<PAGE> 1
As filed with the Securities and Exchange Commission on December 7, 1999
Registration No. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
DUSA PHARMACEUTICALS, INC.
(Exact name of registrant as specified in its charter)
NEW JERSEY 22-3103129
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
25 UPTON DRIVE
WILMINGTON, MASSACHUSETTS 02061
(978) 657-7500
(Address, including ZIP code, and telephone number,
including area code, of registrant's principal executive offices)
1991 INCENTIVE STOCK OPTION PLAN OF DEPRENYL USA, INC.
DUSA PHARMACEUTICALS, INC. 1994 RESTRICTED STOCK OPTION PLAN
DUSA PHARMACEUTICALS, INC. 1996 OMNIBUS PLAN, AS AMENDED
STOCK OPTION AGREEMENTS FOR D. GEOFFREY SHULMAN
STOCK OPTION AGREEMENT FOR JAMES P. DOHERTY
STOCK OPTION AGREEMENT FOR THEODORE SALL
STOCK OPTION AGREEMENT FOR RICHARD C. LUFKIN
STOCK OPTION AGREEMENT FOR HERBERT F. HABERMAN
STOCK OPTION AGREEMENTS FOR JAMES C. KENNEDY
STOCK OPTION AGREEMENTS FOR ROY H. POTTIER
STOCK OPTION AGREEMENTS FOR ROBERT L. REID
STOCK OPTION AGREEMENT FOR DEAN VAN VUGT
STOCK OPTION AGREEMENT FOR MARTIN BARKIN
STOCK OPTION AGREEMENTS FOR RONALD L. CARROLL
STOCK OPTION AGREEMENTS FOR SCOTT LUNDAHL
STOCK OPTION AGREEMENT FOR DANIEL PIACQUADIO
STOCK OPTION AGREEMENT FOR ALLYN GOLUB
STOCK OPTION AGREEMENT FOR DAVID COHEN
CLASS B WARRANT AGREEMENT FOR D. GEOFFREY SHULMAN
(Full title of the plans)
NANETTE W. MANTELL, ESQ.
LANE AND MANTELL
991 ROUTE 22 WEST, PO BOX 8539
SOMERVILLE, NEW JERSEY 08876
(908) 253-9333
(Name, address, including ZIP code, and telephone number,
including area code, of agent for service)
COPIES TO:
DR. D. GEOFFREY SHULMAN, PRESIDENT
DUSA PHARMACEUTICALS, INC.
25 UPTON DRIVE
WILMINGTON, MASSACHUSETTS 02061
(978) 657-7500
<PAGE> 2
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
==============================================================================================================================
Amount Proposed Maximum Proposed Maximum Amount of
Title of Each Class of Securities to be Offering Price Per Aggregate Offering Registration
to be Registered Registered(1) Share Price Fee
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1991 Incentive Stock Option Plan -
Shares of common stock no par value (options issued
and outstanding) 80,000 $ 5.15(2) $ 412,000.00 $ 108.77
- ------------------------------------------------------------------------------------------------------------------------------
1994 Restricted Stock Option Plan -
Shares of common stock no par value (options issued
and outstanding) 65,000 $ 3.38(2) $ 219,700.00 $ 58.00
- ------------------------------------------------------------------------------------------------------------------------------
1996 Omnibus Plan, as Amended -
Shares of common stock no par value (options reserved
for future grants) 546,878 $19.00(3) $10,390,682.00 $ 2,743.14
- ------------------------------------------------------------------------------------------------------------------------------
1996 Omnibus Plan, as Amended -
Shares of common stock no par value (options issued
and outstanding) 1,165,166 $ 9.22(2) $10,742,830.52 $ 2,836.11
- ------------------------------------------------------------------------------------------------------------------------------
Shares of common stock without par value (4) 734,811 $ 6.22(2) $ 4,570,524.42 $ 1,206.62
- ------------------------------------------------------------------------------------------------------------------------------
TOTAL REGISTRATION FEE.............................................................................................$ 6,952.64
==============================================================================================================================
</TABLE>
(1) Together with an indeterminate number of additional shares
which may be issued pursuant to the various DUSA Plans as a
result of stock splits, stock dividends or similar
transactions in accordance with Rule 416.
(2) Estimated solely for the purpose of calculating the
registration fee pursuant to Rule 457(h)(1) of the Securities
Act of 1933, as amended, based upon the average exercise price
of the outstanding options rounded to the nearest cent.
(3) Estimated solely for the purpose of calculating the
registration fee pursuant to Rule 457(h)(1) of the Securities
Act of 1933, as amended, based upon the average of the high
and low price as reported on The NASDAQ National Market on
November 30, 1999.
(4) The securities to be registered are shares of common stock
issuable upon exercise of options or warrants including 75,000
shares under the Stock Option Agreements for D. Geoffrey
Shulman; 37,500 shares under the Stock Option Agreement for
James P. Doherty; 10,000 shares under the Stock Option
Agreement for Theodore Sall; 12,500 shares under the Stock
Option Agreement for Richard C. Lufkin; 2,800 shares under the
Stock Option Agreement for Herbert F. Haberman; 33,200 shares
under the Stock Option Agreements for James C. Kennedy; 24,250
shares under the Stock Option Agreements for Roy H. Pottier;
26,800 shares under the Stock Option Agreements for Robert L.
Reid; 2,261 shares under the Stock Option Agreement for Dean
Van Vugt; 15,500 shares under the Stock Option Agreement for
Martin Barkin; 60,000 shares under the Stock Option Agreements
for Ronald L. Carroll; 60,000 shares under the Stock Option
Agreements for Scott Lundahl; 15,000 shares under the Stock
Option Agreement for Daniel Piacquadio; 5,000 shares under the
Stock Option Agreement for Allyn Golub; 5,000 shares under the
Stock Option Agreement for David Cohen; and 350,000 shares
under the Class B Warrant Agreement for D. Geoffrey Shulman.
<PAGE> 3
PART I
INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
The documents containing the information required by Part I of Form S-8
have been or will be sent or given to the participants in each of the Plans
being registered hereby as specified by Rule 428(b)(1) of Regulation C under the
Securities Act of 1933, as amended, and such documents taken together with the
documents incorporated by reference in this registration statement shall
constitute a prospectus that meets the requirements of Section 10(a) of the
Securities Act.
Pursuant to Rule 428 of the Securities Act such documents are not
required to be filed with the SEC as part of this registration statement or as
an Exhibit hereto.
PART II
INFORMATION REQUIRED TO BE IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
DUSA hereby incorporates by reference in this registration statement
the following documents previously filed by the registrant with the SEC:
- Annual Report on Form 10-K for the year ended December 31,
1998.
- Quarterly Reports on Form 10-Q for the quarters ended March
31, 1999, June 30, 1999 and September 30, 1999.
- Seven Current Reports on Form 8-K, including the exhibits: one
dated January 7, 1999 which was filed on January 11, 1999; one
dated and filed on January 14, 1999; one dated and filed on
June 11, 1999; one dated and filed on June 29, 1999; one dated
and filed on October 14, 1999; one dated November 22, 1999 and
filed on November 24, 1999; and one dated and filed on
December 6, 1999.
- The description of DUSA's common stock contained in its
registration statement on Form 8-A which was filed on January
3, 1992, amended on October 24, 1997 (and in DUSA's Quarterly
Report on Form 10-Q which was filed on November 12, 1997).
- All documents subsequently filed by DUSA pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act of 1934, as
amended, on or after the date of this registration statement
and prior to the filing of a post-effective amendment which
indicates that all securities offered have been sold or which
deregisters all securities then remaining unsold shall be
deemed to be incorporated by reference in this registration
statement and to be part hereof from the date of filing of
such documents.
ITEM 4. DESCRIPTION OF SECURITIES
Not applicable.
1
<PAGE> 4
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
The validity of the securities offered hereby will be passed upon by
Lane and Mantell, a professional corporation, Somerville, New Jersey. As of
December 6, 1999, shareholders and associates of Lane and Mantell beneficially
own, directly or indirectly, less than 1% of the common stock of DUSA.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Article 5 of the Company's Certificate of Incorporation, as amended,
and New Jersey Business Corporation Act, N.J.S.A. 14A:2-7 provide as follows:
Any director and officer of the Corporation shall not be personally
liable to the Corporation or its shareholders for damages for breach of
any duty owed to the Corporation or its shareholders, except that this
provision shall not relieve a director or officer from liability for
any breach of duty based upon an act or omission (a) in breach of such
person's duty of loyalty to the Corporation or its shareholders; (b)
not in good faith or involving a knowing violation of law; or (c)
resulting in receipt by such person of an improper personal benefit.
The Company's By-laws, as amended, pursuant to the New Jersey Business
Corporation Act, N.J.S.A. 14A:3-5, provide as follows:
ARTICLE IV
INDEMNIFICATION
Section 1. Actions by Others. The Corporation (1) shall indemnify any
person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (other than an action by or in the
right of the Corporation) by reason of the fact that he is or was a director,
officer or trustee of the Corporation or of any constituent corporation absorbed
by the Corporation in a consolidation or merger and (2) except as otherwise
required by Section 3 of this Article, may indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the Corporation) by
reason of the fact that he (a) is or was an employee or agent or the legal
representative of a director, officer, trustee, employee or agent of the
Corporation or of any absorbed constituent corporation, or (b) is or was serving
at the request of the Corporation or of any absorbed constituent corporation as
a director, officer, employee, agent of or participant in another corporation,
partnership, joint venture, trust or other enterprise, or the legal
representative of such a person against expenses, costs, disbursements
(including attorneys' fees), judgments, fines and amounts actually and
reasonably incurred by him in good faith and in connection with such action,
suit or proceeding if he acted in a manner he reasonably believed to be in or
not opposed to the best interests of the Corporation, and with respect to any
criminal action or proceeding, he had no reasonable cause to believe that his
conduct was unlawful. The termination of any action, suit or proceeding by
judgment, order, settlement, conviction, or upon a pleas of nolo contendere or
its equivalent, shall not, of itself, create a presumption that the person did
not meet the applicable standard of conduct.
Section 2. Actions by or in the Right of the Corporation. The
Corporation shall indemnify any person who was or is a party or is threatened to
be made a party to any threatened, pending or completed action or suit by or in
the right of the Corporation to procure a judgment in its favor by reason of the
fact that he is or was a director, officer, trustee, employee or agent of the
Corporation or of any constituent
2
<PAGE> 5
corporation absorbed by the Corporation by consolidation or merger, or the legal
representative of any such person, or is or was serving at the request of the
Corporation or of any absorbed constituent corporation, as a director, officer,
trustee, employee, agent of or participant, or the legal representative of any
such person in another corporation, partnership, joint venture, trust or other
enterprise against expenses (including attorneys' fees) actually and reasonably
incurred by him in connection with the defense or settlement of such action or
suit if he acted in good faith and in a manner he reasonably believed to be in
or not opposed to the best interests of the Corporation and except that no
indemnification shall be made in respect of any claim, issue or matter as to
which such person shall have been adjudged to be liable to the Corporation
unless and only to the extent that the New Jersey Superior Court or the court in
which such action or suit was brought shall determine upon application that,
despite the adjudication of liability but in view of all the circumstances of
the case, such person is fairly and reasonably entitled to indemnity for such
expenses which the New Jersey Superior Court or such other court shall deem
proper.
Section 3. Successful Defense. To the extent that a person who is or
was a director, officer, trustee, employee or agent of the Corporation or of any
constituent corporation absorbed by the Corporation by consolidation or merger,
or the legal representative of any such person, has been successful on the
merits or otherwise in defense of any action, suit proceeding referred to in
Section 1 or Section 2 of this Article, or in defense of any claim, issue, or
matter therein, he shall be indemnified against expenses (including attorneys'
fees) actually and reasonably incurred by him in connection therewith.
Section 4. Specific Authorization. Any indemnification under Section 1
or Section 2 of this Article (unless ordered by a court) shall be made by the
Corporation only as authorized in the specific case upon a determination that
indemnification of the director, officer, trustee, employee, agent, or the legal
representative thereof, is proper in the circumstances because he has met the
applicable standard of conduct set forth in said Sections 1 and 2. Such
determination shall be made (1) by the Board of Directors by a majority vote of
quorum consisting of directors who were not parties to such action, suit or
proceeding, or (2) if such a quorum is not obtainable, a quorum of disinterested
directors so directs, by independent legal counsel for a written opinion, (3) by
the shareholders.
Section 5. Advance of Expenses. Expenses incurred by any person who may
have a right of indemnification under this Article in defending civil or
criminal action, suit or proceeding may be paid by the Corporation in advance of
the final distribution of such action, suit or proceeding as authorized by the
board of directors upon receipt of an undertaking by or on behalf of the
director, officer, trustee, employee, or the legal representative thereof, to
repay such amount unless it shall ultimately be determined that he is entitled
to be indemnified by the Corporation pursuant to this Article.
Section 6. Right of Indemnity not Exclusive. The indemnification and
advancement of expenses provided by this Article shall not exclude any other
rights to which those seeking indemnification may be entitled under the
certificate of incorporation of the Corporation or any By-Law agreement, vote of
shareholders or otherwise; provided that no indemnification shall be made to or
on behalf of a Director, officer, trustee, employee, agent, or legal
representative if a judgment or other final adjudication adverse to such persons
establishes that his acts or omissions (a) were in breach of his duty of loyalty
to the corporation or its shareholders, (b) were not in good faith or involved a
knowing violation of law or (c) resulted in receipt by such person of an
improper personal benefit.
Section 7. Insurance. The Corporation may purchase and maintain
insurance on behalf of any person who is or was a director, officer, trustee,
employee or agent of the Corporation or of any constituent corporation absorbed
by the Corporation by consolidation or merger of the legal representative of
such person or is or was serving at the request of the Corporation or of any
absorbed constituent corporation as a director, officer, trustee, employee or
agent of or participant in another corporation, partnership, joint venture,
trust or other enterprise, or the legal representative of any such person
against any liability asserted against him and incurred by him in any such
capacity, arising out of his status as such or by reason of his
3
<PAGE> 6
being or having been such, whether or not the Corporation would have the power
to indemnify him against such liability under the provisions of this Article,
the New Jersey Business Corporation Act, or otherwise.
Section 8. Invalidity of any Provision of this Article. The invalidity
or unenforceability of any provision of this Article shall not affect the
validity or enforceability of the remaining provisions of this Article.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
ITEM 8. EXHIBITS
(4.1) 1991 Incentive Stock Option Plan of Deprenyl USA, Inc.
(4.2) DUSA Pharmaceuticals, Inc. 1994 Restricted Stock Option Plan
(4.3) DUSA Pharmaceuticals, Inc. 1996 Omnibus Plan, as Amended
(4.4) Stock Option Agreements for D. Geoffrey Shulman
(4.5) Stock Option Agreement for James P. Doherty
(4.6) Stock Option Agreement for Theodore Sall
(4.7) Stock Option Agreement for Richard C. Lufkin
(4.8) Stock Option Agreement for Herbert F. Haberman
(4.9) Stock Option Agreements for James C. Kennedy
(4.10) Stock Option Agreements for Roy H. Pottier
(4.11) Stock Option Agreements for Robert L. Reid
(4.12) Stock Option Agreement for Dean Van Vugt
(4.13) Stock Option Agreement for Martin Barkin
(4.14) Stock Option Agreements for Ronald L. Carroll
(4.15) Stock Option Agreements for Scott Lundahl
(4.16) Stock Option Agreement for Daniel Piacquadio
(4.17) Stock Option Agreement for Allyn Golub
(4.18) Stock Option Agreement for David Cohen
(4.19) Class B Warrant Agreement for D. Geoffrey Shulman
(5.1) Opinion of Lane and Mantell
(23.1) Consent of Deloitte & Touche LLP
(23.2) Consent of Lane and Mantell (contained in Exhibit 5.1)
(24.1) Power of Attorney (See Page i)
(99.1) Form of 1991 Incentive Stock Option Agreement
(99.2) Form of 1994 Restricted Stock Option Agreement
(99.3) Form of Omnibus Nonqualified Stock Option Agreement
(99.4) Form of Omnibus Incentive Stock Option Agreement
(99.5) Form of Omnibus Nonqualified Stock Option Agreement with
increasing Exercise Price
(99.6) Form of Omnibus Incentive Stock Option Agreement with
increasing Exercise Price
ITEM 9. UNDERTAKINGS
(A)(1) The undersigned registrant hereby undertakes:
4
<PAGE> 7
(i) To file, during any period in which offers or sales are
being made, a post-effective amendment to this registration statement to include
any material information with respect to the plan of distribution not previously
disclosed in the registration statement or any material change to such
information in the registration statement.
(ii) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement;
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof; and
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(B) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(C) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
5
<PAGE> 8
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Wilmington, State of Massachusetts, Country of the
United States, on December 7, 1999.
DUSA Pharmaceuticals, Inc.
------------------------------
Registrant
By: /s/ D. Geoffrey Shulman
------------------------
Dr. D. Geoffrey Shulman,
President
POWER OF ATTORNEY
Know All Men By These Presents, that each person whose signature
appears below constitutes and appoints D. Geoffrey Shulman as true and lawful
attorney-in-fact and agent with full power of substitution and resubstitution,
for him and in his name, place and stead, in any and all capacities, to sign any
or all amendments (including post-effective amendments) to this registration
statement or any related registration statement that is to be effective upon
filing pursuant to Rule 462(b), and to file the same, with all exhibits thereto,
and other documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorney-in-fact and agent full power and
authority to do and perform each and every act and thing requisite and necessary
to be done in connection with the above premises, as fully to all intents and
purposes as he might or could do in person, hereby ratifying and confirming all
that said attorney-in-fact and agent or his substitute or substitutes, may
lawfully do or cause to be done by virtue thereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated:
<TABLE>
<S> <C> <C>
s/D. Geoffrey Shulman Director, Chairman of the December 7, 1999
- ---------------------------------- Board, President, Chief ----------------
Geoffrey Shulman, MD, FRCPC Executive Officer and Chief Date
Financial Officer (Principal
Executive, Financial, and
Accounting Officer)
s/Ronald L. Carroll Executive Vice President, December 7, 1999
- ---------------------------------- Chief Operating Officer ----------------
Ronald L. Carroll Date
s/Stuart L. Marcus Senior Vice President, December 7, 1999
- ---------------------------------- Scientific Affairs ----------------
Stuart L. Marcus, MD, PhD Date
s/Scott L. Lundahl Vice President, December 7, 1999
- ---------------------------------- Technology ----------------
Scott L. Lundahl Date
s/Gregory M. Torre Vice President, December 7, 1999
- ---------------------------------- Regulatory Affairs ----------------
Gregory M. Torre Date
</TABLE>
-i-
<PAGE> 9
<TABLE>
<S> <C> <C>
s/Nanette W. Mantell Secretary December 7, 1999
- ---------------------------------- ----------------
Nanette W. Mantell, Esq. Date
s/John H. Abeles Director December 7, 1999
- ---------------------------------- ----------------
John H. Abeles, MD Date
s/James P. Doherty, BSc Director December 7, 1999
- ---------------------------------- ----------------
James P. Doherty, BSc Date
s/Jay M. Haft, Esq. Director December 7, 1999
- ---------------------------------- ----------------
Jay M. Haft, Esq. Date
s/Richard C. Lufkin Director December 7, 1999
- ---------------------------------- ----------------
Richard C. Lufkin Date
</TABLE>
-ii-
<PAGE> 10
EXHIBIT INDEX
<TABLE>
<S> <C>
(4.1) 1991 Incentive Stock Option Plan of Deprenyl USA, Inc.............
(4.2) DUSA Pharmaceuticals, Inc. 1994 Restricted Stock Option Plan......
(4.3) DUSA Pharmaceuticals, Inc. 1996 Omnibus Plan, as Amended..........
(4.4) Stock Option Agreements for D. Geoffrey Shulman...................
(4.5) Stock Option Agreement for James P. Doherty.......................
(4.6) Stock Option Agreement for Theodore Sall..........................
(4.7) Stock Option Agreement for Richard C. Lufkin......................
(4.8) Stock Option Agreement for Herbert F. Haberman....................
(4.9) Stock Option Agreements for James C. Kennedy......................
(4.10) Stock Option Agreements for Roy H. Pottier........................
(4.11) Stock Option Agreements for Robert L. Reid........................
(4.12) Stock Option Agreement for Dean Van Vugt..........................
(4.13) Stock Option Agreement for Martin Barkin..........................
(4.14) Stock Option Agreements for Ronald L. Carroll.....................
(4.15) Stock Option Agreements for Scott Lundahl.........................
(4.16) Stock Option Agreement for Daniel Piacquadio......................
(4.17) Stock Option Agreement for Allyn Golub............................
(4.18) Stock Option Agreement for David Cohen............................
(4.19) Class B Warrant Agreement for D. Geoffrey Shulman.................
(5.1) Opinion of Lane and Mantell.......................................
(23.1) Consent of Deloitte & Touche LLP..................................
(23.2) Consent of Lane and Mantell (contained in Exhibit 5.1)............
(24.1) Power of Attorney (See Page i)....................................
(99.1) Form of 1991 Incentive Stock Option Agreement.....................
(99.2) Form of 1994 Restricted Stock Option Agreement....................
(99.3) Form of Omnibus Nonqualified Stock Option Agreement...............
(99.4) Form of Omnibus Incentive Stock Option Agreement..................
(99.5) Form of Omnibus Nonqualified Stock Option Agreement
with increasing Exercise Price.................................
(99.6) Form of Omnibus Incentive Stock Option Agreement
with increasing Exercise Price.................................
</TABLE>
<PAGE> 1
Exhibit 4.1
INCENTIVE STOCK OPTION PLAN
OF
DEPRENYL USA, INC.
ARTICLE I
STATEMENT OF PURPOSE
1.1 Purpose of the Plan. Under this incentive stock option plan (the
"Plan") of Deprenyl USA, Inc., (the "Company") options may be granted to
eligible employees (the "Optionees") to purchase shares of the Company's capital
stock. The Plan is designed to enable the Company and its subsidiaries to
attract, retain and motivate their employees by providing for or increasing the
proprietary interests of such employees in the Company. The Plan provides for
options which qualify as incentive stock options under Section 422 of the
Internal Revenue Code of 1986, as amended (the "Code").
ARTICLE II
AMOUNT AND SOURCE OF STOCK
2.1 Stock Subject to Plan. The maximum number of shares of stock for
which options granted hereunder may be exercised shall be four hundred twenty
thousand (420,000) shares of common stock, without par value, subject to the
unexercised portions of any options granted under this Plan which expire or
terminate or are canceled may again be subject to options under the Plan. Any
unissued shares which are not subject to an outstanding option at the
termination of this Plan shall cease to be subject to this Plan.
2.2 Adjustment of Shares. The number of shares of stock available under
the Plan shall be decreased by the number of shares with respect to which there
are issued and outstanding options, and increased by the number of shares with
respect to which an option has expired or terminated.
ARTICLE III
PARTICIPATION
3.1 Participation. The Board of Directors (the "Board") shall
determine, pursuant to Section 3.3 hereof, those employees
<PAGE> 2
who shall be eligible to receive stock options under this Plan and the number of
shares subject to each option. An option shall be granted to an employee solely
for reasons connected with his or her employment. In making its determinations,
a majority of the members of the Board acting on the matter must be
disinterested persons as provided for herein.
3.2 Limitation for Certain Employees. No employee who owns stock
directly or within the meaning of Section 424(d) of the Code, possessing more
than Ten Percent (10%) of the total combined voting power of all classes of
stock of the Company or any parent or subsidiary corporation of the Company, may
acquire an option under this Plan. Notwithstanding the foregoing limitation,
such an employee may acquire an option if at the time the option is granted the
option price is at least One Hundred Ten Percent (110%) of the fair market value
of the stock subject to the option and such option, by its terms, is not
exercisable after the expiration of five (5) years from the date the option is
granted.
3.3 Eligible Employees. The class of employees who are eligible to be
considered for the grant of options hereunder are any persons regularly employed
by the Company or its parent(s) or subsidiaries and are determined by the Board
to be a key employee.
ARTICLE IV
TERMS AND CONDITIONS OF THE STOCK OPTION
4.1 Option Price. The price at which each share of stock may be
purchased under an option (the "Option Price") shall be determined by the Board,
but shall not be less than the fair market value of the stock subject to the
option on the date the option is granted. The "fair market value" shall be
deemed for all purposes under this Plan to be the mean between the highest and
lowest sales prices reported as having occurred on the automated quotation
system operated by the National Association of Securities Dealers, Inc.
("NASDAQ"), or such other exchange where the Company's stock is traded or, if
there is no such sale on that date, then on the last preceding date on which
such a sale was reported. In no event shall the Option Price be less than the
par value of a share of common stock of the Company. In the case of an employee
described in Section 3.2, the Option Price must equal or exceed One Hundred Ten
Percent (110%) of the fair market value of the stock subject to the option and
shall not be exercisable after five (5) years from the date the option is
granted.
<PAGE> 3
4.2 Transferability. Any option granted under this Plan shall by its
terms be nontransferable by the Optionee other than by will or the laws of
descent and distribution and is exercisable during the Optionee's lifetime only
by him or by his guardian or legal representative. Nothing shall preclude the
Optionee from designating in the instrument evidencing his option the person who
after his death may exercise the option pursuant to the Plan. If the employee
attempts to alienate, assign, hypothecate, pledge or otherwise dispose of any
option, except as herein provided, or in the event of attachment, execution or
similar process upon the rights or interest herein conferred, the option shall
become immediately null and void and without legal effect.
4.3 Adjustments. If the outstanding shares of stock of the class then
subject to this Plan are increased or decreased, or are changed into or
exchanged for a different number or kind of shares or securities, as a result of
one or more reorganizations, recapitalizations, stock splits, reverse stock
splits, stock dividends or the like, appropriate adjustments shall be made in
the number and/or kind of shares or securities for which options may thereafter
be granted under this Plan and of which options then outstanding under this Plan
may thereafter be exercised. Any such adjustment in outstanding options shall be
made without changing the aggregate exercise price applicable to the unexercised
portions of such option.
4.4 Maximum Option Term. No option granted under this Plan may be
exercised in whole or in part more than ten (10) years after the date of its
grant.
4.5 Plan Duration. Options may not be granted under this Plan more than
ten (10) years after the date of the adoption of this Plan, or of shareholder
approval thereof, whichever is earlier.
4.6 Payment. Payment for stock purchased upon any exercise of an option
granted under this Plan shall be made in full in cash or its equivalent
concurrently with such exercise, except that, if and to the extent the
instrument evidencing the option so provides, and if the Company is not then
prohibited from purchasing or acquiring shares of such stock, such payment may
be made in whole or in part with shares of the same class of stock as that which
are then subject to the option, delivered in lieu of cash concurrently with such
exercise, the shares so delivered to be valued on the basis of the fair market
value of the stock determined in
<PAGE> 4
accordance with the procedure specified in Section 4.1 hereof on the day
preceding the date of exercise.
4.7 Limitation. Options shall not be granted under this Plan which
first become exercisable in any calendar year and which permit the Optionee to
purchase shares of the Company having an aggregate value in excess of One
Hundred Thousand Dollars ($100,000.00), determined at the time of the grant of
the option. No Optionee may exercise options during a calendar year for the
purchase of shares having an aggregate fair market value (determined at the time
of the grant of the options) exceeding One Hundred Thousand Dollars
($100,000.00), except and to the extent that such options were first exercisable
in preceding calendar years.
4.8 Exercise of Option. The Optionee may purchase Twenty- Five Percent
(25%) of the common stock with respect to which the option has been granted on
and after the first anniversary of the date of the grant, and an additional
Twenty-Five Percent (25%) of the common stock with respect to which the option
has been granted on and after each of the three (3) succeeding anniversaries of
said date. Installments or portions thereof not exercised in earlier periods
shall be accumulated and be available for exercise in later periods. In
exercising his option, the Optionee may exercise less than the full installment
available to him, but he must exercise the option in full shares of common stock
of the Company. The Optionee is limited to ten (10) exercises during the term of
his option. The option may be exercised by paying the full amount of the Option
Price to the Company by delivery of a certified or bank cashier's check or by
delivery of shares of stock of the Company with a fair market value equal to the
Option Price as is provided for in Section 4.6. Alternatively, the Optionee may
exercise the option by paying a combination of cash or stock. Upon payment of
the Option Price, the stock so purchase shall be delivered to the Optionee;
provided, however, until the option is paid, the Optionee shall not be
considered a holder of any shares of stock purchase pursuant to this Plan. The
exercise of the option shall be subject to the following additional conditions:
(a) No option may be exercised within one (1) year after the
option is granted.
(b) Any option received, other than by employees described in
Section 3.2, must be exercised within ten (10) years after the
date on which the option is granted.
<PAGE> 5
(c) Each option may be exercised in part or in full, but must
be exercised in the order in which each option is granted. As
long as a previously issued option has not been completely
exercised, or has not lapsed, no subsequently issued option
may be exercised.
ARTICLE V
PLAN ADMINISTRATION
5.1 Administration. The Plan shall be administered by the Board, or by
a committee (the "Committee") of not less than three members of the Board, each
of whom shall not be eligible, and shall not have been eligible at any time
within one year prior to his appointment to the Committee for selection as a
person to whom stock may be allocated or to whom stock options may be granted
pursuant to the Plan. The interpretation and construction by the Committee of
any term or provision of the Plan or of any option granted under it shall be
final, unless otherwise determined by the Board, in which event such
determination by the Board shall be final. Notwithstanding the foregoing, this
Plan shall be administered so as to qualify the options herein granted in a
manner which will qualify the options as incentive stock options pursuant to
Section 422 of the Code. In carrying out its duties hereunder, the Board or
Committee may from time to time adopt rules and regulations for carrying out
this Plan and, subject to the provisions of this Plan, may prescribe the form or
forms of the instruments evidencing any option granted under this Plan. Subject
to the provisions of this Plan, the Board or, by delegation from the Board, the
Committee shall have full and final authority in its discretion to select the
key employees to be granted options, to grant such option and to determine the
number of shares to be subject thereto, the exercise prices, the terms of
exercise, expiration dates and other pertinent provisions thereof.
5.2 Effective Date. The Plan shall become effective upon its adoption
by the Board, provided that the Shareholders of the Company approve the Plan by
a majority vote within twelve (12) months after the plan is adopted by the
Board. If the Plan is not approved by the shareholders within the twelve (12)
month period, all stock options granted under the Plan shall terminate at the
time of the shareholder's meeting or upon expiration of the twelve (12) month
period, whichever shall first occur.
5.3 Plan Term. The Plan shall terminate and no further options shall be
granted after the expiration of ten (10) years
<PAGE> 6
from the date the Plan is adopted, or the Plan is approved by the shareholders,
whichever occurs earlier.
ARTICLE VI
CORPORATE REORGANIZATIONS
6.1 Corporate Reorganizations. Upon the dissolution or liquidation of
the Company, or upon a reorganization, merger or consolidation of the Company as
a result of which the outstanding securities of the class then subject to
options hereunder are changed into or exchanged for cash or property or
securities not of the Company's issue, or upon a sale of substantially all the
property of the Company to, or the acquisition of stock representing more than
Eighty Percent (80%) of the voting power of the stock of the Company then
outstanding by another corporation or person, the Plan shall terminate, and all
options theretofore granted hereunder shall terminate, unless provision be made
in writing in connection with such transaction for the continuance of the Plan
and/or for the assumption of options theretofore granted, or the substitution
for such options or options covering the stock of the successor employer
corporation, or a parent or a subsidiary thereof, with appropriate adjustments
as to the number and kind of shares and prices, in which event the Plan and
options theretofore granted shall continue in the manner and under the terms so
provided. If the Plan and unexercised options shall terminate pursuant to the
foregoing sentence, all persons entitled to exercise any unexercised portions of
options then outstanding, shall have the right, at such time prior to the
consummation of the transaction causing such termination as the Company shall
designate, to exercise the unexercised portions of their options, including the
portions thereof which would, but for this paragraph entitled "Corporate
Reorganizations," not yet be exercisable. The Instrument evidencing any option
may also provide for such acceleration of otherwise unexercisable portions of
the option upon other specified events or occurrences, such as involuntary
terminations of the Optionee's employment following certain changes in the
control of the Company.
ARTICLE VII
FACTORS RELATING TO EMPLOYMENT
7.1 Termination of Employment. If prior to the termination of the Plan,
an employee ceases to be employed other than by reason of death or disability,
each option shall be exercisable only for a period of three (3) months from the
date of the cessation of employment or the option expiration date, whichever is
earlier.
<PAGE> 7
Thereafter, all unexercised options and the rights thereunder shall terminate.
7.2 Disability of Employee. If prior to the termination of the Plan an
employee ceases to be employed by reason of a disability as defined in Section
22(e)(3) of the Code, such employee shall exercise each option within one year
from the cessation of employment or on the option expiration date, whichever is
earlier. Thereafter, all unexercised options and the rights thereunder shall
terminate. Notwithstanding the provisions of this paragraph, however, if the
Optionee shall be discharged for cause (which shall be defined as participation
in conduct during employment consisting of fraud, felony, willful misconduct or
commission of any act which causes or may reasonably be expected to cause
substantial damage to the Company) each option to the extent not previously
exercised shall terminate at once.
7.3 Death of Employee. If prior to the termination date of the Plan an
employee dies while holding an option, the option may be exercised to the same
extent that the Optionee could have exercised the option at the time of his
death, by the estate of the decedent or by a person who acquired the right to
exercise the option by a written designation made by the deceased employee in
the instrument in which he was granted the option, or by bequest, inheritance or
under the laws of descent and distribution of the applicable state. The option
shall be exercised within the earlier of one year after the employee's death or
upon the option expiration date.
ARTICLE VIII
MISCELLANEOUS
8.1 Restricted Stock. If the instrument evidencing the option so
provides, shares of stock issued on exercise of an option granted under this
Plan may upon issuance be subject to the following restrictions (and, as used
herein, "Restricted Stock" means shares issued on exercise of options granted
under this Plan which are still subject to restrictions imposed under this
Section 8.1 that have not yet expired or terminated):
(a) Shares of Restricted Stock may not be sold or otherwise
transferred or hypothecated;
(b) If the employment of the holder of shares of restricted
stock with the Company or a subsidiary is terminated for any
reason other than his death, normal or
<PAGE> 8
early retirement in accordance with his employer's established
retirement policies or practices, or total disability, the
Company (or any subsidiary designated by it) shall have the
option for sixty (60) days after such termination of
employment to purchase for cash all or any part of his
restricted stock at the fair market value of the restricted
stock on the date of such termination of employment
(determined in manner and specified in the instrument
evidencing the option); and
(c) As to the shares of stock affected thereby, any additional
restrictions that may be imposed on particular shares of
restricted stock as specified in the instrument evidencing the
option.
