Exhibit 4.4
Exhibit C
GLOBAL PHARMACEUTICAL CORPORATION
NON-STATUTORY STOCK OPTION AGREEMENT
FOR ELIGIBLE DIRECTORS
1. Grant of Options
Global Pharmaceutical Corporation, a Delaware corporation (the
"Company"), hereby grants to ________________ (the "Optionee"), _____
Options (the "Options"), pursuant to the Company's 1995 Stock
Incentive Plan (the "Plan"), to purchase an aggregate of ______
shares of common stock, $.01 par value per share ("Common Stock"), of
the Company at a price of $_______ per share (the "Exercise Price Per
Share"), purchasable as set forth in and subject to the terms and
conditions of this Option Agreement and the Plan. All undefined
capitalized terms herein shall have the same meaning as set forth in
the Plan.
2. Exercise of Options and Effect of Termination of Services or Death
(a) Exercisability of Options. The Options shall become exercisable
and option shares may be purchased based on the number of full years of
service for the Company or a Subsidiary that have expired since the date of
grant (set forth on the signature page hereof), in accordance with the
following schedule:
Percentage of Option Shares
Number of Years of Service Available
Since Date of Grant for Purchase (Cumulative)
-------------------------- -------------------------
1 33%
2 66%
3 100%
[; provided, however, one-third of the initial grant (10,000 Options) shall be
vested upon its grant and the remaining two-thirds of the grant (20,000
Options) shall vest according to the foregoing schedule.] Notwithstanding the
foregoing, the Options shall not be exercisable prior to the initial public
offering of the Company's Common Stock and unless such exercise is in
compliance with the Securities Act of 1933, as amended (the "Securities Act"),
all other applicable laws and regulations (including state securities laws)
and the requirements of any securities exchange on which the shares of Common
Stock are listed.
(b) Expiration Date. Except as otherwise provided in this Option
Agreement or the Plan, the Options may not be exercised
after the date (hereinafter the "Expiration Date") that is
the tenth anniversary of the date of grant.
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(c) Effect of Termination of Services or Death . If the Optionee
ceases to serve as a director of the Company or a Subsidiary, the Options that
have been previously granted to the Optionee and that are vested as of the
date of such cessation may be exercised by the Optionee after the date such
Optionee ceases to be a director of the Company or Subsidiary. If the Optionee
dies while a director of the Company or Subsidiary, the Options that have been
previously granted to the Optionee and that are vested as of the date of such
death may be exercised by the administrator of the Optionee's estate, or by
the person to whom such Options are transferred by will or the laws of descent
and distribution. In no event, however, may any Option be exercised after the
Expiration Date of such Option.
(d) Exercise Procedure. Subject to the conditions set forth in this
Agreement and, if applicable, Section 6 of the Plan, the Options shall be
exercised by the Optionee's delivery of written notice of exercise to the
Secretary of the Company, specifying the number of shares to be purchased and
the Exercise Price Per Share to be paid therefor and accompanied by payment in
accordance with Section 3 hereof. The Optionee may purchase less than the
total number of shares covered hereby, provided that no exercise of less than
all the Options may be for less than 100 whole shares.
3. Payment of Purchase Price
Payment of the Exercise Price Per Share for shares purchased upon
exercise of an Option shall be made by delivery to the Company of the purchase
price, payable in cash (by check) or any other method of payment that is
permitted by the Plan.
4. Delivery of Shares
The Company shall, upon payment of the Exercise Price Per Share for
the number of shares purchased and paid for, make prompt delivery of such
shares to the Optionee. No shares shall be issued and delivered upon exercise
of an Option unless and until, in the opinion of counsel for the Company, any
applicable registration requirements of the Securities Act, any applicable
listing requirements of any national securities exchange on which stock of the
same class is then listed, and any other requirements of law, including state
securities laws, or of any regulatory bodies having jurisdiction over such
issuance and delivery, shall have been fully complied with.
5. Non-transferability of Options
Except as provided in the Plan, the Options are personal and no
rights granted hereunder may be transferred, assigned, pledged or hypothecated
in any way (whether by operation of law or otherwise), except by will or the
laws of descent and distribution, nor shall any such rights be subject to
execution, attachment or similar process. Upon any attempt to transfer,
assign, pledge, hypothecate or otherwise dispose of an Option or of such
rights contrary to the provisions hereof, or upon the levy of any attachment
or similar process upon any Option or such rights, this Option Agreement and
such rights shall, at the election of the Company, become null and void.
