Exhibit 3
STOCK OPTION AGREEMENT
STOCK OPTION AGREEMENT (the "Agreement"), dated as of October 5, 1999,
among E. I. du Pont de Nemours and Company, a Delaware corporation (the
"Grantee"), DPC Newco, Inc., a Delaware corporation and a wholly owned
subsidiary of the Grantee ("Merger Sub"), and CombiChem, Inc., a Delaware
corporation (the "Grantor"). Capitalized terms used herein and not otherwise
defined shall have the meanings given to such terms in the Merger Agreement (as
defined below).
WHEREAS, the Grantee, Merger Sub, and the Grantor are entering into an
Agreement and Plan of Merger, dated as of the date hereof (the "Merger
Agreement"), which provides, among other things, for the merger of Merger Sub
and Grantor (the "Merger");
WHEREAS, the Grantee and Merger Sub have requested that the Grantor
grant to the Grantee an option to purchase up to 2,684,431 shares of Common
Stock, par value $0.001 per share, of the Grantor (the "Common Stock"), on the
terms and subject to the conditions hereof; and
WHEREAS, the Grantor is willing to grant the Grantee the requested
option.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements set forth herein, the parties hereto, intending to be
legally bound hereby, agree as follows:
1. The Option; Exercise; Adjustments; Payment of Spread.
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(a) Contemporaneously herewith the Grantee, Merger Sub and the
Grantor are entering into the Merger Agreement. Subject to the other terms and
conditions set forth herein, the Grantor hereby grants to the Grantee an
irrevocable option (the "Option") to purchase up to 2,684,431 shares of Common
Stock (the "Shares") at a cash purchase price equal to $6.75 per share (the
"Purchase Price"). The Option may be exercised by the Grantee, in whole or in
part, at any time, but only on one occasion, following (but not prior to) the
occurrence of the events set forth in any of clauses (i) or (ii) of Section 2(d)
hereof, and prior to the Termination Date (as defined below).
(b) In the event the Grantee wishes to exercise the Option, the
Grantee shall send a written notice to the Grantor (the "Stock Exercise Notice")
specifying the total number of Shares it wishes to purchase and a date (subject
to the expiration or termination of any applicable waiting period under the HSR
Act (as defined below)) not later than ten (10) business days and not earlier
than three (3) business days following the date such notice is given for the
closing of such purchase. In the event of any change in the number of issued
and outstanding shares of capital stock of the Company (by reason of any stock
dividend, stock split, recapitalization, merger, issuance of capital stock upon
exercise of warrants or options or any
other event), the number of Shares subject to this Option and the Purchase Price
shall be appropriately adjusted to restore the Grantee to its rights hereunder,
including its right to purchase Shares representing 19.9% of the capital stock
of the Grantor entitled to vote generally for the election of the directors of
the Grantor which is issued and outstanding immediately prior to the exercise of
the Option.
(c) If at any time the Option is exercisable pursuant to the
terms of Section 1(a) hereof and at or prior to such time the payment referred
to in Section 9.5(b) of the Merger Agreement shall have become payable, the
Grantee may on one occasion elect, in lieu of exercising the Option to purchase
Shares provided in Section 1(a) hereof, to send a written notice to the Grantor
(a "Cash Exercise Notice") specifying a date not later than twenty (20) business
days and not earlier than ten (10) business days following the date such notice
is given on which date the Grantor shall pay to the Grantee an amount in cash
(the "Cancellation Amount") equal to the Spread (as defined below) multiplied by
all or such portion of the Shares subject to the Option as Grantee shall
specify.
As used herein "Spread" shall mean the excess, if any, over
the Purchase Price of the higher of (x) if applicable, the highest price per
share of Common Stock (including any brokerage commissions, transfer taxes and
soliciting dealers' fees) paid or proposed to be paid by any person pursuant to
any Acquisition Proposal occurring after the date of this Agreement and prior to
the Termination Date (the "Alternative Purchase Price") or (y) the average of
the closing bid and asked prices of the Common Stock on the Nasdaq National
Market ("Nasdaq") or on such other national securities exchange on which the
shares of Common Stock are then listed for the last five (5) trading days
immediately prior to the date of the Cash Exercise Notice (the "Closing Price").