The restrictions imposed under this Section 8.1 shall apply as well to
all shares or other securities issued in respect of restricted stock in
connection with any stock split, reverse stock split, stock dividend,
recapitalization, reclassification, spin-off, split-off, merger, consolidation
or reorganization, but such restrictions shall expire or terminate at such time
or times as shall be specified therefore in the instrument evidencing the option
which provides for the restrictions.
8.2 Amendment and Termination. The Board may alter, amend, suspend or
terminate this Plan, provided that no such action shall deprive an Optionee
without his consent or any option granted to the Optionee pursuant to this Plan
of any of his rights under such option. Except as herein provided, no such
action of the Board, unless taken with the approval of the shareholders of the
Company, may:
(a) increase the maximum number of shares for which options
granted under this Plan may be exercised;
(b) reduce the minimum permissible exercise price;
(c) alter the class of employees eligible to receive options
under the Plan.
8.3 Registration of Shares. At the discretion of the Board, the options
and the shares of stock received upon exercise of an option shall be registered
with the federal Securities and Exchange Commission and any applicable state
securities law commission. In the absence of such registration, both the options
and the shares: 1) will be issued only pursuant to an exemption from
registration;
<PAGE> 9
2) cannot be sold, pledged, traded or otherwise disposed of in the absence of an
effective registration statement or an opinion of counsel satisfactory to the
Company that such registration is not required; and 3) will bear an appropriate
restrictive legend to that effect. The employees to whom options are granted may
be required to sign an investment letter satisfactory to the Board at the time
the options are exercised, and may be required to comply with any other
requirements for a "private placement" exemption under Section 4(a) of the
Securities Act of 1933 and any applicable state securities law exemption.
8.4 Plan Does Not Confer Employment or Shareholder Rights. The right of
the Company to terminate (whether by dismissal, retirement or otherwise) the
Optionee's employment with it at any time at will, or as otherwise provided by
any agreement between the Optionee and the Company, is specifically reserved.
Neither the Optionee nor any person entitled to exercise his rights in the event
of his death shall have any rights of a shareholder with respect to the shares
subject to each option, except to the extent that a certificate for such shares
shall have been issued upon the exercise of each option as provided for herein.
Adopted this 26th day of September, 1991.
DEPRENYL USA, INC.
By: /s/ D. Geoffrey Shulman
---------------------------------
D. GEOFFREY SHULMAN, MD, FRCDC
<PAGE> 1
Exhibit 4.2
DUSA PHARMACEUTICALS, INC.
1994 RESTRICTED STOCK OPTION PLAN
ARTICLE I - PURPOSE
This non-qualified restricted stock option plan (the "Plan") is
intended to advance the interests of DUSA Pharmaceuticals, Inc. (the "Company")
and its shareholders by encouraging and enabling selected officers, directors,
employees and consultants of the Company, upon whose judgment, initiative and
effort the Company is largely dependent for the successful conduct of its
business, to acquire and retain a proprietary interest in the Company by
ownership of its common stock. Options granted under the Plan are not intended
to be options which meet the requirements of Section 422 of the Internal Revenue
Code of 1986, as amended (the "Code").
ARTICLE II - DEFINITIONS
(a) "Board of Directors" shall mean the board of directors of the
Company.
(b) "Common Stock" shall mean the Company's no par value common stock.
(c) "Date of Grant" shall mean the date on which an option is granted
under the Plan.
(d) "Option" shall mean the option granted under the Plan.
(e) "Optioned Shares" shall mean that number of Common Stock shares
which are subject to the Option granted by the Company to the optionee pursuant
to this Agreement.
(f) "Optionee" shall mean a person to whom an Option has been granted
under the Plan; and
(g) "Successor" shall mean the legal representative of the estate of
the deceased Optionee, or the person or persons who acquire the right to
exercise an Option by bequest or inheritance or by reason of the death of an
Optionee.
ARTICLE III - ADMINISTRATION OF THE PLAN
(a) Administration. The Plan shall be administered by the Board of
Directors or a committee of not less than two (2) members of the Board of
Directors (the "Committee"). If the Plan is administered by the Committee, it
shall report all action taken by it to the Board of Directors. The Board of
Directors or the Committee shall have complete authority and discretion to
interpret and
<PAGE> 2
administer the Plan in a manner which is consistent with the Plan's provisions,
and to make any amendments with respect thereto, subject to Article VIII,
subparagraph (c). However, in no event shall the Board of Directors or the
Committee have the power to determine eligibility of directors to participate in
the Plan, or to determine the number, the value, the vesting or exercise period
or the timing of the option grants to be made under the Plan to directors (all
such determinations are automatic pursuant to the provisions of the Plan). Any
action taken by the Board of Directors or the Committee with respect to the
administration of the Plan which would violate Rule 16b-3 under the Securities
Exchange Act of 1934, as amended from time to time (or any successor provision)
shall be null and void. The decisions made by the Board of Directors or the
Committee in connection with selecting persons to participate (other than
directors), authorizing the number of stock options and any other aspect of the
Plan administration shall be final and binding.
(b) Effective Date. The Plan shall become effective upon its adoption
by the Board (the "Approval Date"), provided that the shareholders of the
Company approve the Plan by a majority vote at the next annual shareholder
meeting. If the Plan is not approved by the shareholders, all Options granted
under the Plan shall terminate.
(c) Plan Term. The Plan shall terminate and no further Options shall be
granted after the expiration of ten (10) years from the date the Plan is
adopted.
ARTICLE IV - COMMON STOCK SUBJECT TO THE PLAN
The maximum number of shares of the Company's Common Stock which may be
issued upon the exercise of Options granted under the Plan shall not exceed
three hundred thousand (300,000), subject to adjustment under the provisions of
Article VII hereof.
ARTICLE V - PARTICIPANTS
Options may be granted under the Plan to any person who is or who
agrees to become an officer, director, employee or consultant of the Company or
its subsidiaries, provided that the number of shares reserved for issuance under
the Plan to any one person pursuant to options granted shall not exceed 5% of
the Company's outstanding Common Stock.
ARTICLE VI - AUTOMATIC GRANTS OF OPTIONS TO DIRECTORS
2
<PAGE> 3
Incumbent directors shall receive automatic grants of 10,000 options to
purchase the Company's Common Stock on each anniversary of the Approval Date.
Incoming directors shall receive 15,000 options to purchase the Company's Common
Stock on the first Approval date after their election to the Board of Directors
and thereafter, shall receive the option amounts designated for incumbent
directors. The specific terms and conditions of such option grants shall be
consistent with Article VII.
ARTICLE VII - TERMS AND CONDITIONS OF THE OPTIONS
Any Option granted under the Plan shall be evidenced by an agreement
executed by the Company and the Optionee, and shall contain such terms and be in
such form as the Board of Directors or the Committee, from time to time,
approve, subject to the following limitations and conditions:
(a) Option Price. The price at which each share of stock may be
purchased under an Option (the "Option Price") shall be determined by the Board
of Directors or by the Committee, but shall not be less than the fair market
value of a share of Common Stock on the day immediately preceding the Date of
Grant. The "fair market value" shall be deemed for all purposes under the Plan
to be the closing sales price reported as having occurred on the automated
quotation system operated by the National Association of Securities Dealers,
Inc. ("NASDAQ") or such other exchange where the Company's stock is traded
(e.g., The Toronto Stock Exchange) or, if there is not such sale on that date,
then on the last preceding date on which such a sale was reported.
If at any time the Common Stock is not listed on any securities
exchange or quoted in the NASDAQ system, the Option Price will be the fair
market value of the Common Stock as determined in the good faith judgment of the
Board of Directors.
(b) Period of Option. The expiration date of each Option shall be ten
(10) years from the Date of Grant, provided that if such day is not a day on
which the Company is open for business, then on the first following day on which
the Company is open for business.
(c) Exercise of Option. The Optionee may purchase twenty-five percent
(25%) of the Common Stock with respect to which the Option has been granted on
or after the first anniversary of the day immediately preceding the Date of
Grant and an additional twenty-five percent (25%) of the Common Stock with
respect to which the Option has been granted on and after each of the three
succeeding anniversaries of the day immediately preceding the Date of Grant.
Installments or portions thereof not exercised in earlier periods shall be
accumulated and available for exercise in
3
<PAGE> 4
later periods. In exercising the Option, the Optionee may exercise less than the
full installment available to him, but he/she must exercise the Option in full
shares of Common Stock of the Company. The Optionee is limited to ten (10)
exercises during the term of his/her Option. The Option may be exercised by
giving to the Company, at its registered office, notice in writing setting out
the number of Optioned Shares with respect to which the option is being
exercised. The notice must be accompanied by a certified check, official bank
cashier's check or money order in an amount equal to the Option Price multiplied
by the number of Optioned Shares requested and a duly executed copy of the
Restricted Stock Option Agreement given to the Optionee. Until the exercised
Optioned Shares are paid in full, the Optionee shall not be considered a holder
of any shares of the Common Stock purchased pursuant to the Plan.
(d) Vesting of Shareholders Rights. No Optionee nor his/her successor
shall have any rights as a shareholder of the Company until the certificates
evidencing shares purchased are properly delivered to such Optionee or his/her
successor against payment for the shares being purchased.
(e) Non-Transferability of Option. No Option shall be transferable or
assignable by an Optionee other than by will or by the laws of descent and
distribution, and each Option shall be exercisable during the Optionee's
lifetime only by him. Nothing shall preclude the Optionee from designating in
the instrument evidencing his Option the person who after his death may exercise
the Option pursuant to the Plan. No Option shall be subject to execution,
attachment or similar process. Upon any attempt to assign, transfer, pledge,
hypothecate or otherwise dispose of this Option contrary to the provisions
hereof, or upon the levy of any attachment or similar process upon the Option
granted herein, such Option shall immediately become void.
(f) Termination of Employment. Subject to subparagraph (g) of this
Article V, upon termination of an Optionee's employment with or service to the
Company for any reason, such part of the Option as is then exercisable but
unexercised may be exercised by the Optionee for a period of ninety (90) days
after termination or such later date as the Board of Directors may approve after
which time the Option shall expire; provided, however, that in no event may the
Option be exercised after the expiration date of the Option. The granting of an
Option to an Optionee does not alter, in any way, the Company's existing rights
to terminate such Optionee's employment or service at any time, for any reason,
nor does it confer upon such Optionee any rights or privileges, except as
specifically provided for him/her under the Plan.
(g) Death or Permanent Disability of Optionee. If the Optionee dies or
becomes totally
4
<PAGE> 5
and permanently disabled while in the employ or service of the Company, such
part of the Option as is then exercisable but unexercised may be exercised by
the Optionee or his/her successor for a period of six (6) months after the death
or disability of the Optionee (notwithstanding the expiration date of the
Option). The Board of Directors shall be entitled to determine if and when an
Optionee has become permanently disabled. In the event that the Option is not
exercised within the six (6) month period, the Option shall expire.
ARTICLE VIII - ADJUSTMENTS
(a) Adjustment of Shares Subject to the Plan. The number of shares of
stock available under the Plan shall be decreased by the number of shares with
respect to which there are issued and outstanding Options, and increased by the
number of shares with respect to which an Option has expired, terminated or been
canceled.
(b) Adjustment of Options Granted. In the event that the outstanding
shares of Common Stock of the Company are hereafter increased or decreased, or
changed into or exchanged for a different number or kind of shares or other
securities of the Company, or for another corporation, by reason of a
recapitalization, reclassification, stock split, reverse stock split,
combination of shares or dividend or any other distribution payable in capital
stock, appropriate adjustments shall be made by the Board of Directors or the
Committee in the number and kind of shares for the purchase of which Options may
be granted under the Plan. In addition, the Board of Directors or the Committee
shall make appropriate adjustments in the number and kind of shares as to which
outstanding Options, or portions thereof, then unexercised, shall be exercisable
to the end that the proportionate interest of the holder of the Option shall, to
the extent practicable, be maintained without change in the total price
applicable to the unexercised portion of the Option, but with a corresponding
adjustment in the Option Price per share.
(c) Dissolution or Liquidation. In the event of the dissolution or
liquidation of the Company, any Option granted under the Plan shall terminate as
of the date to be fixed by the Board of Directors or the Committee, provided
that not less than thirty (30) days written notice of the date so fixed shall be
given to each Optionee and each such Optionee shall have the right during such
period to exercise his/her Option as to all or any part of the shares covered
thereby, including shares as to which this Option would not otherwise be
exercisable by reason of an insufficient lapse of time.
(d) Reorganization. In the event of a Reorganization (as hereinafter
defined) in which
5
<PAGE> 6
the Company is not the surviving or acquiring company, or in which the Company
is or becomes a wholly-owned subsidiary of another company after the effective
date of the Reorganization, then
(i) if there is no plan or agreement respecting the
Reorganization (the "Reorganization Agreement") or if the
Reorganization Agreement does not specifically provide for the change,
conversion or exchange of the shares under outstanding and unexercised
stock options for securities of another corporation, then the Board of
Directors or the Committee shall take the Option, and the Option shall
terminate, as provided in subparagraph (c) of this Article VII; or
(ii) if there is a Reorganization Agreement and if the
Reorganization Agreement specifically provides for the change,
conversion or exchange of the shares under outstanding and unexercised
stock option for securities of another corporation, then the Board of
Directors or the Committee shall adjust the shares under such
outstanding and unexercised stock options (and shall adjust the shares
remaining under the Plan, if the Reorganization Agreement makes
specific provision therefor) in a manner not inconsistent with the
provisions of the Reorganization Agreement for the adjustment, change,
conversion or exchange of such stock and such Options.
The term "Reorganization" as used in this subparagraph (d) of this
Article VII, shall mean any statutory merger, statutory consolidation, sale of
all or substantially all of the assets of the Company, or sale, pursuant to an
agreement with the Company, of securities of the Company, pursuant to which the
Company is or becomes a wholly-owned subsidiary of another company after the
effective date of the Reorganization.
ARTICLE IX - MISCELLANEOUS
(a) Restrictions on Common Stock. Common Stock acquired pursuant to the
exercise of an Option under the Plan shall be subject to applicable transfer
restrictions under applicable Canadian or United States federal securities laws,
under the requirements of any national securities exchange or market upon which
such common stock are then listed and/or traded, and under any blue sky or state
securities laws applicable to such common stock. If the instrument evidencing
the Option so provides, Common Stock issued on exercise of an Option granted
under the Plan may upon issuance be subject to additional restrictions.
(b) Registration of Shares. At the discretion of the Board of
Directors, the Options and the shares of Common Stock received upon exercise of
an Option shall be registered with the United
6
<PAGE> 7
States Securities and Exchange Commission and any applicable state securities
law commission. In the absence of such registration, both the Options and the
Optioned Shares: 1) will be issued only pursuant to an exemption from
registration; 2) cannot be sold, pledged, traded or otherwise disposed of in the
absence of an effective registration statement or an opinion of counsel
satisfactory to the Company that such registration is not required; 3) will bear
an appropriate restrictive legend to that effect. The Optionees may be required
to sign an investment letter satisfactory to the Board of Directors at the time
the Options are exercised, and may be required to comply with any other
requirements for an exemption under the Securities Act of 1933 and any
applicable state securities law exemption.
(c) Amendment, Suspension and Termination of the Plan. The Board of
Directors may, at any time, suspend or terminate the Plan or may amend it,
subject to the consent of The Toronto Stock Exchange, from time to time in such
respects as the Board of Directors may deem advisable in order that the Options
granted thereunder may conform to any changes in the law or in any other respect
which the Board of Directors may deem to be in the best interests of the
Company. Unless the Plan shall theretofore have been terminated by the Board of
Directors, the Plan shall terminate ten (10) years after the effective date of
the Plan. No Option may be granted during any suspension or after the
termination of the Plan. No amendment, suspension or termination of the Plan
shall, without an Optionee's consent, alter or impair any of the rights or
obligations under any Option theretofore granted to such Optionee under the
Plan. Except as herein provided, no such action of the Board of Directors,
unless taken with the approval of the shareholders of the Company, may:
(i) increase the maximum number of shares for which Options
granted under the Plan may be exercised;
(ii) reduce the minimum permissible Option Price; or
(iii) alter the class of participants eligible to receive
Options under the Plan.
(d) Use of Proceeds. The proceeds received by the Company from the sale
of Common Stock, pursuant to the exercise of Options granted under the Plan,
shall be added to the Company's general funds and used for general corporate
purposes.
Adopted this 2nd day of August, 1994.
7
<PAGE> 1
EXHIBIT 4.3
DUSA PHARMACEUTICALS, INC.
1996 OMNIBUS PLAN
(AS AMENDED JUNE 10, 1998)
ARTICLE I - PURPOSE
This Omnibus Plan (the "Plan") is intended to promote the growth and
general prosperity of DUSA Pharmaceuticals, Inc. (the "Company") and its
shareholders by offering incentives to its key directors, employees and
consultants of the Company who are primarily responsible for the growth of the
Company and to attract and retain qualified directors, employees and consultants
of the Company and thereby benefit its shareholders based on the growth of the
Company.
ARTICLE II - DEFINITIONS
Unless the context indicates otherwise, the following terms, when used
in this Plan, shall have the meanings set forth in this Section:
(a) "Award" shall mean grants under this Plan that provide the
participants with the right to purchase Common Stock or that are valued by
reference to the Fair Market Value of the Common Stock.
(b) "Board" shall mean the Board of Directors of the Company.
(c) "Cause" shall mean deliberate, willful or gross misconduct.
(d) A "Change of Control" shall be deemed to have taken place upon (i)
the acquisition by a third person, including a "group" as defined in Section
13(d)(3) of the Securities Exchange Act of 1934, as amended, of shares of the
Company having 50% or more of the total number of votes that may be cast for the
election of Directors of the Company; (ii) shareholder approval of a transaction
for the acquisition of the Company, or substantially all of its assets by
another entity or for a merger, reorganization, consolidation or other business
combination to which the Company is a part; or (iii) the election during any
period of 24 months or less of 50% or more of the Directors of the Company where
such Directors were not in office immediately prior to such period provided,
however, that no "Change of Control" shall be deemed to have taken place if the
Directors of the Company in office on the date of adoption of the Plan, or their
successors in office nominated by such Directors, affirmatively approve a
resolution to such effect.
(e) "Code" shall mean the Internal Revenue Code of 1986 as it may be
amended from time to time.
(f) "Committee" shall mean, collectively, the Board, or any Committee
of two or more Non-Employee Directors, that may be designated by the Board to
administer the Plan.
(g) "Common Stock" shall mean all classes of stock, without par value,
including convertible preferred, stock purchase warrants and all common stock
equivalents.
(h) "Consultant" shall mean any person who (i) is engaged to perform
services for the Company or its Subsidiaries, other than as an Employee or
Director, or (ii) has agreed to become a consultant within the meaning of clause
(i).
(i) "Director" shall mean any member of the Board.
<PAGE> 2
(j) "Disability" shall mean inability to perform the services required
hereunder due to mental or physical disability which continues for either (i) a
total of 180 working days during any 12- month period or (ii) 150 consecutive
working days.
(k) "Employee" shall mean (i) any full-time employee of the Company or
its Subsidiaries (including Directors who are otherwise employed on a full-time
basis by the Company or its Subsidiaries), or (ii) any person who has agreed to
become an employee within the meaning of clause (i).
(l) "Exchange Act" shall mean the Securities Exchange Act of 1934 as it
may be amended from time to time.
(m) "Fair Market Value" of the Common Stock on a given date shall be
based upon, the last sales price or, if unavailable, the average of the closing
bid and asked prices per share of the Common Stock on such date (or, if there
was no trading or quotation in the Common Stock on such date, on the next
preceding date on which there was trading or quotation).
(n) "Grantee" shall mean a person granted an Award under the Plan.
(o) "ISO" shall mean an Option granted pursuant to the Plan to purchase
shares of the Common Stock and intended to qualify as an incentive stock option
under Section 422 of the Code, as now or hereafter constituted.
(p) "1933 Act" shall mean the Securities Act of 1933; as amended.
(q) "Non-Employee Director" shall mean a non-employee director as
defined in Exchange Act Rule 16b-3(b)(3)(i).
(r) "NQSO" shall mean an Option granted pursuant to the Plan to
purchase shares of the Common Stock that is not an ISO.
(s) "Options" shall refer collectively to NQSOs and ISOs issued under
and subject to the Plan. Each option is exercisable into one share of Common
Stock of the Company.
(t) "Parent" shall mean any parent corporation as defined in Section
424 of the Code.
(u) "Performance Awards" shall mean grants under the Plan, payable in
cash, Common Stock, other securities or other awards and shall confer on the
holder there of the right to receive payments, upon the achievement of such
performance goals during such performance periods as the Committee shall
establish.
(v) "Restricted Stock" shall mean Common Stock subject to restrictions
on transfer and/or such other restrictions on incidents of ownership as the
Committee may determine.
(w) "SAR" shall mean a right to receive, upon surrender of the right,
but without payment, an amount payable in cash.
(x) "Subsidiary" shall mean (i) any corporation with respect to which
the Company owns, directly or indirectly, 50% or more of the total combined
voting power of all classes of stock of such Company, or (ii) any entity which
the Committee reasonably expects to become a subsidiary within the meaning of
clause (i).
ARTICLE III - ADMINISTRATION
The Plan shall be administered by the Committee. Subject to the
provisions of the Plan, the Committee shall have full discretion and the
exclusive power (i) to select the Employees, Consultants and Directors who will
participate in the Plan and to make Awards to such Employees, Consultants, and
Directors, (ii) to determine the time at which such Awards shall be granted and
any terms and conditions with respect to such Awards as shall not be
inconsistent with the
<PAGE> 3
provisions of the Plan, and (iii) to resolve all questions relating to the
administration of the Plan. The interpretation of and application by the
Committee of any provision of the Plan shall be final and conclusive. The
Committee may in its discretion establish such rules and guidelines relating to
the Plan as it may deem desirable. No member of the Board of Directors or the
Committee shall be liable for any action or determination made in good faith
with respect to the Plan or any Awards granted hereunder. The Committee may
employ such legal counsel, consultants and agents as it may deem desirable for
the administration of the Plan and may rely upon any opinion received from any
such counsel or consultant and any computation received from any such consultant
or agent. The Committee shall keep minutes of its actions under the Plan.
ARTICLE IV - SHARES OF COMMON STOCK SUBJECT TO THE PLAN
Subject to the provisions of Article XV, the maximum number of shares
with respect to which the Awards may be granted under the Plan shall not exceed
fifteen percent (15%) of the number of shares of Common Stock outstanding. Any
shares subject to an Award under the Plan, which Award for any reason expires or
is terminated unexercised as to such shares, shall again be available for the
grant of other Awards under the Plan provided, however, that forfeited Common
Stock or other securities shall not be available for further Awards if the
participant has realized any benefits of ownership from such Common Stock.
Shares delivered upon exercise of the Awards, at the election of the Board of
Directors of the Company, may be stock that is authorized but previously
unissued or stock reacquired by the Company or both.
ARTICLE V - ELIGIBILITY
The individuals who shall be eligible to participate in the Plan shall
be Employees, Consultants and Directors of the Company. An Employee, Consultant
or Director who has been granted an Award in one year shall not necessarily be
entitled to be granted Awards in subsequent years.
ARTICLE VI - GRANTS OF STOCK OPTIONS TO EMPLOYEES AND CONSULTANTS
The Committee may grant Options, as follows, which may be designated as
(i) NQSOs or (ii) ISOs intended to qualify under Code Section 422:
(a) NONQUALIFIED STOCK OPTIONS. A NQSO is a right to purchase a
specified number of shares of Common Stock during such specified time as the
Committee may determine, not to exceed ten (10) years, at a price determined by
the Committee that, unless deemed otherwise by the Committee, is not less than
the Fair Market Value of the Common Stock on the date the option is granted.
NQSOs granted to Employees and Consultants shall vest at the rate of one quarter
of the total granted on each of the first, second, third and fourth
anniversaries of the day of the grant, subject to satisfaction of certain
conditions involving continuous periods of service or engagement.
(i) The purchase price of the Common Stock subject to the NQSO
may be paid in cash. At the discretion of the Committee, the purchase price may
also be paid by the tender of Common Stock or through a combination of Common
Stock and cash or through such other means as the Committee determines are
consistent with the Plan's purpose and applicable law. No fractional shares of
Common Stock will be issued or accepted.
(ii) Without limiting the foregoing, to the extent permitted
by law (including relevant state law), (A) the Committee may agree to accept, as
full or partial payment of the purchase price of Common Stock issued upon the
exercise of the NQSO, a promissory note of the person exercising the NQSO
evidencing the person's obligation to make future cash payments to the Company,
which promissory note shall be payable as determined by the Company (but in no
event later than five (5) years after the date thereof), shall be secured by a
pledge of the shares of Common Stock purchased and shall bear interest at a rate
established by the Committee and (B) the Committee may also permit the person
exercising the NQSO, either on a selective or aggregate basis, to simultaneously
exercise the NQSO and sell
<PAGE> 4
the shares of Common Stock acquired, pursuant to a brokerage or similar
arrangement approved in advance by the Committee, and use the proceeds from sale
as payment of the purchase price of such Common Stock.
(b) INCENTIVE STOCK OPTIONS. An ISO is an Award in the form of an
Option to purchase Common Stock that complies with the requirements of Code
Section 422 or any successor section.
(i) The aggregate Fair Market Value (determined at the time of
the grant of the Award) of the shares of Common Stock subject to ISOs which are
exercisable by one person for the first time during a particular calendar year
shall not exceed $100,000. To the extent that ISOs granted to an employee exceed
the limitation set forth in the preceding sentence, ISOs granted last shall be
treated as NQSOs.
(ii) No ISO may be granted under this Plan on or after the
tenth anniversary of the date this Plan is adopted or the date this Plan is
approved by shareholders, whichever is earlier.
(iii) No ISO may be exercisable more than:
(A) in the case of an Employee who is not a Ten
Percent Shareholder, within the meaning of Code Section 422, on the date the ISO
is granted; ten (10) years after the date the ISO is granted; and
(B) in the case of an Employee who is a Ten Percent
Shareholder, within the meaning of Code Section 422, on the date the ISO is
granted, five (5) years after the date the ISO is granted.
(iv) The exercise price of any ISO shall be determined by the
Committee and shall be no less than:
(A) in the case of an Employee who is not a Ten
Percent Shareholder, on the date the ISO is granted, the Fair Market Value of
the Common Stock subject to the ISO on such date; and
(B) in the case of an Employee who is a Ten Percent
Shareholder, on the date the ISO is granted, not less than 110 percent of the
Fair Market Value of the Common Stock subject to the ISO on such date.
(v) The Committee may provide that the option price under an
ISO may be paid by one or more of the methods available for paying the option
price of an NQSO.
(vi) ISOs shall vest at the rate of one quarter of the total
granted on each of the first, second, third and fourth anniversaries of the day
of the grant, subject to satisfaction of certain conditions involving continuous
periods of service or engagement.
ARTICLE VII - GRANTS OF STOCK APPRECIATION RIGHTS TO EMPLOYEES AND CONSULTANTS
An SAR is a right to receive, upon surrender of the right, but without
payment, an amount payable in cash.
(i) The amount payable with respect to each SAR shall be equal in value
to the applicable percentage of the excess, if any, of the Fair Market Value of
a share of Common Stock on the exercise date over the exercise price of the SAR.
The exercise price of the SAR shall be determined by the Committee and shall not
be less than the Fair Market Value of a share of Common Stock on the date the
SAR is granted.
(ii) In the case of an SAR granted in tandem with an ISO to an Employee
or Consultant who is a Ten Percent Shareholder on the date of such grant, the
amount payable with respect to each SAR shall be equal in value to the
applicable percentage of the excess, if any, of the Fair Market Value of a share
of Common Stock on the exercise date over the exercise price of the SAR, which
exercise price shall not be less than 110% of the Fair Market Value of a share
of Common Stock on the date the SAR is granted.
(iii) The applicable percentage and exercise price shall be established
by the Committee at the time the SAR is granted.
<PAGE> 5
(iv) SARs shall vest at the rate of one quarter of the total granted on
each of the first, second, third and fourth anniversaries of the day of the
grant, subject to satisfaction of certain conditions involving continuous
periods of service or engagement.
ARTICLE VIII - GRANTS OF RESTRICTED STOCK TO EMPLOYEES AND CONSULTANTS
Restricted Stock is Common Stock of the Company that is issued to a
participant at a price determined by the Committee, which price may be zero, and
is subject to restrictions on transfer and/or such other restrictions on
incidents of ownership as the Committee may determine.
ARTICLE IX - GRANTS OF PERFORMANCE AWARDS TO EMPLOYEES AND CONSULTANTS
A Performance Award granted under the Plan (i) may be denominated or
payable in cash, Common Stock (including without limitation, Restricted Stock),
other securities or other Awards and (ii) shall confer on the holder thereof the
right to receive payments, in whole or in part, upon the achievement of such
performance goals during such performance periods as the Committee shall
establish. Subject to the terms of the Plan and any applicable Award agreement,
the performance goals to be achieved during any performance period, the length
of any performance period, the amount of any Performance Award granted and the
amount of any payment or transfer to be made pursuant to any Performance Award
shall be determined by the Committee.
ARTICLE X - GRANTS OF OTHER STOCK-BASED INCENTIVE AWARDS TO
EMPLOYEES AND CONSULTANTS
The Committee may from time to time grant Awards under this Plan that
provide the participant with the right to purchase Common Stock or that are
valued by reference to the Fair Market Value of the Common Stock (including, but
not limited to, phantom securities or dividend equivalents). Such Awards shall
be in a form determined by the Committee (and may include terms contingent upon
a change of control of the Company), provided that such Awards shall not be
inconsistent with the terms and purposes of the Plan. The Committee will
determine the price of any Award and may accept any lawful consideration.
ARTICLE XI - GRANTS OF STOCK OPTIONS TO DIRECTORS
(a) Directors of the Company shall be eligible to receive NQSOs under
the Plan. Each individual who agrees to become a Director shall receive, without
the exercise of the discretion of any person, a NQSO under the Plan relating to
the purchase of 15,000 shares of Common Stock at an exercise price equal to the
Fair Market Value. Thereafter, on the day after the annual meeting of
shareholders, each person who is a continuing Director on any such date shall
receive, without the exercise of the discretion of any person, a NQSO under the
Plan relating to the purchase of 10,000 shares of Common Stock.
(b) The exercise price of each share of Common Stock subject to a NQSO
granted to a Director shall equal the Fair Market Value of a share of Common
Stock on the date such NQSO is granted. The option price of a NQSO granted to a
Director may be paid in accordance with Article VI (a) (i) and (ii) of the Plan.
(c) Each automatic NQSO granted to a Director shall vest in full on the
date of the grant. The NQSOs to directors shall have a term not to exceed ten
(10) years from the date of grant, or, if later, the date the Grantee becomes a
Director. Notwithstanding the exercise period of any NQSO granted to a Director,
all such NQSOs shall immediately become exercisable upon (i) the death of a
Director while serving as such, or (ii) a Change of Control.
<PAGE> 6
ARTICLE XII - EXERCISE OF OPTIONS
Options granted under the Plan may be exercised by a Grantee only while
the Employee, Consultant or Director is and, continuously since the date the
Option was granted, has been an Employee, Consultant or Director of the Company
or one of its subsidiaries, except that:
(i) if the Grantee's termination of employment is other than for Cause,
any Options held by the Grantee may be exercised, to the extent then
exercisable, for a period of three months after the date of such termination of
employment;
(ii) if such termination of employment is by reason of retirement or
disability, any Options held by the Grantee at the time of death or disability
will be exercisable for a period of 12 months after the date of such termination
of employment;
(iii) in the event of death after termination of employment pursuant to
(i) or (ii) above, the person or persons to whom the Grantee's rights are
transferred by will or the laws of descent and distribution shall have a period
of three years from the date of termination of the Grantee's employment to
exercise any Options which the Grantee could have exercised during such period;
and
(iv) in the event of the death of an Grantee while employed, any
Options then held by the Grantee shall become fully and immediately exercisable
and may be exercised by the person or persons to whom the Grantee's rights are
transferred by will or the laws of descent and distribution for a period of
three years after the Grantee's death. In no event, however, shall any Option be
exercisable after the date specified in Article VI, as applicable.
An Option granted hereunder shall be exercisable, in whole or in part,
only by written notice delivered in person or by mail to the Secretary of the
Company at its principal office, specifying the number of shares of Common Stock
to be purchased and accompanied by payment thereof and otherwise in accordance
with the option agreement pursuant to which the Option was granted.
In the event of a Change of Control affecting the Company, then,
notwithstanding any provision of the Plan or of any provisions of any Award
agreements entered into between the Company and any participant to the contrary,
all Awards that have not expired and which are then held by any participant (or
the person or persons to whom any deceased participant's rights have been
transferred) shall, as of such Change of Control, become fully and immediately
vested and exercisable and may be exercised for the remaining term of such
Awards.
ARTICLE XIII - AWARD AGREEMENTS
Each Award granted under the Plan shall be evidenced by an Award
agreement between the Grantee and the Company, setting forth the number of
shares of Common Stock, SARs, or units subject to the Award and such other terms
and conditions applicable to the Award not inconsistent with the Plan as the
Committee may deem appropriate.
ARTICLE XIV - TAX WITHHOLDING
The Committee may establish such rules and procedures as it considers
desirable in order to satisfy any obligation of the Company or any subsidiary to
withhold federal income taxes or other taxes with respect to any Award made
under the Plan. Such rules and procedures may provide (i) in the case of Awards
paid in shares of Common Stock, that the person receiving the Award may satisfy
the withholding obligation by instructing the Company to withhold shares of
Common Stock otherwise issuable upon exercise of such Award in order to satisfy
such withholding obligation and (ii) in the case of an Award paid in cash, that
the withholding obligation shall be satisfied by withholding the applicable
amount and paying the net amount in cash to the participant.
<PAGE> 7
ARTICLE XV - DILUTION OR OTHER ADJUSTMENT
If the Company is a party to any merger or consolidation, or undergoes
any separation, reorganization or liquidation, the Board of Directors of the
Company shall have the power to make arrangements, which shall be binding upon
the holders of unexpired Awards, for the substitution of new Awards for, or the
assumption by another corporation of, any unexpired Awards then outstanding
hereunder. In the case of any ISO, such action shall be taken only in the manner
and to the extent permitted by Sections 422 and 424 of the Code. In addition, in
the event of a reclassification, stock split, combination of shares, separation
(including a spin-off), dividend on shares of the Common Stock payable in stock,
or other similar change in capitalization or in the corporate structure of
shares of the Common Stock of the Company, the Committee shall conclusively
determine the appropriate adjustment in the option prices of outstanding
Options, in the number and kind of shares or other securities as to which
outstanding Awards shall be exercisable, and in the aggregate number of shares
with respect to which Awards may be granted. In the case of any ISO, any such
adjustment in the shares or other securities subject to the ISO (including any
adjustment in the Option price) shall be made in such manner as not to
constitute a modification as defined by Section 424(h)(3) of the Code and only
to the extent permitted by Sections 422 and 424 of the Code.
