EXHIBIT 10.14
OPTION AGREEMENT
This Option Agreement (this "Agreement") is made as of March 29, 1996
by and among Plasma & Materials Technologies, Inc., a California corporation
(the "Company"), PMT CVD Partners, L.P., a California limited partnership (the
"Partnership"), and _____________________________ (the "Investor").
R E C I T A L S:
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WHEREAS, the Company and the Investor are limited partners of the
Partnership pursuant to the Limited Partnership Agreement dated as of the date
hereof (the "Partnership Agreement"); and
WHEREAS, the Investor wishes to enter into an agreement granting the
Company an option to purchase, pursuant to the terms and conditions set forth
herein, (i) the Investor's entire limited partnership interest in the
Partnership (the "Partnership Interests") and (ii) all of the shares of the
common stock of CVD, Inc., a California corporation and the general partner of
the Partnership, owned by the Investor (the "GP Shares").
NOW, THEREFORE, in consideration of the mutual covenants expressed
herein and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, and intending to be legally bound,
the parties agree as follows:
A G R E E M E N T:
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1. Option. The Investor hereby grants to the Company an exclusive,
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irrevocable option (the "Option") to purchase all but not less than all of the
Partnership Interests and GP Shares now or hereafter beneficially owned or held
by the Investor. The Option is exercisable at any time after the date hereof
and may be exercised in accordance with the terms of Section 4 hereof, provided
that such Option must be exercised prior to March 29, 2001 (the "Option
Termination Date").
2. Exercise Price. Upon exercise of the Option, the aggregate
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purchase price for the Partnership Interests and GP Shares held by the Investor
(collectively, the "Option Exercise Price") shall be determined by the following
formula:
EP = CC X (1.40)/T/
EP: Option Exercise Price, which shall, in all
circumstances, equal at least 2 X CC
CC: Capital Contribution of the Investor to the Partnership
T: Period of time commencing on the date of the Investor's
Capital Contribution and ending on the Option Closing
Date, as defined below, expressed as a fraction of
years
3. Form of Payment. The Option Exercise Price (a) shall be net of
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the Investor's Percentage Interest (as defined in the Partnership Agreement)
multiplied by all royalty amounts, if any, paid to the Partnership by the
Company pursuant to the R&D Agreement (as defined in the Partnership Agreement)
whether or not such amounts have been distributed to the Investor pursuant to
the Partnership Agreement and (b) may be paid in cash, in Common Stock of the
Company (the "Common Stock"), or in any combination thereof, at the sole
discretion of the Company, provided that any Common Stock delivered to the
Investor shall be either registered under the Securities Act of 1933, as amended
(the "Act"), or shall be subject to such registration rights and procedures
under the Act as may be reasonably acceptable to the Investor. The number of
shares of Common Stock to be delivered in payment of all or a portion of the
Option Exercise Price shall be determined by (i) dividing the portion of the
Option Exercise Price to be paid in shares of Common Stock by (ii) the product
of nine-tenths (0.90) multiplied by the Average Stock Price. For purposes of
this Section 3, the "Average Stock Price" shall mean the average closing sales
prices of Common Stock quoted on Nasdaq National Market or, if then traded on a
national securities exchange, the average closing prices of Common Stock on the
principal national securities exchange on which listed or, if quoted on the
Nasdaq over-the-counter system, the average of the mean of the closing bid and
asked prices of Common Stock quoted on such system, in any such case on each of
the ten (10) trading days immediately preceding the Option Closing Date. Any
shares of Common Stock paid in connection with the Option Exercise Price will be
validly authorized and issued, fully paid and nonassessable and free and clear
of any and all liens and encumbrances.
4. Manner of Exercise. The Option may be exercised at any time by
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written notice from the Company to the Investor stating that the Option is being
exercised and setting forth: (a) the portion, if any, of the Option Exercise
Price to be paid in cash and the portion, if any, of the Option Exercise Price
to be paid in Common Stock and (b) the date, not less than ten (10) or more than
thirty (30) days after the date the Company gives written notice of the exercise
of the Option (the "Exercise Date"), on which the Partnership Interests and GP
Shares shall be purchased (the "Option Closing Date").