If the Alternative Purchase Price includes any property other
than cash, the Alternative Purchase Price shall be the sum of (i) the fixed cash
amount, if any, included in the Alternative Purchase Price plus (ii) the fair
market value of such other property. If such other property consists of
securities with an existing public trading market, the average of the closing
prices (or the average of the closing bid and asked prices if closing prices are
unavailable) for such securities in their principal public trading market on the
five trading days ending five (5) days prior to the date the Cash Exercise
Notice is given shall be deemed to equal the fair market value of such property.
If such other property consists of something other than cash or securities with
an existing public trading market and, as of the payment date for the Spread,
agreement on the value of such other property has not been reached, the
Alternative Purchase Price shall be deemed to equal the Closing Price.
Upon exercise of its right to receive cash pursuant to this
Section 1(c), the obligations of the Grantor to deliver Shares pursuant to
Section 3 shall be terminated with respect to such number of Shares for which
the Grantee shall have elected to be paid the Spread.
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2. Conditions to Delivery of Shares. The Grantor's obligation to
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deliver Shares upon exercise of the Option is subject only to the conditions
that:
(a) No preliminary or permanent injunction or other order issued
by any federal or state court of competent jurisdiction prohibiting the delivery
of the Shares shall be in effect; and
(b) Any applicable waiting periods under the Xxxx-Xxxxx-Xxxxxx
Antitrust Improvements Act of 1976, as amended (the "HSR Act"), shall have
expired or been terminated; and
(c) the representations and warranties of the Grantee made in
Section 5 of this Agreement shall be true and correct in all material respects
as of the date of the closing of the issuance of the Shares; and
(d) (i) (A) a bona fide Acquisition Proposal shall have been
made to the Grantor or any of its stockholders or any Person shall have
announced an intention (whether or not conditional) to make an Acquisition
Proposal with respect to the Grantor, and on or following the date of the Merger
Agreement but prior to the date that the Offer is consummated, such Acquisition
Proposal, announcement or intention is or becomes publicly known, (B) no event
shall have become publicly known prior to the time that such Acquisition
Proposal, announcement or intention is or becomes publicly known that would have
a material adverse effect on the ability of Grantee or Merger Sub to consummate
the Merger (other than any event related to such Acquisition Proposal,
announcement or intention or any event related to a breach of the Merger
Agreement or this Agreement by Grantor) and (C) on or following the date on
which such Acquisition Proposal, announcement or intention is or becomes
publicly known, the Merger Agreement is terminated by either the Grantee or the
Grantor pursuant to Section 9.2(i) of the Merger Agreement, unless Merger Sub
has consummated the Offer and Grantor has complied with Section 1.4 of the
Merger Agreement; or
(ii) the Merger Agreement is terminated (x) by the Grantor
pursuant to Section 9.3(a) of the Merger Agreement, or (y) by the Grantee
pursuant to Section 9.4(a) of the Merger Agreement, or (z) pursuant to Section
9.2(iv) of the Merger Agreement as a result of the failure to satisfy any one of
the conditions set forth in paragraphs (c), (e) or (f) of Annex A of the Merger
Agreement.
(e) As used in this Agreement, "person" shall have the meaning
specified in Sections 3(a)(9) and 13(d)(3) of the Exchange Act. Notwithstanding
any other provision of this Stock Option Agreement, the Merger Agreement or the
Shareholders Agreement, any reference to a majority of the total issued and
outstanding shares or Shares, or shares or Shares outstanding on a fully diluted
basis, or similar references, shall, for purposes of such agreements, exclude
from the determination thereof any shares of Common Stock issuable upon exercise
of or subject to this Stock Option Agreement and any reference to beneficial
ownership of shares of Common Stock or similar references shall, for purposes of
such
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agreements, exclude from the determination thereof any shares of Common
Stock issuable upon exercise of or subject to this Stock Option Agreement and/or
the Shareholders Agreement.