ARTICLE XVI - ASSIGNABILITY
No Award granted under this Plan shall be sold, pledged, assigned or
transferred other than by will or the laws of descent and distribution, and
Awards shall be exercisable during the Grantee's lifetime only by the Grantee.
ARTICLE XVII - AMENDMENT OR TERMINATION
The Board of Directors of the Company may at any time amend, suspend or
terminate the Plan subject to the regulatory requirements of the United States
Securities and Exchange Commission and the National Association of Securities
Dealers or other applicable federal or state regulatory authority, provided,
however, that no change in any Awards previously granted may be made without the
consent of the holder thereof.
ARTICLE XVIII - GENERAL PROVISIONS
(a) Common Stock acquired pursuant to the exercise of an Option under
the Plan shall be subject to applicable transfer restrictions under applicable
Canadian or United States federal securities laws, under the requirements of any
national securities exchange or market upon which such Common Stock are then
listed and/or traded, and under any blue sky or state securities laws applicable
to such Common Stock. If the instrument evidencing the Option so provides,
Common Stock issued on exercise of an Option granted under the Plan may upon
issuance be subject to additional restrictions.
(b) At the discretion of the Board of Directors, the Options and the
shares of Common Stock received upon exercise of an Option shall be registered
with the United States Securities and Exchange Commission and any applicable
state securities law commission. In the absence of such registration, both the
Options and the shares of Common Stock underlying the Options: 1) will be issued
only pursuant to an exemption from registration; 2) cannot be sold, pledged,
traded or otherwise disposed of in the absence of an effective registration
statement or an opinion of counsel satisfactory to the Company that such
registration is not required; 3) will bear an appropriate restrictive legend to
that effect. Individuals receiving Options may be required to sign an investment
letter satisfactory to the Board of Directors at the time the Options are
exercised, and may be required to comply with any other requirements for an
exemption under the Securities Act of 1933 and any applicable state securities
law exemption.
(c) The proceeds received by the Company from the sale of Common Stock,
pursuant to the exercise of Options granted under the Plan, shall be added to
the Company's general funds and used for general corporate purposes.
<PAGE> 8
(d) No Awards may be exercised by the holder thereof if such exercise,
and the receipt of cash or stock thereunder, would be, in the opinion of counsel
selected by the Company, contrary to law or the regulations of any duly
constituted authority having jurisdiction over the Plan.
(e) No Award recipient shall have any rights as a shareholder with
respect to any shares subject to Awards granted to him or her under the Plan
prior to the date as of which he or she is actually recorded as the holder of
such shares upon the stock records of the Company.
(f) Nothing contained in the Plan or in Awards granted thereunder shall
confer upon any Employee, Consultant or Director any right to continue in the
employ of the Company or any of its subsidiaries or interfere in any way with
the right of the Company or any of its subsidiaries to terminate his or her
employment at any time.
ARTICLE XIX - EFFECTIVE DATE
The Plan shall become effective on the date of its adoption by the
Board of Directors of the Company subject to approval of the Plan by the holders
of a majority of the outstanding voting shares of the Company within 12 months
after the date of the Plan's adoption by said Board of Directors. In the event
of the failure to obtain such shareholder approval, the Plan shall be null and
void and the Company shall have no liability thereunder. No Award granted under
the Plan shall be exercisable until such shareholder approval has been obtained.
ARTICLE XX - TERMINATION
No Award may be granted under the Plan on or after the date which is
ten years following the effective date specified in Article XIX, but Awards
previously granted may be exercised in accordance with their terms.
Adopted the 10th day of June, 1998
<PAGE> 1
Exhibit 4.4(a)
STOCK OPTION AGREEMENT
THIS AGREEMENT is made as of the 30th day of September, 1991 between
DEPRENYL USA, INC., a corporation incorporated under the laws of the State of
New Jersey (hereinafter referred to as the "Company") and D. GEOFFREY SHULMAN,
MD, FRCPC, an individual residing at 256 Russell Hill Road, Toronto, Ontario M4V
2T2, CANADA (hereinafter referred to as the "Participant").
WITNESSETH:
WHEREAS, the Board of Directors of the Company has determined that in
consideration for services rendered on the Company's behalf and in order to
provide an inducement to the Participant to acquire a proprietary interest in
the Company, it is in the Company's best interest to grant an option to him to
purchase shares of the Company's common stock ("Shares") on the terms and
conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
expressed herein, it is agreed by and between the parties as follows:
1.1 DEFINITIONS
In this Agreement:
"Board of Directors" means the board of directors of the Company;
"Exercise Price" means CDN. $6.79;
"Expiration Date" means 5:00 p.m. (Eastern Standard Time) on the later
of the dates provided in Section 2.2;
"Optioned Shares" means that number of Shares which are subject to the
option granted by the Company to the Participant pursuant to this
Agreement; and
"Shares" means shares of common stock, without par value, of the
Company.
2.1 GRANT OF OPTION
The Company hereby grants to the Participant an option to purchase, in
accordance with the vesting rights outlined in Sections 2.6 and 2.7
hereof, up to 50,000 Shares for an amount per Share equal to the
Exercise Price, upon the terms and subject to the conditions herein
contained.
2.2 Subject to Sections 2.6, 2.7 and 3.1 hereof, the Participant shall have
the right, at any time prior to 5:00 p.m. (Eastern Standard Time) on
the fifth anniversary date hereof, being
<PAGE> 2
September 30, 1996 (provided that if such day is not a day on which the
Company is open for business then on the first following day on which
the Company is open for business) to exercise this option for any
number of the Optioned Shares up to the maximum number of Shares
specified in Section 2.1 above.
2.3 The option may be exercised by the Participant or by his executors or
personal representatives in the circumstances described in Section 4.1
by providing to the Company notice in writing in the form of Schedule A
hereto setting out the number of Optioned Shares with respect to which
the option is being exercised. The notice must be accompanied by a
certified check, official bank cashier's check or money order in an
amount equal to the Exercise Price multiplied by the number of Shares
requested and a duly executed copy of this Agreement.
2.4 The Company shall cause its registrar and transfer agent to deliver to
the Participant as soon as practicable after receipt of such notice and
payment a certificate or certificates registered in the name of the
Participant or as the Participant may direct for the number of Shares
with respect to which the option is duly exercised.
2.5 Nothing contained in this Agreement or action taken pursuant hereto
shall obligate the Participant to purchase and/or pay for, or the
Company to issue, any Shares except those Optioned Shares with respect
to which the Participant shall have duly exercised the option to
purchase in accordance with this Agreement.
2.6 Subject to Section 2.7 hereof, the option granted hereunder shall vest
in the following manner:
(a) one-quarter of the option on the first anniversary of the day
immediately preceding the date hereof, being September 29,
1992;
(b) one-quarter of the option on the second anniversary of the day
immediately preceding the date hereof, being September 29,
1993;
(c) one-quarter of the option on the third anniversary of the day
immediately preceding the date hereof, being September 29,
1994; and
(d) one-quarter of the option on the fourth anniversary of the day
immediately preceding the date hereof, being September 29,
1995;
and, except as provided by Section 6.1, the Participant shall only be
entitled to exercise this option in the amounts set out above and from
and after the dates so specified.
2.7 Notwithstanding anything contained in Section 2.6 hereof, the option
shall continue to vest only so long as the Participant continues to
serve the Company as a director or officer. Should the Participant
cease to serve in such capacity ("Termination"), no further vesting of
the option shall occur and the provisions of Section 3.1 shall apply
with respect to the exercise of the option to the extent that it has
vested and has not yet been exercised.
2
<PAGE> 3
3.1 EXPIRATION ON TERMINATION
Subject to Section 4.1 hereof, upon Termination, such part of the
option as is then vested but unexercised may be exercised by the
Participant for a period of ninety (90) days after Termination or such
later date as the Board of Directors may approve after which time this
option shall expire; provided, however, that in no event may this
option be exercised after the Expiration Date.
4.1 DEATH OR PERMANENT DISABILITY
In the event that on or prior to the Expiration Date, the Participant
dies or becomes totally and permanently disabled while providing
serving the Company as a director or officer, this option, to the
extent then vested but unexercised, may be exercised by the Participant
for a period up to six (6) months after the death or disability of the
Participant; provided, however, that in no event may this option be
exercised after the Expiration Date. Disability shall be defined as in
Section 22(e)(3) of the Internal Revenue Code of 1986, as amended. For
the purposes of this provision only, reference to the Participant in
this Agreement shall be construed as including the executors or
personal representatives of a deceased Participant. In the event that
this option is not exercised within the period of six (6) months set
out above, this option shall expire.
5.1 SUBDIVISION, CONSOLIDATION OR REORGANIZATION
(a) In the event of any subdivision, redivision or change of the
Shares of the Company into a greater number of Shares at any time after
the date of this Agreement and prior to the Expiration Date of this
option, the Company shall deliver at the time of exercise of this
option, but for the same aggregate consideration payable therefor, such
additional number of Shares as the Participant would have been entitled
to receive as a result of such subdivision, redivision or change if on
the record date thereof the Participant had been the registered holder
of the number of such Shares with respect to which the option is later
exercised.
(b) In the event of any consolidation or change of the Shares of the
Company into a lesser number of Shares at any time after the date of
this Agreement and prior to the expiration of this option, the Company
shall deliver at the time of exercise of this option, but for the same
aggregate consideration payable therefor, such reduced number of
Shares, as the Participant would have been entitled to receive upon
such consolidation or change if on the record date thereof the
Participant had been the registered holder of the number of such Shares
with respect to which the option is later exercised.
(c) If at any time after the date of this Agreement and prior to the
expiration of this option, the Shares shall be reclassified or
reorganized, otherwise than as specified in Sections 5.1(a) and (b),
the Participant shall be entitled to receive upon the exercise of this
option and shall accept in lieu of the number of Shares then subscribed
for, but for the same aggregate consideration payable therefor, the
same aggregate number of shares of the appropriate class of shares that
the Participant would have been entitled to receive as a result of such
reclassification or other reorganization of Shares if on the record
date thereof the Participant
3
<PAGE> 4
had been the registered holder of the number of such Shares with
respect to which the option is later exercised.
6.1 TAKE-OVER BID
If an offeror makes an offer to purchase 50% or more of the outstanding
Shares to substantially all holders of the Shares or, if an insider of
the Company makes an offer to purchase Shares to substantially all
holders of the Shares, and the Board of Directors recommends acceptance
of such offer to the shareholders of the Company and the offer price is
greater than the Exercise Price, then this option, whether or not it
has vested in whole or in part, shall become immediately exercisable.
The Participant shall be bound to exercise this option and to tender
the Optioned Shares issued upon exercise of this option into the offer
upon receipt of notice from the Company if the Company provides an
interest-free loan to the Participant in the amount of the Exercise
Price for all of the Optioned Shares issuable upon exercise of this
option, subject to the execution of a security agreement by the
Participant in favor of the Company securing repayment of the loan.
7.1 NO ASSIGNMENT
The Participant may not assign, transfer, pledge or hypothecate any of
his rights hereunder in any way (whether by operation of law or
otherwise) except by will or by the laws of succession on intestacy
which may apply to the estate of the Participant upon his death. The
option granted herein shall not be subject to execution, attachment or
similar process. Upon any attempt to assign, transfer, pledge,
hypothecate or otherwise dispose of this option contrary to the
provisions hereof, or upon the levy of any attachment or similar
process upon the option granted herein, such option shall immediately
become void.
8.1 GENERAL
(a) Time shall be of the essence of this Agreement.
(b) In this Agreement, words importing the singular number include
the plural and vice versa and words importing the masculine gender
include the feminine and neuter genders.
(c) All notices which may be or are required to be given by one
party to the other party pursuant to this Agreement shall be in writing
and shall be mailed by first class or certified mail, return receipt
requested, postage prepaid, or transmitted by hand delivery as follows:
If to the Company: Deprenyl USA, Inc.
378 Roncesvalles Ave.
Toronto, ON M6R 2M7
CANADA
Attention: Dr. D. Geoffrey Shulman
4
<PAGE> 5
with a copy to: Nanette W. Mantell, Esq., Corporate Secretary
Lane and Mantell
991 Route 22 West
PO Box 8539
Somerville, NJ 08876
U.S.A.
If to the Participant: at the address of the Participant from time
to time in the records of the Company,
or such other address as to which either party may from time to time
notify the other as aforesaid.
9.1 RESTRICTIONS ON TRANSFER
The Participant understands and acknowledges that the option and Shares
underlying the option have not been registered and that they are
subject to certain restrictions on transfer under the Securities Act of
1933 of the United States, as amended, (the "1933 Act"); such
restrictions provide that the Shares may not be sold without
registration or exemption from registration under the 1933 Act; and,
for purposes of the Securities Act (Ontario) (the "Ontario Act"), the
first trade of the Shares issued pursuant to the exercise of the
option, other than a trade exempted by the Ontario Act, will be a
distribution unless the Company has been a reporting issuer for at
least twelve (12) months and the Company is not in default of any
requirement of the Ontario Act, disclosure has been made to the Ontario
Securities Commission of the exempt trade, no unusual effort is made to
prepare the market or create a demand for the Shares, and no
extraordinary commission or consideration is paid with respect to the
trade, provided that such first trade is not from the holdings of a
so-called "control block".
10.1 REPORTING REQUIREMENTS
The Participant understands and acknowledges that he will be subject to
certain reporting requirements upon his receipt and exercise of the
option, and in connection therewith, upon the receipt and exercise of
the option, the Participant agrees to timely file with the Securities
and Exchange Commission, the National Association of Securities
Dealers, Inc., and any appropriate Canadian securities regulatory
authorities, the appropriate documentation regarding his ownership of
the Company's securities.
5
<PAGE> 6
IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties hereto.
Attest: DEPRENYL USA, INC.
a New Jersey corporation
s/Edward L. Foster By: s/ D. Geoffrey Shulman
- ------------------------------ ------------------------------------
Edward L. Foster, Treasurer Dr. D. Geoffrey Shulman, President
PARTICIPANT
s/D. Geoffrey Shulman
---------------------------------------
Dr. D. Geoffrey Shulman
6
<PAGE> 7
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of Deprenyl USA, Inc.
Pursuant to the terms and subject to the conditions set forth in the
Stock Option Agreement (the "Agreement") dated , between Deprenyl USA, Inc.
and the undersigned, I hereby elect to purchase shares of Common Stock of
Deprenyl USA, Inc. I understand that such purchase is subject to all the terms
and conditions of the Agreement. I request that the certificates for such shares
of Common Stock shall be issued in the name of:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
In full payment of the purchase price with respect to the Optioned
Shares exercised, the undersigned hereby tenders payment of $___________ by
certified check or official bank cashier's check or money order payable in
Canadian currency to the order of Deprenyl USA, Inc.
Dated: X
---------------------------------------------
(Signature)
-------------------------------------
Name (Please Print)
-------------------------------------
(Address)
-------------------------------------
Taxpayer Identification Number
<PAGE> 8
Exhibit 4.4(b)
STOCK OPTION AGREEMENT
THIS AGREEMENT is made as of the 16th day of March, 1993 between DEPRENYL
USA, INC., a corporation incorporated under the laws of the State of New Jersey
(hereinafter referred to as the "Company") and D. GEOFFREY SHULMAN, an
individual residing in the Province of Ontario, CANADA (hereinafter referred to
as the "Participant").
WITNESSETH:
WHEREAS, the Board of Directors of the Company has determined that in
consideration for services rendered on the Company's behalf and in order to
provide an inducement to the Participant to acquire a proprietary interest in
the Company, it is in the Company's best interest to grant him an option to
purchase Shares on the terms and conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
expressed herein, it is agreed by and between the parties as follows:
1.1 DEFINITIONS
In this Agreement:
"Board of Directors" means the board of directors of the Company;
"Exercise Price" means CDN. $10.875;
"Expiration Date" means 5:00 p.m. (Eastern Standard Time) on the later of
the dates provided in Section 2.2;
"Management Agreement" means an agreement dated October 1, 1991 between
the Company and Deprenyl Research Limited pursuant to which Deprenyl
Research Limited will provide to the Company administrative, financial,
scientific and marketing support, and other management services which may
be required by the Company;
"Optioned Shares" means that number of Shares which are subject to the
option granted by the Company to the Participant pursuant to this
Agreement;
"Research Institution" means the research institution with which the
Participant was affiliated as of the date hereof;
"Services" means consulting or other services provided by the Participant
to the Company with respect to 5-aminolevulinic acid photodynamic therapy
or improvements thereon or in connection with the Management Agreement;
and
"Shares" means shares of Common Stock in the share capital of the
Company.
<PAGE> 9
2.1 GRANT OF OPTION
The Company hereby grants to the Participant an option to purchase, in
accordance with the vesting rights outlined in Sections 2.6 and 2.7
hereof, up to 25,000 Shares for an amount per Share equal to the Exercise
Price, upon the terms and subject to the conditions herein contained.
2.2 Subject to Sections 2.6, 2.7 and 3.1 hereof, the Participant shall have
the right, at any time prior to 5:00 p.m. (Eastern Standard Time) on the
fifth anniversary date hereof, being March 16, 1998, provided that if
such day is not a day on which the Company is open for business then on
the first following day on which the Company is open for business, to
exercise this option for any number of the Optioned Shares up to the
maximum number of Shares specified in Section 2.1 above.
2.3 The option may be exercised by the Participant or by his executors or
personal representatives in the circumstances described in Section 4.1 by
giving to the Company at its registered office notice in writing in the
form of Schedule A hereto setting out the number of Optioned Shares with
respect to which the option is being exercised. The notice must be
accompanied by a certified check, official bank cashier's check or money
order in an amount equal to the Exercise Price multiplied by the number
of Shares requested and a duly executed copy of this Agreement.
2.4 The Company shall cause its registrar and transfer agent to deliver to
the Participant as soon as practicable after receipt of such notice and
payment a certificate or certificates registered in the name of the
Participant or as the Participant may direct for the number of Shares
with respect to which the option is duly exercised.
2.5 Nothing contained in this Agreement or done pursuant hereto shall
obligate the Participant to purchase and/or pay for, or the Company to
issue, any Shares except those Optioned Shares with respect to which the
Participant shall have duly exercised the option to purchase in
accordance with this Agreement.
2.6 Subject to Sections 2.1 and 2.7 hereof, the option granted hereunder
shall vest in the Participant in the following manner:
(a) one-quarter of the option on the first anniversary of the day
immediately preceding the date hereof, being March 15, 1994;
(b) one-quarter of the option on the second anniversary of the day
immediately preceding the date hereof, being March 15, 1995;
(c) one-quarter of the option on the third anniversary of the day
immediately preceding the date hereof, being March 15, 1996; and
(d) one-quarter of the option on the fourth anniversary of the day
immediately preceding the date hereof, being March 15, 1997;
2
<PAGE> 10
and, except as provided by Section 6.1, the Participant shall only be
entitled to exercise this option in the amounts set out above and from
and after the dates so specified.
2.7 Notwithstanding anything contained in Sections 2.1 and 2.6 hereof,
options shall continue to vest in the Participant only so long as the
Participant shall continue to be (a) employed or engaged by the Company
as an employee, director or officer, (b) providing Services to the
Company in connection with the Management Agreement, or (c) affiliated
with the Research Institution and providing Services when requested by
the Company. Immediately upon the Participant's ceasing to be so
employed, engaged, or affiliated, or upon termination of the provision of
Services (collectively, "Termination"), no further options shall vest or
become exercisable, except at the discretion of the board, and the
provisions of Section 3.1 shall apply with respect to the exercise of
those options which have already vested in the Participant and have not
yet been exercised. The Board of Directors shall be entitled to determine
if and when Termination has occurred with respect to a Participant.
3.1 EXPIRATION ON TERMINATION
Subject to Section 4.1 hereof, upon Termination, such part of the option
as is then exercisable or vested but unexercised may be exercised by the
Participant for a period of ninety (90) days after Termination or such
later date as the Board of Directors may approve after which time this
option shall expire; provided, however, that in no event may this option
be exercised after the Expiration Date.
4.1 DEATH OR PERMANENT DISABILITY OF EMPLOYEE
In the event that on or prior to the Expiration Date, the Participant
dies or becomes totally and permanently disabled while (a) employed or
engaged by the Company as an employee, director or officer, (b) employed
by Deprenyl Research Limited and providing Services to the Company in
connection with the Management Agreement or (c) affiliated with the
Research Institution and providing Services when requested by the
Company, this option, to the extent then exercisable but unexercised, may
be exercised by the Participant for a period of six (6) months after the
death or disability of the Participant, notwithstanding the Expiration
Date. The Board of Directors shall be entitled to determine if and when a
Participant has become permanently disabled. For the purposes of this
provision only, reference to the Participant in this Agreement shall be
construed as including the executors or personal representatives of a
deceased Participant. In the event that this option is not exercised
within the period of six (6) months set out above, this option shall
expire.
5.1 SUBDIVISION, CONSOLIDATION OR REORGANIZATION
(a) In the event of any subdivision, redivision or change of the Shares
of the Company into a greater number of Shares at any time after the date
of this Agreement and prior to the Expiration Date of this option, the
Company shall deliver at the time of exercise of this option, but for the
same aggregate consideration payable therefor, such additional number of
Shares as the Participant would have been entitled to receive as a result
of such subdivision, redivision or change if on the record date thereof
the Participant had been the
3
<PAGE> 11
registered holder of the number of such Shares with respect to which the
option is later exercised.
(b) In the event of any consolidation or change of the Shares of the
Company into a lesser number of Shares at any time after the date of this
Agreement and prior to the expiration of this option, the Company shall
deliver at the time of exercise of this option, but for the same
aggregate consideration payable therefor, such reduced number of Shares,
as the Participant would have been entitled to receive upon such
consolidation or change if on the record date thereof the Participant had
been the registered holder of the number of such Shares with respect to
which the option is later exercised.
(c) If at any time after the date of this Agreement and prior to the
expiration of this option, the Shares shall be reclassified or
reorganized, otherwise than as specified in Sections 5.1(a) and (b), the
Participant shall be entitled to receive upon the exercise of this option
and shall accept in lieu of the number of Shares then subscribed for, but
for the same aggregate consideration payable therefor, the same aggregate
number of shares of the appropriate class of shares that the Participant
would have been entitled to receive as a result of such reclassification
or other reorganization of Shares if on the record date thereof the
Participant had been the registered holder of the number of such Shares
with respect to which the option is later exercised.
6.1 TAKE-OVER BID
If an offeror makes an offer to purchase 50% or more of the outstanding
Shares to substantially all holders of the Shares or, if an insider of
the Company makes an offer to purchase Shares to substantially all
holders of the Shares, and the Board of Directors recommends acceptance
of such offer to the shareholders of the Company and the offer price is
greater than the Exercise Price, then this option, whether or not it has
vested in whole or in part in the Participant, shall become immediately
exercisable. The Participant shall be bound to exercise this option and
to tender the Optioned Shares issued upon exercise of this option into
the offer upon receipt of notice from the Company if the Company provides
an interest-free loan to the Participant in the amount of the Exercise
Price for all of the Optioned Shares issuable upon exercise of this
option, subject to the execution of a security agreement by the
Participant in favor of the Company securing repayment of the loan.
7.1 NO ASSIGNMENT
The Participant may not assign, transfer, pledge or hypothecate any of
his rights hereunder in any way (whether by operation of law or
otherwise) except by will or by the laws of succession on intestacy which
may apply to the estate of the Participant upon his death. The option
granted herein shall not be subject to execution, attachment or similar
process. Upon any attempt to assign, transfer, pledge, hypothecate or
otherwise dispose of this option contrary to the provisions hereof, or
upon the levy of any attachment or similar process upon the option
granted herein, such option shall immediately become void.
4
<PAGE> 12
8.1 GENERAL
(a) Time shall be of the essence of this Agreement.
(b) In this Agreement, words importing the singular number include the
plural and vice versa and words importing the masculine gender include
the feminine and neuter genders.
(c) All notices which may be or are required to be given by one party
to the other party pursuant to this Agreement shall be in writing and
shall be mailed by first class or certified mail, return receipt
requested, postage prepaid, or transmitted by hand delivery as follows:
<TABLE>
<S> <C>
If to the Company: Deprenyl USA, Inc.
378 Roncesvalles Ave.
Toronto, ON M6R 2M7
CANADA
Attention: Mr. Edward L. Foster
If to the Participant: Dr. D. Geoffrey Shulman
at the address of the Participant from time to time in
the records of the Company,
</TABLE>
or such other address as to which either party may from time to time
notify the other as aforesaid.
9.1 RESTRICTIONS ON TRANSFER
The Participant understands and acknowledges that he is subject to
certain restrictions on transfer under the Securities Act of 1933 of the
United States, as amended, (the "1933 Act") of the Shares issued pursuant
to the exercise of the option; such restrictions provide that the Shares
may not be sold without registration or exemption from registration under
the 1933 Act; and, for purposes of the Securities Act (Ontario) (the
"Ontario Act"), the first trade of such Shares, other than a trade
exempted by the Ontario Act, will be a distribution unless the Company
has been a reporting issuer for at least twelve (12) months and the
Company is not in default of any requirement of the Ontario Act,
disclosure has been made to the Ontario Securities Commission of the
exempt trade, no unusual effort is made to prepare the market or create a
demand for the Shares, and no extraordinary commission or consideration
is paid with respect to the trade, provided that such first trade is not
from the holdings of a so-called "control block".
10.1 REPORTING REQUIREMENTS
The Participant understands and acknowledges that he may be subject to
certain reporting requirements upon his exercise of the option, and in
connection therewith, upon the receipt and exercise of the option, the
Participant agrees to timely file with the Securities and Exchange
Commission, the National Association of Securities Dealers, Inc., and any
5
<PAGE> 13
appropriate Canadian securities regulatory authorities, the appropriate
documentation regarding his ownership of the Company's securities.
IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto.
<TABLE>
<S> <C>
Attest: DEPRENYL USA, INC.
a New Jersey corporation
s/Nanette W. Mantell By: s/Edward L. Foster
- -------------------------------- ------------------------------
Nanette W. Mantell, Secretary Edward L. Foster, Treasurer
PARTICIPANT
s/D. Geoffrey Shulman
----------------------------------
D. GEOFFREY SHULMAN, Chairman,
President and CEO
</TABLE>
6
<PAGE> 14
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of Deprenyl USA, Inc.
Pursuant to the terms and subject to the conditions set forth in the
Stock Option Agreement (the "Agreement") dated , between Deprenyl USA,
Inc. and the undersigned, and Stock Options granted to the undersigned by such
Agreement, I hereby elect to purchase shares of Common Stock of Deprenyl
USA, Inc. which were the subject of such Stock Options. I understand that such
purchase is subject to all the terms and conditions of the Agreement. I request
that the certificates for such shares of Common Stock shall be issued in the
name of:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
In full payment of the purchase price with respect to the Stock Options
exercised, the undersigned hereby tenders payment of $___________ by certified
check or official bank cashier's check or money order payable in Canadian or
United States currency to the order of Deprenyl USA, Inc.
<TABLE>
<S> <C>
Dated: X
-------------------------------------
(Signature)
-------------------------------------
Name (Please Print)
-------------------------------------
(Address)
-------------------------------------
Taxpayer Identification Number
</TABLE>
<PAGE> 15
Exhibit 4.4(c)
STOCK OPTION AGREEMENT
THIS AGREEMENT is made as of the 17th day of February, 1994 between DUSA
PHARMACEUTICALS, INC., a corporation incorporated under the laws of the State of
New Jersey (hereinafter referred to as the "Company") and D. GEOFFREY SHULMAN,
MD, FRCPC, an individual residing in the Province of Ontario, CANADA
(hereinafter referred to as the "Participant").
WITNESSETH:
WHEREAS, the Board of Directors of the Company has determined that in
consideration for services rendered on the Company's behalf and in order to
provide an inducement to the Participant to acquire a proprietary interest in
the Company, it is in the Company's best interest to grant him an option to
purchase Shares on the terms and conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
expressed herein, it is agreed by and between the parties as follows:
1.1 DEFINITIONS
In this Agreement:
"Board of Directors" means the board of directors of the Company;
"Exercise Price" means CDN.$6.50;
"Expiration Date" means 5:00 p.m. (Eastern Standard Time) on the later of
the dates provided in Section 2.2;
"Optioned Shares" means that number of Shares which are subject to the
option granted by the Company to the Participant pursuant to this
Agreement; and
"Shares" means shares of Common Stock in the share capital of the
Company.
2.1 GRANT OF OPTION
The Company hereby grants to the Participant an option to purchase, in
accordance with the vesting rights outlined in Sections 2.6 and 2.7
hereof, up to 10,000 Shares for an amount per Share equal to the Exercise
Price, upon the terms and subject to the conditions herein contained.
2.2 Subject to Sections 2.6, 2.7 and 3.1 hereof, the Participant shall have
the right, at any time prior to 5:00 p.m. (Eastern Standard Time) on the
fifth anniversary date hereof, being February 17, 1999, provided that if
such day is not a day on which the Company is open for business then on
the first following day on which the Company is open for business, to
<PAGE> 16
exercise this option for any number of the Optioned Shares up to the
maximum number of Shares specified in Section 2.1 above.
2.3 The option may be exercised by the Participant or by his executors or
personal representatives in the circumstances described in Section 4.1 by
giving to the Company at its registered office notice in writing in the
form of Schedule A hereto setting out the number of Optioned Shares with
respect to which the option is being exercised. The notice must be
accompanied by a certified check, official bank cashier's check or money
order in an amount equal to the Exercise Price multiplied by the number
of Shares requested and a duly executed copy of this Agreement.
2.4 The Company shall cause its registrar and transfer agent to deliver to
the Participant as soon as practicable after receipt of such notice and
payment a certificate or certificates registered in the name of the
Participant or as the Participant may direct for the number of Shares
with respect to which the option is duly exercised.
2.5 Nothing contained in this Agreement or done pursuant hereto shall
obligate the Participant to purchase and/or pay for, or the Company to
issue, any Shares except those Optioned Shares with respect to which the
Participant shall have duly exercised the option to purchase in
accordance with this Agreement.
2.6 Subject to Sections 2.1 and 2.7 hereof, the option granted hereunder
shall vest in the Participant in the following manner:
(a) one-quarter of the option on the first anniversary of the day
immediately preceding the date hereof, being February 16, 1995;
(b) one-quarter of the option on the second anniversary of the day
immediately preceding the date hereof, being February 16, 1996;
(c) one-quarter of the option on the third anniversary of the day
immediately preceding the date hereof, being February 16, 1997;
and
(d) one-quarter of the option on the fourth anniversary of the day
immediately preceding the date hereof, being February 16, 1998;
and, except as provided by Section 6.1, the Participant shall only be
entitled to exercise this option in the amounts set out above and from
and after the dates so specified.
2.7 Notwithstanding anything contained in Sections 2.1 and 2.6 hereof,
options shall continue to vest in the Participant only so long as the
Participant shall continue to serve the Company as a director and/or
officer. Should the Participant cease to serve in such capacity (the
"Termination"), no further options shall vest or become exercisable,
except at the discretion of the Board of Directors, and the provisions of
Section 3.1 shall apply with respect to the exercise of those options
which have already vested in the Participant and have not yet been
exercised. The Board of Directors shall be entitled to determine if and
when Termination has occurred with respect to the Participant.
2
<PAGE> 17
3.1 EXPIRATION ON TERMINATION
Subject to Section 4.1 hereof, upon Termination, such part of the option
as is then exercisable but unexercised may be exercised by the
Participant for a period of ninety (90) days after Termination or such
later date as the Board of Directors may approve after which time this
option shall expire; provided, however, that in no event may this option
be exercised after the Expiration Date.
4.1 DEATH OR PERMANENT DISABILITY OF EMPLOYEE
In the event that on or prior to the Expiration Date, the Participant
dies or becomes totally and permanently disabled while serving the
Company as a director or officer, this option, to the extent then
exercisable but unexercised, may be exercised by the Participant for a
period of six (6) months after the death or disability of the
Participant, [notwithstanding the Expiration Date]. The Board of
Directors shall be entitled to determine if and when a Participant has
become permanently disabled. For the purposes of this provision only,
reference to the Participant in this Agreement shall be construed as
including the executors or personal representatives of a deceased
Participant. In the event that this option is not exercised within the
period of six (6) months set out above, this option shall expire.
5.1 SUBDIVISION, CONSOLIDATION OR REORGANIZATION
(a) In the event of any subdivision, redivision or change of the
Shares of the Company into a greater number of Shares at any time after
the date of this Agreement and prior to the Expiration Date of this
option, the Company shall deliver at the time of exercise of this option,
but for the same aggregate consideration payable therefor, such
additional number of Shares as the Participant would have been entitled
to receive as a result of such subdivision, redivision or change if on
the record date thereof the Participant had been the registered holder of
the number of such Shares with respect to which the option is later
exercised.
(b) In the event of any consolidation or change of the Shares of the
Company into a lesser number of Shares at any time after the date of this
Agreement and prior to the expiration of this option, the Company shall
deliver at the time of exercise of this option, but for the same
aggregate consideration payable therefor, such reduced number of Shares,
as the Participant would have been entitled to receive upon such
consolidation or change if on the record date thereof the Participant had
been the registered holder of the number of such Shares with respect to
which the option is later exercised.
(c) If at any time after the date of this Agreement and prior to the
expiration of this option, the Shares shall be reclassified or
reorganized, otherwise than as specified in Sections 5.1(a) and (b), the
Participant shall be entitled to receive upon the exercise of this option
and shall accept in lieu of the number of Shares then subscribed for, but
for the same aggregate consideration payable therefor, the same aggregate
number of shares of the appropriate class of shares that the Participant
would have been entitled to receive as a result of such
3
<PAGE> 18
reclassification or other reorganization of Shares if on the record date
thereof the Participant had been the registered holder of the number of
such Shares with respect to which the option is later exercised.
6.1 TAKE-OVER BID
If an offeror makes an offer to purchase 50% or more of the outstanding
Shares to substantially all holders of the Shares or, if an insider of
the Company makes an offer to purchase Shares to substantially all
holders of the Shares, and the Board of Directors recommends acceptance
of such offer to the shareholders of the Company and the offer price is
greater than the Exercise Price, then this option, whether or not it has
vested in whole or in part in the Participant, shall become immediately
exercisable. The Participant shall be bound to exercise this option and
to tender the Optioned Shares issued upon exercise of this option into
the offer upon receipt of notice from the Company if the Company provides
an interest-free loan to the Participant in the amount of the Exercise
Price for all of the Optioned Shares issuable upon exercise of this
option, subject to the execution of a security agreement by the
Participant in favor of the Company securing repayment of the loan.
