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STOCK OPTION AGREEMENT
DATE: OPTION NUMBER SP-14
AUGUST 16, 1999 NUMBER OF SHARES PURCHASABLE
100,000
TO PURCHASE SHARES OF
CLASS B COMMON STOCK
-OF-
K-V PHARMACEUTICAL COMPANY
THIS CERTIFIES THAT Xxxx X. Xxxxxxxx is hereby granted the option to
purchase, at the option price of $16.50 per share, all or any part of that
number of fully paid and non-assessable shares of the Class B Common Stock,
par value $0.01 per share ("Class B Common Stock"), of K-V Pharmaceutical
Company, a Delaware corporation (hereinafter called the "Company") above set
forth, upon and subject to the following terms and conditions:
This Option and all rights to purchase shares hereunder shall expire four
(4) years from the date hereof (hereinafter called the "expiration date").
This Option and all rights hereunder shall be assignable and
transferable.
As of August 16, 1999, and prior to its expiration or earlier
termination, this Option shall be exercisable from time to time as to all or
any of the shares then purchasable hereunder as follows: during the
four-year period commencing August 16, 1999 and ending August 15, 2003, it
may be exercised as to all or any shares at any time during which this Option
shall be exercisable as to the shares subject hereto.
This Option may be exercised from time to time only by delivery to the
Company at its main office (attention of the Secretary) of a duly signed
notice in writing stating the number of shares with respect to which this
Option is being exercised and the time and date of delivery thereof, which
time and date of delivery shall be during the normal business hours of the
Company on a regular business day not less than fifteen (15) days after the
giving of such notice unless an earlier date has been mutually agreed upon;
provided, however, that not less than ten (10) shares may be purchased at any
one time unless the number purchased is the total number then purchasable
hereunder; and provided further that this Option may not be exercised at any
time when this Option or the granting or exercise hereof violates any law or
governmental order or regulation. At the time of delivery specified in such
notice, the Company shall, without transfer or issue tax to the holder (or
other person entitled to exercise this Option) transfer and set aside for the
benefit of the holder (or other person entitled to exercise this Option) a
certificate or certificates out of the Company's theretofore authorized but
unissued or reacquired shares of Class B Common Stock as the Company may
elect (with appropriate
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legend thereon, if deemed necessary by the Company, containing the
representation by the person exercising the Option that the shares purchased
shall be for investment purposes and not with a view to resale or
distribution) against payment of the option price in full for the number of
shares purchased by either (i) cash (including a certified or bank cashier's
check or the equivalent thereof), or (ii) at the discretion of the Board, by
delivering at fair market value, as determined by the Board, Company Common
Stock already owned by the Participant, or (iii) any combination of cash and
Company Common Stock, to be held by the Company and subsequently delivered to
the holder (or such other person) as hereinafter provided. If the holder
fails to pay for any part of the number of shares specified in such notice as
required, the right to purchase such shares may be terminated by the Board.
To the extent that this Option has not been exercised in full prior to
its termination or expiration date, whichever occurs sooner, it shall
terminate and become void and of no effect.
Upon payment of the purchase price therefor the Company shall deliver to
the holder, as soon as practicable thereafter, certificates representing the
Class B Common Stock purchased hereunder (the "Certificates"), free and clear
of restrictions except for the restrictions which are necessary to assure
compliance by the Company and the holder with applicable federal and state
securities laws and/or the listing requirements of any national securities
exchange.
This Option shall not confer upon the holder any right to remain in the
employ of the Company or any subsidiary thereof and shall not confer upon the
holder any rights in the stock of the Company prior to the issuance of a
stock certificate pursuant to the exercise of this Option. No adjustment
shall be made for dividends or other rights for which the record date is
prior to the date such stock certificate is issued.
In the event that the outstanding shares of Class B Common Stock of the
Company are hereafter increased or decreased or changed into or exchanged for
a different number or kind of shares or other securities of the Company or of
another corporation, or in the event that there is a "corporate transaction"
as that term is defined in the Regulations under Section 425 of the Internal
Revenue Code of 1986, by reason of reorganization, merger, consolidation,
recapitalization, reclassification, stock split-up, spin-off, combination of
shares or dividend payable in capital stock, this Option shall, to the extent
that it has not been exercised, entitle the holder upon the subsequent
exercise of this Option to such number and kind of securities or other
property, subject to the terms of the Option, to which the holder would be
entitled had the holder actually owned the shares subject to the unexercised
portion of this Option at the time of the occurrence of such event, and the
aggregate purchase price upon the subsequent exercise of this Option shall be
the same as if the Class B Common Stock of the Company originally optioned
were being purchased as provided herein; provided, however, that each such
adjustment in the number and kind of shares subject to this Option, including
any adjustment in the Option price, shall be made in such manner as not to
constitute a "modification" as defined in Section 425 of the Internal Revenue
Code of 1986. Any such adjustment made by the Board of Directors shall be
conclusive.
The Company may postpone the issuance and delivery of shares upon any
exercise of this Option, if necessary, until admission of such shares to
listing on any stock exchange and completion of registration and
qualification of such shares under any applicable state or federal law, rule
or regulation.
The holder hereof shall make such representations and furnish such
information to the Company as may be appropriate to permit the Company to
issue such shares in compliance with the
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provisions of the Security Act of 1933, as amended (the "Securities Act"), or
any other applicable law, including state securities laws. Without limiting
the generality of the foregoing, if requested by the Company, the holder will
represent, in form acceptable to the Company, that the holder is purchasing
any shares issued pursuant hereto for investment purposes and not with a view
to resale or distribution.
This Option is issued pursuant to the resolutions duly adopted by the
Board of Directors, the receipt of a copy of which the holder acknowledges by
virtue of the acceptance hereof, and is subject to all the terms and
conditions of said resolutions.
A determination by the Board of Directors of any questions which may
arise with respect to the interpretation and construction of the provisions
of this Option shall be final.
WITNESS the seal of the Company and the signatures of its duly authorized
officers
Dated: August 16, 1999
K-V PHARMACEUTICAL COMPANY
By: /s/ Xxxxxx X. Xxxxxxxx
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Vice President, Finance
ACCEPTED:
BY: /s/ Xxxx X. Xxxxxxxx
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Xxxx X. Xxxxxxxx
