EXHIBIT 4.3
STOCK OPTION AGREEMENT
AGREEMENT made as of December 19, 1995 by and between CADUS PHARMACEUTICAL
CORPORATION (the "Corporation"), a Delaware corporation having offices at 000
Xxx Xxx Xxxx Xxxxx Xxxx, Xxxxxxxxx, Xxx Xxxx 00000-0000, and _________________
("Employee"), residing at ______________________________________________.
W I T N E S S E T H:
WHEREAS, Employee desires to participate in the equity ownership of the
Corporation and the Corporation desires to provide Employee with an added
incentive to remain in the employ of the Corporation by granting to Employee the
right and option, subject to certain conditions, to purchase shares of the
common stock, $.001 par value, of the Corporation (the "Common Stock");
NOW, THEREFORE, in consideration of the mutual covenants hereinafter
contained, the parties hereto agree as follows:
1. Grant of Stock Option.
As an additional inducement to Employee to continue in the employ of
the Corporation, the Corporation hereby grants to Employee the right and option
(the "Option") to purchase from the Corporation One Hundred Thousand (100,000)
shares of Common Stock (the "Shares"), subject to adjustment as provided in
Paragraph 7 hereof, on the terms and subject to the conditions hereinafter set
forth.
2. Purchase Price.
Subject to adjustment as provided in Paragraph 7 hereof, the
purchase price (the "Option Purchase Price") to be paid upon exercise of the
Option shall be $1.20 per share.
3. Exercisability of Option.
(a) The Option shall be exercisable, on a cumulative basis, during a
period of ten (10) years commencing from the date hereof and terminating at the
close of business on December 19, 2005, as follows:
(i) up to ______ Shares subject to the Option may be purchased
by Employee after December 19, 1996;
(ii) up to an additional ______ Shares subject to the Option
may be purchased by Employee after December 19, 1997;
(iii) up to an additional ______ Shares subject to the Option
may be purchased by Employee after December 19, 1998; and
(iv) up to an additional ______ Shares subject to the Option
may be purchased by Employee after December 19, 1999.
(b) The unexercised portion of the Option will automatically and
without notice terminate and become null and void at the close of business on
December 19, 2005. If, however, Employee's employment with the Corporation or
parent or subsidiary corporation terminates before the close of business on
December 31, 2005, the Option will terminate on the applicable date as described
below; provided, however, that none of the events described below shall extend
the period of exercisability of the Option beyond the close of business on
December 31, 2005:
(i) the date of termination, if Employee voluntarily
terminates his employment or his employment is terminated by the Corporation for
"cause" (as hereinafter defined);
(ii) the expiration of twelve (12) months after Employee's
death or the termination of his employment by reason of his "disability" (as
hereinafter defined); or
(iii) the expiration of three (3) months from the date of
termination of Employee's employment by the Corporation without cause.
(c) For the purposes of this Agreement, the term "cause" shall mean
the commission by Employee of any material act of malfeasance, fraud,
dishonesty, or breach of fiduciary duty against the Corporation or any
unauthorized disclosure of confidential information by Employee. The
determination of cause by the Board of Directors of the Corporation shall be
final and binding for all purposes.
(d) For purposes of this Agreement, the term "disability" shall mean
such physical or mental illness or incapacity or Employee as shall (i) prevent
Employee from performing his customary services and duties to the Corporation
and (ii) continue during any period of one hundred twenty (120) consecutive days
or for periods aggregating one hundred eighty (180) days in any 365 day period.
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4. Exercise of Option.
(a) The Option may be exercised by Employee as to all or a portion
of the Shares (but not as to a fractional share of Common Stock) as to which the
Option has become exercisable, at any time within the applicable period
specified in Paragraph 3 hereof, by the giving of written notice of the exercise
thereof to the Corporation in the manner provided in Paragraph 14 hereof and
substantially in the form annexed hereto as Exhibit A, which notice shall be
accompanied by payment in full of the purchase price therefor by certified or
bank cashier's or other acceptable check. Such exercise shall be effective upon
receipt by the Corporation of such written notice and payment; and Employee, to
the extent permitted by law, shall be deemed the owner of the Shares being
purchased as of the close of business on the date of such exercise and payment.
The Corporation shall cause a certificate or certificates representing the
Shares purchased to be delivered to Employee within ten (10) days after the
effective date of such exercise. Employee agrees that such certificate or
certificates shall bear such legend or legends as the Board of Directors of the
Corporation, in its sole discretion, determines to be necessary or appropriate
to prevent a violation of, or to perfect an exemption from, the registration
requirements of the Securities Act of 1933, as amended (the "Securities Act").