5. Transfer of Title; Representations and Warranties. Transfer of
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title by the Investor to the Company of the Partnership Interests and GP Shares
shall be deemed to
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occur automatically on the Option Closing Date subject to the payment in full by
the Company on such date of the amount owing to the Investor as determined in
accordance with Sections 2 and 3 hereof, and, in connection with such transfer
of title, the Investor agrees to make such representations and warranties with
respect to its title in and to the Partnership Interests and GP Shares as may be
requested by the Company. After the Option Closing Date, subject to the payment
in full by the Company on such date of the amount owing to the Investor as
determined in accordance with Sections 2 and 3 hereof, the Investor shall have
no rights whatsoever in connection with the Partnership Interests and GP Shares,
other than the right to receive the full Option Exercise Price therefor.
6. Exercisability of Warrants. Commencing on the Option Closing
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Date, and for a period of one (1) year thereafter, that certain Common Stock
Purchase Warrant dated as of any even date herewith (the "Warrant") delivered to
Investor in connection with Investor's original capital contribution to the
Partnership shall be exercisable pursuant to the terms and conditions set forth
therein.
7. Notices. Except as otherwise set forth herein, any notice
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required or permitted under this Agreement shall be given in writing and shall
be deemed effectively given upon personal delivery to the party to be notified
or, if sent by telecopier, upon confirmation of transmission, or three (3) days
after deposit with the United States Post Office, by registered or certified
mail, or one (1) day after deposit with an overnight air courier, in each case
postage prepaid and addressed to the party to be notified at the addresses and
facsimile numbers set forth on the signature page hereof, or at such other
address as such party may designate by ten (10) days' advance written notice to
the other parties to this Agreement.
8. Governing Law. This Agreement shall be governed by and construed
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in accordance with the laws of the State of California.
9. Specific Performance. The parties hereto hereby agree that the
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breach of any of the terms of this Agreement will cause irreparable injury for
which an adequate remedy at law is not available. Accordingly, the parties
hereto agree that each such party shall be entitled to specifically enforce any
of the provisions hereof by means of injunctive or other equitable relief, which
relief shall be in addition to any other remedies at law or in equity that may
be available to such party.
10. Entire Agreement. This Agreement, along with the Partnership
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Agreement, the Subscription Agreement (as defined in the Partnership Agreement),
the Warrant, the R&D Agreement, the License Agreement (as defined in the
Partnership Agreement) and that certain Share Subscription and Shareholders
Agreement dated as of an even date herewith among CVD, Inc., the Investor and
certain other parties thereto, constitute the entire agreement among the parties
with respect to the subject matter hereof
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and thereof and supersede any and all prior agreements and understandings of the
parties, whether written or oral, in connection therewith.
11. Counterparts. This Agreement may be executed in any number of
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counterparts, each of which shall be an original, but all of which taken
together shall constitute one agreement.
12. Termination. This Agreement, and the Option granted hereunder,
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shall terminate and have no further force or effect on the Option Termination
Date.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
COMPANY: PLASMA & MATERIALS TECHNOLOGIES, INC.
By:
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Xx. Xxxxxx X. Xxxxxxxx
President and Chief Executive Officer
Address:
0000 Xxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xx. Xxxxxx X. Xxxxxxxx
Facsimile No.: (000) 000-0000
PARTNERSHIP: PMT CVD PARTNERS, L.P.
By: CVD, Inc.,
General Partner
By:
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Xxxx X. Xx Xxxxx
Chief Financial Officer and Secretary
Address:
0000 Xxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xx. Xxxx X. Xx Xxxxx
Facsimile No.: (000) 000-0000
[Signatures continued on following page]
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[Signatures continued from previous page]
INVESTOR: ________________________
Address:
________________________
________________________
________________________
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