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6. No Special Employment Rights
Nothing contained in the Plan or this Option Agreement shall
constitute evidence of any agreement or understanding, express or implied,
that the Optionee has a right to continue as a director for any period of
time.
7. Rights as a Stockholder
The Optionee shall have no rights as a stockholder with respect to
any shares which may be purchased by exercise of the Options unless and until
a certificate representing such shares is duly issued to the Optionee. Except
as otherwise expressly provided in the Plan, no adjustment shall be made for
dividends or other rights for which the record date is prior to the date on
such stock certificate.
8. Recapitalization
In the event that the outstanding shares of Common Stock of the
Company are changed into or exchanged for a different number or kind of shares
or other securities of the Company by reason of any recapitalization,
reclassification, stock split, stock dividend, combination or subdivision, an
appropriate and proportionate adjustment shall be made in the number and kind
of shares subject to the Plan and in the number, kind and per share exercise
price, of shares subject to unexercised Options or portions thereof granted
prior to such adjustment. Any such adjustment to an outstanding Option shall
be made without change in the total price applicable to the unexercised
portion of such Option as of the date of the adjustment.
9. Reorganization
In the event the Company is merged or consolidated with another
entity and the Company is not a surviving entity, or in the event all or
substantially all of the assets or more than 20% of the outstanding voting
stock of the Company entitled to vote for directors is acquired by any other
entity or person other than an Affiliate or any entity or person or any
affiliate thereof owning 5% or more of the outstanding voting stock of the
Company prior to the effective date of the initial public offering of the
Company's Common Stock, or in the event of a reorganization or liquidation of
the Company, prior to the Expiration Date or termination of this Option
Agreement, the Optionee shall, with respect to the options or any unexercised
portion hereof, be entitled to the rights and benefits, and be subject to the
limitations, set forth in Section 14 of the Plan.
10. Withholding Taxes
The Company's obligation to deliver shares upon the exercise of an
Option shall be subject to the Optionee's satisfaction of all applicable
federal, state and local income and employment tax withholding requirements,
if any.
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11. Optionee Representations; Legend
(a) Representations. The Optionee represents, warrants and covenants
that he or she has had such opportunity as he or she has deemed adequate to
obtain from representatives of the Company such information as is necessary to
permit the Optionee to evaluate the merits and risks of his or her investment
in the Company. The Optionee understands that there may be restrictions on his
or her ability to resell any shares acquired on exercise of an Option,
including xxxxxxx xxxxxxx laws and the Company's xxxxxxx xxxxxxx policy, as
well as other restrictions that will apply if the Optionee is an "affiliate"
of the Company. By making payment upon exercise of an Option, the Optionee
shall be deemed to have reaffirmed, as of the date of such payment, the
representations made in this Section 11.
(b) Legend on Stock Certificate. The Optionee understands that, any
shares of Common Stock acquired upon exercise of an Option may not have been
registered under the Securities Act, nor the securities laws of any state.
Accordingly, unless all such registrations are then in effect, all stock
certificates representing shares of Common Stock issued to the Optionee upon
exercise of an Option shall have affixed thereto a legend substantially in the
following form, in addition to any other legends required by applicable state
law:
"THE SHARES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1993, AS
AMENDED, NOR THE SECURITIES LAW OF ANY STATE. CONSEQUENTLY, THE SHARES
REPRESENTED BY THIS CERTIFICATE MAY NOT BE SOLD OR TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION, OR AN EXEMPTION FROM REGISTRATION UNDER
SUCH LAWS."
12. Miscellaneous
In the event that the Plan terminates prior to the expiration date of
the Options granted hereunder, this Option Agreement shall incorporate by
reference all applicable provisions of the Plan until the earlier of (i) the
close of business on the day the Option(s) granted hereunder expire, or (ii)
the date on which all shares available for issuance hereunder shall have been
issued pursuant to the exercise of Options granted hereunder.
Except as provided herein or in Plan, this Option Agreement may not
be amended or otherwise modified unless evidenced in writing and signed by the
Company and the Optionee.
All notices under this Option Agreement shall, unless otherwise
provided herein, be mailed or delivered by hand to the parties at their
respective addresses set forth beneath their names below or at such other
address as may be designated in writing by either of the parties to the other.
This Option Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware.
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This Option Agreement shall be binding upon and inure to the heirs,
successors and assigns of the Optionee (subject, however, to the limitations
set forth herein with respect to assignment of the Options or rights therein)
and the Company, and shall be construed in a manner that is consistent with
the provisions of the Plan.
Date of Grant: Global Pharmaceutical Corporation
By: ________________________________
Name:
Title:
Optionee
____________________________________
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