EXHIBIT 10.36
CASHLESS COLLAR
OTC ISSUER STOCK OPTION MASTER AGREEMENT
TERMS AND CONDITIONS
The terms and conditions below shall govern all transactions in Options
(as hereinafter defined) between Xxxxxxx Xxxxx & Co. ("GS&Co.") and the
undersigned (the "Company"). These terms and conditions are collectively
referred to as the "Agreement". Please acknowledge your agreement to and
acceptance of this Agreement by signing and returning the enclosed copy hereof.
Until the signed copy of this Agreement is received, any Option transactions
entered into between the Company and GS&Co. shall nevertheless be governed
hereby.
1. Definitions.
(a) American Option: An Option which may be exercised on any Business Day,
except on the Expiration Date, between the hours of 9:00 A.M. and 2:30 P.M. New
York time, and on the Expiration Date between the hours of 9:00 A.M. and 4:30
P.M., New York time.
(b) Averaging Period: The number of consecutive Business Days indicated in the
Confirmation beginning on and including the Exercise Date.
(c) Business Day: Any day that (1) Federal Reserve Member Banks in New York, NY
are open for business, and (2) the primary market for trading the Option
Securities is (or, but for the existence of a Market Disruption Event, would be)
open for business.
(d) Confirmation: The written evidence of an Option delivered by GS&Co. to the
Company, containing the specific terms with respect thereto. Each Confirmation,
together with this Agreement, shall constitute the written agreement between the
Company and GS&Co. with respect to such Option.
(e) Contracts: The "Trading Unit" of an Option, consisting initially of 100
shares of the Option Security, subject to adjustment as provided in Section 2.
(f) Early Termination Amount: The net amount payable by one party to the other,
calculated by the Non-Defaulting party by aggregating and setting-off, as
applicable:
(i) the outstanding payments due (or that would have been due but for
Section 6) under this Agreement to each party immediately prior to the Early
Termination Date;
(ii) the Replacement Value of Options to be settled under Section 9
which are unexercised immediately prior to the Early Termination Date;
(iii) the Non-Defaulting Party's Other Expenses; and
(iv) at the option of the Non-Defaulting Party, any cash collateral or
the liquidation value of non-cash collateral.
(g) European Option: An Option which may be exercised only on the Expiration
Date between the hours of 9:00 A.M. and 4:30 P.M. New York time.
(h) Exercise Date: The Business Day on which exercise of an Option is, or is
deemed to be, effective.
(i) Exercise Price: The price per share, as set forth in a Confirmation, at
which an Option Security may be purchased or sold or otherwise settled upon
exercise of the related Option.
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(j) Expiration Date: For an Option means 4:30 P.M., New York time, on the date
identified as the Expiration Date in the related Confirmation, at which time, if
an Option has not been exercised, the rights granted to the holder thereunder
expire and the Option is deemed terminated. If an Expiration Date is not a
Business Day, then the next succeeding Business Day shall be deemed to be the
Expiration Date for such Option.
(k) Major Dealer: A securities broker/dealer or bank other than an affiliate of
the Non-Defaulting Party selected by the Non-Defaulting Party, which has a net
worth of at least U.S.$200,000,000 (or its equivalent) and regularly makes
markets in Options on securities and indices.
(l) Market Disruption Event: The occurrence during the half hour period
immediately prior to the time at which valuation will take place of the material
suspension or material limitation of trading in (i) Option Securities on the
primary market or (ii) options or futures on Option Securities on the primary
market or on any other exchange on which such options or futures are traded. For
the purposes of this definition, (X) a limitation on the hours and number of
days of trading will not constitute a Market Disruption Event if it results from
an announced change in the regular business hours of the primary market or other
relevant exchange and (Y) a limitation on trading imposed during the course of a
day by reason of movements in price otherwise exceeding levels permitted by the
primary market or other relevant stock exchange may, if GS&Co. so determines,
constitute a Market Disruption Event.
