EXHIBIT 4.3
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UNIVAX BIOLOGICS, INC.
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NONSTATUTORY STOCK OPTION AGREEMENT
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THIS AGREEMENT, entered into as of , 19__, between
UNIVAX BIOLOGICS, INC., a Delaware corporation (the "Company"), and
____________________ (the "Optionee").
WITNESSETH:
Whereas the Company's Board of Directors has the authority to grant
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nonstatutory stock options in order to provide selected Employees, Directors,
and Consultants of the Company with an opportunity to acquire Common Stock of
the Company; and
Now Therefore, it is agreed as follows:
SECTION 1. GRANT OF OPTION.
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On the terms and conditions stated below, the Company hereby grants to the
Optionee the option to purchase ( ) Shares for the sum of
Fifteen Cents ($0.15) per share which is agreed to be (100%) of the fair market
value thereof on the Date of Grant. This option is not intended to be an
Incentive Stock Option.
SECTION 2. NO TRANSFER OR ASSIGNMENT OF OPTION.
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Except as otherwise provided in this Agreement, this option and the rights
and privileges conferred hereby shall not be transferred, assigned, pledged or
hypothecated in any way (whether by operation of law or otherwise) and shall not
be subject to sale under execution, attachment or similar process. Upon any
attempt to transfer, assign, pledge, hypothecate or otherwise dispose of this
option, or of any right or privilege conferred hereby, contrary to the
provisions hereof, or upon any attempted sale under any execution, attachment or
similar process upon the rights and privileges conferred hereby, this option and
the rights and privileges conferred hereby shall immediately become null and
void.
SECTION 3. RIGHT TO EXERCISE
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(a) Vesting. Subject to the conditions stated herein, the right to
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exercise this option shall accrue in cumulative installments over a period of
four (4) years with 12.50% of the shares becoming exercisable six (6) months
from the date of this Agreement and 6.25% becoming exercisable every three (3)
months thereafter.
(b) Periods of Nonexercisability. Any other provision of this
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Agreement notwithstanding, the Company shall have the right to designate one or
more periods of time, each of which shall not exceed eighteen (18) months in
length, during which this option shall not be exercisable if the Company
determines (in its sole discretion) that such limitation on exercise could in
any way facilitate a lessening of any restriction on transfer pursuant to the
Securities Act or any state securities laws with respect to any issuance of
securities by the Company, facilitate the registration or qualification of any
securities by the Company under the Securities Act or any state securities laws,
or facilitate the perfection of any exemption from the registration or
qualification requirements of the Securities Act or any applicable state
securities laws for the issuance or transfer of any securities. Such limitation
on exercise shall not alter the vesting schedule set forth in Section 3(a) other
than to limit the periods during which this option shall be exercisable. The
Optionee shall be notified in writing of any such designation by the Company.
SECTION 4. EXERCISE PROCEDURES.
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(a) Notice of Exercise. The Optionee or the Optionee's representative may
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exercise this option by giving written notice to the Secretary of the Company
pursuant to Section 12(d). The notice shall specify the election to exercise
this option, the number of Shares for which it is being exercised and the form
of payment. The notice shall be signed by the person or persons exercising this
option. In the event that this option is being exercised by the representative
of the Optionee, the notice shall be accompanied by proof (satisfactory to the
Company) of the representative's right to exercise this option. The Optionee or
the Optionee's representative shall deliver to the Secretary of the Company, at
the time of giving the notice, payment in a form permissible under Section 5 for
the full amount of the Purchase Price.
(b) Issuance of Shares. After receiving a proper notice of exercise, the
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Company shall cause to be issued a certificate or certificates for the Shares as
to which this option has been exercised, registered in the name of the person
exercising this option (or in the names of such person and his or her spouse as
community property or as joint tenants with right of survivorship). The
Company shall cause such certificate or certificates to be delivered to or upon
the order of the person exercising this option.
SECTION 5. PAYMENT FOR STOCK.
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The entire Purchase Price may be paid in lawful money of the United States
of America. Alternatively, all or part of the Purchase Price may be paid by
the surrender of Shares in good form for transfer. Such Shares must have been
owned for more than twelve (12) months by the Optionee or the Optionee's
representative and must have a fair market value (as determined by the Board of
Directors) on the date of exercise of this option which, together with any
amount paid in lawful money, is equal to the Purchase Price.
