986, as amended (the "Code"), and shall be construed as a non-qualified stock
option.
2. GRANT OF OPTION
The Company hereby irrevocably grants to Optionee the Option to
purchase all or any part of an aggregate of _________ common shares, no par
value, of the Company (the "Common Shares") (such number being subject to
adjustment as provided in Section 15 of this Agreement), on the terms and
conditions set forth in this Agreement and in the Company's 1995 Non-Employee
Director and Senior Executive Stock Option Plan (the "Plan"), which is
incorporated herein by this reference. The terms used in this Agreement shall
have the same definitions set forth in the Plan, except as otherwise defined
herein.
3. EXERCISE PRICE
The exercise price shall be U.S. $__________ for each Common Share,
which price is not less than the fair market value per Common Share on the date
of grant.
4. DURATION OF OPTION
The Option may not be exercised after, and shall expire as of 11:59
p.m., Washington, D.C. local time, on January 1, ______, and may be exercised
during such period only in accordance with the terms of the Plan and this
Agreement.
5. SCHEDULE OF EXERCISE OF OPTION
The Option shall be exercisable during the period set forth in Section
4 above, in accordance with the following schedule:
(a) _______ of the Common Shares optioned hereunder shall
first become exercisable on January 1, ___; and
(b) an additional _____ of the Common Shares optioned
hereunder shall first become exercisable on January
1, _____; and
(c) the remaining ____ of the Common Shares optioned
hereunder shall first become exercisable on January
1, _____.
Notwithstanding the foregoing, the exercisability of the Option may be
automatically accelerated immediately prior to the specified effective date or
the occurrence of any of the events listed in Section 6.3(a) of the Plan in
accordance with the terms of Section 6.3 of the Plan.
6. TERMINATION OF STATUS AS A NON-EMPLOYEE DIRECTOR
Upon Optionee's resignation or termination from the Company's Board of
Directors for any reason whatsoever (including, without limitation, death), the
Option shall be exercisable, to the extent Optionee was entitled to exercise the
Option as of the date of such resignation or termination,
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at any time prior to the expiration date of the Option. To the extent that
Optionee was not entitled to exercise the Option as of the date of such
resignation or termination, or if Optionee does not exercise the Option (to the
extent he or she was entitled to exercise the Option) at any time prior to the
Option's expiration date, the Option shall terminate and become null and void,
such that the number of shares exercisable under the Option shall not be
increased by the virtue of the passage of time. Notwithstanding the foregoing
provisions of this Article 6, if Optionee is terminated or removed by the
Company for willful or gross misconduct, including, without limitation, breach
of fiduciary duty, the Option shall terminate immediately and automatically on
the date of Optionee's termination.
7. DEATH OF OPTIONEE
Subject to the provisions of the Plan, if the Option is held by
Optionee at the time of his or her death, the Option may be subsequently
exercised by the legal representative of Optionee's estate only to the extent
Optionee was entitled to exercise the Option as of the date of his or her death.
8. METHOD OF EXERCISE OF OPTION
The Option shall be exercised, in whole or in part, by delivery of a
written notice to the Company in the manner described in Article 19 of this
Agreement. Such notice shall be signed by Optionee and shall state the election
to exercise the Option, the number of Common Shares in respect of which the
Option is being exercised, and such other representations and agreements as to
Optionee's investment intent with respect to such Common Shares as may be
required by the Company. Such notice shall be accompanied by payment in full of
the aggregate exercise price of the Common Shares to be purchased in (i) cash,
(ii) check (including, without limitation, payment in accordance with a cashless
exercise program under which, if so instructed by Optionee, Common
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Shares may be issued directly to Optionee's broker or dealer upon receipt of the
purchase price in cash from the broker or dealer), (iii) other Common Shares of
the Company qualifying as mature shares under appropriate accounting standards
and having an aggregate fair market value on the date of surrender equal to the
aggregate exercise price of the Common Shares being exercised under the Option,
(iv) such other form as the Compensation Committee may accept, or (v) any
combination of such methods of payment. The Option may not be exercised for a
fraction of a Common Share.
9. LIMITATIONS ON EXERCISE OF OPTION
(a) No Common Shares shall be issued pursuant to the exercise
of the Option unless the exercise of the Option and the issuance and delivery of
the Common Shares hereunder shall comply with all relevant provisions of
Canadian and United States laws, including, without limitation, the Securities
Act (Quebec), the Securities Act of 1933, as amended, the Securities Exchange
Act of 1934, as amended, the rules and regulations promulgated thereunder, and
the requirements of any securities exchange upon which the Common Shares may
then be listed, and shall be further subject to the approval of counsel for the
Company with respect to such compliance.
(b) As a condition to the exercise of the Option, the Company
may require Optionee to complete a questionnaire in a form acceptable to the
Company and to make certain representations and warranties required or
desireable (in the opinion of the Company or its counsel), including, without
limitation, any representations and warranties required by law, in the opinion
of counsel, regarding investment intent. Certificates representing Common Shares
issued upon exercise of the Option shall bear a legend prohibiting transfer of
such Common Shares unless, in the opinion of such counsel, such transfer is not
inconsistent with any of the requirements of any applicable Canadian and United
States securities laws.