(m) Market Price: The closing sale price (or, if no closing sale price is
reported, the average of the bid and asked prices) reported on the New York
Stock Exchange or, in the event the Option Security is not listed on the New
York Stock Exchange, such other national or regional stock exchange upon which
the Option Security is listed and principally traded. If the Option Security is
not listed on a national or regional securities exchange, then the Market Price
will be the average of the closing bid and asked prices reported by the National
Association of Securities Dealers Automated Quotation System ("NASDAQ").
(n) Option: The right, but not the obligation, of the holder (purchaser) of an
Option to purchase from the issuer (seller) of the Option (in the case of a
"Call Option") or to sell to its issuer (in the case of a "Put Option") the
number of Contracts set forth in the applicable Confirmation.
(o) Option Security: With respect to any Option, the security of the Company
identified in the related Confirmation for purchase or sale upon exercise of the
Option.
(p) Other Expenses: In relation to an Early Termination Date, all costs, losses
and expenses (including, without limitation, legal fees, stamp, registration,
documentation and similar taxes, and value added taxes but for the avoidance of
doubt, without duplication of any amounts falling within subparagraphs (i) and
(ii) of the definition of Early Termination Amount) incurred or suffered by the
Non-Defaulting Party as a result of the other party's default, any steps taken
by it to implement, protect or enforce its rights under the Agreement and all
commercially reasonable steps taken by it as a result of the default (or in
contemplation of the impending default), including purchase or sale of Option
Securities pursuant to Options exercised but not settled, in order to unwind any
xxxxxx or cover any expenses.
(q) Premium: The purchase price of an Option specified in the Confirmation.
(r) Quotation: In respect of an Option, a quotation from a Major Dealer of the
amount that would be required to be paid by or to the Non-Defaulting Party for
an instrument that would have the effect of preserving the economic equivalent
of the payment and/or delivery obligations of the parties under the Option that
would, but for the occurrence of the Early Termination Date, otherwise have
fallen due.
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(s) Replacement Value: With respect to an Option, the value of the Option
calculated as an amount equal to:
(i) the arithmetic mean of three Quotations; or
(ii) if only two Quotations are available to the Non-Defaulting
Party, the arithmetic mean of those two Quotations; or
(iii) if only one Quotation is available, that Quotation; or
(iv) if no Quotation is available, the amount reasonably determined
by the Non-Defaulting Party to be the value of the Option on
the Early Termination Date.
(t) Settlement Value: The amount in U.S. dollars by which the Exercise Price
exceeds the Market Price (in the case of a Put Option) or the Market Price
exceeds the Exercise Price (in the case of a Call Option) in either case
multiplied by the number of shares of the Option Security covered by an exercise
notice given pursuant to Section 3 below. The Market Price shall be determined
as of the Exercise Date, or, if an Averaging Period is indicated in the
Confirmation, the average of the Market Prices for each Business Day in the
Averaging Period.
2. Adjustments. The Exercise Price and the Trading Units of an Option are each
subject to adjustments as follows:
(a) During the term an Option is in effect (the "Exercise Period"), if any
adjustment is made by the Options Clearing Corporation or its successors ("OCC")
in the terms of outstanding OCC-issued options ("OCC Options") on the Option
Securities, an equivalent and pro rata adjustment shall be made in the terms of
such Option to the extent such adjustment is applicable on the date of any
exercise of such Option. Except as provided in Sub-paragraph (b) below, no
adjustments shall be made in the terms of such Option in any event that does not
result in an adjustment to the terms of outstanding OCC Options on Option
Securities. Without limiting the generality of the foregoing NO ADJUSTMENT SHALL
BE MADE IN THE TERMS OF ANY OPTION FOR ORDINARY CASH DIVIDENDS ON OPTION
SECURITIES. A summary of the terms under which the OCC may make adjustments is
set forth below:
(i) Whenever there is a dividend, stock dividend, stock distribution,
stock split, reverse stock split, rights offering, distribution, reorganization,
recapitalization, reclassification or similar event in respect of the Option
Securities or a merger, consolidation, dissolution or liquidation of the issuer
of the Option Securities, the number of option contracts, the unit of trading,
the exercise price, and the Option Securities, or any of them, with respect to
all outstanding option contracts open for trading in the Option Securities may
be adjusted.