3. The Closing.
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(a) Any closing hereunder shall take place on the date specified
by the Grantee in its Stock Exercise Notice or Cash Exercise Notice or as
specified in Section 1(c), as the case may be, at 10:00 A.M., local time, at the
offices of Xxxxxxx Xxxxx Xxxxxxx & Ingersoll, LLP, 1735 Market Street,
Philadelphia, Pennsylvania, or, if the conditions set forth in Section 2(a), (b)
or (c) have not then been satisfied, on the second business day following the
satisfaction of such conditions, or at such other time and place as the parties
hereto may agree (the "Closing Date"). On the Closing Date, (i) in the event of
a closing pursuant to Section 1(b) hereof, the Grantor will deliver to the
Grantee a certificate or certificates, representing the Shares in the
denominations designated by the Grantee in its Stock Exercise Notice and the
Grantee will purchase such Shares from the Grantor at the price per Share equal
to the Purchase Price, or (ii) in the event of a closing pursuant to Section
1(c) hereof, the Grantor will deliver to the Grantee cash in an amount
determined pursuant to Section 1(c) hereof. Any payment made by the Grantee to
the Grantor, or by the Grantor to the Grantee, pursuant to this Agreement shall
be made by wire transfer of federal funds to a bank designated by the party
receiving such funds.
(b) The Grantee agrees not to transfer or otherwise dispose of
the Option or the Shares, or any interest therein, except in compliance with the
Securities Act of 1933, as amended (the "Securities Act") and any applicable
state securities law. The Grantee further agrees that the certificates
representing the Shares shall bear an appropriate legend relating to the fact
that such Shares have not been registered under the Securities Act.
4. Representations and Warranties of the Grantor. The Grantor
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represents and warrants to the Grantee that (a) the Grantor is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Delaware and has the requisite corporate power and authority to enter
into and perform this Agreement; (b) the execution and delivery of this
Agreement by the Grantor and the consummation by it of the transactions
contemplated hereby have been duly authorized by the Board of Directors of the
Grantor and this Agreement has been duly executed and delivered by a duly
authorized officer of the Grantor and constitutes a valid and binding obligation
of the Grantor, enforceable against Grantor in accordance with its terms,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles; (c) the Grantor has taken
all necessary corporate action to authorize and reserve the Shares issuable upon
exercise of the Option and the Shares, when issued and delivered by the Grantor
upon exercise of the Option and paid for by the Grantee as contemplated hereby,
will be duly authorized, validly issued, fully paid and non-assessable and free
of preemptive rights; (d) except as otherwise required by the HSR Act or the
rules and regulations of Nasdaq, the execution and delivery of this Agreement by
the Grantor and the consummation by it of the transactions contemplated hereby
do not require the consent, waiver, approval or authorization of or any filing
with any person or public authority (other than those that have been obtained
prior
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to the date of this Agreement or will have been obtained prior to the
Closing Date) and will not violate, result in a breach of or the acceleration of
any obligation under, or constitute a default under, any provision of the
Grantor's certificate of incorporation or bylaws, or any indenture, mortgage,
lien, lease, agreement, contract, instrument, order, rule, regulation, judgment,
ordinance, or decree, or restriction by which the Grantor or any of its
subsidiaries or any of their respective properties or assets is bound, except as
set forth in Schedule 4(d) attached hereto; and (e) no "fair price,"
"moratorium," "control share acquisition," "interested shareholder" or other
form of antitakeover statute or regulation (including but not limited to Section
203 of the Delaware General Corporation Law) is or shall be applicable to the
grant of the Option or the acquisition of Shares pursuant to this Agreement.
5. Representations and Warranties of the Grantee. The Grantee
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represents and warrants to the Grantor that (a) the Grantee is a corporation
duly incorporated and validly existing and in good standing under the laws of
the State of Delaware and has the requisite corporate power and authority to
enter into and perform this Agreement, (b) the execution and delivery of this
Agreement by the Grantee and the consummation by it of the transactions
contemplated hereby have been duly authorized by all necessary corporate action
on the part of the Grantee and this Agreement has been duly executed and
delivered by a duly authorized officer of the Grantee and constitutes a valid
and binding obligation of the Grantee, enforceable in accordance with its terms,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles; and (c) the Grantee is
acquiring the Option and, if and when it exercises the Option, will be acquiring
the Shares issuable upon the exercise thereof for its own account and not with a
view to distribution or resale in any manner which would be in violation of the
Securities Act.