(b) In lieu of the check provided for in subparagraph 4(a) above,
Employee may, at his sole option and to the extent permitted by applicable law,
pay for the purchase price of the Shares being purchased by the exercise of the
Option, by delivering to the Corporation shares of Common Stock (in proper form
for transfer and accompanied by all requisite stock transfer tax stamps or cash
in lieu thereof) owned by Employee having a Fair Market Value (as hereinafter
defined in subparagraph 4(c) hereof) equal to such purchase price. Employee may
elect to make such delivery to the Corporation of shares of Common Stock from
Shares he is purchasing pursuant to his exercise of the Option by including such
election in his notice of exercise.
(c) The Fair Market Value of a share of Common Stock as of a
particular date (the "Determination Date") shall mean:
(i) If the Corporation's Common Stock is traded on an exchange
or is quoted through the National Association of Securities Dealers, Inc.
Automated Quotation ("NASDAQ") National Market System, then the closing or last
sale price, respectively,
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reported for the last business day immediately preceding the Determination Date.
(ii) If the Corporation's Common Stock is not listed on an
exchange or quoted on the NASDAQ National Market System but is traded in the
over-the-counter market, then the mean of the closing bid and asked prices
reported for the last business day immediately preceding the Determination Date.
(iii) Except as provided in subparagraph 4(c)(iv) and 4(c)(v)
below, if the Corporation's Common Stock is not publicly traded, then as
determined in good faith by the Corporation's Board of Directors upon a review
of relevant factors.
(iv) If the Determination Date is the date on which the
Corporation's Common Stock is first sold to the public by the Corporation in a
firm commitment public offering under the Securities Act, then the initial
public offering price (before deducting commissions, discounts or expenses) at
which the Common Stock is sold in such offering.
(v) If the Determination Date is the date of a liquidation,
dissolution or winding up of the Corporation, then all amounts to be payable per
share to holders of the Common Stock in the event of such liquidation,
dissolution or winding up.
5. Purchase for Investment.
Employee agrees that at the request of the Corporation and upon
exercise of the Option, he shall execute and deliver to the Corporation a
written statement, in form satisfactory to the Corporation, representing and
warranting that he is purchasing the Shares for his own account, for investment
only and not with a view to the resale or distribution thereof and that any
subsequent offer for sale or sale of any of such Shares shall be made either
pursuant to (a) a registration statement on an appropriate form under the
Securities Act, which registration statement has become effective and is current
with respect to the shares being offered and sold, or (b) a specific exemption
from the registration requirements of the Securities Act, but in claiming such
exemption Employee shall, prior to any offer for sale or sale of such shares,
obtain a favorable written opinion from counsel for or approved by the
Corporation as to the availability of such exemption.
6. Non-Transferability of Option.
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The Option shall not be transferable by Employee other than by will
or the laws of descent and distribution.
7. Adjustment of Shares.
If any change is made in the Shares deliverable upon exercise of the
Option (through merger, consolidation, reorganization, recapitalization, stock
dividend, stock split, split-up, spin-off, split-off, subdivision or combination
of shares, exchange of shares, issuance of rights to subscribe, change in
capital structure or similar event), such adjustments or substitutions shall be
made by the Board of Directors of the Corporation in or for the Shares
(including adjustments in the number of Shares and in the per share price of
Shares subject to the Option) as the Board of Directors of the Corporation
reasonably shall determine to be appropriate and equitable to prevent dilution
or enlargement of Employee's rights hereunder.
8. Covenants of the Corporation.
The Corporation hereby covenants and agrees that:
(a) During the period within which the Option may be exercised, the
Corporation shall at all times reserve and keep available by all necessary
corporate action out of its shares of Common Stock for the purpose of issuance
or transfer upon exercise of the Option the number of shares of Common Stock
included in the Shares and such additional securities as may from time to time
be deliverable hereunder. Such shares may be authorized but unissued shares, or
may be shares held in the treasury of the Corporation or a combination thereof,
at the option of the Corporation.
(b) All shares which may be issued upon exercise of the Option or
delivered pursuant to this Agreement will, upon issuance and payment therefor as
provided herein, be validly issued, fully paid, nonassessable and free from all
liens and charges with respect to the issue thereof.
9. Representations and Warranties of the Corporation.
The Corporation represents and warrants to Employee as follows:
(a) The Corporation is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware.
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(b) The Corporation has all requisite legal and corporate
power to execute this Agreement. The execution, delivery and performance by the
Corporation of this Agreement and the consummation of the transactions
contemplated hereby have been authorized by all necessary corporate action on
the part of the Corporation.