(ii) All adjustments pursuant to this Section shall be made by GS&Co.
by reference to actions taken by the Securities Committee of the OCC and in
consultation with the Company. The Securities Committee determines whether to
make adjustments to reflect particular events in respect of the Option
Securities and the nature and extent of any such adjustment, based on its
judgment as to what is appropriate for the protection of investors and the
public interest, taking into account such factors as fairness to holders and
writers of option contracts on the Option Securities, the maintenance of a fair
and orderly market in options on the Option Securities, consistency of
interpretation and practice, efficiency of exercise settlement procedures, and
the coordination with other clearing agencies of the clearance and settlement of
transactions in the Option Securities. The Securities Committee of the OCC may,
in addition to determining adjustments on a case-by-case basis, adopt statements
of policy or interpretation having general application to specified types of
events.
(iii) In the case of a stock dividend, stock distribution or stock
split whereby one or more Option Securities are issued with respect to each
outstanding Option Security, each Option covering the Option Securities shall be
increased by the same number of additional rights as the number of shares issued
with respect to each Option Security under the Option. The Exercise Price per
share in effect immediately prior to such event shall be proportionately
reduced, and the unit of trading shall remain the same.
(iv) In the case of a stock dividend, stock distribution or stock split
whereby other than a whole number of Option Securities are issued in respect of
each outstanding share, the Exercise Price in effect immediately prior to such
event shall be proportionately reduced, and conversely, in the case of a reverse
stock split or combination of shares of the Option Security, the Exercise Price
in effect immediately prior to such event shall be proportionately increased.
Whenever the Exercise Price with respect to an Option has been reduced or
increased in accordance with this Sub-paragraph (iv), the unit of trading shall
be proportionately increased or reduced, as the case may be.
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(v) In the case of any distribution made with respect to Option
Securities, other than cash distributions subject to paragraph (a) and other
than distributions for which adjustments are provided in Sub-paragraphs (iii) or
(iv), if an adjustment is determined by the Securities Committee of the OCC to
be appropriate, 1) the Exercise Price in effect immediately prior to such event
shall be reduced by the value per share of the distributed property, in which
event the unit of trading shall not be adjusted, or 2) the unit of trading in
effect immediately prior to such event shall be adjusted so as to include the
amount of property distributed with respect to the number of shares of the
Option Security represented by the unit of trading in effect prior to such
adjustment, in which event the Exercise Price shall not be adjusted.
(vi) Adjustments shall as a general rule become effective on the
"ex-date" established by the primary market on which the Option Securities are
open for trading.
(b) If at any time during the life of an Option there shall be no outstanding
OCC options on Option Securities, and an event shall occur for which an
adjustment might have been required under the By-Laws, Rules and stated policies
of the OCC applicable to the adjustment of OCC options, as described above, (the
"OCC Adjustment Rules"), Company and GS&Co. shall mutually determine, applying
the principles set forth in the OCC Adjustment Rules, whether to adjust the
terms of such Option, and the nature of any such adjustment.
(c) No adjustment of the Exercise Price shall be required unless such adjustment
would require an increase or decrease in such price of at least one U.S. cent:
provided that any adjustment which by reason of this Sub-paragraph (c) is not
required to be made shall be carried forward and taken into account (as if such
adjustment had been made at the time when it would have made but for the
provisions of this Sub-paragraph (c)) in any subsequent adjustment. All
calculations under this Sub-paragraph shall be made to the nearest U.S. cent
with five tenths or more of a U.S. cent to be considered (rounded up) a full
cent.