7.1 NO ASSIGNMENT
The Participant may not assign, transfer, pledge or hypothecate any of
his rights hereunder in any way (whether by operation of law or
otherwise) except by will or by the laws of succession on intestacy which
may apply to the estate of the Participant upon his death. The option
granted herein shall not be subject to execution, attachment or similar
process. Upon any attempt to assign, transfer, pledge, hypothecate or
otherwise dispose of this option contrary to the provisions hereof, or
upon the levy of any attachment or similar process upon the option
granted herein, such option shall immediately become void.
8.1 GENERAL
(a) Time shall be of the essence of this Agreement.
(b) In this Agreement, words importing the singular number include the
plural and vice versa and words importing the masculine gender include
the feminine and neuter genders.
(c) All notices which may be or are required to be given by one party
to the other party pursuant to this Agreement shall be in writing and
shall be mailed by first class or certified mail, return receipt
requested, postage prepaid, or transmitted by hand delivery as follows:
<TABLE>
<S> <C>
If to the Company: DUSA Pharmaceuticals, Inc.
337 Roncesvalles Avenue
Toronto, ON M6R 2M8
CANADA
Attention: Edward L. Foster, CA
</TABLE>
4
<PAGE> 19
<TABLE>
<S> <C>
If to the Participant: Dr. D. Geoffrey Shulman
at the address of the Participant
from time to time in the records of
the Company,
</TABLE>
or such other address as to which either party may from time to time
notify the other as aforesaid.
9.1 RESTRICTIONS ON TRANSFER
The Participant understands and acknowledges that he is subject to
certain restrictions on transfer under the Securities Act of 1933 of the
United States, as amended, (the "1933 Act") of the Shares issued pursuant
to the exercise of the option; such restrictions provide that the Shares
may not be sold without registration or exemption from registration under
the 1933 Act; and, for purposes of the Securities Act (Ontario) (the
"Ontario Act"), the first trade of such Shares, other than a trade
exempted by the Ontario Act, will be a distribution unless the Company
has been a reporting issuer for at least twelve (12) months and the
Company is not in default of any requirement of the Ontario Act,
disclosure has been made to the Ontario Securities Commission of the
exempt trade, no unusual effort is made to prepare the market or create a
demand for the Shares, and no extraordinary commission or consideration
is paid with respect to the trade, provided that such first trade is not
from the holdings of a so-called "control block".
10.1 REPORTING REQUIREMENTS
The Participant understands and acknowledges that he may be subject to
certain reporting requirements upon his receipt and exercise of the
option, and in connection therewith, upon the receipt and exercise of the
option, the Participant agrees to timely file with the Securities and
Exchange Commission, the National Association of Securities Dealers,
Inc., and any appropriate Canadian securities regulatory authorities, the
appropriate documentation regarding his ownership of the Company's
securities.
5
<PAGE> 20
IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto.
<TABLE>
<S> <C>
Attest: DUSA PHARMACEUTICALS, INC.,
a New Jersey corporation
s/Nanette W. Mantell By: s/Edward L. Foster
- ------------------------------- --------------------------------------
Nanette W. Mantell, Secretary Edward L. Foster,
Chief Financial Officer and Treasurer
PARTICIPANT
s/ D. Geoffrey Shulman
------------------------------------------
D. GEOFFREY SHULMAN, MD, FRCPC
</TABLE>
6
<PAGE> 21
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of DUSA Pharmaceuticals, Inc.
Pursuant to the terms and subject to the conditions set forth in the
Stock Option Agreement (the "Agreement") dated , between DUSA
Pharmaceuticals, Inc. and the undersigned, and Stock Options granted to the
undersigned by such Agreement, I hereby elect to purchase shares of
Common Stock of DUSA Pharmaceuticals, Inc. which were the subject of such Stock
Options. I understand that such purchase is subject to all the terms and
conditions of the Agreement. I request that the certificates for such shares of
Common Stock shall be issued in the name of:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
In full payment of the purchase price with respect to the Stock Options
exercised, the undersigned hereby tenders payment of $___________ by certified
check or official bank cashier's check or money order payable in Canadian or
United States currency to the order of DUSA Pharmaceuticals, Inc.
<TABLE>
<S> <C>
Dated: X
----------------------------------------
(Signature)
-------------------------------------------
Name (Please Print)
-------------------------------------------
(Address)
-------------------------------------------
Taxpayer Identification Number
</TABLE>
<PAGE> 1
Exhibit 4.5
STOCK OPTION AGREEMENT
THIS AGREEMENT is made as of the 30th day of September, 1991 between
DEPRENYL USA, INC., a corporation incorporated under the laws of the State of
New Jersey (hereinafter referred to as the "Company") and JAMES P. DOHERTY, BSC,
an individual residing at 1 Bachelor Place, Willowdale, Ontario M2L 1W9, CANADA
(hereinafter referred to as the "Participant").
WITNESSETH:
WHEREAS, the Board of Directors of the Company has determined that in
consideration for services rendered on the Company's behalf and in order to
provide an inducement to the Participant to acquire a proprietary interest in
the Company, it is in the Company's best interest to grant an option to him to
purchase shares of the Company's common stock ("Shares") on the terms and
conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
expressed herein, it is agreed by and between the parties as follows:
1.1 DEFINITIONS
In this Agreement:
"Board of Directors" means the board of directors of the Company;
"Exercise Price" means CDN. $6.79;
"Expiration Date" means 5:00 p.m. (Eastern Standard Time) on the later of
the dates provided in Section 2.2;
"Optioned Shares" means that number of Shares which are subject to the
option granted by the Company to the Participant pursuant to this
Agreement; and
"Shares" means shares of common stock, without par value, of the Company.
2.1 GRANT OF OPTION
The Company hereby grants to the Participant an option to purchase, in
accordance with the vesting rights outlined in Sections 2.6 and 2.7
hereof, up to 50,000 Shares for an amount per Share equal to the Exercise
Price, upon the terms and subject to the conditions herein contained.
2.2 Subject to Sections 2.6, 2.7 and 3.1 hereof, the Participant shall have
the right, at any time prior to 5:00 p.m. (Eastern Standard Time) on the
fifth anniversary date hereof, being
<PAGE> 2
September 30, 1996 (provided that if such day is not a day on which the
Company is open for business then on the first following day on which the
Company is open for business) to exercise this option for any number of
the Optioned Shares up to the maximum number of Shares specified in
Section 2.1 above.
2.3 The option may be exercised by the Participant or by his executors or
personal representatives in the circumstances described in Section 4.1 by
providing to the Company notice in writing in the form of Schedule A
hereto setting out the number of Optioned Shares with respect to which
the option is being exercised. The notice must be accompanied by a
certified check, official bank cashier's check or money order in an
amount equal to the Exercise Price multiplied by the number of Shares
requested and a duly executed copy of this Agreement.
2.4 The Company shall cause its registrar and transfer agent to deliver to
the Participant as soon as practicable after receipt of such notice and
payment a certificate or certificates registered in the name of the
Participant or as the Participant may direct for the number of Shares
with respect to which the option is duly exercised.
2.5 Nothing contained in this Agreement or action taken pursuant hereto shall
obligate the Participant to purchase and/or pay for, or the Company to
issue, any Shares except those Optioned Shares with respect to which the
Participant shall have duly exercised the option to purchase in
accordance with this Agreement.
2.6 Subject to Section 2.7 hereof, the option granted hereunder shall vest in
the following manner:
(a) one-quarter of the option on the first anniversary of the day
immediately preceding the date hereof, being September 29, 1992;
(b) one-quarter of the option on the second anniversary of the day
immediately preceding the date hereof, being September 29, 1993;
(c) one-quarter of the option on the third anniversary of the day
immediately preceding the date hereof, being September 29, 1994;
and
(d) one-quarter of the option on the fourth anniversary of the day
immediately preceding the date hereof, being September 29, 1995;
and, except as provided by Section 6.1, the Participant shall only be
entitled to exercise this option in the amounts set out above and from
and after the dates so specified.
2.7 Notwithstanding anything contained in Section 2.6 hereof, the option
shall continue to vest only so long as the Participant continues serve to
the Company as a director or officer. Should the Participant cease serve
in such capacity ("Termination"), no further vesting of the option shall
occur and the provisions of Section 3.1 shall apply with respect to the
exercise of the option to the extent that it has vested and has not yet
been exercised.
2
<PAGE> 3
3.1 EXPIRATION ON TERMINATION
Subject to Section 4.1 hereof, upon Termination, such part of the option
as is then vested but unexercised may be exercised by the Participant for
a period of ninety (90) days after Termination or such later date as the
Board of Directors may approve after which time this option shall expire;
provided, however, that in no event may this option be exercised after
the Expiration Date.
4.1 DEATH OR PERMANENT DISABILITY
In the event that on or prior to the Expiration Date, the Participant
dies or becomes totally and permanently disabled while serving the
Company as a director or officer, this option, to the extent then vested
but unexercised, may be exercised by the Participant for a period up to
six (6) months after the death or disability of the Participant;
provided, however, that in no event may this option be exercised after
the Expiration Date. Disability shall be defined as in Section 22(e)(3)
of the Internal Revenue Code of 1986, as amended. For the purposes of
this provision only, reference to the Participant in this Agreement shall
be construed as including the executors or personal representatives of a
deceased Participant. In the event that this option is not exercised
within the period of six (6) months set out above, this option shall
expire.
5.1 SUBDIVISION, CONSOLIDATION OR REORGANIZATION
(a) In the event of any subdivision, redivision or change of the
Shares of the Company into a greater number of Shares at any time after
the date of this Agreement and prior to the Expiration Date of this
option, the Company shall deliver at the time of exercise of this option,
but for the same aggregate consideration payable therefor, such
additional number of Shares as the Participant would have been entitled
to receive as a result of such subdivision, redivision or change if on
the record date thereof the Participant had been the registered holder of
the number of such Shares with respect to which the option is later
exercised.
(b) In the event of any consolidation or change of the Shares of the
Company into a lesser number of Shares at any time after the date of this
Agreement and prior to the expiration of this option, the Company shall
deliver at the time of exercise of this option, but for the same
aggregate consideration payable therefor, such reduced number of Shares,
as the Participant would have been entitled to receive upon such
consolidation or change if on the record date thereof the Participant had
been the registered holder of the number of such Shares with respect to
which the option is later exercised.
(c) If at any time after the date of this Agreement and prior to the
expiration of this option, the Shares shall be reclassified or
reorganized, otherwise than as specified in Sections 5.1(a) and (b), the
Participant shall be entitled to receive upon the exercise of this option
and shall accept in lieu of the number of Shares then subscribed for, but
for the same aggregate consideration payable therefor, the same aggregate
number of shares of the appropriate class of shares that the Participant
would have been entitled to receive as a result of such reclassification
or other reorganization of Shares if on the record date thereof the
Participant
3
<PAGE> 4
had been the registered holder of the number of such Shares with respect
to which the option is later exercised.
6.1 TAKE-OVER BID
If an offeror makes an offer to purchase 50% or more of the outstanding
Shares to substantially all holders of the Shares or, if an insider of
the Company makes an offer to purchase Shares to substantially all
holders of the Shares, and the Board of Directors recommends acceptance
of such offer to the shareholders of the Company and the offer price is
greater than the Exercise Price, then this option, whether or not it has
vested in whole or in part, shall become immediately exercisable. The
Participant shall be bound to exercise this option and to tender the
Optioned Shares issued upon exercise of this option into the offer upon
receipt of notice from the Company if the Company provides an
interest-free loan to the Participant in the amount of the Exercise Price
for all of the Optioned Shares issuable upon exercise of this option,
subject to the execution of a security agreement by the Participant in
favor of the Company securing repayment of the loan.
7.1 NO ASSIGNMENT
The Participant may not assign, transfer, pledge or hypothecate any of
his rights hereunder in any way (whether by operation of law or
otherwise) except by will or by the laws of succession on intestacy which
may apply to the estate of the Participant upon his death. The option
granted herein shall not be subject to execution, attachment or similar
process. Upon any attempt to assign, transfer, pledge, hypothecate or
otherwise dispose of this option contrary to the provisions hereof, or
upon the levy of any attachment or similar process upon the option
granted herein, such option shall immediately become void.
8.1 GENERAL
(a) Time shall be of the essence of this Agreement.
(b) In this Agreement, words importing the singular number include the
plural and vice versa and words importing the masculine gender include
the feminine and neuter genders.
(c) All notices which may be or are required to be given by one party
to the other party pursuant to this Agreement shall be in writing and
shall be mailed by first class or certified mail, return receipt
requested, postage prepaid, or transmitted by hand delivery as follows:
<TABLE>
<S> <C>
If to the Company: Deprenyl USA, Inc.
378 Roncesvalles Ave.
Toronto, ON M6R 2M7
CANADA
Attention: Dr. D. Geoffrey Shulman
</TABLE>
4
<PAGE> 5
<TABLE>
<S> <C>
with a copy to: Nanette W. Mantell, Esq., Corporate Secretary
Lane and Mantell
991 Route 22 West
PO Box 8539
Somerville, NJ
08876 U.S.A.
If to the Participant: at the address of the Participant from
time to time in the records of the Company,
</TABLE>
or such other address as to which either party may from time to time
notify the other as aforesaid.
9.1 RESTRICTIONS ON TRANSFER
The Participant understands and acknowledges that the option and Shares
underlying the option have not been registered and that they are subject
to certain restrictions on transfer under the Securities Act of 1933 of
the United States, as amended, (the "1933 Act"); such restrictions
provide that the Shares may not be sold without registration or exemption
from registration under the 1933 Act; and, for purposes of the Securities
Act (Ontario) (the "Ontario Act"), the first trade of the Shares issued
pursuant to the exercise of the option, other than a trade exempted by
the Ontario Act, will be a distribution unless the Company has been a
reporting issuer for at least twelve (12) months and the Company is not
in default of any requirement of the Ontario Act, disclosure has been
made to the Ontario Securities Commission of the exempt trade, no unusual
effort is made to prepare the market or create a demand for the Shares,
and no extraordinary commission or consideration is paid with respect to
the trade, provided that such first trade is not from the holdings of a
so-called "control block".
10.1 REPORTING REQUIREMENTS
The Participant understands and acknowledges that he will be subject to
certain reporting requirements upon his receipt and exercise of the
option, and in connection therewith, upon the receipt and exercise of the
option, the Participant agrees to timely file with the Securities and
Exchange Commission, the National Association of Securities Dealers,
Inc., and any appropriate Canadian securities regulatory authorities, the
appropriate documentation regarding his ownership of the Company's
securities.
5
<PAGE> 6
IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto.
<TABLE>
<S> <C>
Attest: DEPRENYL USA, INC.
a New Jersey corporation
s/Edward L. Foster By: s/D. Geoffrey Shulman
- ------------------------------ ------------------------------------
Edward L. Foster, Treasurer Dr. D. Geoffrey
Shulman, President
PARTICIPANT
s/James P. Doherty
----------------------------------------
James P. Doherty
</TABLE>
6
<PAGE> 7
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of Deprenyl USA, Inc.
Pursuant to the terms and subject to the conditions set forth in the
Stock Option Agreement (the "Agreement") dated , between Deprenyl USA,
Inc. and the undersigned, I hereby elect to purchase shares of Common
Stock of Deprenyl USA, Inc. I understand that such purchase is subject to all
the terms and conditions of the Agreement. I request that the certificates for
such shares of Common Stock shall be issued in the name of:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
In full payment of the purchase price with respect to the Optioned Shares
exercised, the undersigned hereby tenders payment of $___________ by certified
check or official bank cashier's check or money order payable in Canadian
currency to the order of Deprenyl USA, Inc.
<TABLE>
<S> <C>
Dated: X
-----------------------------
(Signature)
---------------------------------------
Name (Please Print)
---------------------------------------
(Address)
---------------------------------------
Taxpayer Identification Number
</TABLE>
<PAGE> 1
Exhibit 4.6
STOCK OPTION AGREEMENT
THIS AGREEMENT is made as of the 30th day of September, 1991 between
DEPRENYL USA, INC., a corporation incorporated under the laws of the State of
New Jersey (hereinafter referred to as the "Company") and THEODORE SALL, PHD, an
individual residing at 94 Woodcrest Drive, Woodcliff Lakes, New Jersey 07675
(hereinafter referred to as the "Participant").
WITNESSETH:
WHEREAS, the Board of Directors of the Company has determined that in
consideration for services rendered on the Company's behalf and in order to
provide an inducement to the Participant to acquire a proprietary interest in
the Company, it is in the Company's best interest to grant an option to him to
purchase shares of the Company's common stock ("Shares") on the terms and
conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
expressed herein, it is agreed by and between the parties as follows:
1.1 DEFINITIONS
In this Agreement:
"Board of Directors" means the board of directors of the Company;
"Exercise Price" means U.S. $6.00;
"Expiration Date" means 5:00 p.m. (Eastern Standard Time) on the later of
the dates provided in Section 2.2;
"Optioned Shares" means that number of Shares which are subject to the
option granted by the Company to the Participant pursuant to this
Agreement;
"Shares" means shares of common stock, without par value, of the Company.
2.1 GRANT OF OPTION
The Company hereby grants to the Participant an option to purchase, in
accordance with the vesting rights outlined in Sections 2.6 and 2.7
hereof, up to 10,000 Shares for an amount per Share equal to the Exercise
Price, upon the terms and subject to the conditions herein contained.
2.2 Subject to Sections 2.6, 2.7 and 3.1 hereof, the Participant shall have
the right, at any time prior to 5:00 p.m. (Eastern Standard Time) on the
fifth anniversary date hereof, being September 30, 1996 (provided that if
such day is not a day on which the Company is open
<PAGE> 2
for business then on the first following day on which the Company is open
for business) to exercise this option for any number of the Optioned
Shares up to the maximum number of Shares specified in Section 2.1 above.
2.3 The option may be exercised by the Participant or by his executors or
personal representatives in the circumstances described in Section 4.1 by
providing to the Company notice in writing in the form of Schedule A
hereto setting out the number of Optioned Shares with respect to which
the option is being exercised. The notice must be accompanied by a
certified check, official bank cashier's check or money order in an
amount equal to the Exercise Price multiplied by the number of Shares
requested and a duly executed copy of this Agreement.
2.4 The Company shall cause its registrar and transfer agent to deliver to
the Participant as soon as practicable after receipt of such notice and
payment a certificate or certificates registered in the name of the
Participant or as the Participant may direct for the number of Shares
with respect to which the option is duly exercised.
2.5 Nothing contained in this Agreement or action taken pursuant hereto shall
obligate the Participant to purchase and/or pay for, or the Company to
issue, any Shares except those Optioned Shares with respect to which the
Participant shall have duly exercised the option to purchase in
accordance with this Agreement.
2.6 Subject to Section 2.7 hereof, the option granted hereunder shall vest in
the following manner:
(a) one-quarter of the option on the first anniversary of the day
immediately preceding the date hereof, being September 29, 1992;
(b) one-quarter of the option on the second anniversary of the day
immediately preceding the date hereof, being September 29, 1993;
(c) one-quarter of the option on the third anniversary of the day
immediately preceding the date hereof, being September 29, 1994;
and
(d) one-quarter of the option on the fourth anniversary of the day
immediately preceding the date hereof, being September 29, 1995;
and, except as provided by Section 6.1, the Participant shall only be
entitled to exercise this option in the amounts set out above and from
and after the dates so specified.
2.7 Notwithstanding anything contained in Section 2.6 hereof, the option
shall continue to vest only so long as the Participant continues to serve
the Company as a director or officer. Should the Participant cease to
serve in such capacity ("Termination"), no further vesting of the option
shall occur and the provisions of Section 3.1 shall apply with respect to
the exercise of the option to the extent that it has vested and has not
yet been exercised.
2
<PAGE> 3
3.1 EXPIRATION ON TERMINATION
Subject to Section 4.1 hereof, upon Termination, such part of the option
as is then vested but unexercised may be exercised by the Participant for
a period of ninety (90) days after Termination or such later date as the
Board of Directors may approve after which time this option shall expire;
provided, however, that in no event may this option be exercised after
the Expiration Date.
4.1 DEATH OR PERMANENT DISABILITY
In the event that on or prior to the Expiration Date, the Participant
dies or becomes totally and permanently disabled while servicing the
Company as a director or office, this option, to the extent then vested
but unexercised, may be exercised by the Participant for a period up to
six (6) months after the death or disability of the Participant;
provided, however, that in no event may this option be exercised after
the Expiration Date. Disability shall be defined as in Section 22(e)(3)
of the Internal Revenue Code of 1986, as amended. For the purposes of
this provision only, reference to the Participant in this Agreement shall
be construed as including the executors or personal representatives of a
deceased Participant. In the event that this option is not exercised
within the period of six (6) months set out above, this option shall
expire.
5.1 SUBDIVISION, CONSOLIDATION OR REORGANIZATION
(a) In the event of any subdivision, redivision or change of the
Shares of the Company into a greater number of Shares at any time after
the date of this Agreement and prior to the Expiration Date of this
option, the Company shall deliver at the time of exercise of this option,
but for the same aggregate consideration payable therefor, such
additional number of Shares as the Participant would have been entitled
to receive as a result of such subdivision, redivision or change if on
the record date thereof the Participant had been the registered holder of
the number of such Shares with respect to which the option is later
exercised.
(b) In the event of any consolidation or change of the Shares of the
Company into a lesser number of Shares at any time after the date of this
Agreement and prior to the expiration of this option, the Company shall
deliver at the time of exercise of this option, but for the same
aggregate consideration payable therefor, such reduced number of Shares,
as the Participant would have been entitled to receive upon such
consolidation or change if on the record date thereof the Participant had
been the registered holder of the number of such Shares with respect to
which the option is later exercised.
(c) If at any time after the date of this Agreement and prior to the
expiration of this option, the Shares shall be reclassified or
reorganized, otherwise than as specified in Sections 5.1(a) and (b), the
Participant shall be entitled to receive upon the exercise of this option
and shall accept in lieu of the number of Shares then subscribed for, but
for the same aggregate consideration payable therefor, the same aggregate
number of shares of the appropriate class of shares that the Participant
would have been entitled to receive as a result of such reclassification
or other reorganization of Shares if on the record date thereof the
Participant
3
<PAGE> 4
had been the registered holder of the number of such Shares with respect
to which the option is later exercised.
6.1 TAKE-OVER BID
If an offeror makes an offer to purchase 50% or more of the outstanding
Shares to substantially all holders of the Shares or, if an insider of
the Company makes an offer to purchase Shares to substantially all
holders of the Shares, and the Board of Directors recommends acceptance
of such offer to the shareholders of the Company and the offer price is
greater than the Exercise Price, then this option, whether or not it has
vested in whole or in part, shall become immediately exercisable. The
Participant shall be bound to exercise this option and to tender the
Optioned Shares issued upon exercise of this option into the offer upon
receipt of notice from the Company if the Company provides an
interest-free loan to the Participant in the amount of the Exercise Price
for all of the Optioned Shares issuable upon exercise of this option,
subject to the execution of a security agreement by the Participant in
favor of the Company securing repayment of the loan.
7.1 NO ASSIGNMENT
The Participant may not assign, transfer, pledge or hypothecate any of
his rights hereunder in any way (whether by operation of law or
otherwise) except by will or by the laws of succession on intestacy which
may apply to the estate of the Participant upon his death. The option
granted herein shall not be subject to execution, attachment or similar
process. Upon any attempt to assign, transfer, pledge, hypothecate or
otherwise dispose of this option contrary to the provisions hereof, or
upon the levy of any attachment or similar process upon the option
granted herein, such option shall immediately become void.
8.1 GENERAL
(a) Time shall be of the essence of this Agreement.
(b) In this Agreement, words importing the singular number include the
plural and vice versa and words importing the masculine gender include
the feminine and neuter genders.
(c) All notices which may be or are required to be given by one party
to the other party pursuant to this Agreement shall be in writing and
shall be mailed by first class or certified mail, return receipt
requested, postage prepaid, or transmitted by hand delivery as follows:
<TABLE>
<S> <C>
If to the Company: Deprenyl USA, Inc.
378 Roncesvalles Ave.
Toronto, ON M6R 2M7
CANADA
Attention: Dr. D. Geoffrey Shulman
</TABLE>
4
<PAGE> 5
<TABLE>
<S> <C>
with a copy to: Nanette W. Mantell, Esq., Corporate Secretary
Lane and Mantell
991 Route 22 West
PO Box 8539
Somerville, NJ 08876
U.S.A.
If to the Participant: at the address of the Participant from time
to time in the records of the Company,
</TABLE>
or such other address as to which either party may from time to time
notify the other as aforesaid.
9.1 RESTRICTIONS ON TRANSFER
The Participant understands and acknowledges that the option and Shares
underlying the option have not been registered and that they are subject
to certain restrictions on transfer under the Securities Act of 1933 of
the United States, as amended, (the "1933 Act"); such restrictions
provide that the Shares may not be sold without registration or exemption
from registration under the 1933 Act; and, for purposes of the Securities
Act (Ontario) (the "Ontario Act"), the first trade of the Shares issued
pursuant to the exercise of the option, other than a trade exempted by
the Ontario Act, will be a distribution unless the Company has been a
reporting issuer for at least twelve (12) months and the Company is not
in default of any requirement of the Ontario Act, disclosure has been
made to the Ontario Securities Commission of the exempt trade, no unusual
effort is made to prepare the market or create a demand for the Shares,
and no extraordinary commission or consideration is paid with respect to
the trade, provided that such first trade is not from the holdings of a
so-called "control block".
10.1 REPORTING REQUIREMENTS
The Participant understands and acknowledges that he will be subject to
certain reporting requirements upon his receipt and exercise of the
option, and in connection therewith, upon the receipt and exercise of the
option, the Participant agrees to timely file with the Securities and
Exchange Commission, the National Association of Securities Dealers,
Inc., and any appropriate Canadian securities regulatory authorities, the
appropriate documentation regarding his ownership of the Company's
securities.
5
<PAGE> 6
IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto.
<TABLE>
<S> <C>
Attest: DEPRENYL USA, INC.
a New Jersey corporation
s/Edward L. Foster By: s/D. Geoffrey Shulman
- ---------------------------------- ----------------------------------
Edward L. Foster, Treasurer Dr. D. Geoffrey Shulman, President
PARTICIPANT
s/Theodore Sall
--------------------------------------
Theodore Sall, PhD
</TABLE>
6
<PAGE> 7
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of Deprenyl USA, Inc.
Pursuant to the terms and subject to the conditions set forth in the
Stock Option Agreement (the "Agreement") dated , between Deprenyl USA,
Inc. and the undersigned, I hereby elect to purchase shares of Common
Stock of Deprenyl USA, Inc. I understand that such purchase is subject to all
the terms and conditions of the Agreement. I request that the certificates for
such shares of Common Stock shall be issued in the name of:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
In full payment of the purchase price with respect to the Optioned Shares
exercised, the undersigned hereby tenders payment of $___________ by certified
check or official bank cashier's check or money order payable in Canadian
currency to the order of Deprenyl USA, Inc.
<TABLE>
<S> <C>
Dated: X
----------------------------------
(Signature)
-------------------------------------
Name (Please Print)
-------------------------------------
(Address)
-------------------------------------
Taxpayer Identification Number
</TABLE>
<PAGE> 1
Exhibit 4.7
STOCK OPTION AGREEMENT
THIS AGREEMENT is made as of the 17th day of December, 1991 between
DEPRENYL USA, INC., a corporation incorporated under the laws of the State of
New Jersey (hereinafter referred to as the "Company") and RICHARD C. LUFKIN, an
individual residing at 2 Walnut Circle, Basking Ridge, New Jersey 07920
(hereinafter
referred to as the "Participant").
WITNESSETH:
WHEREAS, the Board of Directors of the Company has determined that in
consideration for services rendered on the Company's behalf and in order to
provide an inducement to the Participant to acquire a proprietary interest in
the Company, it is in the Company's best interest to grant an option to him to
purchase shares of the Company's common stock ("Shares") on the terms and
conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
expressed herein, it is agreed by and between the parties as follows:
1.1 DEFINITIONS
In this Agreement:
"Board of Directors" means the board of directors of the Company;
"Exercise Price" means U.S. $6.00
"Expiration Date" means 5:00 p.m. (Eastern Standard Time) on the later of
the dates provided in Section 2.2;
"Optioned Shares" means that number of Shares which are subject to the
option granted by the Company to the Participant pursuant to this
Agreement; and
"Shares" means shares of common stock, without par value, of the Company.
2.1 GRANT OF OPTION
The Company hereby grants to the Participant an option to purchase, in
accordance with the vesting rights outlined in Sections 2.6 and 2.7
hereof, up to 12,500 Shares for an amount per Share equal to the Exercise
Price, upon the terms and subject to the conditions herein contained.
2.2 Subject to Sections 2.6, 2.7 and 3.1 hereof, the Participant shall have
the right, at any time prior to 5:00 p.m. (Eastern Standard Time) on the
fifth anniversary date hereof, being December 17, 1996 (provided that if
such day is not a day on which the Company is open
<PAGE> 2
for business then on the first following day on which the Company is open
for business) to exercise this option for any number of the Optioned
Shares up to the maximum number of Shares specified in Section 2.1 above.
2.3 The option may be exercised by the Participant or by his executors or
personal representatives in the circumstances described in Section 4.1 by
providing to the Company notice in writing in the form of Schedule A
hereto setting out the number of Optioned Shares with respect to which
the option is being exercised. The notice must be accompanied by a
certified check, official bank cashier's check or money order in an
amount equal to the Exercise Price multiplied by the number of Shares
requested and a duly executed copy of this Agreement.
2.4 The Company shall cause its registrar and transfer agent to deliver to
the Participant as soon as practicable after receipt of such notice and
payment a certificate or certificates registered in the name of the
Participant or as the Participant may direct for the number of Shares
with respect to which the option is duly exercised.
2.5 Nothing contained in this Agreement or action taken pursuant hereto shall
obligate the Participant to purchase and/or pay for, or the Company to
issue, any Shares except those Optioned Shares with respect to which the
Participant shall have duly exercised the option to purchase in
accordance with this Agreement.
2.6 Subject to Section 2.7 hereof, the option granted hereunder shall vest in
the following manner:
(a) one-quarter of the option on the first anniversary of the day
immediately preceding the date hereof, being December 16, 1992;
(b) one-quarter of the option on the second anniversary of the day
immediately preceding the date hereof, being December 16, 1993;
(c) one-quarter of the option on the third anniversary of the day
immediately preceding the date hereof, being December 16, 1994;
and
(d) one-quarter of the option on the fourth anniversary of the day
immediately preceding the date hereof, being December 16, 1995;
and, except as provided by Section 6.1, the Participant shall only be
entitled to exercise this option in the amounts set out above and from
and after the dates so specified.
2.7 Notwithstanding anything contained in Section 2.6 hereof, the option
shall continue to vest only so long as the Participant continues to serve
the Company as a director or officer. Should the Participant cease to
serve in such capacity ("Termination"), no further vesting of the option
shall occur and the provisions of Section 3.1 shall apply with respect to
the exercise of the option to the extent that it has vested and has not
yet been exercised.
2
<PAGE> 3
3.1 EXPIRATION ON TERMINATION
Subject to Section 4.1 hereof, upon Termination, such part of the option
as is then vested but unexercised may be exercised by the Participant for
a period of ninety (90) days after Termination or such later date as the
Board of Directors may approve after which time this option shall expire;
provided, however, that in no event may this option be exercised after
the Expiration Date.
4.1 DEATH OR PERMANENT DISABILITY
In the event that on or prior to the Expiration Date, the Participant
dies or becomes totally and permanently disabled while serving the
Company as a director or officer, this option, to the extent then vested
but unexercised, may be exercised by the Participant for a period up to
six (6) months after the death or disability of the Participant;
provided, however, that in no event may this option be exercised after
the Expiration Date. Disability shall be defined as in Section 22(e)(3)
of the Internal Revenue Code of 1986, as amended. For the purposes of
this provision only, reference to the Participant in this Agreement shall
be construed as including the executors or personal representatives of a
deceased Participant. In the event that this option is not exercised
within the period of six (6) months set out above, this option shall
expire.
5.1 SUBDIVISION, CONSOLIDATION OR REORGANIZATION
(a) In the event of any subdivision, redivision or change of the
Shares of the Company into a greater number of Shares at any time after
the date of this Agreement and prior to the Expiration Date of this
option, the Company shall deliver at the time of exercise of this option,
but for the same aggregate consideration payable therefor, such
additional number of Shares as the Participant would have been entitled
to receive as a result of such subdivision, redivision or change if on
the record date thereof the Participant had been the registered holder of
the number of such Shares with respect to which the option is later
exercised.
(b) In the event of any consolidation or change of the Shares of the
Company into a lesser number of Shares at any time after the date of this
Agreement and prior to the expiration of this option, the Company shall
deliver at the time of exercise of this option, but for the same
aggregate consideration payable therefor, such reduced number of Shares,
as the Participant would have been entitled to receive upon such
consolidation or change if on the record date thereof the Participant had
been the registered holder of the number of such Shares with respect to
which the option is later exercised.
(c) If at any time after the date of this Agreement and prior to the
expiration of this option, the Shares shall be reclassified or
reorganized, otherwise than as specified in Sections 5.1(a) and (b), the
Participant shall be entitled to receive upon the exercise of this option
and shall accept in lieu of the number of Shares then subscribed for, but
for the same aggregate consideration payable therefor, the same aggregate
number of shares of the appropriate class of shares that the Participant
would have been entitled to receive as a result of such reclassification
or other reorganization of Shares if on the record date thereof the
Participant
3
<PAGE> 4
had been the registered holder of the number of such Shares with respect
to which the option is later exercised.
6.1 TAKE-OVER BID
If an offeror makes an offer to purchase 50% or more of the outstanding
Shares to substantially all holders of the Shares or, if an insider of
the Company makes an offer to purchase Shares to substantially all
holders of the Shares, and the Board of Directors recommends acceptance
of such offer to the shareholders of the Company and the offer price is
greater than the Exercise Price, then this option, whether or not it has
vested in whole or in part, shall become immediately exercisable. The
Participant shall be bound to exercise this option and to tender the
Optioned Shares issued upon exercise of this option into the offer upon
receipt of notice from the Company if the Company provides an
interest-free loan to the Participant in the amount of the Exercise Price
for all of the Optioned Shares issuable upon exercise of this option,
subject to the execution of a security agreement by the Participant in
favor of the Company securing repayment of the loan.