SECTION 6. TERM AND EXPIRATION.
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(a) Basic Term. This option shall in any event expire on the date ten (10)
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years after the Date of Grant.
(b) Termination of Service (Except by Death). If the Optionee's service as
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an Employee, Director, or Consultant terminates for any reason other than death,
then this option shall expire on the earliest of the following occasions:
(i) The expiration date determined pursuant to Subsection (a) above.
(ii) The date thirty (30) days after the termination of the Optionee's
service as an Employee, Director, or Consultant for any reason other than Total
and Permanent Disability; or
(iii) The date six (6) months after the termination of the Optionee's
service as an Employee, Director, or Consultant by reason of Total and Permanent
Disability.
The Optionee may exercise all or part of this option at any time before its
expiration under the preceding sentence, but only to the extent that this option
had become exercisable before the Optionee's service terminated. The
balance of this option shall lapse when the Optionee's service as an Employee,
Director, or Consultant terminates. In the event that the Optionee dies after
the termination of service but before the expiration of this option, all or part
of this option may be exercised (prior to expiration) by the executors or
administrators of the Optionee's estate or by any person who has acquired this
option directly from the Optionee by bequest or inheritance, but only to the
extent that this option had become exercisable before the Optionee's service
terminated.
(c) Death of Optionee. If the Optionee dies as an Employee, Director, or
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Consultant then this option shall expire on the earlier of the following dates:
(i) The expiration date determined pursuant to Subsection (a) above; or
(ii) The date six (6) months after the Optionee's death.
All or part of this option may be exercised at any time before its expiration
under the preceding sentence by the executors or administrators of the
Optionee's estate or by any person who has acquired this option directly from
the Optionee by bequest or inheritance, but only to the extent that this option
had become exercisable before the Optionee's death. The balance of this option
shall lapse when the Optionee dies.
SECTION 7. THE COMPANY'S RIGHT OF FIRST REFUSAL
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(a) Right of First Refusal. In the event that the Optionee or a Transferee
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proposes to sell, pledge or otherwise transfer to any person any Shares acquired
under this Agreement, or any interest in such Shares, the Company shall have the
Right of First Refusal with respect to such Shares. If the Optionee or
Transferee desires to transfer Shares acquired under this
Agreement, the Optionee or Transferee shall give a written Transfer Notice to
the Company describing fully the proposed transfer, including the number of
Shares proposed to be transferred, the proposed transfer price and the name and
address of the proposed Transferee. The Transfer Notice shall be signed both by
the Optionee or Transferee and by the proposed new Transferee and must
constitute a binding commitment of both parties to the transfer of the Shares.
The Company shall have the right to purchase the Shares on the terms of the
proposal described in the Transfer Notice (subject, however, to any change in
such terms permitted under Subsection (b) below) by delivery of a notice of
exercise of the Right of First Refusal within thirty (30) days after the date
when the Transfer Notice was received by the Company. The Company's rights
under this Subsection (a) shall be freely assignable, in whole or in part.
(b) Transfer of Shares. If the Company fails to exercise its Right of First
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Refusal within thirty (30) days after the date when it received the Transfer
Notice, the Optionee or Transferee may, not later than ninety (90) days
following receipt of the Transfer Notice by the Company, conclude a transfer of
the Shares subject to the Transfer Notice on the terms and conditions described
in the Transfer Notice. Any proposed transfer on terms and conditions different
from those described in the Transfer Notice, as well as any subsequent proposed
transfer by the Optionee or Transferee, shall again be subject to the Right of
First Refusal and shall require compliance with the procedure described in
Subsection (a) above. If the Company exercises its Right of First Refusal, the
parties shall consummate the sale of the Shares on the terms set forth in the
Transfer Notice; provided, however, that in the event the Transfer Notice
provides that payment for the Shares is to be made in a form other than lawful
money paid at the time of transfer, the Company shall
have the option of paying for the Shares with lawful money equal to the present
value of the consideration described in the Transfer Notice.
(c) Binding Effect. The Company's Right of First Refusal shall inure to the
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benefit of its successors and assigns and shall be binding upon any Transferee
of the Shares.