(d) If the Exercise Date falls on or after a date with effect from which an
adjustment takes retroactive effect pursuant to any of the provisions of this
Section 2 and such adjustment has not yet been reflected on such Exercise Date,
the Settlement Value will be adjusted to reflect the additional Option
Securities, being equal to the excess of the number of the Option Securities
which would have been used in the calculation of the Settlement Value at such
retroactively adjusted Exercise Price over the number of Option Securities
covered by the Option immediately prior to such adjustment.
3. Exercise Procedure; Automatic Exercise.
(a) An Option may be exercised by the holder thereof by giving notice of
exercise either orally or in writing to the person specified for such purpose in
the space provided below the signature block of this Agreement or as otherwise
notified in writing to the holder of such Option. Oral notice of exercise shall
be confirmed in writing within three Business Days. An Option may be exercised
only in whole and not in part unless "Exercisable in part" is specified in the
related Confirmation.
(b) If the holder has not given notice of exercise or notice of intent not to
exercise to the writer by 4:30 P.M., New York time, on the Expiration Date, the
Option shall be deemed to have been exercised by the holder if such Option is
in-the-money based upon the Market Price on the Expiration Date. An Option is
"in the money" as of 4:30 P.M. on the Expiration Date if the Settlement Value of
the unexercised portion of such Option is based on an amount equal to or greater
than twenty-five cents ($.25) per share. GS&Co. shall attempt to notify the
Company of such automatic exercise as soon as practicable but in any case by the
close of business in New York on the Business Day following the Expiration Date.
Failure or inability to give such notice will not affect the validity of the
exercise.
4. Exercise Limit. If an Option is an American style option, the maximum
aggregate number of shares of the Option Security as to which such Option and
any similar (i.e., put or call) Option then outstanding may be exercised by the
holder on any Business Day is the number of shares, if any, specified in the
related Confirmation as the "Exercise Limit".
5. Settlement upon Exercise.
(a) If "Physical Settlement" is specified in the related Confirmation,
within three Business Days following the Exercise Date (or such other period as
agreed to by the Company and GS&Co.) payment for the Option Securities shall be
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made at the Exercise Price per share therefor in clearing house funds against
delivery of such Option Securities. Option Securities will be delivered in good
transferable form as is customary for that type of Option Security. Whenever an
Option Security is transferable or deliverable by wire transfer or book entry at
a depository or clearing house at which both parties or their clearing agents
are members, such method will be used to effect transfer or delivery. Physical
delivery shall only be made if the foregoing cannot be effected.
(b) If "Cash Settlement" is specified in the related Confirmation, an
Option shall be settled by a payment in clearing house funds of an amount equal
to the Settlement Value on the third Business Day following the Exercise Date or
as otherwise stated in the Confirmation.
(c) If "Physical Settlement" is specified in the related Confirmation
and "Cash Settlement at Company's Election" is specified in such Confirmation,
then, unless the Company has notified GS&Co. to the contrary at least two
Business Days before the Exercise Date (or such other period as may be specified
in the related Confirmation), the Option will settle by physical delivery of the
Option Securities pursuant to Section 5(a) above. Such notice may be given
orally or in writing. Oral notice shall be confirmed in writing within one
Business Day.
(d) If "Net Share Settlement" is specified in the related Confirmation,
then the Company may elect to have the related Option settled by payment of the
Settlement Value in shares of the Option Security by giving notice of such
election to GS&Co. at least two Business Days before the Exercise Date, provided
that, the Option Security shall be listed for trading on the New York Stock
Exchange or Nasdaq at the time of such notice and on the Exercise Date.
If such election is made, settlement shall be made by delivery of the
number of shares of the Option Security equal in value to the Settlement Value,
with such shares valued based on the average of the Market Prices for the
consecutive Business Days in the Net Share Valuation Period. The "Net Share
Valuation Period" shall commence on (but exclude) the final Business Day of any
Averaging Period and end on (and include) the date which follows it by the same
number of Business Days in the Averaging Period. If no Averaging Period is
indicated on the Confirmation, the Net Share Valuation Period shall be deemed to
be the Business Day following the Exercise Date. Delivery of such shares shall
be made "free" in good transferable form by the third Business Day following the
Net Share Valuation Period.
