Exhibit 10.12
DERMA SCIENCES, INC.
STOCK OPTION AGREEMENT
THIS STOCK OPTION AGREEMENT, hereby made and dated as of the 26th day
of November, 2002 (the "Grant Date") between Derma Sciences, Inc., a
Pennsylvania corporation (the "Company"), and Xxxxxx X. Xxxx (the "Optionee").
WHEREAS, the Optionee has been employed as the Vice President - Sales
and Marketing of the Company, and
WHEREAS, the Company desires to recognize and compensate Optionee for
his services to the Company,
NOW, THEREFORE, the parties hereto, intending to be legally bound,
agree as follows:
1. Grant of Option. The Company hereby grants to the Optionee the right
and option to purchase all or any part of an aggregate of 175,000 shares of
common stock of the Company (the "Option") which Option is intended as a
"nonqualified stock option." The Option is in all respects limited and
conditioned as hereinafter provided.
2. Purchase Price. The purchase price per share (the "Option Price") of
the shares covered by the Option (the "Option Shares") shall be $0.50.
3. Term. The Option shall expire on November 26, 2012 (the "Expiration
Date").
4. Exercise of Option. (a) The Option shall become exercisable in five
(5) equal installments and the Optionee shall have the right to purchase from
the Company during his tenure as an employee of the Company, on and after the
following dates, the following number of Option Shares:
Date Installment Number of
Becomes Exercisable Option Shares
November 26, 2002 35,000
November 26, 2003 35,000
November 26, 2004 35,000
November 26, 2005 35,000
November 26, 2006 35,000
(b) Exercisability of the Option Shares shall cease and determine upon
the termination of the Optionee's tenure as an employee of the Company or
subsidiary thereof. Vesting of the Option Shares shall accelerate to 100%
immediately upon a change in control of the Company. For purposes hereof, a
"change in control" shall mean a change in ownership of stock possessing greater
than fifty percent (50%) of the total combined voting power of all classes of
stock entitled to vote of the Company.
5. Method of Exercising Option. (a) Subject to the terms and conditions
of this Option Agreement, the Option may be exercised by giving written notice
to the Company at its principal office specifying the number of Option Shares to
be purchased and accompanied by payment in full of the aggregate purchase price
for the Option Shares. Attached as Exhibit 1 is a form of written notice
acceptable to the Company.
(b) The purchase price shall be payable: (i) in cash or its equivalent,
or (ii) if shares of the same class as the Option Shares are traded on a
national securities exchange, through the transfer to the Company of shares
previously acquired by the Optionee; provided, however, any such shares shall be
valued at the average per share closing price thereof for the five trading days
preceding the date of transfer.
(c) Upon receipt of such notice and payment, the Company, as promptly
as possible, shall deliver or cause to be delivered a certificate or
certificates representing the Option Shares with respect to which the Option is
exercised. The certificate or certificates for such shares shall be registered
in the name of the person or persons exercising the Option (or, if the Optionee
shall so request in the notice exercising the Option, in the name of the
Optionee and the Optionee's spouse, jointly, with right of survivorship) and
shall be delivered as provided above to or upon the written order of the person
or persons exercising the Option. In the event the Option is exercised by any
person or persons after the death or legal disability of the Optionee, such
notice shall be accompanied by appropriate proof of the right of such person or
persons to exercise the Option. All Option Shares that are purchased upon the
exercise of the Option as provided herein shall be fully paid and nonassessable.
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6. Non-Transferability of Option. The Option is not assignable or
transferable, in whole or in part, by the Optionee other than by will or by the
laws of descent and distribution. During the lifetime of the Optionee, the
Option shall be exercisable only by the Optionee or, in the event of the
Optionee's legal disability, by the Optionee's legal representative.
7. Withholding of Taxes. The obligation of the Company to deliver
Option Shares upon the exercise of any Option shall be subject to any applicable
tax withholding requirements.
8. Governing Law. This Agreement shall, to the maximum extent possible,
be construed in a manner consistent with the United States Internal Revenue Code
provisions concerning nonqualified stock options and its interpretation shall
otherwise be governed by the laws of the Commonwealth of Pennsylvania, United
States.
IN WITNESS WHEREOF, the Company, by its President and Chief Executive
Officer, and Optionee have executed this Stock Option Agreement as of the day
and year first hereinabove written.
DERMA SCIENCES, INC.
By:____________________________________________
Xxxxxx X. Xxxxxx
President and Chief Executive Officer
OPTIONEE
_______________________________________________
Xxxxxx X. Xxxx
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DERMA SCIENCES, INC.
NOTICE OF EXERCISE OF STOCK OPTION
I hereby exercise nonqualified stock options granted to me on November
26, 2002 by Derma Sciences, Inc. with respect to the following number of shares
of Derma Sciences, Inc. Common Stock covered by said option:
Number of Shares to be purchased ________________
$0.50
Option price per Share ________________
Total option price ________________
Enclosed is my check in the amount of $_________ (and/or ________
Shares) 1. Please have the certificate or certificates representing the
purchased Shares registered in the following name or names 2 __________________
__________________________ and sent to __________________________.
DATED: ______________, ____.
OPTIONEE
_________________________
Xxxxxx X. Xxxx
____________________________
1 The option price may be paid in whole or in part by delivery of
Shares, subject to the terms of the Optionee's Stock Option Agreement.
2 Certificates may be registered in the name of the Optionee alone or in the
joint names of the Optionee and his/her spouse.
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