7.1 NO ASSIGNMENT
The Participant may not assign, transfer, pledge or hypothecate any of
his rights hereunder in any way (whether by operation of law or
otherwise) except by will or by the laws of succession on intestacy which
may apply to the estate of the Participant upon his death. The option
granted herein shall not be subject to execution, attachment or similar
process. Upon any attempt to assign, transfer, pledge, hypothecate or
otherwise dispose of this option contrary to the provisions hereof, or
upon the levy of any attachment or similar process upon the option
granted herein, such option shall immediately become void.
8.1 GENERAL
(a) Time shall be of the essence of this Agreement.
(b) In this Agreement, words importing the singular number include the
plural and vice versa and words importing the masculine gender include
the feminine and neuter genders.
(c) All notices which may be or are required to be given by one party
to the other party pursuant to this Agreement shall be in writing and
shall be mailed by first class or certified mail, return receipt
requested, postage prepaid, or transmitted by hand delivery as follows:
<TABLE>
<S> <C>
If to the Company: Deprenyl USA, Inc.
378 Roncesvalles Ave.
Toronto, ON M6R 2M7
CANADA
Attention: Dr. D. Geoffrey Shulman
</TABLE>
4
<PAGE> 5
<TABLE>
<S> <C>
with a copy to: Nanette W. Mantell, Esq., Corporate Secretary
Lane and Mantell
991 Route 22 West
PO Box 8539
Somerville, NJ 08876
U.S.A.
If to the Participant: at the address of the Participant from time
to time in the records of the Company,
</TABLE>
or such other address as to which either party may from time to time
notify the other as aforesaid.
9.1 RESTRICTIONS ON TRANSFER
The Participant understands and acknowledges that the option and Shares
underlying the option have not been registered and that they are subject
to certain restrictions on transfer under the Securities Act of 1933 of
the United States, as amended, (the "1933 Act"); such restrictions
provide that the Shares may not be sold without registration or exemption
from registration under the 1933 Act; and, for purposes of the Securities
Act (Ontario) (the "Ontario Act"), the first trade of the Shares issued
pursuant to the exercise of the option, other than a trade exempted by
the Ontario Act, will be a distribution unless the Company has been a
reporting issuer for at least twelve (12) months and the Company is not
in default of any requirement of the Ontario Act, disclosure has been
made to the Ontario Securities Commission of the exempt trade, no unusual
effort is made to prepare the market or create a demand for the Shares,
and no extraordinary commission or consideration is paid with respect to
the trade, provided that such first trade is not from the holdings of a
so-called "control block".
10.1 REPORTING REQUIREMENTS
The Participant understands and acknowledges that he will be subject to
certain reporting requirements upon his receipt and exercise of the
option, and in connection therewith, upon the receipt and exercise of the
option, the Participant agrees to timely file with the Securities and
Exchange Commission, the National Association of Securities Dealers,
Inc., and any appropriate Canadian securities regulatory authorities, the
appropriate documentation regarding his ownership of the Company's
securities.
5
<PAGE> 6
IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto.
<TABLE>
<S> <C>
Attest: DEPRENYL USA, INC.
a New Jersey corporation
s/Edward L. Foster By: s/D. Geoffrey Shulman
- ------------------------------ ------------------------------
Edward L. Foster, Treasurer Dr. D. Geoffrey Shulman, President
PARTICIPANT
s/Richard C. Lufkin
----------------------------------
Richard C. Lufkin
</TABLE>
6
<PAGE> 7
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of Deprenyl USA, Inc.
Pursuant to the terms and subject to the conditions set forth in the
Stock Option Agreement (the "Agreement") dated , between Deprenyl USA,
Inc. and the undersigned, I hereby elect to purchase shares of Common
Stock of Deprenyl USA, Inc. I understand that such purchase is subject to all
the terms and conditions of the Agreement. I request that the certificates for
such shares of Common Stock shall be issued in the name of:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
In full payment of the purchase price with respect to the Optioned Shares
exercised, the undersigned hereby tenders payment of $___________ by certified
check or official bank cashier's check or money order payable in Canadian
currency to the order of Deprenyl USA, Inc.
<TABLE>
<S> <C>
Dated: X
------------------------------------
(Signature)
-------------------------------------
Name (Please Print)
-------------------------------------
(Address)
-------------------------------------
Taxpayer Identification Number
</TABLE>
<PAGE> 1
Exhibit 4.8
STOCK OPTION AGREEMENT
THIS AGREEMENT is made as of the 30th day of September, 1991 between
DEPRENYL USA, INC., a corporation incorporated under the laws of the State of
New Jersey (hereinafter referred to as the "Company") and HERBERT F. HABERMAN,
MD, FRCPC, an individual residing at 12 Ridgewood Road, Toronto, ON M5P 1T5
CANADA (hereinafter referred to as the "Participant").
WITNESSETH:
WHEREAS, the Board of Directors of the Company has determined that in
consideration for services rendered on the Company's behalf and in order to
provide an inducement to the Participant to acquire a proprietary interest in
the Company, it is in the Company's best interest to grant an option to him to
purchase shares of the Company's common stock ("Shares") on the terms and
conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
expressed herein, it is agreed by and between the parties as follows:
1.1 DEFINITIONS
In this Agreement:
"Board of Directors" means the board of directors of the Company;
"Exercise Price" means CDN. $6.79;
"Expiration Date" means 5:00 p.m. (Eastern Standard Time) on the later of
the dates provided in Section 2.2;
"Optioned Shares" means that number of Shares which are subject to the
option granted by the Company to the Participant pursuant to this
Agreement;
"Services" means consulting or other services provided by the Participant
to the Company pursuant to the Consulting Agreement between the
Participant and the Company; and
"Shares" means shares of common stock, without par value, of the Company.
<PAGE> 2
2.1 GRANT OF OPTION
The Company hereby grants to the Participant an option to purchase, in
accordance with the vesting rights outlined in Sections 2.6 and 2.7
hereof, up to 10,000 Shares for an amount per Share equal to the Exercise
Price, upon the terms and subject to the conditions herein contained.
2.2 Subject to Sections 2.6, 2.7 and 3.1 hereof, the Participant shall have
the right, at any time prior to 5:00 p.m. (Eastern Standard Time) on the
fifth anniversary date hereof, being September 30, 1996 (provided that if
such day is not a day on which the Company is open for business then on
the first following day on which the Company is open for business) to
exercise this option for any number of the Optioned Shares up to the
maximum number of Shares specified in Section 2.1 above.
2.3 The option may be exercised by the Participant or by his executors or
personal representatives in the circumstances described in Section 4.1 by
providing to the Company notice in writing in the form of Schedule A
hereto setting out the number of Optioned Shares with respect to which
the option is being exercised. The notice must be accompanied by a
certified check, official bank cashier's check or money order in an
amount equal to the Exercise Price multiplied by the number of Shares
requested and a duly executed copy of this Agreement.
2.4 The Company shall cause its registrar and transfer agent to deliver to
the Participant as soon as practicable after receipt of such notice and
payment a certificate or certificates registered in the name of the
Participant or as the Participant may direct for the number of Shares
with respect to which the option is duly exercised.
2.5 Nothing contained in this Agreement or action taken pursuant hereto shall
obligate the Participant to purchase and/or pay for, or the Company to
issue, any Shares except those Optioned Shares with respect to which the
Participant shall have duly exercised the option to purchase in
accordance with this Agreement.
2.6 Subject to Section 2.7 hereof, the option granted hereunder shall vest in
the following manner:
(a) one-quarter of the option on the first anniversary of the day
immediately preceding the date hereof, being September 29, 1992;
(b) one-quarter of the option on the second anniversary of the day
immediately preceding the date hereof, being September 29, 1993;
(c) one-quarter of the option on the third anniversary of the day
immediately preceding the date hereof, being September 29, 1994;
and
(d) one-quarter of the option on the fourth anniversary of the day
immediately preceding the date hereof, being September 29, 1995;
2
<PAGE> 3
and, except as provided by Section 6.1, the Participant shall only be
entitled to exercise this option in the amounts set out above and from
and after the dates so specified.
2.7 Notwithstanding anything contained in Section 2.6 hereof, the option
shall continue to vest only so long as the Participant continues to
provide Services to the Company. Should the Participant cease to provide
such Services ("Termination"), no further vesting of the option shall
occur unless the Board of Directors determines otherwise and the
provisions of Section 3.1 shall apply with respect to the exercise of the
option to the extent that it has vested and has not yet been exercised.
3.1 EXPIRATION ON TERMINATION
Subject to Section 4.1 hereof, upon Termination, such part of the option
as is then vested but unexercised may be exercised by the Participant for
a period of ninety (90) days after Termination or such later date as the
Board of Directors may approve after which time this option shall expire;
provided, however, that in no event may this option be exercised after
the Expiration Date.
4.1 DEATH OR PERMANENT DISABILITY
In the event that on or prior to the Expiration Date, the Participant
dies or becomes totally and permanently disabled while providing Services
to the Company, this option, to the extent then vested but unexercised,
may be exercised by the Participant for a period up to six (6) months
after the death or disability of the Participant; provided, however, that
in no event may this option be exercised after the Expiration Date.
Disability shall be defined as in Section 22(e)(3) of the Internal
Revenue Code of 1986, as amended. For the purposes of this provision
only, reference to the Participant in this Agreement shall be construed
as including the executors or personal representatives of a deceased
Participant. In the event that this option is not exercised within the
period of six (6) months set out above, this option shall expire.
5.1 SUBDIVISION, CONSOLIDATION OR REORGANIZATION
(a) In the event of any subdivision, redivision or change of the
Shares of the Company into a greater number of Shares at any time after
the date of this Agreement and prior to the Expiration Date of this
option, the Company shall deliver at the time of exercise of this option,
but for the same aggregate consideration payable therefor, such
additional number of Shares as the Participant would have been entitled
to receive as a result of such subdivision, redivision or change if on
the record date thereof the Participant had been the registered holder of
the number of such Shares with respect to which the option is later
exercised.
(b) In the event of any consolidation or change of the Shares of the
Company into a lesser number of Shares at any time after the date of this
Agreement and prior to the expiration of this option, the Company shall
deliver at the time of exercise of this option, but for the same
aggregate consideration payable therefor, such reduced number of Shares,
as the Participant would have been entitled to receive upon such
consolidation or change if on
3
<PAGE> 4
the record date thereof the Participant had been the registered holder of
the number of such Shares with respect to which the option is later
exercised.
(c) If at any time after the date of this Agreement and prior to the
expiration of this option, the Shares shall be reclassified or
reorganized, otherwise than as specified in Sections 5.1(a) and (b), the
Participant shall be entitled to receive upon the exercise of this option
and shall accept in lieu of the number of Shares then subscribed for, but
for the same aggregate consideration payable therefor, the same aggregate
number of shares of the appropriate class of shares that the Participant
would have been entitled to receive as a result of such reclassification
or other reorganization of Shares if on the record date thereof the
Participant had been the registered holder of the number of such Shares
with respect to which the option is later exercised.
6.1 TAKE-OVER BID
If an offeror makes an offer to purchase 50% or more of the outstanding
Shares to substantially all holders of the Shares or, if an insider of
the Company makes an offer to purchase Shares to substantially all
holders of the Shares, and the Board of Directors recommends acceptance
of such offer to the shareholders of the Company and the offer price is
greater than the Exercise Price, then this option, whether or not it has
vested in whole or in part, shall become immediately exercisable. The
Participant shall be bound to exercise this option and to tender the
Optioned Shares issued upon exercise of this option into the offer upon
receipt of notice from the Company if the Company provides an
interest-free loan to the Participant in the amount of the Exercise Price
for all of the Optioned Shares issuable upon exercise of this option,
subject to the execution of a security agreement by the Participant in
favor of the Company securing repayment of the loan.
7.1 NO ASSIGNMENT
The Participant may not assign, transfer, pledge or hypothecate any of
his rights hereunder in any way (whether by operation of law or
otherwise) except by will or by the laws of succession on intestacy which
may apply to the estate of the Participant upon his death. The option
granted herein shall not be subject to execution, attachment or similar
process. Upon any attempt to assign, transfer, pledge, hypothecate or
otherwise dispose of this option contrary to the provisions hereof, or
upon the levy of any attachment or similar process upon the option
granted herein, such option shall immediately become void.
8.1 GENERAL
(a) Time shall be of the essence of this Agreement.
(b) In this Agreement, words importing the singular number include the
plural and vice versa and words importing the masculine gender include
the feminine and neuter genders.
(c) All notices which may be or are required to be given by one party
to the other party pursuant to this Agreement shall be in writing and
shall be mailed by first class or certified mail, return receipt
requested, postage prepaid, or transmitted by hand delivery as follows:
4
<PAGE> 5
<TABLE>
<S> <C>
If to the Company: Deprenyl USA, Inc.
378 Roncesvalles Ave.
Toronto, ON M6R 2M7
CANADA
Attention: Dr. D. Geoffrey Shulman
with a copy to: Nanette W. Mantell, Esq., Corporate Secretary
Lane and Mantell
991 Route 22 West
PO Box 8539
Somerville, NJ
08876
U.S.A.
If to the Participant: at the address of the Participant from time to time in
the records of the Company,
</TABLE>
or such other address as to which either party may from time to time
notify the other as aforesaid.
9.1 RESTRICTIONS ON TRANSFER
The Participant understands and acknowledges that the option and Shares
underlying the option have not been registered and that they are subject
to certain restrictions on transfer under the Securities Act of 1933 of
the United States, as amended, (the "1933 Act"); such restrictions
provide that the Shares may not be sold without registration or exemption
from registration under the 1933 Act; and, for purposes of the Securities
Act (Ontario) (the "Ontario Act"), the first trade of the Shares issued
pursuant to the exercise of the option, other than a trade exempted by
the Ontario Act, will be a distribution unless the Company has been a
reporting issuer for at least twelve (12) months and the Company is not
in default of any requirement of the Ontario Act, disclosure has been
made to the Ontario Securities Commission of the exempt trade, no unusual
effort is made to prepare the market or create a demand for the Shares,
and no extraordinary commission or consideration is paid with respect to
the trade, provided that such first trade is not from the holdings of a
so-called "control block".
5
<PAGE> 6
IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto.
<TABLE>
<S> <C>
Attest: DEPRENYL USA, INC.
a New Jersey corporation
s/Edward L. Foster By: s/D. Geoffrey Shulman
- ------------------------------- ------------------------------
Edward L. Foster, Treasurer Dr. D. Geoffrey
Shulman, President
PARTICIPANT
s/Herbert F. Haberman
----------------------------------
Herbert F. Haberman, MD, FRCPC
</TABLE>
6
<PAGE> 7
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of Deprenyl USA, Inc.
Pursuant to the terms and subject to the conditions set forth in the
Stock Option Agreement (the "Agreement") dated , between Deprenyl USA,
Inc. and the undersigned, I hereby elect to purchase shares of Common
Stock of Deprenyl USA, Inc. I understand that such purchase is subject to all
the terms and conditions of the Agreement. I request that the certificates for
such shares of Common Stock shall be issued in the name of:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
In full payment of the purchase price with respect to the Optioned Shares
exercised, the undersigned hereby tenders payment of $___________ by certified
check or official bank cashier's check or money order payable in Canadian
currency to the order of Deprenyl USA, Inc.
<TABLE>
<S> <C>
Dated: X
----------------------------------
(Signature)
-------------------------------------
Name (Please Print)
-------------------------------------
(Address)
-------------------------------------
Taxpayer Identification Number
</TABLE>
<PAGE> 1
Exhibit 4.9(a)
STOCK OPTION AGREEMENT
THIS AGREEMENT is made as of the 30th day of September, 1991 between
DEPRENYL USA, INC., a corporation incorporated under the laws of the State of
New Jersey (hereinafter referred to as the "Company") and JAMES C. KENNEDY, MD,
PHD, an individual residing at (hereinafter referred to as the
"Participant").
WITNESSETH:
WHEREAS, the Board of Directors of the Company has determined that in
consideration for services rendered on the Company's behalf and in order to
provide an inducement to the Participant to acquire a proprietary interest in
the Company, it is in the Company's best interest to grant an option to him to
purchase shares of the Company's common stock ("Shares") on the terms and
conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
expressed herein, it is agreed by and between the parties as follows:
1.1 DEFINITIONS
In this Agreement:
"Board of Directors" means the board of directors of the Company;
"Exercise Price" means CDN. $6.79;
"Expiration Date" means 5:00 p.m. (Eastern Standard Time) on the later
of the dates provided in Section 2.2;
"Optioned Shares" means that number of Shares which are subject to the
option granted by the Company to the Participant pursuant to this
Agreement;
"Services" means consulting or other services provided by the
Participant to the Company, as requested from time to time by the Board
of Directors, at its sole discretion; and
"Shares" means shares of common stock, without par value, of the
Company.
<PAGE> 2
2.1 GRANT OF OPTION
The Company hereby grants to the Participant an option to purchase, in
accordance with the vesting rights outlined in Sections 2.6 and 2.7
hereof, up to 20,000 Shares for an amount per Share equal to the
Exercise Price, upon the terms and subject to the conditions herein
contained.
2.2 Subject to Sections 2.6, 2.7 and 3.1 hereof, the Participant shall have
the right, at any time prior to 5:00 p.m. (Eastern Standard Time) on
the fifth anniversary date hereof, being September 30, 1996 (provided
that if such day is not a day on which the Company is open for business
then on the first following day on which the Company is open for
business) to exercise this option for any number of the Optioned Shares
up to the maximum number of Shares specified in Section 2.1 above.
2.3 The option may be exercised by the Participant or by his executors or
personal representatives in the circumstances described in Section 4.1
by providing to the Company notice in writing in the form of Schedule A
hereto setting out the number of Optioned Shares with respect to which
the option is being exercised. The notice must be accompanied by a
certified check, official bank cashier's check or money order in an
amount equal to the Exercise Price multiplied by the number of Shares
requested and a duly executed copy of this Agreement.
2.4 The Company shall cause its registrar and transfer agent to deliver to
the Participant as soon as practicable after receipt of such notice and
payment a certificate or certificates registered in the name of the
Participant or as the Participant may direct for the number of Shares
with respect to which the option is duly exercised.
2.5 Nothing contained in this Agreement or action taken pursuant hereto
shall obligate the Participant to purchase and/or pay for, or the
Company to issue, any Shares except those Optioned Shares with respect
to which the Participant shall have duly exercised the option to
purchase in accordance with this Agreement.
2.6 Subject to Section 2.7 hereof, the option granted hereunder shall vest
in the following manner:
(a) one-quarter of the option on the first anniversary of the day
immediately preceding the date hereof, being September 29,
1992;
(b) one-quarter of the option on the second anniversary of the day
immediately preceding the date hereof, being September 29,
1993;
(c) one-quarter of the option on the third anniversary of the day
immediately preceding the date hereof, being September 29,
1994; and
(d) one-quarter of the option on the fourth anniversary of the day
immediately preceding the date hereof, being September 29,
1995;
2
<PAGE> 3
and, except as provided by Section 6.1, the Participant shall only be
entitled to exercise this option in the amounts set out above and from
and after the dates so specified.
2.7 Notwithstanding anything contained in Section 2.6 hereof, the option
shall continue to vest only so long as the Participant continues to
provide Services to the Company. Should the Participant cease to
provide such Services ("Termination"), no further vesting of the option
shall occur unless the Board of Directors determines otherwise and the
provisions of Section 3.1 shall apply with respect to the exercise of
the option to the extent that it has vested and has not yet been
exercised.
3.1 EXPIRATION ON TERMINATION
Subject to Section 4.1 hereof, upon Termination, such part of the
option as is then vested but unexercised may be exercised by the
Participant for a period of ninety (90) days after Termination or such
later date as the Board of Directors may approve after which time this
option shall expire; provided, however, that in no event may this
option be exercised after the Expiration Date.
4.1 DEATH OR PERMANENT DISABILITY
In the event that on or prior to the Expiration Date, the Participant
dies or becomes totally and permanently disabled while providing
Services to the Company, this option, to the extent then vested but
unexercised, may be exercised by the Participant for a period up to six
(6) months after the death or disability of the Participant; provided,
however, that in no event may this option be exercised after the
Expiration Date. Disability shall be defined as in Section 22(e)(3) of
the Internal Revenue Code of 1986, as amended. For the purposes of this
provision only, reference to the Participant in this Agreement shall be
construed as including the executors or personal representatives of a
deceased Participant. In the event that this option is not exercised
within the period of six (6) months set out above, this option shall
expire.
5.1 SUBDIVISION, CONSOLIDATION OR REORGANIZATION
(a) In the event of any subdivision, redivision or change of the Shares
of the Company into a greater number of Shares at any time after the
date of this Agreement and prior to the Expiration Date of this option,
the Company shall deliver at the time of exercise of this option, but
for the same aggregate consideration payable therefor, such additional
number of Shares as the Participant would have been entitled to receive
as a result of such subdivision, redivision or change if on the record
date thereof the Participant had been the registered holder of the
number of such Shares with respect to which the option is later
exercised.
(b) In the event of any consolidation or change of the Shares of the
Company into a lesser number of Shares at any time after the date of
this Agreement and prior to the expiration of this option, the Company
shall deliver at the time of exercise of this option, but for the same
aggregate consideration payable therefor, such reduced number of
Shares, as the Participant would have been entitled to receive upon
such consolidation or change if on
3
<PAGE> 4
the record date thereof the Participant had been the registered holder
of the number of such Shares with respect to which the option is later
exercised.
(c) If at any time after the date of this Agreement and prior to
the expiration of this option, the Shares shall be reclassified or
reorganized, otherwise than as specified in Sections 5.1(a) and (b),
the Participant shall be entitled to receive upon the exercise of this
option and shall accept in lieu of the number of Shares then subscribed
for, but for the same aggregate consideration payable therefor, the
same aggregate number of shares of the appropriate class of shares that
the Participant would have been entitled to receive as a result of such
reclassification or other reorganization of Shares if on the record
date thereof the Participant had been the registered holder of the
number of such Shares with respect to which the option is later
exercised.
6.1 TAKE-OVER BID
If an offeror makes an offer to purchase 50% or more of the outstanding
Shares to substantially all holders of the Shares or, if an insider of
the Company makes an offer to purchase Shares to substantially all
holders of the Shares, and the Board of Directors recommends acceptance
of such offer to the shareholders of the Company and the offer price is
greater than the Exercise Price, then this option, whether or not it
has vested in whole or in part, shall become immediately exercisable.
The Participant shall be bound to exercise this option and to tender
the Optioned Shares issued upon exercise of this option into the offer
upon receipt of notice from the Company if the Company provides an
interest-free loan to the Participant in the amount of the Exercise
Price for all of the Optioned Shares issuable upon exercise of this
option, subject to the execution of a security agreement by the
Participant in favor of the Company securing repayment of the loan.
7.1 NO ASSIGNMENT
The Participant may not assign, transfer, pledge or hypothecate any of
his rights hereunder in any way (whether by operation of law or
otherwise) except by will or by the laws of succession on intestacy
which may apply to the estate of the Participant upon his death. The
option granted herein shall not be subject to execution, attachment or
similar process. Upon any attempt to assign, transfer, pledge,
hypothecate or otherwise dispose of this option contrary to the
provisions hereof, or upon the levy of any attachment or similar
process upon the option granted herein, such option shall immediately
become void.
8.1 GENERAL
(a) Time shall be of the essence of this Agreement.
(b) In this Agreement, words importing the singular number include
the plural and vice versa and words importing the masculine gender
include the feminine and neuter genders.
(c) All notices which may be or are required to be given by one
party to the other party pursuant to this Agreement shall be in writing
and shall be mailed by first class or certified mail, return receipt
requested, postage prepaid, or transmitted by hand delivery as follows:
4
<PAGE> 5
If to the Company: Deprenyl USA, Inc.
378 Roncesvalles Ave.
Toronto, ON M6R 2M7
CANADA
Attention: Dr. D. Geoffrey Shulman
with a copy to: Nanette W. Mantell, Esq.,
Corporate Secretary
Lane and Mantell
991 Route 22 West
PO Box 8539
Somerville, NJ 08876
U.S.A.
If to the Participant: at the address of the Participant from
time to time in the records of the
Company,
or such other address as to which either party may from time to time
notify the other as aforesaid.
9.1 RESTRICTIONS ON TRANSFER
The Participant understands and acknowledges that the option and Shares
underlying the option have not been registered and that they are
subject to certain restrictions on transfer under the Securities Act of
1933 of the United States, as amended, (the "1933 Act"); such
restrictions provide that the Shares may not be sold without
registration or exemption from registration under the 1933 Act; and,
for purposes of the Securities Act (Ontario) (the "Ontario Act"), the
first trade of the Shares issued pursuant to the exercise of the
option, other than a trade exempted by the Ontario Act, will be a
distribution unless the Company has been a reporting issuer for at
least twelve (12) months and the Company is not in default of any
requirement of the Ontario Act, disclosure has been made to the Ontario
Securities Commission of the exempt trade, no unusual effort is made to
prepare the market or create a demand for the Shares, and no
extraordinary commission or consideration is paid with respect to the
trade, provided that such first trade is not from the holdings of a
so-called "control block".
5
<PAGE> 6
IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties hereto.
Attest: DEPRENYL USA, INC.
a New Jersey corporation
s/Edward L. Foster By: s/D. Geoffrey Shulman
- ---------------------------- ------------------------------------
Edward L. Foster, Treasurer Dr. D. Geoffrey Shulman, President
PARTICIPANT
s/James C. Kennedy
---------------------------------------
James C. Kennedy, MD, PhD
6
<PAGE> 7
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of Deprenyl USA, Inc.
Pursuant to the terms and subject to the conditions set forth in the
Stock Option Agreement (the "Agreement") dated , between Deprenyl USA, Inc.
and the undersigned, I hereby elect to purchase shares of Common Stock of
Deprenyl USA, Inc. I understand that such purchase is subject to all the terms
and conditions of the Agreement. I request that the certificates for such shares
of Common Stock shall be issued in the name of:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
In full payment of the purchase price with respect to the Optioned
Shares exercised, the undersigned hereby tenders payment of $___________ by
certified check or official bank cashier's check or money order payable in
Canadian currency to the order of Deprenyl USA, Inc.
Dated: X
----------------------------------
(Signature)
----------------------------------
Name (Please Print)
----------------------------------
(Address)
----------------------------------
Taxpayer Identification Number
<PAGE> 8
Exhibit 4.9(b)
NONQUALIFIED STOCK OPTION AGREEMENT
AGREEMENT made and entered into as of the 21ST day of OCTOBER, 1997, by
and between DUSA Pharmaceuticals, Inc., a corporation incorporated under the
laws of the State of New Jersey (the "Company"), and James C. Kennedy, who
resides at 299 Glen Cairn Terrace, Kingston Ontario K7M 4A6, the "(Grantee").
WHEREAS, the Company granted to PARTEQ RESEARCH AND DEVELOPMENT
INNOVATIONS, a corporation incorporated under the laws of Ontario, CANADA
("PARTEQ") on October 21, 1991 (the "Grant Date") stock options for 85,000
shares of the Company's common stock without par value ("Common Stock") in
connection with the agreement to amend a certain License Agreement dated August
27, 1991; and
WHEREAS, PARTEQ has determined to assign a certain number of said
options to the Grantee in consideration of services rendered by him to the
Company; and
WHEREAS, the Company has determined that its interests will be advanced
by acknowledging the assignment by PARTEQ of the options;
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, the parties agree as follows:
SECTION 1
GRANT
1.1 The Company hereby acknowledges the assignment to the Grantee
of the right and option (the "Option") to purchase, in
accordance with the vesting rights outlined in Sections 3.1
and 3.6 hereof, up to 13,200 shares of authorized but unissued
Common Stock of the Company on the terms and conditions herein
set forth in this Nonqualified Stock Option Agreement.
SECTION 2
PRICE
2.1 The purchase price of the shares of Common Stock subject to
this Option shall be the fair market value of the shares of
Common Stock on the Grant Date ($10.875 per share)(the
"Exercise Price").
SECTION 3
WHEN EXERCISABLE
3.1 The aggregate number of shares of Common Stock of the Company
optioned by this Agreement (the "Optioned Shares") shall vest
in the Grantee as follows:
<PAGE> 9
(a) 25% of the Option on the first anniversary of the day
of the grant, being October 21,1998;
(b) 25% of the Option on the second anniversary of the
day of grant, being October 21, 1999;
(c) 25% of the Option on the third anniversary of the day
of the grant, being October 21, 2000;
(d) 25% of the Option on the fourth anniversary of the
day of the grant, being October 21,2001; and
and, except as provided by Sections 3.6 and 6.3 hereof, the Grantee
shall only be entitled to exercise this Option, in whole or in part, in
the amounts set out above and from and after the dates so specified.
3.2 Subject to Sections 3.1 and 3.6 hereof, the Grantee shall have
the right, at any time prior to 5:00 p.m. (Eastern Standard
Time) on the date prior to the tenth anniversary date of the
grant, being October 20, 2007, provided that if such day is
not a day on which the Company is open for business then on
the first following day on which the Company is open for
business, to exercise this Option for any number of the
Optioned Shares up to the maximum number of shares specified
in Section 1.1 above.
3.3 No less than one thousand (1,000) shares may be purchased upon
any one exercise of the Option granted hereby unless the
number of shares purchased at such time is the total number of
shares in respect of which the Option hereby granted is then
exercisable.
3.4 In no event shall any Option granted hereby be exercisable for
a fractional share.
3.5 From time to time, in its discretion, the Company's Stock
Option Committee (the "Committee") may offer the Grantee the
right to cancel any Option granted hereunder in exchange for
such consideration as the Committee shall determine.
3.6 Notwithstanding anything contained in Sections 1 and 3.1
hereof, the Option shall continue to vest in the Grantee only
so long as the Grantee shall continue to provide services to
the Company. Should the Grantee cease to provide services to
the Company, the Option shall not further vest or become
exercisable.
SECTION 4
HOW EXERCISABLE
4.1 Subject to such administrative regulations as the Committee
may from time to time adopt, the Grantee or beneficiary shall,
in order to exercise this Option give to the Company at its
principal office notice in writing in the form of Schedule A
hereto setting out the number of Optioned Shares with respect
to which the Option is being exercised. The notice must be
accompanied by payment of a certified check,
2
<PAGE> 10
official bank cashier's check or money order in an amount
equal to the Exercise Price multiplied by the number of shares
requested and a duly executed copy of this Agreement. At the
discretion of the Committee, the Grantee may pay all or a
portion of the purchase price by tender of Common Stock or a
combination of stock and cash or other means determined by the
Committee.
4.2 Any notice under this Section shall include an undertaking to
furnish or execute such documents as the Committee in its
discretion shall deem necessary (i) to evidence such exercise,
in whole or in part, of the Option evidenced by this
Agreement, (ii) to determine whether registration is then
required under the Securities Act of 1933, or any other law,
as then in effect, and (iii) to comply with or satisfy the
requirements of the Securities Act of 1933, or any other law,
as then in effect.
4.3 The Grantee agrees that all shares purchased by him under the
Option will be acquired for investment, not distribution, and
that any notice of exercise of the Option must be accompanied
by a written representation to that effect, signed by the
Grantee.
SECTION 5
TERMINATION OF OPTION
5.1 The Option granted hereby shall terminate and be of no force
or effect upon the expiration of ten years from the date of
the Grant unless terminated prior to such time as provided
below.
5.2 Subject to Section 3.6, hereof if the Amended and Restated
License Agreement is terminated by PARTEQ, the Option may be
exercised, to the extent exercisable, for a period of three
months after the date of such termination or such later date
as the Company's Board of Directors may approve; and if such
Agreement is terminated by DUSA, the Option shall continue to
vest in the Grantee as provided in Section 3.1 above.
5.3 Any determination made by the Committee with respect to any
matter referred to in this Section 5 shall be final and
conclusive on all persons affected thereby.
SECTION 6
ADJUSTMENTS TO OPTION
6.1 Subject to any required action by the Committee and
shareholders, the number of shares provided for in the Option,
and the price per share thereof shall be proportionately
adjusted for any increase or decrease in the number of issued
shares of the Company resulting from the payment of a share
dividend, a share split or any transaction which is a
"corporate transaction" (as defined in the Treasury
regulations promulgated under Section 424 of the Code.
6.2 Subject to any required action by the Committee and
shareholders, if the Company shall be the surviving entity in
any merger or consolidation, or after a consolidation
3
<PAGE> 11
of the Company and one or more entities in which the resulting
entity is an independent entity, the Option shall pertain to
and apply to the securities of the surviving entity in an
amount that the board of directors of the surviving entity, at
its sole discretion, determines to be equivalent, as nearly as
practicable, to the nearest whole number and class of shares
that were subject to the Option. These shares of stock or
other securities shall, after such merger or consolidation, be
deemed to be shares for all purposes hereof. The aforesaid
adjustments, when applicable, shall be made by the Committee,
and the Committee's determination shall be final, binding and
conclusive.
6.3 In the event of a Change of Control (as defined below), any
and all outstanding Options not fully vested shall
automatically vest in full and shall be immediately
exercisable. The date on which such accelerated vesting and
immediate exercisability shall occur shall be the date of the
occurrence of the Change of Control.
A "Change of Control" shall be deemed to have taken place upon
(i) the acquisition by a third person, including a "group" as
defined in Section 13(d)(3) of the Securities Exchange Act of
1934, as amended, of shares of the Company having 50% or more
of the total number of votes that may be cast for the election
of Directors of the Company; (ii) shareholder approval of a
transaction for the acquisition of the Company, or
substantially all of its assets by another entity or for a
merger, reorganization, consolidation or other business
combination to which the Company is a part; or (iii) the
election during any period of 24 months or less of 50% or more
of the Directors of the Company where such Directors were not
in office immediately prior to such period provided, however,
that no "Change of Control" shall be deemed to have taken
place if the Directors of the Company in office on the date of
adoption of the Plan, or their successors in office nominated
by such Directors, affirmatively approve a resolution to such
effect.
Except as provided with respect to a Grantee in his stock
option agreement or other controlling agreement between him
and the Company, to the extent that the acceleration,
exercisability or parachute payment attributable to the Option
following a Change of Control would result in "excess
parachute payments"(1) when the former are aggregated with
other payments or benefits to the Grantee, such parachute
payments or benefits provided to a Grantee under this
Agreement shall be reduced to the extent necessary so that no
portion thereof shall be subject to the excise tax imposed by
Section 4999 of the Code. This reduction will only be made if
it will cause the Grantee's net after-tax benefit to exceed
the net after-tax benefit that would have existed if such
reduction were not made. "Net after-tax benefit" shall be the
sum of (i) all payments and benefits which a Grantee receives
or is entitled to receive that would constitute a "parachute
payment" under Section 280G of the Code, less (ii) the amount
of federal income taxes payable with respect to the payments
and
- ----------------------
(1)"Excess parachute payments" are defined in Section 280G of the Code and
are determined by tax counsel of the Company.