(c) This Agreement has been duly executed by the Corporation
and, assuming due and valid execution and delivery of the same by Employee,
constitutes the valid and legally binding obligation of the Corporation
enforceable in accordance with its terms.
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10. No Fractional Shares.
Upon the exercise of the Option, the Corporation shall not be
required to issue any fractional shares or scrip certificates evidencing any
fractional interest in shares. In any case where, pursuant to the terms of the
Option, Employee would be entitled, except for the provisions of this Paragraph
10, to receive a fractional share, the number of shares issuable upon such
exercise shall be rounded to the next larger whole share if such fractional
share interest is a major fraction; if such fractional share interest is not a
major fraction, it shall be disregarded.
11. "Lock-Up" Agreement.
Employee, if so requested by the Corporation and an underwriter of
Common Stock or other securities of the Corporation, shall not sell, grant any
option or right to buy or sell, or otherwise transfer or dispose of in any
manner, whether in privately-negotiated or open-market transactions, any Common
Stock or other securities of the Corporation held by him or which he has the
right to acquire during the 180-day period following the effective date of a
registration statement of the Corporation filed with the Securities and Exchange
Commission in connection with such offering or such shorter period as such
underwriter shall have advised the Corporation in writing is adequate to permit
the successful and orderly distribution of such Common Stock or other
securities; provided, however, that such "lock-up" agreement shall be in writing
and in form and substance satisfactory to the Corporation and such underwriter.
The Corporation may impose stop-transfer instructions with respect to the shares
subject to the foregoing restrictions until the end of said 180-day period. This
Paragraph 11 shall survive the termination or exercise of the Option.
12. Entire Agreement Amendments.
This Agreement sets forth the entire understanding of the parties
with respect to the subject matter hereof, and no statement, representation,
warranty or covenant has been made by either party except as expressly set forth
herein. This Agreement supersedes and cancels all prior agreements between the
parties, whether written or oral, with respect to the subject matter hereof. No
alteration, amendment or modification of any of the terms and provisions hereof
shall be valid unless made pursuant to a written instrument signed by all of the
parties hereto.
13. Applicable Law.
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This Agreement shall be governed by, and construed and enforced in
accordance with, the laws of the State of Delaware.
14. Notices.
All notices, requests, demands and other communications hereunder
shall be in writing and shall be deemed to have been duly given if delivered
personally or mailed, first class, postage prepaid, certified mail, return
receipt requested, to the other party at its address as set forth at the
beginning of this Agreement or as either of the parties may designate in
conformity with the foregoing.
15. Paragraph Headings.
The paragraph headings set forth in this Agreement are for reference
purposes only and shall not be considered as part of this Agreement in any
respect nor shall they in any way affect the substance of any provisions
contained in this Agreement.
16. Successors and Assigns.
This Agreement shall not be assignable by Employee, but the rights
hereunder may be transferred as described in Paragraph 6 hereof. All of the
terms and provisions of this Agreement shall be binding upon and inure to the
benefit of and be enforceable by Employee, the Corporation, the heirs and
personal representatives of Employee and the successors and assigns of the
Corporation.
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
as of the day and year first above written.
CADUS PHARMACEUTICAL CORPORATION
By: __________________________________
Xxxxxx X. Xxxxx, President
______________________________________
NAME OF EMPLOYEE
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EXHIBIT A
[Date of Exercise]
Cadus Pharmaceutical Corporation
000 Xxx Xxx Xxxx Xxxxx Xxxx
Xxxxxxxxx, XX 00000-0000
Attention: Corporate Secretary
Re: Stock Option
Dear Sir:
I am the holder of a Stock Option granted to me by Cadus
Pharmaceutical Corporation (the "Corporation"), pursuant to a Stock Option
Agreement dated as of December , 1995, to purchase shares of Common Stock of the
Corporation ("Shares"). I hereby exercise such option with respect to Shares,
the total purchase price for which is $ , and [I enclose a certified or bank
cashier's or other acceptable check payable to the order of the Corporation in
the amount of $ , representing the total purchase price for the Shares] [I
hereby elect to pay the purchase price by delivering to the Corporation shares
of Common Stock of the Corporation having a fair market value equal to $ from
the Shares I am purchasing pursuant to the exercise of such option]. The
certificate or certificates representing the Shares should be registered in my
name and should be forwarded to me at .
Please acknowledge receipt of the exercise of my stock option on the
attached copy of this letter.
Very truly yours,
[EMPLOYEE]
RECEIPT ACKNOWLEDGED:
CADUS PHARMACEUTICAL CORPORATION
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By: ______________________________
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