Net Share Settlement of an Option issued by the Company is subject to
the following conditions precedent being fulfilled on the Exercise Date: the
Company shall have (i) registered pursuant to an effective registration
statement filed under the Securities Act of 1933, as amended, the offering and
sale by Goldman of not less than 125% of the shares of the Option Security
necessary to fulfill the delivery obligation by the Company assuming that the
number of such shares were determined on the basis of the average of the Market
Prices on the five (5) Business Days prior to the Exercise Date; (ii) delivered
to Goldman such number of prospectuses relating thereto as Goldman shall have
reasonably requested; and (iii) entered into an indemnification agreement
reasonably acceptable to Goldman covering the information contained in such
prospectus. If these conditions precedent are not satisfied on the Exercise
Date, Goldman may require such Option to be settled in cash pursuant to Section
5(b).
(e) Settlement for Fair Value: On any Business Day prior to the
Expiration Date (the "Notification Date"), the Company may irrevocably elect to
Net Share Settle an Option (in whole or in part) at the fair market value (as
determined below) by orally notifying GS&Co. of the number of shares of the
Option Security for which such election applies. The Company shall deliver
written notice of such election by the close of business on the following
Business Day by fax to Xxxxxx Xxxxxxx at 000-000-0000. Upon receiving such
notice, GS&Co. will quote to the Company a "Settlement Warrant Price", and a
"Settlement Share Price" both expressed in dollars per share. If the Company
accepts such Settlement Warrant Price and Settlement Share Price, the
"Settlement Value" shall be the product of (i) the number of shares designated
by the Company on its notice, multiplied by (ii) the Settlement Warrant Price.
Where an Option is to be settled by Settlement for Fair Value, the options shall
settle on the third Business Day following the Notification Date by delivery of
a number of shares to the holder of such Option. Where the Company is the writer
of such Option, then delivery of shares under this provision is subject to the
conditions precedent set forth in paragraph 5 (d)
(f) With respect to any Option that is to be cash-settled or that is to
be settled by Net Share Settlement, if GS&Co. determines that a Market
Disruption Event is occurring on what would otherwise be the Exercise Date, then
the Exercise Date shall be the next Business Day on which a Market Disruption
Event is not occurring, provided that if a Market Disruption Event is still
subsisting on the fifth Business Day after the Exercise Date, then such fifth
Business Day shall be
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the Exercise Date and GS&Co. shall determine the Market Price as of such fifth
day. In the event that GS&Co. determines that a Market Disruption Event is
occurring on a Business Day in an Averaging Period or a Net Share Valuation
Period, then such period shall be extended so that the number of Business Days
in such period on which a Market Disruption Event is not occurring equals the
number of days indicated in the Confirmation for the Averaging Period, provided
that if a Market Disruption Event is subsisting for five Business Days, then
such fifth Business Day shall be deemed to conclude the Averaging Period or the
Net Share Valuation Period.
6. No Default. Each obligation of a party in respect of each Option to make a
payment or deliver Option Securities is subject to the condition precedent that
no Event of Default or event that, with the lapse of time or the giving of
notice or both, would become an Event of Default by the other party has occurred
and is continuing.
7. Representations, Warranties and Covenants.
(a) The Company and GS&Co. each represent and warrant to and covenant with the
other with respect to this Agreement and each Option entered into hereunder
that:
(i) This Agreement has been duly authorized, executed and delivered by
such party and constitutes its valid and legally binding obligation, enforceable
against such party in accordance with its terms; and the issuance, sale and
purchase, as the case may be, of each Option will be duly authorized, executed
and, when delivered by such party, will constitute the valid and legally binding
obligation of such party enforceable against such party in accordance with the
terms thereof.
(ii) The execution and delivery of this Agreement by such party does
not, and the performance by it of its obligations hereunder and under each
Option will not, violate, conflict with or constitute a breach under any
agreement or instrument to which it is party or which is binding on any of its
properties.