6. Listing of Shares; Filings; Governmental Consents. Subject to
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applicable law and the rules and regulations of Nasdaq or such other national
securities exchange on which the shares of the Grantor's Common Stock are then
listed, after the Option becomes exercisable hereunder, the Grantor will
promptly file an application to list the Shares on Nasdaq or on such other
national securities exchange on which the shares of Common Stock are then listed
and will use its reasonable best efforts to obtain approval of such listing and
to effect all necessary filings by the Grantor under the HSR Act; provided,
however, that if the Grantor is unable to effect such listing on Nasdaq by the
Closing Date, the Grantor will nevertheless be obligated to deliver the Shares
on the Closing Date and to continue its efforts to effect such listing on Nasdaq
or such other national securities exchange on which the shares of the Grantor's
Common Stock are then listed. Each of the parties hereto will use its
reasonable best efforts to obtain consents of all third parties and governmental
authorities, if any, necessary to the consummation of the transactions
contemplated by this Agreement.
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7. Registration Rights.
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(a) In the event that the Grantee shall desire to sell any of
the Shares after the purchase of such Shares pursuant to this Agreement, and
such sale requires, in the reasonable opinion of counsel to the Grantee (which
opinion must be reasonably satisfactory to Grantor and its counsel),
registration of such Shares under the Securities Act, the Grantor will cooperate
with the Grantee and any underwriters selected by the Grantee (which
underwriters must be reasonably satisfactory to Grantor) in registering such
Shares for resale for a period of at least forty-five (45) days, including,
without limitation, promptly filing a registration statement which complies with
the requirements of applicable federal and state securities laws and entering
into an underwriting agreement with such underwriters upon such terms and
conditions as are customarily contained in underwriting agreements with respect
to secondary distributions; provided that the Grantor shall not be required to
have declared effective more than two (2) registration statements hereunder and
shall be entitled to delay the filing or effectiveness of any registration
statement and may suspend the use of any registration statement (and related
prospectus) for one or more periods of time not exceeding an aggregate of sixty
(60) days in any one year period if the offering would, in the judgment of the
board of directors of the Grantor in consultation with counsel to Grantor,
require premature disclosure of any material corporate development or material
transaction involving the Grantor or interfere with any previously planned
securities offering by the Grantor. In addition, upon receipt of notice of the
occurrence of any event as a result of which any registration statement,
prospectus or prospectus supplement, contains any untrue statements of material
fact or fails or omits to state any material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they are made, not misleading, the Grantee shall forthwith discontinue the
disposition of any Shares under such registration statement, prospectus or
prospectus supplement until the Grantee receives from the Grantor copies (which
subject to the limitations on suspension set forth above shall promptly be made
available by the Grantor) of an amended or supplemented registration statement,
prospectus or supplement so that, as thereafter delivered to purchasers of such
Shares, such registration statement, prospectus or prospectus supplement shall
not contain any untrue statement of material fact or fail or omit to state any
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they are made, not
misleading.