(d) Termination of Right of First Refusal. Any other provision of this
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Section 7 notwithstanding, in the event that Stock is listed on an established
stock exchange or is quoted regularly on the NASDAQ System at the time when the
Optionee or Transferee desires to transfer Shares, the Company shall have no
Right of First Refusal, and the Optionee or Transferee shall have no obligation
to comply with the procedures prescribed by Subsections (a), (b) and (c) above.
SECTION 8. LEGALITY OF INITIAL ISSUANCE.
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No Shares shall be issued upon the exercise of this option unless and until
the Company has determined that:
(a) It and the Optionee have taken any actions required to register the
Shares under the Securities Act or to perfect an exemption from the registration
requirements thereof;
(b) Any applicable listing requirement of any stock exchange on which
Stock is listed has been satisfied; and
(c) Any other applicable provision of state or federal law has been
satisfied.
SECTION 9. NO REGISTRATION RIGHTS.
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The Company may, but shall not be obligated to, register or qualify the sale
of Shares under the Securities Act or any other applicable law. The Company
shall not be obligated to take any affirmative action in order to cause the sale
of Shares under this Agreement to comply with any law.
SECTION 10. RESTRICTIONS ON TRANSFER OF SHARES.
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(a) Restrictions. Regardless of whether the offering and sale of Shares have
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been registered under the Securities Act or have been registered or qualified
under the securities laws of any state, the Company may impose restrictions upon
the sale, pledge or other transfer of such Shares (including the placement of
appropriate legends on stock certificates) if, in the judgment of the Company
and its counsel, such restrictions are necessary or desirable in order to
achieve compliance with the provisions of the Securities Act, the securities
laws of any state or any other law.
(b) Investment Intent at Grant. The Optionee represents and agrees that
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the Shares to be acquired upon exercising this option will be acquired for
investment, and not with a view to the sale or distribution thereof.
(c) Investment Intent at Exercise. In the event that the sale of Shares is
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not registered under the Securities Act but an exemption is available which
requires an investment representation or other representation, the Optionee
shall represent and agree at the time of exercise that the Shares being acquired
upon exercising this option are being acquired for investment, and not with a
view to the sale or distribution thereof, and shall make such other
representations as are deemed necessary or appropriate by the Company and its
counsel.
(d) Legend. All certificates evidencing Shares acquired under this
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Agreement in an unregistered transaction shall bear the following restrictive
legend (and such other restrictive legends as are required or deemed advisable
under the provisions of any applicable law):
"THE SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED, OR OTHERWISE TRANSFERRED
WITHOUT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR AN OPINION OF
COUNSEL, SATISFACTORY TO THE COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION IS
NOT REQUIRED."
(e) Removal of Legends. If, in the opinion of the Company and its counsel,
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any legend placed on a stock certificate representing Shares sold under this
Agreement is no longer required, the holder of such certificate shall be
entitled to exchange such certificate for a certificate representing the same
number of Shares but lacking such legend.
(f) Administration. Any determination by the Company and its counsel in
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connection with any of the matters set forth in this Section 10 shall be
conclusive and binding on the Optionee and all other persons.
SECTION 11. SHARES AND ADJUSTMENTS.
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(a) General. In the event of a subdivision of the outstanding Shares, a
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declaration of a dividend payable in Shares, a declaration of a dividend payable
in a form other than Shares in an amount that has a material effect on the value
of Shares, a combination or consolidation of the outstanding Shares (by
reclassification or otherwise) into a lesser number of Shares, a
recapitalization or a similar occurrence, the Committee shall make appropriate
adjustments in one or both of (i) the number of Shares covered by this option or
(ii) the Exercise Price.
(b) Reorganizations. In the event that the Company is a party to a merger or
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other reorganization, this option shall be subject to the agreement of merger or
reorganization. Such agreement may provide, without limitation, for the
assumption of this option by the surviving corporation or its parent, for its
continuation by the Company (if the Company is a surviving corporation), for
its settlement in cash, for the acceleration of its exercisability followed by
its cancellation if not exercised or its cancellation (if not exercised) without
an acceleration, in all cases without the Optionee's consent.