4
<PAGE> 12
benefits described in (i) above, calculated at the maximum
marginal income tax rate(2) for the year in which such
payments and benefits shall be paid to the Grantee, less (iii)
the amount of excise taxes imposed with respect to the
payments and benefits described in (i) above by Section 4999
of the Code.
6.4 In the event of a change in the Company's shares which is
limited to a change of all of its authorized shares with par
value into the same number of shares with a different par
value or without par value, the shares resulting from any such
change shall be deemed to be shares within the meaning of this
Agreement.
6.5 Except as herein before expressly provided in Paragraphs 6.1,
6.2, 6.3 and 6.4 of this Section 6, the Grantee shall have no
rights by reason of any subdivision or consolidation of shares
of any class or payment of any share dividend or any other
increase or decrease in the number of shares of any class or
by reason of any dissolution, liquidation, merger,
consolidation or spin-off of assets or stock of another
corporation and any issuance by the Company of shares of any
class, or securities convertible into shares of any class,
shall not affect the Option, and no adjustment by reason
thereof shall be made with respect to the number or price of
the Company's shares subject to the Option. The grant of the
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 or to merge, consolidate, dissolve, liquidate, sell
or transfer all or any part of its business or assets.
SECTION 7
TRANSFER
7.1 This Option shall not be transferable by the Grantee in any
way. During the lifetime of the Grantee, the Option shall be
exercisable only by him. Any other attempted assignment,
transfer, pledge, hypothecation or other disposition of the
Option shall be void and have no effect unless in accordance
with the terms set forth herein.
SECTION 8
WITHHOLDING TAXES
8.1 The Company shall have the right to retain and withhold from
any payment, under the Option granted, any amount that is to
be withheld or otherwise deducted and paid with respect to
such payment. At its discretion, the Company may require the
Grantee, if it receives shares under a nonqualified stock
option grant, to reimburse the Company for any taxes that are
required to be withheld by the Company, and may withhold any
distribution in whole or in part until the Company is so
reimbursed. In lieu thereof, the Company shall have the right
to withhold from any other cash amounts due (or to become due)
to the Grantee an amount equal to such taxes required to be
withheld by the Company to reimburse the Company for any such
- ------------------
(2)This rate is based on the rate for the year set forth in the Code at the
time of the first payment to the participant.
5
<PAGE> 13
taxes, or the Company may retain and withhold a number of
shares of Common Stock having a market value not less than the
amount of such taxes and cancel (in whole or in part) any
shares of Common Stock so withheld in order to reimburse the
Company for any such taxes.
SECTION 9
IMPACT ON OTHER BENEFITS
9.1 The value of the Option (either on the date of grant of the
Option or at the time the shares are vested) shall not be
includable as compensation or earnings for purposes of any
other benefit plan offered by the Company.
SECTION 10
ADMINISTRATION
10.1 The Committee shall have full authority and discretion to
decide all matters relating to the administration and
interpretation of this Agreement. All such Committee
determinations shall be final, conclusive and binding upon the
Company, the Grantee and any and all interested parties.
SECTION 11
AMENDMENT(S)
11.1 This Agreement may not in any way be amended without the
Grantee's written consent.
SECTION 12
FORCE AND EFFECT
12.1 The various provisions of this Agreement are severable in
their entirety. Any determination of invalidity or
unenforceability of any one provision shall have no effect on
the continuing force and effect of the remaining provisions.
SECTION 13
NOTICE OF DISPOSITION OF SHARES
13.1 The Grantee agrees that if he should dispose of any shares of
Common Stock acquired on the exercise of the Option, including
a disposition by sale, exchange, gift or transfer of legal
title within twelve (12) months of the date such shares are
transferred to the Grantee, the Grantee will notify the
Company promptly of such disposition.
6
<PAGE> 14
SECTION 14
NOTICES
14.1 All notices which may be or are required to be given by one
party to the other party pursuant to this Agreement shall be
in writing and shall be mailed by first class or certified
mail, return receipt requested, postage prepaid, or
transmitted by hand delivery as follows:
If to the Company: DUSA Pharmaceuticals, Inc.
181 University Avenue
Suite 1208
Toronto, ON M5H 3M7
CANADA
Attention: Dr. D. Geoffrey Shulman
If to the Grantee: James C. Kennedy
or such other address as to which either party may from time
to time notify the other as aforesaid.
SECTION 15
RESTRICTIONS ON TRANSFER
15.1 The Grantee understands and acknowledges that he is subject to
certain restrictions on transfer under the Securities Act of
1933 of the United States, as amended, (the "1933 Act") of the
shares issued pursuant to the exercise of the Option; such
restrictions provide that the shares may not be sold without
registration or exemption from registration under the 1933
Act.
SECTION 16
REPORTING REQUIREMENTS
16.1 The Grantee understands and acknowledges that he may be
subject to certain reporting requirements upon his receipt and
exercise of the Option, and in connection therewith, upon the
receipt and exercise of the Option, the Grantee agrees to
timely file with the Securities and Exchange Commission, the
National Association of Securities Dealers, Inc., and any
appropriate Canadian securities regulatory authorities, the
appropriate documentation regarding his ownership of the
Company's securities.
7
<PAGE> 15
SECTION 17
GOVERNING LAW
17.1 This Agreement shall be construed and enforced in accordance
with and governed by the laws of the State of New Jersey.
IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties hereto.
Attest: DUSA PHARMACEUTICALS, INC.,
a New Jersey corporation
s/ Nanette W. Mantell By: s/D. Geoffrey Shulman
- -------------------------------- --------------------------------
Nanette W. Mantell, Secretary Dr. D. Geoffrey Shulman, President
GRANTEE
s/James C. Kennedy
------------------------------
James C. Kennedy
8
<PAGE> 16
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of DUSA Pharmaceuticals, Inc.
Pursuant to the terms and subject to the conditions set forth in the
Nonqualified Stock Option Agreement (the "Agreement") dated October 21, 1997,
between DUSA Pharmaceuticals, Inc. and the undersigned, and the Option granted
to the undersigned by such Agreement, I hereby elect to purchase ____ shares of
Common Stock of DUSA Pharmaceuticals, Inc. which were the subject of such
Option. I understand that such purchase is subject to all the terms and
conditions of the Agreement. I request that the certificates for such shares of
Common Stock shall be issued in the name of:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(please print or type name and address)
The undersigned hereby represents and warrants to, and agrees with the
Company as follows:
(a) The shares are being purchased for the undersigned's own
account, for investment purposes only, and not for the account of any other
person, and not with a view to distribution, assignment, or resale to others, or
to fractionalization in whole or in part and that the offering and sale of the
shares is intended to be exempt from registration under the Securities Act of
1933 (the "Act"). In furtherance thereof, the undersigned represents, warrants
and agrees as follows: (i) no other person has or will have a direct or indirect
beneficial interest in such shares and the undersigned will not sell,
hypothecate, or otherwise transfer his shares except in accordance with the Act
and applicable state securities laws or unless in the opinion of counsel for the
Company, an exemption from the registration requirements of the Act and such
laws is available; and (ii) the Company is under no obligation to register the
shares on behalf of the undersigned or to assist the undersigned in complying
with any exemption from registration.
<PAGE> 17
(b) The undersigned has such knowledge and experience in financial
and business matters that the undersigned is capable of evaluating the merits
and risks of investment in the Company and of making an informed investment
decision.
In full payment of the purchase price with respect to the Option
exercised, the undersigned hereby tenders payment of $___________ by certified
check or official bank cashier's check or money order payable in Canadian or
United States currency to the order of DUSA Pharmaceuticals, Inc.
Dated: X
-------------------------------------
(Signature)
-------------------------------------------
Name (Please Print)
-------------------------------------------
(Address)
-------------------------------------------
Taxpayer Identification Number
<PAGE> 1
Exhibit 4.10(a)
STOCK OPTION AGREEMENT
THIS AGREEMENT is made as of the 30th day of September, 1991 between
DEPRENYL USA, INC., a corporation incorporated under the laws of the State of
New Jersey (hereinafter referred to as the "Company") and ROY H. POTTIER, PHD,
an individual residing at (hereinafter referred to as the "Participant").
WITNESSETH:
WHEREAS, the Board of Directors of the Company has determined that in
consideration for services rendered on the Company's behalf and in order to
provide an inducement to the Participant to acquire a proprietary interest in
the Company, it is in the Company's best interest to grant an option to him to
purchase shares of the Company's common stock ("Shares") on the terms and
conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
expressed herein, it is agreed by and between the parties as follows:
1.1 DEFINITIONS
In this Agreement:
"Board of Directors" means the board of directors of the Company;
"Exercise Price" means CDN. $6.79;
"Expiration Date" means 5:00 p.m. (Eastern Standard Time) on the later
of the dates provided in Section 2.2;
"Optioned Shares" means that number of Shares which are subject to the
option granted by the Company to the Participant pursuant to this
Agreement;
"Services" means consulting or other services provided by the
Participant to the Company, as requested from time to time by the Board
of Directors, at its sole discretion; and
"Shares" means shares of common stock, without par value, of the
Company.
<PAGE> 2
2.1 GRANT OF OPTION
The Company hereby grants to the Participant an option to purchase, in
accordance with the vesting rights outlined in Sections 2.6 and 2.7
hereof, up to 20,000 Shares for an amount per Share equal to the
Exercise Price, upon the terms and subject to the conditions herein
contained.
2.2 Subject to Sections 2.6, 2.7 and 3.1 hereof, the Participant shall have
the right, at any time prior to 5:00 p.m. (Eastern Standard Time) on
the fifth anniversary date hereof, being September 30, 1996 (provided
that if such day is not a day on which the Company is open for business
then on the first following day on which the Company is open for
business) to exercise this option for any number of the Optioned Shares
up to the maximum number of Shares specified in Section 2.1 above.
2.3 The option may be exercised by the Participant or by his executors or
personal representatives in the circumstances described in Section 4.1
by providing to the Company notice in writing in the form of Schedule A
hereto setting out the number of Optioned Shares with respect to which
the option is being exercised. The notice must be accompanied by a
certified check, official bank cashier's check or money order in an
amount equal to the Exercise Price multiplied by the number of Shares
requested and a duly executed copy of this Agreement.
2.4 The Company shall cause its registrar and transfer agent to deliver to
the Participant as soon as practicable after receipt of such notice and
payment a certificate or certificates registered in the name of the
Participant or as the Participant may direct for the number of Shares
with respect to which the option is duly exercised.
2.5 Nothing contained in this Agreement or action taken pursuant hereto
shall obligate the Participant to purchase and/or pay for, or the
Company to issue, any Shares except those Optioned Shares with respect
to which the Participant shall have duly exercised the option to
purchase in accordance with this Agreement.
2.6 Subject to Section 2.7 hereof, the option granted hereunder shall vest
in the following manner:
(a) one-quarter of the option on the first anniversary of the day
immediately preceding the date hereof, being September 29,
1992;
(b) one-quarter of the option on the second anniversary of the day
immediately preceding the date hereof, being September 29,
1993;
(c) one-quarter of the option on the third anniversary of the day
immediately preceding the date hereof, being September 29,
1994; and
(d) one-quarter of the option on the fourth anniversary of the day
immediately preceding the date hereof, being September 29,
1995;
2
<PAGE> 3
and, except as provided by Section 6.1, the Participant shall only be
entitled to exercise this option in the amounts set out above and from
and after the dates so specified.
2.7 Notwithstanding anything contained in Section 2.6 hereof, the option
shall continue to vest only so long as the Participant continues to
provide Services to the Company. Should the Participant cease to
provide such Services ("Termination"), no further vesting of the option
shall occur unless the Board of Directors determines otherwise and the
provisions of Section 3.1 shall apply with respect to the exercise of
the option to the extent that it has vested and has not yet been
exercised.
3.1 EXPIRATION ON TERMINATION
Subject to Section 4.1 hereof, upon Termination, such part of the
option as is then vested but unexercised may be exercised by the
Participant for a period of ninety (90) days after Termination or such
later date as the Board of Directors may approve after which time this
option shall expire; provided, however, that in no event may this
option be exercised after the Expiration Date.
4.1 DEATH OR PERMANENT DISABILITY
In the event that on or prior to the Expiration Date, the Participant
dies or becomes totally and permanently disabled while providing
Services to the Company, this option, to the extent then vested but
unexercised, may be exercised by the Participant for a period up to six
(6) months after the death or disability of the Participant; provided,
however, that in no event may this option be exercised after the
Expiration Date. Disability shall be defined as in Section 22(e)(3) of
the Internal Revenue Code of 1986, as amended. For the purposes of this
provision only, reference to the Participant in this Agreement shall be
construed as including the executors or personal representatives of a
deceased Participant. In the event that this option is not exercised
within the period of six (6) months set out above, this option shall
expire.
5.1 SUBDIVISION, CONSOLIDATION OR REORGANIZATION
(a) In the event of any subdivision, redivision or change of the
Shares of the Company into a greater number of Shares at any time after
the date of this Agreement and prior to the Expiration Date of this
option, the Company shall deliver at the time of exercise of this
option, but for the same aggregate consideration payable therefor, such
additional number of Shares as the Participant would have been entitled
to receive as a result of such subdivision, redivision or change if on
the record date thereof the Participant had been the registered holder
of the number of such Shares with respect to which the option is later
exercised.
(b) In the event of any consolidation or change of the Shares of
the Company into a lesser number of Shares at any time after the date
of this Agreement and prior to the expiration of this option, the
Company shall deliver at the time of exercise of this option, but for
the same aggregate consideration payable therefor, such reduced number
of Shares, as the Participant would have been entitled to receive upon
such consolidation or change if on
3
<PAGE> 4
the record date thereof the Participant had been the registered holder
of the number of such Shares with respect to which the option is later
exercised.
(c) If at any time after the date of this Agreement and prior to
the expiration of this option, the Shares shall be reclassified or
reorganized, otherwise than as specified in Sections 5.1(a) and (b),
the Participant shall be entitled to receive upon the exercise of this
option and shall accept in lieu of the number of Shares then subscribed
for, but for the same aggregate consideration payable therefor, the
same aggregate number of shares of the appropriate class of shares that
the Participant would have been entitled to receive as a result of such
reclassification or other reorganization of Shares if on the record
date thereof the Participant had been the registered holder of the
number of such Shares with respect to which the option is later
exercised.
6.1 TAKE-OVER BID
If an offeror makes an offer to purchase 50% or more of the outstanding
Shares to substantially all holders of the Shares or, if an insider of
the Company makes an offer to purchase Shares to substantially all
holders of the Shares, and the Board of Directors recommends acceptance
of such offer to the shareholders of the Company and the offer price is
greater than the Exercise Price, then this option, whether or not it
has vested in whole or in part, shall become immediately exercisable.
The Participant shall be bound to exercise this option and to tender
the Optioned Shares issued upon exercise of this option into the offer
upon receipt of notice from the Company if the Company provides an
interest-free loan to the Participant in the amount of the Exercise
Price for all of the Optioned Shares issuable upon exercise of this
option, subject to the execution of a security agreement by the
Participant in favor of the Company securing repayment of the loan.
7.1 NO ASSIGNMENT
The Participant may not assign, transfer, pledge or hypothecate any of
his rights hereunder in any way (whether by operation of law or
otherwise) except by will or by the laws of succession on intestacy
which may apply to the estate of the Participant upon his death. The
option granted herein shall not be subject to execution, attachment or
similar process. Upon any attempt to assign, transfer, pledge,
hypothecate or otherwise dispose of this option contrary to the
provisions hereof, or upon the levy of any attachment or similar
process upon the option granted herein, such option shall immediately
become void.
8.1 GENERAL
(a) Time shall be of the essence of this Agreement.
(b) In this Agreement, words importing the singular number include
the plural and vice versa and words importing the masculine gender
include the feminine and neuter genders.
(c) All notices which may be or are required to be given by one
party to the other party pursuant to this Agreement shall be in writing
and shall be mailed by first class or certified mail, return receipt
requested, postage prepaid, or transmitted by hand delivery as follows:
4
<PAGE> 5
If to the Company: Deprenyl USA, Inc.
378 Roncesvalles Ave.
Toronto, ON M6R 2M7
CANADA
Attention: Dr. D. Geoffrey Shulman
with a copy to: Nanette W. Mantell, Esq., Corporate
Secretary
Lane and Mantell
991 Route 22 West
PO Box 8539
Somerville, NJ 08876
U.S.A.
If to the Participant: at the address of the Participant from
time to time in the records of the
Company,
or such other address as to which either party may from time to time
notify the other as aforesaid.
9.1 RESTRICTIONS ON TRANSFER
The Participant understands and acknowledges that the option and Shares
underlying the option have not been registered and that they are
subject to certain restrictions on transfer under the Securities Act of
1933 of the United States, as amended, (the "1933 Act"); such
restrictions provide that the Shares may not be sold without
registration or exemption from registration under the 1933 Act; and,
for purposes of the Securities Act (Ontario) (the "Ontario Act"), the
first trade of the Shares issued pursuant to the exercise of the
option, other than a trade exempted by the Ontario Act, will be a
distribution unless the Company has been a reporting issuer for at
least twelve (12) months and the Company is not in default of any
requirement of the Ontario Act, disclosure has been made to the Ontario
Securities Commission of the exempt trade, no unusual effort is made to
prepare the market or create a demand for the Shares, and no
extraordinary commission or consideration is paid with respect to the
trade, provided that such first trade is not from the holdings of a
so-called "control block".
5
<PAGE> 6
IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties hereto.
Attest: DEPRENYL USA, INC.
a New Jersey corporation
s/Edward L. Foster By: s/D. Geoffrey Shulman
- ---------------------------- -------------------------------------
Edward L. Foster, Treasurer Dr. D. Geoffrey Shulman, President
PARTICIPANT
s/Roy H. Pottier
--------------------------------------
Roy H. Pottier, PhD
6
<PAGE> 7
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of Deprenyl USA, Inc.
Pursuant to the terms and subject to the conditions set forth in the
Stock Option Agreement (the "Agreement") dated , between Deprenyl USA, Inc.
and the undersigned, I hereby elect to purchase shares of Common Stock of
Deprenyl USA, Inc. I understand that such purchase is subject to all the terms
and conditions of the Agreement. I request that the certificates for such shares
of Common Stock shall be issued in the name of:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
In full payment of the purchase price with respect to the Optioned
Shares exercised, the undersigned hereby tenders payment of $___________ by
certified check or official bank cashier's check or money order payable in
Canadian currency to the order of Deprenyl USA, Inc.
Dated: X
---------------------------------
(Signature)
------------------------------------
Name (Please Print)
------------------------------------
(Address)
------------------------------------
Taxpayer Identification Number
<PAGE> 8
Exhibit 4.10(b)
NONQUALIFIED STOCK OPTION AGREEMENT
AGREEMENT made and entered into as of the 21ST day of OCTOBER, 1997, by
and between DUSA Pharmaceuticals, Inc., a corporation incorporated under the
laws of the State of New Jersey (the "Company"), and Roy H. Pottier, who resides
at 5 Huntsmill Cresent, Kingston, the "(Grantee").
WHEREAS, the Company granted to PARTEQ RESEARCH AND DEVELOPMENT
INNOVATIONS, a corporation incorporated under the laws of Ontario, CANADA
("PARTEQ") on October 21, 1991 (the "Grant Date") stock options for 85,000
shares of the Company's common stock without par value ("Common Stock") in
connection with the agreement to amend a certain License Agreement dated August
27, 1991; and
WHEREAS, PARTEQ has determined to assign a certain number of said
options to the Grantee in consideration of services rendered by him to the
Company; and
WHEREAS, the Company has determined that its interests will be advanced
by acknowledging the assignment by PARTEQ of the options;
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, the parties agree as follows:
SECTION 1
GRANT
1.1 The Company hereby acknowledges the assignment to the Grantee
of the right and option (the "Option") to purchase, in
accordance with the vesting rights outlined in Sections 3.1
and 3.6 hereof, up to 4,250 shares of authorized but unissued
Common Stock of the Company on the terms and conditions herein
set forth in this Nonqualified Stock Option Agreement.
SECTION 2
PRICE
2.1 The purchase price of the shares of Common Stock subject to
this Option shall be the fair market value of the shares of
Common Stock on the Grant Date ($10.875 per share)(the
"Exercise Price").
SECTION 3
WHEN EXERCISABLE
3.1 The aggregate number of shares of Common Stock of the Company
optioned by this Agreement (the "Optioned Shares") shall vest
in the Grantee as follows:
<PAGE> 9
(a) 25% of the Option on the first anniversary of the day
of the grant, being October 21,1998;
(b) 25% of the Option on the second anniversary of the
day of grant, being October 21, 1999;
(c) 25% of the Option on the third anniversary of the day
of the grant, being October 21, 2000;
(d) 25% of the Option on the fourth anniversary of the
day of the grant, being October 21,2001; and
and, except as provided by Sections 3.6 and 6.3 hereof, the Grantee
shall only be entitled to exercise this Option, in whole or in part, in
the amounts set out above and from and after the dates so specified.
3.2 Subject to Sections 3.1 and 3.6 hereof, the Grantee shall have
the right, at any time prior to 5:00 p.m. (Eastern Standard
Time) on the date prior to the tenth anniversary date of the
grant, being October 20, 2007, provided that if such day is
not a day on which the Company is open for business then on
the first following day on which the Company is open for
business, to exercise this Option for any number of the
Optioned Shares up to the maximum number of shares specified
in Section 1.1 above.
3.3 No less than one thousand (1,000) shares may be purchased upon
any one exercise of the Option granted hereby unless the
number of shares purchased at such time is the total number of
shares in respect of which the Option hereby granted is then
exercisable.
3.4 In no event shall any Option granted hereby be exercisable for
a fractional share.
3.5 From time to time, in its discretion, the Company's Stock
Option Committee (the "Committee") may offer the Grantee the
right to cancel any Option granted hereunder in exchange for
such consideration as the Committee shall determine.
3.6 Notwithstanding anything contained in Sections 1 and 3.1
hereof, the Option shall continue to vest in the Grantee only
so long as the Grantee shall continue to provide services to
the Company. Should the Grantee cease to provide services to
the Company, the Option shall not further vest or become
exercisable.
SECTION 4
HOW EXERCISABLE
4.1 Subject to such administrative regulations as the Committee
may from time to time adopt, the Grantee or beneficiary shall,
in order to exercise this Option give to the Company at its
principal office notice in writing in the form of Schedule A
hereto setting out the number of Optioned Shares with respect
to which the Option is being exercised. The notice must be
accompanied by payment of a certified check, official
2
<PAGE> 10
bank cashier's check or money order in an amount equal to the
Exercise Price multiplied by the number of shares requested
and a duly executed copy of this Agreement. At the discretion
of the Committee, the Grantee may pay all or a portion of the
purchase price by tender of Common Stock or a combination of
stock and cash or other means determined by the Committee.
4.2 Any notice under this Section shall include an undertaking to
furnish or execute such documents as the Committee in its
discretion shall deem necessary (i) to evidence such exercise,
in whole or in part, of the Option evidenced by this
Agreement, (ii) to determine whether registration is then
required under the Securities Act of 1933, or any other law,
as then in effect, and (iii) to comply with or satisfy the
requirements of the Securities Act of 1933, or any other law,
as then in effect.
4.3 The Grantee agrees that all shares purchased by him under the
Option will be acquired for investment, not distribution, and
that any notice of exercise of the Option must be accompanied
by a written representation to that effect, signed by the
Grantee.
SECTION 5
TERMINATION OF OPTION
5.1 The Option granted hereby shall terminate and be of no force
or effect upon the expiration of ten years from the date of
the Grant unless terminated prior to such time as provided
below.
5.2 Subject to Section 3.6, hereof if the Amended and Restated
License Agreement is terminated by PARTEQ, the Option may be
exercised, to the extent exercisable, for a period of three
months after the date of such termination or such later date
as the Company's Board of Directors may approve; and if such
Agreement is terminated by DUSA, the Option shall continue to
vest in the Grantee as provided in Section 3.1 above.
5.3 Any determination made by the Committee with respect to any
matter referred to in this Section 5 shall be final and
conclusive on all persons affected thereby.
SECTION 6
ADJUSTMENTS TO OPTION
6.1 Subject to any required action by the Committee and
shareholders, the number of shares provided for in the Option,
and the price per share thereof shall be proportionately
adjusted for any increase or decrease in the number of issued
shares of the Company resulting from the payment of a share
dividend, a share split or any transaction which is a
"corporate transaction" (as defined in the Treasury
regulations promulgated under Section 424 of the Code.
6.2 Subject to any required action by the Committee and
shareholders, if the Company shall be the surviving entity in
any merger or consolidation, or after a consolidation
3
<PAGE> 11
of the Company and one or more entities in which the resulting
entity is an independent entity, the Option shall pertain to
and apply to the securities of the surviving entity in an
amount that the board of directors of the surviving entity, at
its sole discretion, determines to be equivalent, as nearly as
practicable, to the nearest whole number and class of shares
that were subject to the Option. These shares of stock or
other securities shall, after such merger or consolidation, be
deemed to be shares for all purposes hereof. The aforesaid
adjustments, when applicable, shall be made by the Committee,
and the Committee's determination shall be final, binding and
conclusive.
6.3 In the event of a Change of Control (as defined below), any
and all outstanding Options not fully vested shall
automatically vest in full and shall be immediately
exercisable. The date on which such accelerated vesting and
immediate exercisability shall occur shall be the date of the
occurrence of the Change of Control.
A "Change of Control" shall be deemed to have taken place upon
(i) the acquisition by a third person, including a "group" as
defined in Section 13(d)(3) of the Securities Exchange Act of
1934, as amended, of shares of the Company having 50% or more
of the total number of votes that may be cast for the election
of Directors of the Company; (ii) shareholder approval of a
transaction for the acquisition of the Company, or
substantially all of its assets by another entity or for a
merger, reorganization, consolidation or other business
combination to which the Company is a part; or (iii) the
election during any period of 24 months or less of 50% or more
of the Directors of the Company where such Directors were not
in office immediately prior to such period provided, however,
that no "Change of Control" shall be deemed to have taken
place if the Directors of the Company in office on the date of
adoption of the Plan, or their successors in office nominated
by such Directors, affirmatively approve a resolution to such
effect.
Except as provided with respect to a Grantee in his stock
option agreement or other controlling agreement between him
and the Company, to the extent that the acceleration,
exercisability or parachute payment attributable to the Option
following a Change of Control would result in "excess
parachute payments"1 when the former are aggregated with other
payments or benefits to the Grantee, such parachute payments
or benefits provided to a Grantee under this Agreement shall
be reduced to the extent necessary so that no portion thereof
shall be subject to the excise tax imposed by Section 4999 of
the Code. This reduction will only be made if it will cause
the Grantee's net after-tax benefit to exceed the net
after-tax benefit that would have existed if such reduction
were not made. "Net after-tax benefit" shall be the sum of (i)
all payments and benefits which a Grantee receives or is
entitled to receive that would constitute a "parachute
payment" under Section 280G of the Code, less (ii) the amount
of federal income taxes payable with respect to the payments
and
- --------
(1)"Excess parachute payments" are defined in Section 280G of the Code and
are determined by tax counsel of the Company.
4
<PAGE> 12
benefits described in (i) above, calculated at the maximum
marginal income tax rate2 for the year in which such payments
and benefits shall be paid to the Grantee, less (iii) the
amount of excise taxes imposed with respect to the payments
and benefits described in (i) above by Section 4999 of the
Code.
6.4 In the event of a change in the Company's shares which is
limited to a change of all of its authorized shares with par
value into the same number of shares with a different par
value or without par value, the shares resulting from any such
change shall be deemed to be shares within the meaning of this
Agreement.
6.5 Except as herein before expressly provided in Paragraphs 6.1,
6.2, 6.3 and 6.4 of this Section 6, the Grantee shall have no
rights by reason of any subdivision or consolidation of shares
of any class or payment of any share dividend or any other
increase or decrease in the number of shares of any class or
by reason of any dissolution, liquidation, merger,
consolidation or spin-off of assets or stock of another
corporation and any issuance by the Company of shares of any
class, or securities convertible into shares of any class,
shall not affect the Option, and no adjustment by reason
thereof shall be made with respect to the number or price of
the Company's shares subject to the Option. The grant of the
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 or to merge, consolidate, dissolve, liquidate, sell
or transfer all or any part of its business or assets.
SECTION 7
TRANSFER
7.1 This Option shall not be transferable by the Grantee in any
way. During the lifetime of the Grantee, the Option shall be
exercisable only by him. Any other attempted assignment,
transfer, pledge, hypothecation or other disposition of the
Option shall be void and have no effect unless in accordance
with the terms set forth herein.
SECTION 8
WITHHOLDING TAXES
8.1 The Company shall have the right to retain and withhold from
any payment, under the Option granted, any amount that is to
be withheld or otherwise deducted and paid with respect to
such payment. At its discretion, the Company may require the
Grantee, if it receives shares under a nonqualified stock
option grant, to reimburse the Company for any taxes that are
required to be withheld by the Company, and may withhold any
distribution in whole or in part until the Company is so
reimbursed. In lieu thereof, the Company shall have the right
to withhold from any other cash amounts due (or to become due)
to the Grantee an amount equal to such taxes required to be
withheld by the Company to reimburse the Company for any such
- ------------
(2)"This rate is based on the rate for the year set forth in the Code at
the time of the first payment to the participant.
5
<PAGE> 13
taxes, or the Company may retain and withhold a number of
shares of Common Stock having a market value not less than the
amount of such taxes and cancel (in whole or in part) any
shares of Common Stock so withheld in order to reimburse the
Company for any such taxes.
SECTION 9
IMPACT ON OTHER BENEFITS
9.1 The value of the Option (either on the date of grant of the
Option or at the time the shares are vested) shall not be
includable as compensation or earnings for purposes of any
other benefit plan offered by the Company.
SECTION 10
ADMINISTRATION
10.1 The Committee shall have full authority and discretion to
decide all matters relating to the administration and
interpretation of this Agreement. All such Committee
determinations shall be final, conclusive and binding upon the
Company, the Grantee and any and all interested parties.
SECTION 11
AMENDMENT(S)
11.1 This Agreement may not in any way be amended without the
Grantee's written consent.
SECTION 12
FORCE AND EFFECT
12.1 The various provisions of this Agreement are severable in
their entirety. Any determination of invalidity or
unenforceability of any one provision shall have no effect on
the continuing force and effect of the remaining provisions.
SECTION 13
NOTICE OF DISPOSITION OF SHARES
13.1 The Grantee agrees that if he should dispose of any shares of
Common Stock acquired on the exercise of the Option, including
a disposition by sale, exchange, gift or transfer of legal
title within twelve (12) months of the date such shares are
transferred to the Grantee, the Grantee will notify the
Company promptly of such disposition.
6
<PAGE> 14
SECTION 14
NOTICES
14.1 All notices which may be or are required to be given by one
party to the other party pursuant to this Agreement shall be
in writing and shall be mailed by first class or certified
mail, return receipt requested, postage prepaid, or
transmitted by hand delivery as follows:
If to the Company: DUSA Pharmaceuticals, Inc.
181 University Avenue
Suite 1208
Toronto, ON M5H 3M7
CANADA
Attention: Dr. D. Geoffrey Shulman
If to the Grantee: Roy H. Pottier
or such other address as to which either party may from time
to time notify the other as aforesaid.
SECTION 15
RESTRICTIONS ON TRANSFER
15.1 The Grantee understands and acknowledges that he is subject to
certain restrictions on transfer under the Securities Act of
1933 of the United States, as amended, (the "1933 Act") of the
shares issued pursuant to the exercise of the Option; such
restrictions provide that the shares may not be sold without
registration or exemption from registration under the 1933
Act.
SECTION 16
REPORTING REQUIREMENTS
16.1 The Grantee understands and acknowledges that he may be
subject to certain reporting requirements upon his receipt and
exercise of the Option, and in connection therewith, upon the
receipt and exercise of the Option, the Grantee agrees to
timely file with the Securities and Exchange Commission, the
National Association of Securities Dealers, Inc., and any
appropriate Canadian securities regulatory authorities, the
appropriate documentation regarding his ownership of the
Company's securities.
7
<PAGE> 15
SECTION 17
GOVERNING LAW
17.1 This Agreement shall be construed and enforced in accordance
with and governed by the laws of the State of New Jersey.
IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties hereto.
Attest: DUSA PHARMACEUTICALS, INC.,
a New Jersey corporation
s/Nanette W. Mantell By: s/D. Geoffrey Shulman
- --------------------------------- ------------------------------
Nanette W. Mantell, Secretary Dr. D. Geoffrey Shulman, President
GRANTEE
s/Roy H. Pottier
------------------------------
Roy H. Pottier
8
<PAGE> 16
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of DUSA Pharmaceuticals, Inc.
Pursuant to the terms and subject to the conditions set forth in the
Nonqualified Stock Option Agreement (the "Agreement") dated October 21, 1997,
between DUSA Pharmaceuticals, Inc. and the undersigned, and the Option granted
to the undersigned by such Agreement, I hereby elect to purchase ____ shares of
Common Stock of DUSA Pharmaceuticals, Inc. which were the subject of such
Option. I understand that such purchase is subject to all the terms and
conditions of the Agreement. I request that the certificates for such shares of
Common Stock shall be issued in the name of:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(please print or type name and address)
The undersigned hereby represents and warrants to, and agrees with the
Company as follows:
(a) The shares are being purchased for the undersigned's own account,
for investment purposes only, and not for the account of any other person, and
not with a view to distribution, assignment, or resale to others, or to
fractionalization in whole or in part and that the offering and sale of the
shares is intended to be exempt from registration under the Securities Act of
1933 (the "Act"). In furtherance thereof, the undersigned represents, warrants
and agrees as follows: (i) no other person has or will have a direct or indirect
beneficial interest in such shares and the undersigned will not sell,
hypothecate, or otherwise transfer his shares except in accordance with the Act
and applicable state securities laws or unless in the opinion of counsel for the
Company, an exemption from the registration requirements of the Act and such
laws is available; and (ii) the Company is under no obligation to register the
shares on behalf of the undersigned or to assist the undersigned in complying
with any exemption from registration.
<PAGE> 17
(b) The undersigned has such knowledge and experience in financial and
business matters that the undersigned is capable of evaluating the merits and
risks of investment in the Company and of making an informed investment
decision.
In full payment of the purchase price with respect to the Option
exercised, the undersigned hereby tenders payment of $___________ by certified
check or official bank cashier's check or money order payable in Canadian or
United States currency to the order of DUSA Pharmaceuticals, Inc.