(b) If the Shares are registered pursuant to the provisions of
this Section 7, the Grantor agrees (i) to furnish copies of the registration
statement and the prospectus relating to the Shares covered thereby in such
numbers as the Grantee may from time to time reasonably request and (ii) if any
event shall occur as a result of which it becomes necessary to amend or
supplement any registration statement or prospectus, to prepare and file under
the applicable securities laws such amendments and supplements as may be
necessary to keep available for at least forty-five (45) days a prospectus
covering the Shares meeting the requirements of such securities laws, and to
furnish the Grantee such numbers of copies of the registration statement and
prospectus as amended or supplemented as may reasonably be requested. The
Grantor shall bear the cost of the registration, including, but not limited to,
all registration and filing fees, printing expenses, and fees and disbursements
of counsel and
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accountants for the Grantor, except that the Grantee shall pay the fees and
disbursements of its counsel and the underwriting fees and selling commissions
applicable to the shares of Common Stock sold by the Grantee. The Grantor shall
indemnify and hold harmless (i) the Grantee, its affiliates and its officers and
directors and (ii) each underwriter and each person who controls any underwriter
within the meaning of the Securities Act or the Securities Exchange Act of 1934,
as amended (collectively, the "Underwriters") ((i) and (ii) being referred to as
"Indemnified Parties") against any losses, claims, damages, liabilities or
expenses to which the Indemnified Parties may become subject, insofar as such
losses, claims, damages, liabilities (or actions in respect thereof) and
expenses arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained or incorporated by reference in any
registration statement filed pursuant to this Section 7 or arise out of or are
based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading; provided, however, that the Grantor will not be liable in any such
case to the extent that any such loss, liability, claim, damage or expense
arises out of or is based upon (A) an untrue statement or alleged untrue
statement in or omission or alleged omission from any such documents in reliance
upon and in conformity with written information furnished to the Grantor by the
Indemnified Parties expressly for use or incorporation by reference therein, or
(B) the fact that the person asserting any such loss, liability, claim, damage
or expense did not receive a copy of an amended preliminary prospectus or the
final prospectus (or the final prospectus as amended or supplemented) at or
prior to the written confirmation of the sale of the Shares to such person
because of the failure of the Grantee to so provide such amended preliminary or
final prospectus.
(c) The Grantee and the Underwriters shall indemnify and hold
harmless the Grantor, its affiliates and its officers and directors against any
losses, claims, damages, liabilities or expenses to which the Grantor, its
affiliates and its officers and directors may become subject, insofar as such
losses, claims, damages, liabilities (or actions in respect thereof) and
expenses arise out of or are based upon (i) any untrue statement of any material
fact contained or incorporated by reference in any registration statement filed
pursuant to this Section 7, or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Grantor by the Indemnified
Parties, as applicable, specifically for use or incorporation by reference
therein or (ii) the fact that the person asserting any such loss, liability,
claim, damage or expense did not receive a copy of an amended preliminary
prospectus or the final prospectus (or the final prospectus as amended or
supplemented) at or prior to the written confirmation of the sale of the Shares
to such person because of the failure of the Grantee to so provide such amended
preliminary or final prospectus.
(d) Promptly after receipt by an indemnified party under
subsection (b) or (c) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to
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notify the indemnifying party shall not relieve it from any liability which it
may have to any indemnified party otherwise than under such subsection. In case
any such action shall be brought against any indemnified party and it shall
notify the indemnifying party of the commencement thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it shall
wish, jointly with any other indemnifying party similarly notified, to assume
the defense thereof, with counsel satisfactory to such indemnified party, and,
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party under such subsection for any legal expenses of
other counsel or any other expenses, in each case subsequently incurred by such
indemnified party, in connection with the defense thereof other than reasonable
costs of investigation. No indemnified party shall settle any action or claim
without the consent of the indemnifying party, which consent shall not be
unreasonably withheld or delayed.
8. Expenses. Each party hereto shall pay its own expenses incurred
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in connection with this Agreement, except as otherwise specifically provided
herein.
9. Modification or Amendment. Subject to the provisions of
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applicable law, the parties hereto may modify or amend this Agreement, by
written agreement executed and delivered by duly authorized officers of the
respective parties.
10. Counterparts. This Agreement may be executed in any number of
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counterparts, each such counterpart being deemed to be an original instrument,
and all such counterparts shall together constitute the same agreement.