(b) Each party represents and warrants to the other that it has the right to
enter into the Option transactions entered into hereunder.
(c) In addition to the foregoing, the Company represents and warrants to Goldman
that (i) as of the trade date of each Option hereunder the Company's most recent
Annual Report on Form 10-K, together with all reports subsequently filed by the
Company pursuant to the Exchange Act, taken together, do not contain any untrue
statement of a material fact or any omission of a material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances in which they were made, not misleading; and (ii) it has taken
such advice from its legal, tax and accounting advisors as it has deemed
necessary prior to entering into this Agreement, and is not relying on Goldman
for any such advice regarding this Agreement or any action either party may take
or refrain from taking thereunder.
8. Default. If any of the following events (each an "Event of Default") shall
occur with respect to a party to an Option (the "Defaulting Party"), the party
which is not in default (the "Non-Defaulting Party") shall have the rights set
forth in Section 9:
(i) the Defaulting Party fails to perform any obligation required to be
performed under this Agreement or any Option entered into hereunder, including,
without limitation, the failure to pay any Premium when due, and such failure is
not cured within three Business Days after receipt of notice thereof;
(ii) the Defaulting Party repudiates any of its obligations hereunder
or under any Option;
(iii) a case in bankruptcy shall be commenced or consented to or a
petition for the appointment of a receiver shall be filed by the Defaulting
Party or brought against the Defaulting Party or the Defaulting Party shall make
a general assignment for the benefit of creditors or admit in writing that it is
unable to pay its debts as they become due, or shall suspend the transaction of
its usual business or any material portion thereof or (if a corporation) shall
be dissolved or shall be a party, other than the surviving party, to a merger or
consolidation; or
(iv) the Non-Defaulting Party shall reasonably believe in good faith
that the Defaulting Party will be unable to meet its obligations when due for
any reason and the Defaulting Party fails, after 10 Business Days prior written
notice from the Non-Defaulting party to provide the Non-Defaulting Party with
adequate assurance of its ability to perform.
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9. Remedies.
(a) Upon the occurrence of an Event of Default and with respect to all unexpired
but unexercised Options (for which purpose a partially exercised Option is an
unexercised Option but only as to the unexercised portion), the Non-Defaulting
Party may by written notice to the Defaulting Party sent while the Event of
Default is continuing and specifying the relevant Event of Default, elect to
terminate and settle all Options (but not some only) in accordance with this
Section 9 on the Early Termination Date, being the date specified in and no
earlier than the date of the notice.
(b) If an Early Termination Date occurs, the Non-Defaulting Party shall
calculate the Early Termination Amount payable by one party to the other and
shall as soon as reasonably practicable give to the Defaulting Party a statement
thereof (including details of any relevant Quotations).
(c) The Early Termination Amount shall be payable on the Business Day
immediately after notice of its amount is given to the Defaulting Party and,
unless payable by the Non-Defaulting Party, shall be paid together with interest
thereon from (and including) the Early Termination Date to (but excluding) the
date of payment at the rate, to the extent permitted by applicable law, of 2 per
cent per annum above Xxxxxx Guaranty Trust Company's prime (or base) commercial
loan rate for short term borrowings as in effect from time to time.
(d) The parties agree that the amounts recoverable under this Section 9 are a
reasonable pre-estimate of loss and not a penalty. Such amounts are payable for
the loss of bargain and the loss of protection against future risks.
(e) The Non-Defaulting Party's rights under this Section 9 shall be in addition
to, and not in limitation or exclusion of, any other rights which the
Non-Defaulting Party may have (whether by agreement, operation of law or
otherwise) against the Defaulting Party.