Dated: X
----------------------------------
(Signature)
-----------------------------------
Name (Please Print)
-------------------------------------
(Address)
-------------------------------------
Taxpayer Identification Number
<PAGE> 1
Exhibit 4.11(a)
STOCK OPTION AGREEMENT
THIS AGREEMENT is made as of the 30th day of September, 1991 between
DEPRENYL USA, INC., a corporation incorporated under the laws of the State of
New Jersey (hereinafter referred to as the "Company") and ROBERT L. REID, MD, an
individual residing at (hereinafter referred to as the "Participant").
WITNESSETH:
WHEREAS, the Board of Directors of the Company has determined that in
consideration for services rendered on the Company's behalf and in order to
provide an inducement to the Participant to acquire a proprietary interest in
the Company, it is in the Company's best interest to grant an option to him to
purchase shares of the Company's common stock ("Shares") on the terms and
conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
expressed herein, it is agreed by and between the parties as follows:
1.1 DEFINITIONS
In this Agreement:
"Board of Directors" means the board of directors of the Company;
"Exercise Price" means CDN. $6.79;
"Expiration Date" means 5:00 p.m. (Eastern Standard Time) on the later
of the dates provided in Section 2.2;
"Optioned Shares" means that number of Shares which are subject to the
option granted by the Company to the Participant pursuant to this
Agreement;
"Services" means consulting or other services provided by the
Participant to the Company, as requested from time to time by the Board
of Directors, at its sole discretion; and
"Shares" means shares of common stock, without par value, of the
Company.
<PAGE> 2
2.1 GRANT OF OPTION
The Company hereby grants to the Participant an option to purchase, in
accordance with the vesting rights outlined in Sections 2.6 and 2.7
hereof, up to 20,000 Shares for an amount per Share equal to the
Exercise Price, upon the terms and subject to the conditions herein
contained.
2.2 Subject to Sections 2.6, 2.7 and 3.1 hereof, the Participant shall have
the right, at any time prior to 5:00 p.m. (Eastern Standard Time) on
the fifth anniversary date hereof, being September 30, 1996 (provided
that if such day is not a day on which the Company is open for business
then on the first following day on which the Company is open for
business) to exercise this option for any number of the Optioned Shares
up to the maximum number of Shares specified in Section 2.1 above.
2.3 The option may be exercised by the Participant or by his executors or
personal representatives in the circumstances described in Section 4.1
by providing to the Company notice in writing in the form of Schedule A
hereto setting out the number of Optioned Shares with respect to which
the option is being exercised. The notice must be accompanied by a
certified check, official bank cashier's check or money order in an
amount equal to the Exercise Price multiplied by the number of Shares
requested and a duly executed copy of this Agreement.
2.4 The Company shall cause its registrar and transfer agent to deliver to
the Participant as soon as practicable after receipt of such notice and
payment a certificate or certificates registered in the name of the
Participant or as the Participant may direct for the number of Shares
with respect to which the option is duly exercised.
2.5 Nothing contained in this Agreement or action taken pursuant hereto
shall obligate the Participant to purchase and/or pay for, or the
Company to issue, any Shares except those Optioned Shares with respect
to which the Participant shall have duly exercised the option to
purchase in accordance with this Agreement.
2.6 Subject to Section 2.7 hereof, the option granted hereunder shall vest
in the following manner:
(a) one-quarter of the option on the first anniversary of the day
immediately preceding the date hereof, being September 29,
1992;
(b) one-quarter of the option on the second anniversary of the day
immediately preceding the date hereof, being September 29,
1993;
(c) one-quarter of the option on the third anniversary of the day
immediately preceding the date hereof, being September 29,
1994; and
(d) one-quarter of the option on the fourth anniversary of the day
immediately preceding the date hereof, being September 29,
1995;
2
<PAGE> 3
and, except as provided by Section 6.1, the Participant shall only be
entitled to exercise this option in the amounts set out above and from
and after the dates so specified.
2.7 Notwithstanding anything contained in Section 2.6 hereof, the option
shall continue to vest only so long as the Participant continues to
provide Services to the Company. Should the Participant cease to
provide such Services ("Termination"), no further vesting of the option
shall occur unless the Board of Directors determines otherwise and the
provisions of Section 3.1 shall apply with respect to the exercise of
the option to the extent that it has vested and has not yet been
exercised.
3.1 EXPIRATION ON TERMINATION
Subject to Section 4.1 hereof, upon Termination, such part of the
option as is then vested but unexercised may be exercised by the
Participant for a period of ninety (90) days after Termination or such
later date as the Board of Directors may approve after which time this
option shall expire; provided, however, that in no event may this
option be exercised after the Expiration Date.
4.1 DEATH OR PERMANENT DISABILITY
In the event that on or prior to the Expiration Date, the Participant
dies or becomes totally and permanently disabled while providing
Services to the Company, this option, to the extent then vested but
unexercised, may be exercised by the Participant for a period up to six
(6) months after the death or disability of the Participant; provided,
however, that in no event may this option be exercised after the
Expiration Date. Disability shall be defined as in Section 22(e)(3) of
the Internal Revenue Code of 1986, as amended. For the purposes of this
provision only, reference to the Participant in this Agreement shall be
construed as including the executors or personal representatives of a
deceased Participant. In the event that this option is not exercised
within the period of six (6) months set out above, this option shall
expire.
5.1 SUBDIVISION, CONSOLIDATION OR REORGANIZATION
(a) In the event of any subdivision, redivision or change of the
Shares of the Company into a greater number of Shares at any time after
the date of this Agreement and prior to the Expiration Date of this
option, the Company shall deliver at the time of exercise of this
option, but for the same aggregate consideration payable therefor, such
additional number of Shares as the Participant would have been entitled
to receive as a result of such subdivision, redivision or change if on
the record date thereof the Participant had been the registered holder
of the number of such Shares with respect to which the option is later
exercised.
(b) In the event of any consolidation or change of the Shares of
the Company into a lesser number of Shares at any time after the date
of this Agreement and prior to the expiration of this option, the
Company shall deliver at the time of exercise of this option, but for
the same aggregate consideration payable therefor, such reduced number
of Shares, as the Participant would have been entitled to receive upon
such consolidation or change if on
3
<PAGE> 4
the record date thereof the Participant had been the registered holder
of the number of such Shares with respect to which the option is later
exercised.
(c) If at any time after the date of this Agreement and prior to
the expiration of this option, the Shares shall be reclassified or
reorganized, otherwise than as specified in Sections 5.1(a) and (b),
the Participant shall be entitled to receive upon the exercise of this
option and shall accept in lieu of the number of Shares then subscribed
for, but for the same aggregate consideration payable therefor, the
same aggregate number of shares of the appropriate class of shares that
the Participant would have been entitled to receive as a result of such
reclassification or other reorganization of Shares if on the record
date thereof the Participant had been the registered holder of the
number of such Shares with respect to which the option is later
exercised.
6.1 TAKE-OVER BID
If an offeror makes an offer to purchase 50% or more of the outstanding
Shares to substantially all holders of the Shares or, if an insider of
the Company makes an offer to purchase Shares to substantially all
holders of the Shares, and the Board of Directors recommends acceptance
of such offer to the shareholders of the Company and the offer price is
greater than the Exercise Price, then this option, whether or not it
has vested in whole or in part, shall become immediately exercisable.
The Participant shall be bound to exercise this option and to tender
the Optioned Shares issued upon exercise of this option into the offer
upon receipt of notice from the Company if the Company provides an
interest-free loan to the Participant in the amount of the Exercise
Price for all of the Optioned Shares issuable upon exercise of this
option, subject to the execution of a security agreement by the
Participant in favor of the Company securing repayment of the loan.
7.1 NO ASSIGNMENT
The Participant may not assign, transfer, pledge or hypothecate any of
his rights hereunder in any way (whether by operation of law or
otherwise) except by will or by the laws of succession on intestacy
which may apply to the estate of the Participant upon his death. The
option granted herein shall not be subject to execution, attachment or
similar process. Upon any attempt to assign, transfer, pledge,
hypothecate or otherwise dispose of this option contrary to the
provisions hereof, or upon the levy of any attachment or similar
process upon the option granted herein, such option shall immediately
become void.
8.1 GENERAL
(a) Time shall be of the essence of this Agreement.
(b) In this Agreement, words importing the singular number include
the plural and vice versa and words importing the masculine gender
include the feminine and neuter genders.
(c) All notices which may be or are required to be given by one
party to the other party pursuant to this Agreement shall be in writing
and shall be mailed by first class or certified mail, return receipt
requested, postage prepaid, or transmitted by hand delivery as follows:
4
<PAGE> 5
<TABLE>
<S> <C>
If to the Company: Deprenyl USA, Inc.
378 Roncesvalles Ave.
Toronto, ON M6R 2M7
CANADA
Attention: Dr. D. Geoffrey Shulman
with a copy to: Nanette W. Mantell, Esq., Corporate
Secretary
Lane and Mantell
991 Route 22 West
PO Box 8539
Somerville, NJ 08876
U.S.A.
If to the Participant: at the address of the Participant from
time to time in the records of the
Company,
</TABLE>
or such other address as to which either party may from time to time
notify the other as aforesaid.
9.1 RESTRICTIONS ON TRANSFER
The Participant understands and acknowledges that the option and Shares
underlying the option have not been registered and that they are
subject to certain restrictions on transfer under the Securities Act of
1933 of the United States, as amended, (the "1933 Act"); such
restrictions provide that the Shares may not be sold without
registration or exemption from registration under the 1933 Act; and,
for purposes of the Securities Act (Ontario) (the "Ontario Act"), the
first trade of the Shares issued pursuant to the exercise of the
option, other than a trade exempted by the Ontario Act, will be a
distribution unless the Company has been a reporting issuer for at
least twelve (12) months and the Company is not in default of any
requirement of the Ontario Act, disclosure has been made to the Ontario
Securities Commission of the exempt trade, no unusual effort is made to
prepare the market or create a demand for the Shares, and no
extraordinary commission or consideration is paid with respect to the
trade, provided that such first trade is not from the holdings of a
so-called "control block".
5
<PAGE> 6
IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties hereto.
Attest: DEPRENYL USA, INC.
a New Jersey corporation
s/Edward L. Foster By: s/D. Geoffrey Shulman
- ---------------------------- -----------------------------------
Edward L. Foster, Treasurer Dr. D. Geoffrey Shulman, President
PARTICIPANT
s/Robert L. Reid
--------------------------------
Robert L. Reid, MD
6
<PAGE> 7
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of Deprenyl USA, Inc.
Pursuant to the terms and subject to the conditions set forth in the
Stock Option Agreement (the "Agreement") dated , between Deprenyl USA, Inc.
and the undersigned, I hereby elect to purchase shares of Common Stock of
Deprenyl USA, Inc. I understand that such purchase is subject to all the terms
and conditions of the Agreement. I request that the certificates for such shares
of Common Stock shall be issued in the name of:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
In full payment of the purchase price with respect to the Optioned
Shares exercised, the undersigned hereby tenders payment of $___________ by
certified check or official bank cashier's check or money order payable in
Canadian currency to the order of Deprenyl USA, Inc.
Dated: X
------------------------------
(Signature)
-----------------------------------
Name (Please Print)
-----------------------------------
(Address)
-----------------------------------
Taxpayer Identification Number
<PAGE> 8
Exhibit 4.11(b)
NONQUALIFIED STOCK OPTION AGREEMENT
AGREEMENT made and entered into as of the 21ST day of OCTOBER, 1997, by
and between DUSA Pharmaceuticals, Inc., a corporation incorporated under the
laws of the State of New Jersey (the "Company"), and Robert L. Reid, who resides
at 5 Concord Drive, Kingston Ontairo K7L 4V1, the "(Grantee").
WHEREAS, the Company granted to PARTEQ RESEARCH AND DEVELOPMENT
INNOVATIONS, a corporation incorporated under the laws of Ontario, CANADA
("PARTEQ") on October 21, 1991 (the "Grant Date") stock options for 85,000
shares of the Company's common stock without par value ("Common Stock") in
connection with the agreement to amend a certain License Agreement dated August
27, 1991; and
WHEREAS, PARTEQ has determined to assign a certain number of said
options to the Grantee in consideration of services rendered by him to the
Company; and
WHEREAS, the Company has determined that its interests will be advanced
by acknowledging the assignment by PARTEQ of the options;
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, the parties agree as follows:
SECTION 1
GRANT
1.1 The Company hereby acknowledges the assignment to the Grantee
of the right and option (the "Option") to purchase, in
accordance with the vesting rights outlined in Sections 3.1
and 3.6 hereof, up to 6,800 shares of authorized but unissued
Common Stock of the Company on the terms and conditions herein
set forth in this Nonqualified Stock Option Agreement.
SECTION 2
PRICE
2.1 The purchase price of the shares of Common Stock subject to
this Option shall be the fair market value of the shares of
Common Stock on the Grant Date ($10.875 per share)(the
"Exercise Price").
SECTION 3
WHEN EXERCISABLE
3.1 The aggregate number of shares of Common Stock of the Company
optioned by this Agreement (the "Optioned Shares") shall vest
in the Grantee as follows:
<PAGE> 9
(a) 25% of the Option on the first anniversary of the day
of the grant, being October 21, 1998;
(b) 25% of the Option on the second anniversary of the
day of grant, being October 21, 1999;
(c) 25% of the Option on the third anniversary of the day
of the grant, being October 21, 2000;
(d) 25% of the Option on the fourth anniversary of the
day of the grant, being October 21,2001; and
and, except as provided by Sections 3.6 and 6.3 hereof, the Grantee
shall only be entitled to exercise this Option, in whole or in part, in
the amounts set out above and from and after the dates so specified.
3.2 Subject to Sections 3.1 and 3.6 hereof, the Grantee shall have
the right, at any time prior to 5:00 p.m. (Eastern Standard
Time) on the date prior to the tenth anniversary date of the
grant, being October 20, 2007, provided that if such day is
not a day on which the Company is open for business then on
the first following day on which the Company is open for
business, to exercise this Option for any number of the
Optioned Shares up to the maximum number of shares specified
in Section 1.1 above.
3.3 No less than one thousand (1,000) shares may be purchased upon
any one exercise of the Option granted hereby unless the
number of shares purchased at such time is the total number of
shares in respect of which the Option hereby granted is then
exercisable.
3.4 In no event shall any Option granted hereby be exercisable for
a fractional share.
3.5 From time to time, in its discretion, the Company's Stock
Option Committee (the "Committee") may offer the Grantee the
right to cancel any Option granted hereunder in exchange for
such consideration as the Committee shall determine.
3.6 Notwithstanding anything contained in Sections 1 and 3.1
hereof, the Option shall continue to vest in the Grantee only
so long as the Grantee shall continue to provide services to
the Company. Should the Grantee cease to provide services to
the Company, the Option shall not further vest or become
exercisable.
SECTION 4
HOW EXERCISABLE
4.1 Subject to such administrative regulations as the Committee
may from time to time adopt, the Grantee or beneficiary shall,
in order to exercise this Option give to the Company at its
principal office notice in writing in the form of Schedule A
hereto setting out the number of Optioned Shares with respect
to which the Option is being exercised. The notice must be
accompanied by payment of a certified check, official
2
<PAGE> 10
bank cashier's check or money order in an amount equal to the
Exercise Price multiplied by the number of shares requested
and a duly executed copy of this Agreement. At the discretion
of the Committee, the Grantee may pay all or a portion of the
purchase price by tender of Common Stock or a combination of
stock and cash or other means determined by the Committee.
4.2 Any notice under this Section shall include an undertaking to
furnish or execute such documents as the Committee in its
discretion shall deem necessary (i) to evidence such exercise,
in whole or in part, of the Option evidenced by this
Agreement, (ii) to determine whether registration is then
required under the Securities Act of 1933, or any other law,
as then in effect, and (iii) to comply with or satisfy the
requirements of the Securities Act of 1933, or any other law,
as then in effect.
4.3 The Grantee agrees that all shares purchased by him under the
Option will be acquired for investment, not distribution, and
that any notice of exercise of the Option must be accompanied
by a written representation to that effect, signed by the
Grantee.
SECTION 5
TERMINATION OF OPTION
5.1 The Option granted hereby shall terminate and be of no force
or effect upon the expiration of ten years from the date of
the Grant unless terminated prior to such time as provided
below.
5.2 Subject to Section 3.6, hereof if the Amended and Restated
License Agreement is terminated by PARTEQ, the Option may be
exercised, to the extent exercisable, for a period of three
months after the date of such termination or such later date
as the Company's Board of Directors may approve; and if such
Agreement is terminated by DUSA, the Option shall continue to
vest in the Grantee as provided in Section 3.1 above.
5.3 Any determination made by the Committee with respect to any
matter referred to in this Section 5 shall be final and
conclusive on all persons affected thereby.
SECTION 6
ADJUSTMENTS TO OPTION
6.1 Subject to any required action by the Committee and
shareholders, the number of shares provided for in the Option,
and the price per share thereof shall be proportionately
adjusted for any increase or decrease in the number of issued
shares of the Company resulting from the payment of a share
dividend, a share split or any transaction which is a
"corporate transaction" (as defined in the Treasury
regulations promulgated under Section 424 of the Code.
6.2 Subject to any required action by the Committee and
shareholders, if the Company shall be the surviving entity in
any merger or consolidation, or after a consolidation
3
<PAGE> 11
of the Company and one or more entities in which the resulting
entity is an independent entity, the Option shall pertain to
and apply to the securities of the surviving entity in an
amount that the board of directors of the surviving entity, at
its sole discretion, determines to be equivalent, as nearly as
practicable, to the nearest whole number and class of shares
that were subject to the Option. These shares of stock or
other securities shall, after such merger or consolidation, be
deemed to be shares for all purposes hereof. The aforesaid
adjustments, when applicable, shall be made by the Committee,
and the Committee's determination shall be final, binding and
conclusive.
6.3 In the event of a Change of Control (as defined below), any
and all outstanding Options not fully vested shall
automatically vest in full and shall be immediately
exercisable. The date on which such accelerated vesting and
immediate exercisability shall occur shall be the date of the
occurrence of the Change of Control.
A "Change of Control" shall be deemed to have taken place upon
(i) the acquisition by a third person, including a "group" as
defined in Section 13(d)(3) of the Securities Exchange Act of
1934, as amended, of shares of the Company having 50% or more
of the total number of votes that may be cast for the election
of Directors of the Company; (ii) shareholder approval of a
transaction for the acquisition of the Company, or
substantially all of its assets by another entity or for a
merger, reorganization, consolidation or other business
combination to which the Company is a part; or (iii) the
election during any period of 24 months or less of 50% or more
of the Directors of the Company where such Directors were not
in office immediately prior to such period provided, however,
that no "Change of Control" shall be deemed to have taken
place if the Directors of the Company in office on the date of
adoption of the Plan, or their successors in office nominated
by such Directors, affirmatively approve a resolution to such
effect.
Except as provided with respect to a Grantee in his stock
option agreement or other controlling agreement between him
and the Company, to the extent that the acceleration,
exercisability or parachute payment attributable to the Option
following a Change of Control would result in "excess
parachute payments"(1) when the former are aggregated with
other payments or benefits to the Grantee, such parachute
payments or benefits provided to a Grantee under this
Agreement shall be reduced to the extent necessary so that no
portion thereof shall be subject to the excise tax imposed by
Section 4999 of the Code. This reduction will only be made if
it will cause the Grantee's net after-tax benefit to exceed
the net after-tax benefit that would have existed if such
reduction were not made. "Net after-tax benefit" shall be the
sum of (i) all payments and benefits which a Grantee receives
or is entitled to receive that would constitute a "parachute
payment" under Section 280G of the Code, less (ii) the amount
of federal income taxes payable with respect to the payments
and
- --------
(1)"Excess parachute payments" are defined in Section 280G of the Code and
are determined by tax counsel of the Company.
4
<PAGE> 12
benefits described in (i) above, calculated at the maximum
marginal income tax rate(2) for the year in which such
payments and benefits shall be paid to the Grantee, less (iii)
the amount of excise taxes imposed with respect to the
payments and benefits described in (i) above by Section 4999
of the Code.
6.4 In the event of a change in the Company's shares which is
limited to a change of all of its authorized shares with par
value into the same number of shares with a different par
value or without par value, the shares resulting from any such
change shall be deemed to be shares within the meaning of this
Agreement.
6.5 Except as herein before expressly provided in Paragraphs 6.1,
6.2, 6.3 and 6.4 of this Section 6, the Grantee shall have no
rights by reason of any subdivision or consolidation of shares
of any class or payment of any share dividend or any other
increase or decrease in the number of shares of any class or
by reason of any dissolution, liquidation, merger,
consolidation or spin-off of assets or stock of another
corporation and any issuance by the Company of shares of any
class, or securities convertible into shares of any class,
shall not affect the Option, and no adjustment by reason
thereof shall be made with respect to the number or price of
the Company's shares subject to the Option. The grant of the
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 or to merge, consolidate, dissolve, liquidate, sell
or transfer all or any part of its business or assets.
SECTION 7
TRANSFER
7.1 This Option shall not be transferable by the Grantee in any
way. During the lifetime of the Grantee, the Option shall be
exercisable only by him. Any other attempted assignment,
transfer, pledge, hypothecation or other disposition of the
Option shall be void and have no effect unless in accordance
with the terms set forth herein.
SECTION 8
WITHHOLDING TAXES
8.1 The Company shall have the right to retain and withhold from
any payment, under the Option granted, any amount that is to
be withheld or otherwise deducted and paid with respect to
such payment. At its discretion, the Company may require the
Grantee, if it receives shares under a nonqualified stock
option grant, to reimburse the Company for any taxes that are
required to be withheld by the Company, and may withhold any
distribution in whole or in part until the Company is so
reimbursed. In lieu thereof, the Company shall have the right
to withhold from any other cash amounts due (or to become due)
to the Grantee an amount equal to such taxes required to be
withheld by the Company to reimburse the Company for any such
- ------------------------
(2)"This rate is based on the rate for the year set forth in the Code at
the time of the first payment to the participant.
5
<PAGE> 13
taxes, or the Company may retain and withhold a number of
shares of Common Stock having a market value not less than the
amount of such taxes and cancel (in whole or in part) any
shares of Common Stock so withheld in order to reimburse the
Company for any such taxes.
SECTION 9
IMPACT ON OTHER BENEFITS
9.1 The value of the Option (either on the date of grant of the
Option or at the time the shares are vested) shall not be
includable as compensation or earnings for purposes of any
other benefit plan offered by the Company.
SECTION 10
ADMINISTRATION
10.1 The Committee shall have full authority and discretion to
decide all matters relating to the administration and
interpretation of this Agreement. All such Committee
determinations shall be final, conclusive and binding upon the
Company, the Grantee and any and all interested parties.
SECTION 11
AMENDMENT(S)
11.1 This Agreement may not in any way be amended without the
Grantee's written consent.
SECTION 12
FORCE AND EFFECT
12.1 The various provisions of this Agreement are severable in
their entirety. Any determination of invalidity or
unenforceability of any one provision shall have no effect on
the continuing force and effect of the remaining provisions.
SECTION 13
NOTICE OF DISPOSITION OF SHARES
13.1 The Grantee agrees that if he should dispose of any shares of
Common Stock acquired on the exercise of the Option, including
a disposition by sale, exchange, gift or transfer of legal
title within twelve (12) months of the date such shares are
transferred to the Grantee, the Grantee will notify the
Company promptly of such disposition.
6
<PAGE> 14
SECTION 14
NOTICES
14.1 All notices which may be or are required to be given by one
party to the other party pursuant to this Agreement shall be
in writing and shall be mailed by first class or certified
mail, return receipt requested, postage prepaid, or
transmitted by hand delivery as follows:
If to the Company: DUSA Pharmaceuticals, Inc.
181 University Avenue
Suite 1208
Toronto, ON M5H 3M7
CANADA
Attention: Dr. D. Geoffrey Shulman
If to the Grantee: Robert L. Reid
or such other address as to which either party may from time
to time notify the other as aforesaid.
SECTION 15
RESTRICTIONS ON TRANSFER
15.1 The Grantee understands and acknowledges that he is subject to
certain restrictions on transfer under the Securities Act of
1933 of the United States, as amended, (the "1933 Act") of the
shares issued pursuant to the exercise of the Option; such
restrictions provide that the shares may not be sold without
registration or exemption from registration under the 1933
Act.
SECTION 16
REPORTING REQUIREMENTS
16.1 The Grantee understands and acknowledges that he may be
subject to certain reporting requirements upon his receipt and
exercise of the Option, and in connection therewith, upon the
receipt and exercise of the Option, the Grantee agrees to
timely file with the Securities and Exchange Commission, the
National Association of Securities Dealers, Inc., and any
appropriate Canadian securities regulatory authorities, the
appropriate documentation regarding his ownership of the
Company's securities.
7
<PAGE> 15
SECTION 17
GOVERNING LAW
17.1 This Agreement shall be construed and enforced in accordance
with and governed by the laws of the State of New Jersey.
IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties hereto.
Attest: DUSA PHARMACEUTICALS, INC.,
a New Jersey corporation
s/ Nanette W. Mantell By: s/ D. Geoffrey Shulman
- -------------------------------- --------------------------------
Nanette W. Mantell, Secretary Dr. D. Geoffrey Shulman, President
GRANTEE
s/Robert L. Reid
----------------------------
Robert L. Reid
8
<PAGE> 16
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of DUSA Pharmaceuticals, Inc.
Pursuant to the terms and subject to the conditions set forth in the
Nonqualified Stock Option Agreement (the "Agreement") dated October 21, 1997,
between DUSA Pharmaceuticals, Inc. and the undersigned, and the Option granted
to the undersigned by such Agreement, I hereby elect to purchase ____ shares of
Common Stock of DUSA Pharmaceuticals, Inc. which were the subject of such
Option. I understand that such purchase is subject to all the terms and
conditions of the Agreement. I request that the certificates for such shares of
Common Stock shall be issued in the name of:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(please print or type name and address)
The undersigned hereby represents and warrants to, and agrees with the
Company as follows:
(a) The shares are being purchased for the undersigned's own
account, for investment purposes only, and not for the account of any other
person, and not with a view to distribution, assignment, or resale to others, or
to fractionalization in whole or in part and that the offering and sale of the
shares is intended to be exempt from registration under the Securities Act of
1933 (the "Act"). In furtherance thereof, the undersigned represents, warrants
and agrees as follows: (i) no other person has or will have a direct or indirect
beneficial interest in such shares and the undersigned will not sell,
hypothecate, or otherwise transfer his shares except in accordance with the Act
and applicable state securities laws or unless in the opinion of counsel for the
Company, an exemption from the registration requirements of the Act and such
laws is available; and (ii) the Company is under no obligation to register the
shares on behalf of the undersigned or to assist the undersigned in complying
with any exemption from registration.
<PAGE> 17
(b) The undersigned has such knowledge and experience in financial
and business matters that the undersigned is capable of evaluating the merits
and risks of investment in the Company and of making an informed investment
decision.
In full payment of the purchase price with respect to the Option
exercised, the undersigned hereby tenders payment of $___________ by certified
check or official bank cashier's check or money order payable in Canadian or
United States currency to the order of DUSA Pharmaceuticals, Inc.
Dated: X
--------------------------------
(Signature)
-----------------------------------
Name (Please Print)
-------------------------------------
(Address)
-------------------------------------
Taxpayer Identification Number
<PAGE> 1
Exhibit 4.12
NONQUALIFIED STOCK OPTION AGREEMENT
AGREEMENT made and entered into as of the 21ST day of OCTOBER, 1997, by
and between DUSA Pharmaceuticals, Inc., a corporation incorporated under the
laws of the State of New Jersey (the "Company"), and Dean Van Vugt, who resides
at 9 Faircrest Blvd. Kingston, the "(Grantee").
WHEREAS, the Company granted to PARTEQ RESEARCH AND DEVELOPMENT
INNOVATIONS, a corporation incorporated under the laws of Ontario, CANADA
("PARTEQ") on October 21, 1991 (the "Grant Date") stock options for 85,000
shares of the Company's common stock without par value ("Common Stock") in
connection with the agreement to amend a certain License Agreement dated August
27, 1991; and
WHEREAS, PARTEQ has determined to assign a certain number of said
options to the Grantee in consideration of services rendered by him to the
Company; and
WHEREAS, the Company has determined that its interests will be advanced
by acknowledging the assignment by PARTEQ of the options;
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, the parties agree as follows:
SECTION 1
GRANT
1.1 The Company hereby acknowledges the assignment to the Grantee of
the right and option (the "Option") to purchase, in accordance
with the vesting rights outlined in Sections 3.1 and 3.6 hereof,
up to 2,261 shares of authorized but unissued Common Stock of the
Company on the terms and conditions herein set forth in this
Nonqualified Stock Option Agreement.
SECTION 2
PRICE
2.1 The purchase price of the shares of Common Stock subject to this
Option shall be the fair market value of the shares of Common
Stock on the Grant Date ($10.875 per share)(the "Exercise
Price").
SECTION 3
WHEN EXERCISABLE
3.1 The aggregate number of shares of Common Stock of the Company
optioned by this Agreement (the "Optioned Shares") shall vest in
the Grantee as follows:
<PAGE> 2
(a) 25% of the Option on the first anniversary of the day of
the grant, being October 21, 1998;
(b) 25% of the Option on the second anniversary of the day
of grant, being October 21, 1999;
(c) 25% of the Option on the third anniversary of the day of
the grant, being October 21, 2000;
(d) 25% of the Option on the fourth anniversary of the day
of the grant, being October 21,2001; and
and, except as provided by Sections 3.6 and 6.3 hereof, the Grantee
shall only be entitled to exercise this Option, in whole or in part, in
the amounts set out above and from and after the dates so specified.
3.2 Subject to Sections 3.1 and 3.6 hereof, the Grantee shall have
the right, at any time prior to 5:00 p.m. (Eastern Standard
Time) on the date prior to the tenth anniversary date of the
grant, being October 20, 2007, provided that if such day is not
a day on which the Company is open for business then on the
first following day on which the Company is open for business,
to exercise this Option for any number of the Optioned Shares up
to the maximum number of shares specified in Section 1.1 above.
3.3 No less than one thousand (1,000) shares may be purchased upon
any one exercise of the Option granted hereby unless the number
of shares purchased at such time is the total number of shares in
respect of which the Option hereby granted is then exercisable.
3.4 In no event shall any Option granted hereby be exercisable for a
fractional share.
3.5 From time to time, in its discretion, the Company's Stock Option
Committee (the "Committee") may offer the Grantee the right to
cancel any Option granted hereunder in exchange for such
consideration as the Committee shall determine.
3.6 Notwithstanding anything contained in Sections 1 and 3.1 hereof,
the Option shall continue to vest in the Grantee only so long as
the Grantee shall continue to provide services to the Company.
Should the Grantee cease to provide services to the Company, the
Option shall not further vest or become exercisable.
SECTION 4
HOW EXERCISABLE
4.1 Subject to such administrative regulations as the Committee may
from time to time adopt, the Grantee or beneficiary shall, in
order to exercise this Option give to the Company at its
principal office notice in writing in the form of Schedule A
hereto setting out the number of Optioned Shares with respect to
which the Option is being exercised. The notice must be
accompanied by payment of a certified check, official
2
<PAGE> 3
bank cashier's check or money order in an amount equal to the
Exercise Price multiplied by the number of shares requested and a
duly executed copy of this Agreement. At the discretion of the
Committee, the Grantee may pay all or a portion of the purchase
price by tender of Common Stock or a combination of stock and
cash or other means determined by the Committee.
4.2 Any notice under this Section shall include an undertaking to
furnish or execute such documents as the Committee in its
discretion shall deem necessary (i) to evidence such exercise, in
whole or in part, of the Option evidenced by this Agreement, (ii)
to determine whether registration is then required under the
Securities Act of 1933, or any other law, as then in effect, and
(iii) to comply with or satisfy the requirements of the
Securities Act of 1933, or any other law, as then in effect.
4.3 The Grantee agrees that all shares purchased by him under the
Option will be acquired for investment, not distribution, and
that any notice of exercise of the Option must be accompanied by
a written representation to that effect, signed by the Grantee.
SECTION 5
TERMINATION OF OPTION
5.1 The Option granted hereby shall terminate and be of no force or
effect upon the expiration of ten years from the date of the
Grant unless terminated prior to such time as provided below.
5.2 Subject to Section 3.6, hereof if the Amended and Restated
License Agreement is terminated by PARTEQ, the Option may be
exercised, to the extent exercisable, for a period of three
months after the date of such termination or such later date as
the Company's Board of Directors may approve; and if such
Agreement is terminated by DUSA, the Option shall continue to
vest in the Grantee as provided in Section 3.1 above.
5.3 Any determination made by the Committee with respect to any
matter referred to in this Section 5 shall be final and
conclusive on all persons affected thereby.
SECTION 6
ADJUSTMENTS TO OPTION
6.1 Subject to any required action by the Committee and shareholders,
the number of shares provided for in the Option, and the price
per share thereof shall be proportionately adjusted for any
increase or decrease in the number of issued shares of the
Company resulting from the payment of a share dividend, a share
split or any transaction which is a "corporate transaction" (as
defined in the Treasury regulations promulgated under Section 424
of the Code.
6.2 Subject to any required action by the Committee and shareholders,
if the Company shall be the surviving entity in any merger or
consolidation, or after a consolidation
3
<PAGE> 4
of the Company and one or more entities in which the resulting
entity is an independent entity, the Option shall pertain to and
apply to the securities of the surviving entity in an amount that
the board of directors of the surviving entity, at its sole
discretion, determines to be equivalent, as nearly as
practicable, to the nearest whole number and class of shares that
were subject to the Option. These shares of stock or other
securities shall, after such merger or consolidation, be deemed
to be shares for all purposes hereof. The aforesaid adjustments,
when applicable, shall be made by the Committee, and the
Committee's determination shall be final, binding and conclusive.
6.3 In the event of a Change of Control (as defined below), any and
all outstanding Options not fully vested shall automatically vest
in full and shall be immediately exercisable. The date on which
such accelerated vesting and immediate exercisability shall occur
shall be the date of the occurrence of the Change of Control.
A "Change of Control" shall be deemed to have taken place upon
(i) the acquisition by a third person, including a "group" as
defined in Section 13(d)(3) of the Securities Exchange Act of
1934, as amended, of shares of the Company having 50% or more of
the total number of votes that may be cast for the election of
Directors of the Company; (ii) shareholder approval of a
transaction for the acquisition of the Company, or substantially
all of its assets by another entity or for a merger,
reorganization, consolidation or other business combination to
which the Company is a part; or (iii) the election during any
period of 24 months or less of 50% or more of the Directors of
the Company where such Directors were not in office immediately
prior to such period provided, however, that no "Change of
Control" shall be deemed to have taken place if the Directors of
the Company in office on the date of adoption of the Plan, or
their successors in office nominated by such Directors,
affirmatively approve a resolution to such effect.