11. GOVERNING LAW AND VENUE; WAIVER OF JURY TRIAL.
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(a) THIS AGREEMENT SHALL BE DEEMED TO BE MADE IN AND IN ALL
RESPECTS SHALL BE INTERPRETED, CONSTRUED AND GOVERNED BY AND IN ACCORDANCE WITH
THE LAWS OF THE STATE OF DELAWARE WITHOUT REGARD TO THE CONFLICT OF LAW
PRINCIPLES THEREOF. THE PARTIES HEREBY IRREVOCABLY SUBMIT TO THE JURISDICTION OF
THE COURTS OF THE STATE OF DELAWARE AND THE FEDERAL COURTS OF THE UNITED STATES
OF AMERICA LOCATED IN THE COUNTY OF NEW CASTLE, DELAWARE SOLELY IN RESPECT OF
THE INTERPRETATION AND ENFORCEMENT OF THE PROVISIONS OF THIS AGREEMENT, THE
MERGER AGREEMENT AND OF THE OTHER DOCUMENTS REFERRED TO IN THIS AGREEMENT AND
THE MERGER AGREEMENT, AND IN RESPECT OF THE TRANSACTIONS CONTEMPLATED HEREBY AND
THEREBY, AND HEREBY WAIVE, AND AGREE NOT TO ASSERT, AS A DEFENSE IN ANY ACTION,
SUIT OR PROCEEDING FOR THE INTERPRETATION OR ENFORCEMENT HEREOF OR OF ANY SUCH
DOCUMENT, THAT IT IS NOT SUBJECT THERETO OR THAT SUCH ACTION, SUIT OR PROCEEDING
MAY NOT BE BROUGHT OR IS NOT MAINTAINABLE IN SAID COURTS OR THAT THE VENUE
THEREOF MAY NOT BE APPROPRIATE OR THAT THIS AGREEMENT, THE MERGER AGREEMENT, OR
ANY SUCH DOCUMENT MAY NOT BE ENFORCED IN OR BY SUCH COURTS, AND
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THE PARTIES HERETO IRREVOCABLY AGREE THAT ALL CLAIMS WITH RESPECT TO SUCH ACTION
OR PROCEEDING SHALL BE HEARD AND DETERMINED IN SUCH A DELAWARE STATE OR FEDERAL
COURT. THE PARTIES HEREBY CONSENT TO AND GRANT ANY SUCH COURT JURISDICTION OVER
THE PERSON OF SUCH PARTIES AND OVER THE SUBJECT MATTER OF SUCH DISPUTE AND AGREE
THAT MAILING OF PROCESS OR OTHER PAPERS IN CONNECTION WITH ANY SUCH ACTION OR
PROCEEDING IN THE MANNER PROVIDED IN SECTION 12 OR IN SUCH OTHER MANNER AS MAY
BE PERMITTED BY LAW, SHALL BE VALID AND SUFFICIENT SERVICE THEREOF.
(b) EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY
WHICH MAY ARISE UNDER THIS AGREEMENT OR THE MERGER AGREEMENT OR THE OTHER
DOCUMENTS REFERRED TO IN THIS AGREEMENT AND THE MERGER AGREEMENT, OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IS LIKELY TO INVOLVE COMPLICATED
AND DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN
RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO
THIS AGREEMENT, THE MERGER AGREEMENT, THE OTHER DOCUMENTS REFERRED TO IN THIS
AGREEMENT AND THE MERGER AGREEMENT, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR
THEREBY. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (I) NO REPRESENTATIVE, AGENT
OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT
SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER, (II) EACH SUCH PARTY UNDERSTANDS AND HAS CONSIDERED THE
IMPLICATIONS OF THIS WAIVER, (III) EACH SUCH PARTY MAKES THIS WAIVER VOLUNTARILY
AND (IV) EACH SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG
OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
12. Notices. Any notice, request, instruction or other document to
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be given hereunder by any party to the others shall be in writing and delivered
personally or sent by registered or certified mail, postage prepaid, or by
facsimile:
if to the Grantee or Merger Sub:
E. I. du Pont de Nemours and Company
0000 Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: General Counsel
Fax: (000) 000-0000
with copies to:
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Xxxxxx X. Xxxxx, Esq.
Xxxxxxx Xxxxx Xxxxxxx & Ingersoll, LLP
0000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxxxxx, XX 00000-0000
Fax: (000) 000-0000
if to the Grantor:
Xx. Xxxxxxx Xxxxx, Xx.
CombiChem, Inc.
0000 Xxxxxx Xxxxx Xx
Xxx Xxxxx, XX 00000
Fax: (000) 000-0000
with copies to:
Xxxx X. Xxxxxxx, Esq.