10. Miscellaneous.
(a) A Confirmation sent by GS&Co. to the Company on a Business Day shall be
deemed to have been received by the Company on the same day (or, if sent on a
day which is not a Business Day, on the next succeeding Business Day) if sent by
same-day messenger, by telex or other telecommunication device capable of
transmitting or creating a written record of transmission, and on the third day
after the day it is sent if by first class mail, postage prepaid (or, if mailed
on a day which is a Federal holiday, three days after the next succeeding day
which is not a Federal holiday). If the Company fails to object to the terms
contained in a Confirmation within three Business Days after receipt thereof,
the terms of such Option (as evidenced by the Confirmation) shall be deemed to
have been accepted.
(b) Neither this Agreement nor any Option may be assigned or transferred by
either party hereto without the consent of the other party, except for an
assignment and delegation of all of GS&Co.'s rights and obligations hereunder in
whatever form GS&Co. determines may be appropriate to a partnership,
corporation, trust or other organization in whatever form that succeeds to all
or substantially all of GS&Co.'s assets and business and that assumes such
obligations by contract, operation of law or otherwise. Upon any such delegation
and assumption of obligations, GS&Co. shall be relieved of and fully discharged
from all obligations hereunder, whether such obligations arose before or after
such delegation and assumption.
(c) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
INTERNAL LAWS OF THE STATE OF NEW YORK, UNITED STATES OF AMERICA WITHOUT GIVING
EFFECT TO CONFLICTS OF LAW PRINCIPLES.
(d) This Agreement and each Option entered into hereunder shall be subject to
all laws, rules and regulations applicable thereto, including, but not by way of
limitation, the provisions of the Securities Act of 1933, and the Securities
Exchange Act of 1934, as amended and all rules and regulations, promulgated or
to be promulgated thereunder. The Company and GS&Co. each acknowledge that the
Options acquired by it from the other party hereunder will not be registered
under the Securities Act of 1933, as amended (the "Act") and will be sold by the
issuer of the Option in reliance upon the exemption for private placements
pursuant to Section 4(2) of the Act.
(e) The parties agree that this Agreement and the terms of each Option entered
into hereunder are confidential and may not be publicly disclosed by either
party except with the prior written consent of the other party or pursuant to
the demand or requirement of any court or regulatory agency having jurisdiction
over a party.
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(f) Each Option is being entered into by the parties hereto acting as principal
for their respective own account. Subject to the termination of any Option by
expiration or full performance upon exercise, no failure on the part of either
party to exercise, and no delay in exercising, any contractual right prior to
termination of any such Option as aforesaid will operate as a waiver thereof,
nor will any single or partial exercise by either party of any right preclude
any other or future exercise thereof or the exercise of any other right. No
modification or waiver of any provision hereof nor any consent to any departure
by either party therefrom shall in any event be effective unless the same shall
be in writing, and then such waiver or consent shall be effective only in the
specific instance and for the purpose for which given. All written notices
hereunder shall be sent to a party at its address by mail, hand delivery or
facsimile transmission as set forth below, or to such other address or telex
number as a party shall have last notified the other party in writing, or to
such other address as either party shall have last notified the other party in
writing. For purposes of telephone notice, GS&Co.'s relevant telephone number
and the Company's relevant telephone number are set forth below and each of
GS&Co. and the Company shall notify the other in writing of any change thereof.
11. Arbitration.
(A) ARBITRATION IS FINAL AND BINDING ON THE COMPANY AND GS&CO.
(B) THE COMPANY AND GS&CO. ARE WAIVING THEIR RIGHT TO SEEK REMEDIES IN COURT,
INCLUDING THE RIGHT TO A JURY TRIAL.
(C) PRE-ARBITRATION DISCOVERY IS GENERALLY MORE LIMITED THAN AND DIFFERENT FROM
COURT PROCEEDINGS.
(D) THE ARBITRATOR'S AWARD IS NOT REQUIRED TO INCLUDE FACTUAL FINDINGS OR LEGAL
REASONING AND ANY PARTY'S RIGHT TO APPEAL OR TO SEEK MODIFICATION OF RULINGS BY
THE ARBITRATORS IS STRICTLY LIMITED.