(c) Reservation of Rights. Except as provided in this Section 11, the
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Optionee shall have no rights by reason of any subdivision or consolidation of
shares of stock of any class, the payment of any dividend or any other increase
or decrease in the number of shares of stock of any class. Any issue by the
Company of shares of stock of any class, or securities convertible into shares
of stock of any class, shall not affect, and no adjustment by reason thereof
shall be made with respect to, the number or Exercise Price of the Shares
subject to this option. The grant of this option shall not affect in any way
the right or power of the Company to make adjustments, reclassifications,
reorganizations or changes of its capital or business structure, to merge or
consolidate or to dissolve, liquidate, sell or transfer all or any part of its
business or assets.
SECTION 12. MISCELLANEOUS PROVISIONS.
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(a) Withholding Taxes. In the event that the Company determines that it is
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required to withhold foreign, federal, state or local tax as a result of the
exercise of this option, the Optionee, as a condition to the exercise of this
option, shall make arrangements satisfactory to the Company to enable it to
satisfy all withholding requirements. The Optionee shall also make arrangements
satisfactory to the Company to enable it to satisfy any withholding requirements
that may arise in connection with the disposition of Shares purchased by
exercising this option.
(b) Rights as a Stockholder. Neither the Optionee nor the Optionee's
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representative shall have any rights as a stockholder with respect to any Shares
subject to this option until such Shares have been issued in the name of the
Optionee or the Optionee's representative.
(c) No Employment Rights. Nothing in this Agreement shall be construed as
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giving the Optionee the right to be retained as an Employee, Director, or
Consultant. The Company reserves the right to terminate the Optionee's service
at any time, with or without cause.
(d) Notice. Any notice required by the terms of this Agreement shall be
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given in writing and shall be deemed effective upon personal delivery or upon
deposit with the United States Postal Service, by registered or certified mail
with postage and fees prepaid and addressed to the party entitled to such notice
at the address shown below such party's signature on this Agreement, or at such
other address as such party may designate by ten (10) days' advance written
notice to the other party to this Agreement.
(e) Entire Agreement. This Agreement constitutes the entire contract
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between the parties hereto with regard to the subject matter hereof.
(f) Choice of Law. This Agreement shall be governed by, and construed in
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accordance with, the laws of the State of Maryland, as such laws are applied to
contracts entered into and performed in such State.
SECTION 13. DEFINITIONS
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(a) "Agreement" shall mean this Nonstatutory Stock Option
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Agreement.
(b) "Board" shall mean the Board of Directors of the Company. as
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constituted from time to time.
(c) "Code" shall mean the Internal Revenue Code of 1986, as amended.
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(d) "Director" shall mean an elected member of the Company Board of
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Directors.
(e) "Date of Grant" shall mean the date on which the Committee
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resolved to grant this option, which is also the date as of which this
Agreement is entered into.
(f) "Employee" shall mean any individual who is a common-law employee of the
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Company or of a Subsidiary.
(g) "Exercise Price" shall mean the amount for which one Share may be
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purchased upon exercise of this option, as specified in Section l(a).
(h) "Incentive Stock Option" shall mean an employee incentive stock option
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described in section 422A(b) of the Code.
(i) "Purchase Price" shall mean the Exercise Price multiplied by the number
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of Shares with respect to which this option is being exercised.
(j) "Right of First Refusal" shall mean the Company's right of first refusal
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described in Section 7.
(k) "Securities Act" shall mean the Securities Act of 1933, as amended.
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(l) "Share" shall mean one share of Stock, as adjusted in accordance with
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Section 11 (if applicable).
(m) "Stock" shall mean the Common Stock of the Company.
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(n) "Subsidiary" shall mean any corporation, if the Company and/or one or
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more other Subsidiaries own not less than fifty percent (50%) of the total
combined voting power of all classes or outstanding stock of such corporation.
(o) "Total and Permanent Disability" shall mean that the Optionee is
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unable to engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected to result in
death or which has lasted, or can be expected to last, for a continuous period,
of not less than six (6) months.
(p) "Transferee" shall mean any person to whom the Optionee has directly or
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indirectly transferred any Share acquired under this Agreement.
(q) "Transfer Notice" shall mean the notice of a proposed transfer of Shares
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described in Section 7.
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed on
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its behalf by its officer duly authorized to act on behalf of the Committee; and
the Optionee has personally executed this Agreement.
OPTIONEE UNIVAX BIOLOGICS, INC.
By
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Optionee's Address: Company's Address:
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