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(c) Notwithstanding anything in Articles 6 and 7 hereof to the
contrary, the Option shall not be exercisable after Optionee resigns or
terminates his or her position with the Company if Optionee shall have, during
the time period in which the Option is exercisable, engaged in deliberate action
which, as determined by the Committee, causes substantial harm to the interests
of the Company or constitute a breach of any obligation of Optionee to the
Company. In such event, Optionee shall forfeit all rights to any unexercised
option as of the date of such deliberate action.
10. TAXES
As a condition to the exercise of any portion of the Option, the
Company may require Optionee to make whatever provision is required, in the
reasonable opinion of the Company, to ensure that any taxes required to be
withheld by United States or Canadian federal, state/provincial, or local law as
a result of the granting or exercise of the Option are withheld in accordance
with such applicable law. Provisions for withholding pursuant to the preceding
sentence may include, but shall not be limited to, (i) full payment of the
withholding taxes by Optionee simultaneously with exercise of the Option and
(ii) an agreement by Optionee that such taxes may be withheld in full from any
compensation payable to Optionee.
11. ISSUANCE OF SHARE CERTIFICATES
Upon the payment of the exercise price and subject to all other
provisions of this Agreement and the Plan, the Company will issue certificates
representing the Common Shares subject to the Option. Optionee thereupon shall
have full dividend and voting rights with respect to such Common Shares.
Notwithstanding the exercise of the Option, Optionee shall have no rights as a
shareholder, including the right to vote or to receive dividends, until the
issuance of share certificates by the
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Company, and no adjustment will be made for a dividend or other right, except as
provided in the Plan, for which the record date is prior to the date of issuance
of the share certificates.
12. NON-TRANSFERABILITY
The Option shall not be transferable in any manner other than by will
or by laws of descent or distribution or as otherwise permitted under the Plan
and may be exercised during the lifetime of Optionee only by Optionee, except as
otherwise permitted under the Plan.
13. NO RIGHT TO CONTINUED EMPLOYMENT
The Option shall not confer upon Optionee any right with respect to
continuance of employment or directorship with the Company or any of its parent
or subsidiary corporations, nor shall it interfere in any way with the right of
the Company or any of its parent or subsidiary corporations to terminate
Optionee's employment and/or directorship therewith at any time.
14. NO OBLIGATION TO EXERCISE OPTION
The granting of the Option shall impose no obligation upon Optionee to
exercise the Option.
15. ADJUSTMENTS
In the event of any increase or decrease in the number of issued Common
Shares resulting from certain corporate events (i.e., a stock split or payment
of stock dividend with respect to the Common Shares or any other increase or
decrease in the number of issued Common Shares effected without receipt of
consideration by the Company), the number of Common Shares subject to the Option
and the exercise price per Common Share shall be proportionately adjusted by the
Committee in accordance with the terms of Article X of the Plan. An adjustment
so made shall be final, conclusive, and binding upon Optionee.
16. OPTIONEE BOUND BY PLAN
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Optionee hereby acknowledges receipt of a copy of the Plan and agrees
to be bound by all the terms and provisions thereof.
17. SUCCESSORS IN INTEREST
This Agreement shall inure to the benefit of and be binding upon each
successor and assign of the Company. All obligations imposed upon Optionee and
all rights granted to the Company under this Agreement shall be binding upon
Optionee and his or her heirs, executors, administrators, and legal and personal
representatives.
18. RESOLUTION OF DISPUTES
Any dispute or disagreement which may arise under, or as a result of,
or in any way relate to, the interpretation, construction, or application of
this Agreement shall be determined by the Committee and any such determination
made by the Committee shall be final, binding, and conclusive for all purposes.
19. NOTICES
Any notices, letters, offers, acceptances, or other communications
contemplated by this Agreement shall be in writing and shall be deemed duly
given when delivered by hand (with evidence of receipt thereof) or mailed by
certified or registered mail, first class, postage prepaid and return receipt
requested, addressed as follows:
(i) if to Optionee: Xxxxxxx Xxxxx, 000 X. Xxx Xxxxxx Xxxxx,
Xxxxx Xxxxx, XX 00000
(ii) if to the Company:
North American Vaccine, Inc.
00000 Xxxxxx Xxxxx Xxxxx
Xxxxxxxxxx, XX. 00000
Attention: Senior Vice President, Legal Affairs;
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or at such other addresses as Optionee or the Company may have furnished in
writing to each other. The date of notice for all purposes under this Agreement
shall be the date of the receipt of the notice.
20. APPLICABLE LAW
This Agreement shall be construed in accordance with, and governed by,
the laws of the State of Delaware.
21. CONFLICT BETWEEN AGREEMENT AND PLAN
This Agreement shall be construed, to the maximum extent possible,
consistently with the terms of the Plan. The terms of the Plan shall control if
there are any conflicts between the terms of this Agreement and the Plan.
IN WITNESS WHEREOF, the Company and Optionee have executed this
Agreement as of the date set forth above.
NORTH AMERICAN VACCINE, INC.
By: /s/ XXXXXX X. XXXXX-NABI
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Xxxxxx X. Xxxxx-Nabi
Senior Vice President
Legal Affairs & General Counsel
OPTIONEE:
/s/ XXXXXXX XXXXX
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Xxxxxxx Xxxxx
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