Xxxxxxx Xxxxxxx & Xxxxxxxx LLP
000 Xxxx X Xxxxxx, Xxxxx 0000
Xxx Xxxxx, XX 00000-0000
Fax: (000) 000-0000
or to such other persons or addresses as may be designated in writing by the
party to receive such notice as provided above.
13. Entire Agreement. This Agreement (including any exhibits and
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schedules hereto), the Merger Agreement and the other documents referred to in
this Agreement and the Merger Agreement, constitute the entire agreement, and
supersede all other prior agreements, understandings, representations and
warranties both written and oral, among the parties, with respect to the subject
matter hereof.
14. No Third Party Beneficiaries. This Agreement is not intended to
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confer upon any person or entity other than the parties hereto any rights or
remedies hereunder.
15. Severability. The provisions of this Agreement shall be deemed
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severable and the invalidity or unenforceability of any provision shall not
affect the validity or enforceability of the other provisions hereof. If any
provision of this Agreement, or the application thereof to any person or entity
or any circumstance, is invalid or unenforceable, (a) a suitable and equitable
provision shall be substituted therefor in order to carry out, so far as may be
valid and enforceable, the intent and purpose of such invalid or unenforceable
provision and (b) the remainder of this Agreement and the application of such
provision to other persons or entities or circumstances shall not be affected by
such invalidity or unenforceability, nor shall such invalidity or
unenforceability affect the validity or enforceability of such provision, or the
application thereof, in any other jurisdiction.
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16. Specific Performance. The parties hereto each acknowledge that,
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in view of the uniqueness of the subject matter hereof, the parties hereto would
not have an adequate remedy at law for money damages if this Agreement were not
performed in accordance with its terms, and therefore agree that the parties
hereto shall be entitled to specific enforcement of the terms hereof in addition
to any other remedy to which the parties hereto may be entitled at law or in
equity.
17. Assignment. This Agreement shall not be assignable by operation
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of law or otherwise; provided, however, that the Grantee may assign its rights
and obligations under this Agreement to DuPont Pharmaceuticals Company, a
Delaware general partnership and wholly owned subsidiary of Grantee, or any of
Grantee's direct or indirect wholly owned subsidiaries or affiliates with a net
worth of more than $100,000,000. Any purported assignment made in contravention
of this Agreement shall be null and void.
18. Captions. The Section captions herein are for convenience of
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reference only and do not constitute part of this Agreement and shall not be
deemed to limit or otherwise affect any of the provisions hereof.
19. Termination.
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(a) The right to exercise the Option granted pursuant to this
Agreement shall terminate at (and the Option shall no longer be exercisable
after) the earliest of (i) the Effective Time (as defined in the Merger
Agreement), (ii) the nine month anniversary of the earliest to occur of the
events set forth in any of clauses (i) or (ii) of Section 2(d), and (iii) the
fifteenth day following the termination of the Merger Agreement if prior to such
fifteenth day the events set forth in any of clauses (i) or (ii) of Section 2(d)
shall not have occurred (such earliest date being referred to in this Agreement
as the "Termination Date"); provided that, if the Option cannot be exercised or
the Shares cannot be delivered to the Grantee upon such exercise because one or
more of the conditions set forth in Section 2(a) or (b) hereof have not yet been
satisfied, the Termination Date shall be extended until fifteen (15) days after
such impediment to exercise or delivery has been removed.
(b) All representations and warranties contained in this
Agreement shall survive delivery of and payment for the Shares.
[Remainder of page intentionally left blank]
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IN WITNESS WHEREOF, this Agreement has been duly executed and
delivered by duly authorized officers of the parties hereto as of the date
hereof.
COMBICHEM, INC.
By: /s/ Xxxxxxx Xxxxx, Xx.
-----------------------------------------
Name: Xxxxxxx Xxxxx, Xx.
Title: President and Chief Executive Officer
E. I. DU PONT DE NEMOURS AND
COMPANY
By: /s/ Xxxx X. Xxxxxxxx
----------------------------------------
Name: Xxxx X. Xxxxxxxx
Title: Executive Vice President and
Chief Operating Officer
DPC NEWCO, INC.
By: /s/ Xxxxxxx X. Xxxx
-----------------------------------------
Name: Xxxxxxx X. Xxxx
Title: President
12
