EXHIBIT 10.59
STOCK OPTION AGREEMENT
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STOCK OPTION AGREEMENT dated as of March 12, 1996, between VIMRx
Pharmaceuticals Inc., a Delaware corporation (the "Company"), and Xxxxxx X.
Xxxxxxx ("Xxxxxxx").
WHEREAS, the Company, Xxxxxxx and Xxxxxxx X. Xxxxxxxxx, M.D. have
entered into a guaranty agreement dated March 12, 1996 (the "Consulting
Agreement") pursuant to which Xxxxxxx and Xxxxxxxxx agreed to guaranty certain
on-going obligations of the Company, and the Company has agreed to xxxxx Xxxxxxx
the option described herein;
NOW, THEREFORE, the parties hereto agree as follows:
Section 1. Granting of Option. On the terms and conditions
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hereinafter set forth, the Company hereby grants to Xxxxxxx the irrevocable
option (the "Option") to purchase up to One Hundred Thousand (100,000) fully
paid and nonassessable shares of Common Stock, $.001 par value, of the Company,
at a price of $1.47 per share (the "Exercise Price"). The number of shares of
Common Stock which may be purchased upon the exercise of the Option and the
amount of the Exercise Price are subject to adjustment as set forth in Section
3.
Section 2. Term of Option; Exercise; Nontransferability; Death.
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(a) The Option may be exercised, in whole or in part, commencing the
date hereof, and shall be exercisable for a ten-year period, or through 5:00
p.m. New York City time on March 11, 2006 (the "Expiration Date").
(b) The Option shall be exercised by giving a written notice of
exercise in the form of Appendix 1 hereto, which notice shall be accompanied by
payment to the Company in immediately available funds of the Exercise price for
the number of shares of Common Stock specified in such notice and shall contain
a statement by Xxxxxxx (in a form satisfactory to the Company) that such shares
are being acquired by Xxxxxxx for investment and not with a view to their
distribution or resale. The Company shall have the right to require that
Xxxxxxx also remit to the Company an amount sufficient to satisfy any federal,
state or local withholding tax requirements prior to the delivery of any shares
of stock pursuant to the exercise of the Option. The Exercise Price may also be
paid by delivering previously owned shares of Common Stock or instructing the
Company to withhold that number of shares issuable upon exercise of this Option
having a value, based upon the closing price of the Common Stock on the trading
date immediately preceding the date of exercise, equal to the Exercise Price.
(c) Upon giving such notice and making such payment, the Company shall
promptly issue to Xxxxxxx the shares of Common Stock to which Xxxxxxx is
entitled hereunder.
(d) If the Option should be exercised in part only, the Company shall,
upon surrender of this Option Agreement, simultaneously execute and deliver a
new Option Agreement evidencing the rights of Xxxxxxx to purchase the balance of
the shares of Common Stock purchasable hereunder. No shares shall be issued or
delivered until full payment therefor
has been made. Xxxxxxx shall have none of the rights of a stockholder in respect
of the shares of Common Stock subject to the Option until such shares are issued
or transferred to him. The Company shall pay all expenses, and any and all
United States federal, state and local taxes and other charges that may be
payable in connection with the preparation, issue and delivery of stock
certificates in the name of Xxxxxxx.
(e) Anything herein to the contrary notwithstanding, the Option may
not be exercised for fewer than the lesser of (i) 10,000 shares of Common Stock
or (ii) all remaining shares of Common Stock subject to the Option.
(f) The Option may not be transferred other than by will or by the
laws of descent and distribution, and during Xxxxxxx'x lifetime the option may
be exercised only by him.
(g) If Xxxxxxx dies prior to the Expiration Date, the Option may be
exercised (the extent Xxxxxxx could have exercised it on the date of death) by
his executor or administrator, or by the person or persons to whom the Option is
transferred by will or the applicable laws of descent and distribution, within
twelve months following the date of death, but in no event subsequent to the
Expiration Date. If the Option is exercised by the executor or administrator of
Xxxxxxx, or by the person or persons to whom the Option has been transferred by
Xxxxxxx'x will or the applicable laws of descent and distribution, the Company
shall be under no obligation to deliver stock pursuant to such exercise until
the Company is satisfied as to the authority of the person or persons exercising
the Option.
Section 3. Anti-Dilution Provisions. In the event of a
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recapitalization, stock split, stock dividend, combination, exchange of shares,
merger, consolidation, rights offering, separation, reorganization liquidation
or other change in the corporate structure of the Company, the number of shares
of Common Stock purchasable upon exercise of the Option and the Exercise Price
shall be equitably adjusted in order to protect Xxxxxxx against dilution.
Section 4. Governing Law. This Option Agreement shall be governed by
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and construed in accordance with the laws of the State of New York, regardless
of the laws that might otherwise govern under applicable principles of conflicts
of laws thereof.
Section 5. Counterparts. This Option Agreement may be executed in
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two or more counterparts, each of which shall be deemed to be an original, but
all of which shall constitute one and the same Option.
IN WITNESS WHEREOF, the Company and Xxxxxxx have executed this Option
Agreement as of the day and year first above written.
VIMRx PHARMACEUTICALS INC.
By: /s/ Xxxxxxx X. X'Xxxxxxx
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Xxxxxxx X. X'Xxxxxxx
Chief Financial Officer
/s/ Xxxxxx X Xxxxxxx
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Xxxxxx X. Xxxxxxx
Appendix I
NOTICE OF EXERCISE OF OPTION
To: Dated:
The undersigned, pursuant to the provisions set forth in the attached
Option Agreement, hereby exercises his right to purchase _________________
shares of the Common Stock of VIMRx Pharmaceuticals Inc. (the "Company") (not
less than 10,000 shares unless constituting the balance of the shares
purchasable) pursuant to the terms and provisions of such Option Agreement, and
is hereby making payment of the exercise price therefor as follows (cross out
inapplicable provisions):
(i) $__________ in immediately available funds is being delivered
herewith;
(ii) ___________ shares of Common Stock, having a value of $________
(based upon the closing price of the Common Stock on the trading
date immediately preceding the date hereof) are being delivered
herewith; or
(iii) Please withhold _________ shares of Common Stock, having a
value of $__________ (based upon the closing price of the Common
Stock on the trading date immediately preceding the date
hereof), from the shares issuable upon exercise of this Option,
and deliver the _________ share balance to me.
The undersigned hereby acknowledges that he has had the opportunity to
converse with members of the management of the Company and to familiarize
himself with the Company's current operations and has reviewed the most recent
Annual Report on Form 10-K of the Company and any Quarterly Reports on Form 10-Q
of the Company since the date of the most recent Form 10-K, and hereby
represents and warrants to the Company that he is acquiring the shares of the
Company's Common Stock pursuant to his exercise of the within Option for
investment and not with a view to their distribution or resale. The undersigned
hereby further acknowledges that he understands that such shares (i) have not
been registered under the Securities Act of 1933, as amended (the "Act"), and
are being issued to him by the Company in reliance upon the foregoing
representation and warranty and (ii) may not be resold except in accordance with
the requirements of the Act, including Rule 144 thereunder, if applicable. The
undersigned further consents to the placing of a legend on the certificates for
the shares being purchased to the foregoing effect.
Signature_________________________
Address __________________________
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