(E) THE PANEL OF ARBITRATORS WILL TYPICALLY INCLUDE A MINORITY OF ARBITRATORS
WHO WERE OR ARE AFFILIATED WITH THE SECURITIES INDUSTRY.
ANY CONTROVERSY BETWEEN OR AMONG GS&CO. OR ITS AFFILIATES, OR ANY OF
ITS OR THEIR PARTNERS, DIRECTORS, AGENTS OR EMPLOYEES, ON THE ONE HAND, AND THE
COMPANY OR ITS AGENTS AND AFFILIATES, ON THE OTHER HAND, ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY OPTION ENTERED INTO HEREUNDER, SHALL BE
SETTLED BY ARBITRATION, IN ACCORDANCE WITH THE THEN CURRENT RULES OF, AT THE
COMPANY'S ELECTION, THE AMERICAN ARBITRATION ASSOCIATION ("AAA") OR THE BOARD OF
ARBITRATION OF THE NEW YORK STOCK EXCHANGE ("BANYSE"). IF THE COMPANY DOES NOT
MAKE SUCH ELECTION BY REGISTERED MAIL ADDRESSED TO GS&CO. WITHIN FIVE (5)
BUSINESS DAYS AFTER RECEIPT OF NOTIFICATION FROM GS&CO. REQUESTING SUCH
ELECTION, THEN THE COMPANY IRREVOCABLY AUTHORIZES GS&CO. TO MAKE SUCH ELECTION
ON BEHALF OF THE COMPANY. THE AWARD OF THE ARBITRATORS SHALL BE FINAL, AND
JUDGMENT UPON THE AWARD RENDERED MAY BE ENTERED IN ANY COURT, STATE OR FEDERAL,
HAVING JURISDICTION.
NEITHER PARTY SHALL BRING A PUTATIVE OR CERTIFIED CLASS ACTION TO ARBITRATION,
NOR SEEK TO ENFORCE ANY PRE-DISPUTE ARBITRATION AGREEMENT AGAINST ANY PERSON WHO
HAS INITIATED IN COURT A PUTATIVE CLASS ACTION; WHO IS A MEMBER OF A PUTATIVE
CLASS WHO HAS NOT OPTED OUT OF THE CLASS WITH RESPECT TO ANY CLAIMS ENCOMPASSED
BY THE PUTATIVE CLASS ACTION UNTIL:
(I) THE CLASS CERTIFICATION IS DENIED;
(II) THE CLASS IS DECERTIFIED; OR
(III) THE CUSTOMER IS EXCLUDED FROM THE CLASS BY THE COURT.
SUCH FORBEARANCE TO ENFORCE AN AGREEMENT TO ARBITRATE SHALL NOT CONSTITUTE A
WAIVER OF ANY RIGHTS UNDER THIS AGREEMENT EXCEPT TO THE EXTENT STATED HEREIN.
129
BY SIGNING BELOW, THE COMPANY ACKNOWLEDGES RECEIPT OF A COPY OF THIS
OPTIONS AGREEMENT. A PRE-DISPUTE ARBITRATION CLAUSE IS CONTAINED IN SECTION 11
HEREOF.
XXXXXXX, XXXXX & CO.
Name: Xxxx Xxxxxx
Address: 00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telex No.:
Domestic: WU Tlex 12-5654 Goldsachs
International: ITT421344GOLSAX
TRT 177784 GSUT
WUI62506GOLSAC
Telefax No.: 000-000-0000
Telephone No.: 000-000-0000
Exercise Notice to: Equity Operations: Options
and Derivatives
Accepted and Agreed to this
8th day of April, 1997.
BROADBAND TECHNOLOGIES, INC.
By:
Name: Xxxxxxx X. Xxxxxx
Address: 0000 Xxxxxxx Xxxxx Xxxxx, Xxxxx 000
Telex No:
Domestic:
International:
Telefax No.: (000) 000-0000
Telephone No.: (000) 000-0000
Exercise Notice to: Equity Operations: Options & Derivatives