Except as provided with respect to a Grantee in his stock option
agreement or other controlling agreement between him and the
Company, to the extent that the acceleration, exercisability or
parachute payment attributable to the Option following a Change
of Control would result in "excess parachute payments"(1) when
the former are aggregated with other payments or benefits to the
Grantee, such parachute payments or benefits provided to a
Grantee under this Agreement shall be reduced to the extent
necessary so that no portion thereof shall be subject to the
excise tax imposed by Section 4999 of the Code. This reduction
will only be made if it will cause the Grantee's net after-tax
benefit to exceed the net after-tax benefit that would have
existed if such reduction were not made. "Net after-tax benefit"
shall be the sum of (i) all payments and benefits which a Grantee
receives or is entitled to receive that would constitute a
"parachute payment" under Section 280G of the Code, less (ii) the
amount of federal income taxes payable with respect to the
payments and
- --------------------
(1) "Excess parachute payments" are defined in Section 280G of the Code
and are determined by tax counsel of the Company.
4
<PAGE> 5
benefits described in (i) above, calculated at the maximum
marginal income tax rate(2) for the year in which such payments
and benefits shall be paid to the Grantee, less (iii) the amount
of excise taxes imposed with respect to the payments and benefits
described in (i) above by Section 4999 of the Code.
6.4 In the event of a change in the Company's shares which is limited
to a change of all of its authorized shares with par value into
the same number of shares with a different par value or without
par value, the shares resulting from any such change shall be
deemed to be shares within the meaning of this Agreement.
6.5 Except as herein before expressly provided in Paragraphs 6.1,
6.2, 6.3 and 6.4 of this Section 6, the Grantee shall have no
rights by reason of any subdivision or consolidation of shares of
any class or payment of any share dividend or any other increase
or decrease in the number of shares of any class or by reason of
any dissolution, liquidation, merger, consolidation or spin-off
of assets or stock of another corporation and any issuance by the
Company of shares of any class, or securities convertible into
shares of any class, shall not affect the Option, and no
adjustment by reason thereof shall be made with respect to the
number or price of the Company's shares subject to the Option.
The grant of the 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
or to merge, consolidate, dissolve, liquidate, sell or transfer
all or any part of its business or assets.
SECTION 7
TRANSFER
7.1 This Option shall not be transferable by the Grantee in any way.
During the lifetime of the Grantee, the Option shall be
exercisable only by him. Any other attempted assignment,
transfer, pledge, hypothecation or other disposition of the
Option shall be void and have no effect unless in accordance with
the terms set forth herein.
SECTION 8
WITHHOLDING TAXES
8.1 The Company shall have the right to retain and withhold from any
payment, under the Option granted, any amount that is to be
withheld or otherwise deducted and paid with respect to such
payment. At its discretion, the Company may require the Grantee,
if it receives shares under a nonqualified stock option grant, to
reimburse the Company for any taxes that are required to be
withheld by the Company, and may withhold any distribution in
whole or in part until the Company is so reimbursed. In lieu
thereof, the Company shall have the right to withhold from any
other cash amounts due (or to become due) to the Grantee an
amount equal to such taxes required to be withheld by the Company
to reimburse the Company for any such
- ---------------------
(2) "This rate is based on the rate for the year set forth in the Code
at the time of the first payment to the participant.
5
<PAGE> 6
taxes, or the Company may retain and withhold a number of shares
of Common Stock having a market value not less than the amount of
such taxes and cancel (in whole or in part) any shares of Common
Stock so withheld in order to reimburse the Company for any such
taxes.
SECTION 9
IMPACT ON OTHER BENEFITS
9.1 The value of the Option (either on the date of grant of the
Option or at the time the shares are vested) shall not be
includable as compensation or earnings for purposes of any other
benefit plan offered by the Company.
SECTION 10
ADMINISTRATION
10.1 The Committee shall have full authority and discretion to decide
all matters relating to the administration and interpretation of
this Agreement. All such Committee determinations shall be final,
conclusive and binding upon the Company, the Grantee and any and
all interested parties.
SECTION 11
AMENDMENT(S)
11.1 This Agreement may not in any way be amended without the
Grantee's written consent.
SECTION 12
FORCE AND EFFECT
12.1 The various provisions of this Agreement are severable in their
entirety. Any determination of invalidity or unenforceability of
any one provision shall have no effect on the continuing force
and effect of the remaining provisions.
SECTION 13
NOTICE OF DISPOSITION OF SHARES
13.1 The Grantee agrees that if he should dispose of any shares of
Common Stock acquired on the exercise of the Option, including a
disposition by sale, exchange, gift or transfer of legal title
within twelve (12) months of the date such shares are transferred
to the Grantee, the Grantee will notify the Company promptly of
such disposition.
6
<PAGE> 7
SECTION 14
NOTICES
14.1 All notices which may be or are required to be given by one party
to the other party pursuant to this Agreement shall be in writing
and shall be mailed by first class or certified mail, return
receipt requested, postage prepaid, or transmitted by hand
delivery as follows:
If to the Company: DUSA Pharmaceuticals, Inc.
181 University Avenue
Suite 1208
Toronto, ON M5H 3M7
CANADA
Attention: Dr. D. Geoffrey Shulman
If to the Grantee: Dean Van Vugt
or such other address as to which either party may from time to
time notify the other as aforesaid.
SECTION 15
RESTRICTIONS ON TRANSFER
15.1 The Grantee understands and acknowledges that he is subject to
certain restrictions on transfer under the Securities Act of 1933
of the United States, as amended, (the "1933 Act") of the shares
issued pursuant to the exercise of the Option; such restrictions
provide that the shares may not be sold without registration or
exemption from registration under the 1933 Act.
SECTION 16
REPORTING REQUIREMENTS
16.1 The Grantee understands and acknowledges that he may be subject
to certain reporting requirements upon his receipt and exercise
of the Option, and in connection therewith, upon the receipt and
exercise of the Option, the Grantee agrees to timely file with
the Securities and Exchange Commission, the National Association
of Securities Dealers, Inc., and any appropriate Canadian
securities regulatory authorities, the appropriate documentation
regarding his ownership of the Company's securities.
7
<PAGE> 8
SECTION 17
GOVERNING LAW
17.1 This Agreement shall be construed and enforced in accordance with
and governed by the laws of the State of New Jersey.
IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto.
Attest: DUSA PHARMACEUTICALS, INC.,
a New Jersey corporation
s/ Nanette W. Mantell By: s/ D. Geoffrey Shulman
- ---------------------------------- ---------------------------------
Nanette W. Mantell, Secretary Dr. D. Geoffrey Shulman, President
GRANTEE
s/Dean Van Vugt
---------------------------------
Dean Van Vugt
8
<PAGE> 9
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of DUSA Pharmaceuticals, Inc.
Pursuant to the terms and subject to the conditions set forth in the
Nonqualified Stock Option Agreement (the "Agreement") dated October 21, 1997,
between DUSA Pharmaceuticals, Inc. and the undersigned, and the Option granted
to the undersigned by such Agreement, I hereby elect to purchase _________
shares of Common Stock of DUSA Pharmaceuticals, Inc. which were the subject of
such Option. I understand that such purchase is subject to all the terms and
conditions of the Agreement. I request that the certificates for such shares of
Common Stock shall be issued in the name of:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(please print or type name and address)
The undersigned hereby represents and warrants to, and agrees with the
Company as follows:
(a) The shares are being purchased for the undersigned's own account,
for investment purposes only, and not for the account of any other person, and
not with a view to distribution, assignment, or resale to others, or to
fractionalization in whole or in part and that the offering and sale of the
shares is intended to be exempt from registration under the Securities Act of
1933 (the "Act"). In furtherance thereof, the undersigned represents, warrants
and agrees as follows: (i) no other person has or will have a direct or indirect
beneficial interest in such shares and the undersigned will not sell,
hypothecate, or otherwise transfer his shares except in accordance with the Act
and applicable state securities laws or unless in the opinion of counsel for the
Company, an exemption from the registration requirements of the Act and such
laws is available; and (ii) the Company is under no obligation to register the
shares on behalf of the undersigned or to assist the undersigned in complying
with any exemption from registration.
<PAGE> 10
(b) The undersigned has such knowledge and experience in financial and
business matters that the undersigned is capable of evaluating the merits and
risks of investment in the Company and of making an informed investment
decision.
In full payment of the purchase price with respect to the Option
exercised, the undersigned hereby tenders payment of $___________ by certified
check or official bank cashier's check or money order payable in Canadian or
United States currency to the order of DUSA Pharmaceuticals, Inc.
Dated: X
-----------------------------------------
(Signature)
-----------------------------------
Name (Please Print)
-------------------------------------
(Address)
-------------------------------------
Taxpayer Identification Number
<PAGE> 1
Exhibit 4.13
STOCK OPTION AGREEMENT
THIS AGREEMENT is made as of the 15th day of July, 1992 between DEPRENYL
USA, INC., a corporation incorporated under the laws of the State of New Jersey
(hereinafter referred to as the "Company") and MARTIN BARKIN, MD, BSc (MED), MA,
FRCSC, an individual residing at 54 Old Forest Hill Road, Toronto, Ontario M5P
2P9, CANADA (hereinafter referred to as the "Participant").
WITNESSETH:
WHEREAS, the Board of Directors of the Company has determined that in
consideration for services rendered on the Company's behalf and in order to
provide an inducement to the Participant to acquire a proprietary interest in
the Company, it is in the Company's best interest to grant an option to him to
purchase shares of the Company's common stock ("Shares") on the terms and
conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
expressed herein, it is agreed by and between the parties as follows:
1.1 DEFINITIONS
In this Agreement:
"Board of Directors" means the board of directors of the Company;
"Exercise Price" means CDN. $12.875;
"Expiration Date" means 5:00 p.m. (Eastern Standard Time) on the later
of the dates provided in Section 2.2;
"Optioned Shares" means that number of Shares which are subject to the
option granted by the Company to the Participant pursuant to this
Agreement; and
"Shares" means shares of common stock, without par value, of the
Company.
2.1 GRANT OF OPTION
The Company hereby grants to the Participant an option to purchase, in
accordance with the vesting rights outlined in Sections 2.6 and 2.7
hereof, up to 20,000 Shares for an amount per Share equal to the
Exercise Price, upon the terms and subject to the conditions herein
contained.
2.2 Subject to Sections 2.6, 2.7 and 3.1 hereof, the Participant shall have
the right, at any time prior to 5:00 p.m. (Eastern Standard Time) on the
fifth anniversary date hereof, being July
<PAGE> 2
15, 1997 (provided that if such day is not a day on which the Company is
open for business then on the first following day on which the Company
is open for business) to exercise this option for any number of the
Optioned Shares up to the maximum number of Shares specified in Section
2.1 above.
2.3 The option may be exercised by the Participant or by his executors or
personal representatives in the circumstances described in Section 4.1
by providing to the Company notice in writing in the form of Schedule A
hereto setting out the number of Optioned Shares with respect to which
the option is being exercised. The notice must be accompanied by a
certified check, official bank cashier's check or money order in an
amount equal to the Exercise Price multiplied by the number of Shares
requested and a duly executed copy of this Agreement.
2.4 The Company shall cause its registrar and transfer agent to deliver to
the Participant as soon as practicable after receipt of such notice and
payment a certificate or certificates registered in the name of the
Participant or as the Participant may direct for the number of Shares
with respect to which the option is duly exercised.
2.5 Nothing contained in this Agreement or action taken pursuant hereto
shall obligate the Participant to purchase and/or pay for, or the
Company to issue, any Shares except those Optioned Shares with respect
to which the Participant shall have duly exercised the option to
purchase in accordance with this Agreement.
2.6 Subject to Section 2.7 hereof, the option granted hereunder shall vest
in the following manner:
(a) one-quarter of the option on the first anniversary of the day
immediately preceding the date hereof, being July 14, 1993;
(b) one-quarter of the option on the second anniversary of the day
immediately preceding the date hereof, being July 14, 1994;
(c) one-quarter of the option on the third anniversary of the day
immediately preceding the date hereof, being July 14, 1995; and
(d) one-quarter of the option on the fourth anniversary of the day
immediately preceding the date hereof, being July 14, 1996;
and, except as provided by Section 6.1, the Participant shall only be
entitled to exercise this option in the amounts set out above and from
and after the dates so specified.
2.7 Notwithstanding anything contained in Section 2.6 hereof, the option
shall continue to vest only so long as the Participant continues to
serve the Company as a director. Should the Participant cease to serve
in such capacity ("Termination"), no further vesting of the option shall
occur and the provisions of Section 3.1 shall apply with respect to the
exercise of the option to the extent that it has vested and has not yet
been exercised.
2
<PAGE> 3
3.1 EXPIRATION ON TERMINATION
Subject to Section 4.1 hereof, upon Termination, such part of the option
as is then vested but unexercised may be exercised by the Participant
for a period of ninety (90) days after Termination or such later date as
the Board of Directors may approve after which time this option shall
expire; provided, however, that in no event may this option be exercised
after the Expiration Date.
4.1 DEATH OR PERMANENT DISABILITY
In the event that on or prior to the Expiration Date, the Participant
dies or becomes totally and permanently disabled while serving the
Company as a director, this option, to the extent then vested but
unexercised, may be exercised by the Participant for a period of up to
six (6) months after the death or disability of the Participant;
provided, however, that in no event may this option be exercised after
the Expiration Date. Disability shall be defined as in Section 22(e)(3)
of the Internal Revenue Code of 1986, as amended. For the purposes of
this provision only, reference to the Participant in this Agreement
shall be construed as including the executors or personal
representatives of a deceased Participant. In the event that this option
is not exercised within the period of six (6) months set out above, this
option shall expire.
5.1 SUBDIVISION, CONSOLIDATION OR REORGANIZATION
(a) In the event of any subdivision, redivision or change of the Shares
of the Company into a greater number of Shares at any time after the
date of this Agreement and prior to the Expiration Date of this option,
the Company shall deliver at the time of exercise of this option, but
for the same aggregate consideration payable therefor, such additional
number of Shares as the Participant would have been entitled to receive
as a result of such subdivision, redivision or change if on the record
date thereof the Participant had been the registered holder of the
number of such Shares with respect to which the option is later
exercised.
(b) In the event of any consolidation or change of the Shares of the
Company into a lesser number of Shares at any time after the date of
this Agreement and prior to the expiration of this option, the Company
shall deliver at the time of exercise of this option, but for the same
aggregate consideration payable therefor, such reduced number of Shares,
as the Participant would have been entitled to receive upon such
consolidation or change if on the record date thereof the Participant
had been the registered holder of the number of such Shares with respect
to which the option is later exercised.
(c) If at any time after the date of this Agreement and prior to the
expiration of this option, the Shares shall be reclassified or
reorganized, otherwise than as specified in Sections 5.1(a) and (b), the
Participant shall be entitled to receive upon the exercise of this
option and shall accept in lieu of the number of Shares then subscribed
for, but for the same aggregate consideration payable therefor, the same
aggregate number of shares of the appropriate class of shares that the
Participant would have been entitled to receive as a result of such
reclassification or other reorganization of Shares if on the record date
thereof the Participant
3
<PAGE> 4
had been the registered holder of the number of such Shares with respect
to which the option is later exercised.
6.1 TAKE-OVER BID
If an offeror makes an offer to purchase 50% or more of the outstanding
Shares to substantially all holders of the Shares or, if an insider of
the Company makes an offer to purchase Shares to substantially all
holders of the Shares, and the Board of Directors recommends acceptance
of such offer to the shareholders of the Company and the offer price is
greater than the Exercise Price, then this option, whether or not it has
vested in whole or in part, shall become immediately exercisable. The
Participant shall be bound to exercise this option and to tender the
Optioned Shares issued upon exercise of this option into the offer upon
receipt of notice from the Company if the Company provides an
interest-free loan to the Participant in the amount of the Exercise
Price for all of the Optioned Shares issuable upon exercise of this
option, subject to the execution of a security agreement by the
Participant in favor of the Company securing repayment of the loan.
7.1 NO ASSIGNMENT
The Participant may not assign, transfer, pledge or hypothecate any of
his rights hereunder in any way (whether by operation of law or
otherwise) except by will or by the laws of succession on intestacy
which may apply to the estate of the Participant upon his death. The
option granted herein shall not be subject to execution, attachment or
similar process. Upon any attempt to assign, transfer, pledge,
hypothecate or otherwise dispose of this option contrary to the
provisions hereof, or upon the levy of any attachment or similar process
upon the option granted herein, such option shall immediately become
void.
8.1 GENERAL
(a) Time shall be of the essence of this Agreement.
(b) In this Agreement, words importing the singular number include the
plural and vice versa and words importing the masculine gender include
the feminine and neuter genders.
(c) All notices which may be or are required to be given by one party to
the other party pursuant to this Agreement shall be in writing and shall
be mailed by first class or certified mail, return receipt requested,
postage prepaid, or transmitted by hand delivery as follows:
4
<PAGE> 5
<TABLE>
<S> <C>
If to the Company: Deprenyl USA, Inc.
378 Roncesvalles Ave.
Toronto, ON M6R 2M7
CANADA
Attention: Dr. D. Geoffrey Shulman
with a copy to: Nanette W. Mantell, Esq., Corporate Secretary
Lane and Mantell
991 Route 22 West
PO Box 8539
Somerville, NJ 08876
U.S.A.
If to the Participant: at the address of the Participant
from time to time in the records of the Company,
</TABLE>
or such other address as to which either party may from time to time
notify the other as aforesaid.
9.1 RESTRICTIONS ON TRANSFER
The Participant understands and acknowledges that the option and Shares
underlying the option have not been registered and that they are subject
to certain restrictions on transfer under the Securities Act of 1933 of
the United States, as amended, (the "1933 Act"); such restrictions
provide that the Shares may not be sold without registration or
exemption from registration under the 1933 Act; and, for purposes of the
Securities Act (Ontario) (the "Ontario Act"), the first trade of the
Shares issued pursuant to the exercise of the option, other than a trade
exempted by the Ontario Act, will be a distribution unless the Company
has been a reporting issuer for at least twelve (12) months and the
Company is not in default of any requirement of the Ontario Act,
disclosure has been made to the Ontario Securities Commission of the
exempt trade, no unusual effort is made to prepare the market or create
a demand for the Shares, and no extraordinary commission or
consideration is paid with respect to the trade, provided that such
first trade is not from the holdings of a so-called "control block".
10.1 REPORTING REQUIREMENTS
The Participant understands and acknowledges that he will be subject to
certain reporting requirements upon his receipt and exercise of the
option, and in connection therewith, upon the receipt and exercise of
the option, the Participant agrees to timely file with the Securities
and Exchange Commission, the National Association of Securities Dealers,
Inc., and any appropriate Canadian securities regulatory authorities,
the appropriate documentation regarding his ownership of the Company's
securities.
5
<PAGE> 6
IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto.
IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto.
Attest: DEPRENYL USA, INC.
a New Jersey corporation
s/Edward L. Foster By: s/D. Geoffrey Shulman
- --------------------------------- -----------------------------
Edward L. Foster, Treasurer Dr. D. Geoffrey Shulman, President
PARTICIPANT
s/Martin Barkin
---------------------------------
Martin Barkin, MD, BSc (MED),
MA, FRCSC
6
<PAGE> 7
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of Deprenyl USA, Inc.
Pursuant to the terms and subject to the conditions set forth in the
Stock Option Agreement (the "Agreement") dated , between Deprenyl USA, Inc.
and the undersigned, I hereby elect to purchase shares of Common Stock of
Deprenyl USA, Inc. I understand that such purchase is subject to all the terms
and conditions of the Agreement. I request that the certificates for such shares
of Common Stock shall be issued in the name of:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
In full payment of the purchase price with respect to the Optioned
Shares exercised, the undersigned hereby tenders payment of $___________ by
certified check or official bank cashier's check or money order payable in
Canadian currency to the order of Deprenyl USA, Inc.
Dated: X
---------------------------------------
(Signature)
-------------------------------------
Name (Please Print)
-------------------------------------
(Address)
-------------------------------------
Taxpayer Identification Number
<PAGE> 1
Exhibit 4.14(a)
STOCK OPTION AGREEMENT
THIS AGREEMENT is made as of the 14 day of April, 1994 between DUSA
PHARMACEUTICALS, INC., a corporation incorporated under the laws of the State of
New Jersey (hereinafter referred to as the "Company") and RONALD L. CARROLL, who
resides at 166 Otis Street, Hingham, Massachusetts 02043 (hereinafter referred
to as the "Participant").
WITNESSETH:
WHEREAS, the Company granted on April 14, 1994 (the "Grant Date") to
Lumenetics, Inc., a corporation incorporated under the laws of the State of
Delaware, ("Lumenetics") stock options for 20,000 shares of the Company's common
stock (the "Options"); and
WHEREAS, Lumenetics has determined to assign its interest in the Options
to Ronald L. Carroll and Scott Lundahl, the principal shareholders of
Lumenetics; and
WHEREAS, the Company has determined that it is in the Company's interest
to acknowledge the assignment by Lumenetics of the Options to purchase shares of
the Company's common stock ("Shares") on the terms and conditions set forth in
this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
expressed herein, it is agreed by and between the parties as follows:
1.1 DEFINITIONS
In this Agreement:
"Board of Directors" means the board of directors of the Company;
"Exercise Price" means U.S. $3.625;
"Expiration Date" means 5:00 p.m. (Eastern Standard Time) on the later
of the dates provided in Section 2.2;
"Optioned Shares" means that number of Shares which are subject to the
option granted by the Company to the Participant pursuant to this
Agreement;
"Services" means consulting or other services provided by the
Participant to the Company; and
"Shares" means shares of common stock, without par value, of the
Company.
<PAGE> 2
2.1 GRANT OF OPTION
The Company hereby grants to the Participant an option to purchase, in
accordance with the vesting rights outlined in Sections 2.6 and 2.7
hereof, up to 10,000 SHARES for an amount per Share equal to the
Exercise Price, upon the terms and subject to the conditions herein
contained.
2.2 Subject to Sections 2.6, 2.7 and 3.1 hereof, the Participant shall have
the right, at any time prior to 5:00 p.m. (Eastern Standard Time) on the
tenth (10th) anniversary date hereof, being April 14, 2004 (provided
that if such day is not a day on which the Company is open for business
then on the first following day on which the Company is open for
business) to exercise this option for any number of the Optioned Shares
up to the maximum number of Shares specified in Section 2.1 above.
2.3 The option may be exercised by the Participant or by his executors or
personal representatives in the circumstances described in Section 4.1
by providing to the Company notice in writing in the form of Schedule A
hereto setting out the number of Optioned Shares with respect to which
the option is being exercised. The notice must be accompanied by a
certified check, official bank cashier's check or money order in an
amount equal to the Exercise Price multiplied by the number of Shares
requested and a duly executed copy of this Agreement.
2.4 The Company shall cause its registrar and transfer agent to deliver to
the Participant as soon as practicable after receipt of such notice and
payment a certificate or certificates registered in the name of the
Participant or as the Participant may direct for the number of Shares
with respect to which the option is duly exercised.
2.5 Nothing contained in this Agreement or action taken pursuant hereto
shall obligate the Participant to purchase and/or pay for, or the
Company to issue, any Shares except those Optioned Shares with respect
to which the Participant shall have duly exercised the option to
purchase in accordance with this Agreement.
2.6 Subject to Section 2.7 hereof, the option granted hereunder shall vest
in the following manner:
(a) one-quarter of the option on the first anniversary of the day
immediately preceding the date hereof, being April 13, 1995;
(b) one-quarter of the option on the second anniversary of the day
immediately preceding the date hereof, being April 13, 1996;
(c) one-quarter of the option on the third anniversary of the day
immediately preceding the date hereof, being April 13, 1997; and
(d) one-quarter of the option on the fourth anniversary of the day
immediately preceding the date hereof, being April 13, 1998;
2
<PAGE> 3
and, except as provided by Section 6.1, the Participant shall only be
entitled to exercise this option in the amounts set out above and from
and after the dates so specified.
2.7 Notwithstanding anything contained in Section 2.6 hereof, the option
shall continue to vest only so long as the Participant continues to
provide Services to the Company. Should the Participant cease to provide
such Services ("Termination"), no further vesting of the option shall
occur unless the Board of Directors determines otherwise and the
provisions of Section 3.1 shall apply with respect to the exercise of
the option to the extent that it has vested and has not yet been
exercised.
3.1 EXPIRATION ON TERMINATION
Subject to Section 4.1 hereof, upon Termination, such part of the option
as is then vested but unexercised may be exercised by the Participant
for a period of ninety (90) days after Termination or such later date as
the Board of Directors may approve after which time this option shall
expire; provided, however, that in no event may this option be exercised
after the Expiration Date.
4.1 DEATH OR PERMANENT DISABILITY
In the event that on or prior to the Expiration Date, the Participant
dies or becomes totally and permanently disabled while providing
Services to the Company, this option, to the extent then vested but
unexercised, may be exercised by the Participant for a period up to six
(6) months after the death or disability of the Participant; provided,
however, that in no event may this option be exercised after the
Expiration Date. Disability shall be defined as in Section 22(e)(3) of
the Internal Revenue Code of 1986, as amended. For the purposes of this
provision only, reference to the Participant in this Agreement shall be
construed as including the executors or personal representatives of a
deceased Participant. In the event that this option is not exercised
within the period of six (6) months set out above, this option shall
expire.
5.1 SUBDIVISION, CONSOLIDATION OR REORGANIZATION
(a) In the event of any subdivision, redivision or change of the Shares
of the Company into a greater number of Shares at any time after the
date of this Agreement and prior to the Expiration Date of this option,
the Company shall deliver at the time of exercise of this option, but
for the same aggregate consideration payable therefor, such additional
number of Shares as the Participant would have been entitled to receive
as a result of such subdivision, redivision or change if on the record
date thereof the Participant had been the registered holder of the
number of such Shares with respect to which the option is later
exercised.
(b) In the event of any consolidation or change of the Shares of the
Company into a lesser number of Shares at any time after the date of
this Agreement and prior to the expiration of this option, the Company
shall deliver at the time of exercise of this option, but for the same
aggregate consideration payable therefor, such reduced number of Shares,
as the Participant would have been entitled to receive upon such
consolidation or change if on
3
<PAGE> 4
the record date thereof the Participant had been the registered holder
of the number of such Shares with respect to which the option is later
exercised.
(c) If at any time after the date of this Agreement and prior to the
expiration of this option, the Shares shall be reclassified or
reorganized, otherwise than as specified in Sections 5.1(a) and (b), the
Participant shall be entitled to receive upon the exercise of this
option and shall accept in lieu of the number of Shares then subscribed
for, but for the same aggregate consideration payable therefor, the same
aggregate number of shares of the appropriate class of shares that the
Participant would have been entitled to receive as a result of such
reclassification or other reorganization of Shares if on the record date
thereof the Participant had been the registered holder of the number of
such Shares with respect to which the option is later exercised.
6.1 TAKE-OVER BID
If an offeror makes an offer to purchase 50% or more of the outstanding
Shares to substantially all holders of the Shares or, if an insider of
the Company makes an offer to purchase Shares to substantially all
holders of the Shares, and the Board of Directors recommends acceptance
of such offer to the shareholders of the Company and the offer price is
greater than the Exercise Price, then this option, whether or not it has
vested in whole or in part, shall become immediately exercisable. The
Participant shall be bound to exercise this option and to tender the
Optioned Shares issued upon exercise of this option into the offer upon
receipt of notice from the Company if the Company provides an
interest-free loan to the Participant in the amount of the Exercise
Price for all of the Optioned Shares issuable upon exercise of this
option, subject to the execution of a security agreement by the
Participant in favor of the Company securing repayment of the loan.
7.1 NO ASSIGNMENT
The Participant may not assign, transfer, pledge or hypothecate any of
his rights hereunder in any way (whether by operation of law or
otherwise) except by will or by the laws of succession on intestacy
which may apply to the estate of the Participant upon his death. The
option granted herein shall not be subject to execution, attachment or
similar process. Upon any attempt to assign, transfer, pledge,
hypothecate or otherwise dispose of this option contrary to the
provisions hereof, or upon the levy of any attachment or similar process
upon the option granted herein, such option shall immediately become
void.
8.1 GENERAL
(a) Time shall be of the essence of this Agreement.
(b) In this Agreement, words importing the singular number include the
plural and vice versa and words importing the masculine gender include
the feminine and neuter genders.
(c) All notices which may be or are required to be given by one party to
the other party pursuant to this Agreement shall be in writing and shall
be mailed by first class or certified mail, return receipt requested,
postage prepaid, or transmitted by hand delivery as follows:
4
<PAGE> 5
5
<PAGE> 6
<TABLE>
<S> <C>
If to the Company: DUSA Pharmaceuticals, Inc.
181 University Avenue, Suite 1208
Toronto, ON M5H 3M7
CANADA
Attention: Dr. D. Geoffrey Shulman
with a copy to: Nanette W. Mantell, Esq., Corporate Secretary
Lane and Mantell
991 Route 22 West
PO Box 8539
Somerville, NJ 08876
U.S.A.
If to the Participant: at the address of the Participant from time to time in
the records of the Company,
</TABLE>
or such other address as to which either party may from time to time
notify the other as aforesaid.
9.1 RESTRICTIONS ON TRANSFER
The Participant understands and acknowledges that the option and Shares
underlying the option have not been registered and that they are subject
to certain restrictions on transfer under the Securities Act of 1933 of
the United States, as amended, (the "1933 Act"); such restrictions
provide that the Shares may not be sold without registration or
exemption from registration under the 1933 Act; and, for purposes of the
Securities Act (Ontario) (the "Ontario Act"), the first trade of the
Shares issued pursuant to the exercise of the option, other than a trade
exempted by the Ontario Act, will be a distribution unless the Company
has been a reporting issuer for at least twelve (12) months and the
Company is not in default of any requirement of the Ontario Act,
disclosure has been made to the Ontario Securities Commission of the
exempt trade, no unusual effort is made to prepare the market or create
a demand for the Shares, and no extraordinary commission or
consideration is paid with respect to the trade, provided that such
first trade is not from the holdings of a so-called "control block".
6
<PAGE> 7
IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto.
Attest: DUSA PHARMACEUTICALS, INC.
a New Jersey corporation
s/Nanette W. Mantell By: s/D. Geoffrey Shulman
- ------------------------------------ --------------------------------
Nanette W. Mantell, Secretary Dr. D. Geoffrey Shulman, President
PARTICIPANT
s/ Ronald L. Carroll
------------------------------------
Ronald L. Carroll
7
<PAGE> 8
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of DUSA Pharmaceuticals, Inc.
Pursuant to the terms and subject to the conditions set forth in the
Stock Option Agreement (the "Agreement") dated , between DUSA
Pharmaceuticals, Inc. and the undersigned, I hereby elect to purchase shares
of Common Stock of DUSA Pharmaceuticals, Inc. I understand that such purchase is
subject to all the terms and conditions of the Agreement. I request that the
certificates for such shares of Common Stock shall be issued in the name of:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
In full payment of the purchase price with respect to the Optioned
Shares exercised, the undersigned hereby tenders payment of $___________ by
certified check or official bank cashier's check or money order payable in
Canadian currency to the order of DUSA Pharmaceuticals, Inc.
Dated: X
-------------------------------------------
(Signature)
-------------------------------------
Name (Please Print)
-------------------------------------
(Address)
-------------------------------------
Taxpayer Identification Number
<PAGE> 9
Exhibit 4.14(b)
NONQUALIFIED STOCK OPTION AGREEMENT
AGREEMENT made and entered into as of the 13TH day of MARCH, 1997, by
and between DUSA Pharmaceuticals, Inc., a corporation incorporated under the
laws of the State of New Jersey (the "Company"), and RONALD L. CARROLL, who
resides at 166 Otis Street, Hingham, Massachusetts 02043 (the "Grantee").
WHEREAS, the Company granted on March 13, 1997 (the "Grant Date") to
Lumenetics, Inc., a corporation incorporated under the laws of the State of
Delaware, ("Lumenetics") stock options for 100,000 shares of the Company's
common stock (the "Options"); and
WHEREAS, Lumenetics has determined to assign its interest in the Options
to Ronald L. Carroll and Scott Lundahl, the principal shareholders of
Lumenetics; and
WHEREAS, the Company has determined that its interests will be advanced
by acknowledging the assignment by Lumenetics of the Options.
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, the parties hereby agree as follows:
SECTION 1
GRANT
1.1 The Company hereby acknowledges the assignment to the Grantee of
the right and option (the "Option") to purchase, in accordance
with the vesting rights outlined in Sections 3.1 and 3.6 hereof,
up to 50,000 shares of authorized but unissued Common Stock,
without par value ("Common Stock"), of the Company on the terms
and conditions herein set forth in this Agreement.
SECTION 2
PRICE
2.1 The purchase price of the shares of Common Stock subject to this
Option shall be the fair market value of the shares of Common
Stock on the Grant Date ($6.125 per share)(the "Exercise Price").
SECTION 3
WHEN EXERCISABLE
3.1 The aggregate number of shares of Common Stock of the Company
optioned by this Agreement (the "Optioned Shares") shall vest in
the Grantee as follows:
(a) 25% of the Option on the day of the grant, being March 13,
1997;
<PAGE> 10
(b) 25% of the Option on the second anniversary of the day of
grant, being March 13, 1999;
(c) 25% of the Option on the third anniversary of the day of
the grant, being March 13, 2000;
(d) 25% of the Option on the fourth anniversary of the day of
the grant, being March 13, 2001; and
and, except as provided by Sections 3.6 and 6.3 hereof, the Grantee
shall only be entitled to exercise this Option, in whole or in part, in
the amounts set out above and from and after the dates so specified.
3.2 Subject to Sections 3.1 and 3.6 hereof, the Grantee shall have
the right, at any time prior to 5:00 p.m. (Eastern Standard Time)
on the date prior to the tenth anniversary date of the grant,
being March 12, 2007, provided that if such day is not a day on
which the Company is open for business then on the first
following day on which the Company is open for business, to
exercise this Option for any number of the Optioned Shares up to
the maximum number of shares specified in Section 1.1 above.
3.3 No less than one thousand (1,000) shares may be purchased upon
any one exercise of the Option granted hereby unless the number
of shares purchased at such time is the total number of shares in
respect of which the Option hereby granted is then exercisable.
3.4 In no event shall any Option granted hereby be exercisable for a
fractional share.
3.5 From time to time, in its discretion, the Company's Stock Option
Committee (the "Committee") may offer the Grantee the right to
cancel any Option granted hereunder in exchange for such
consideration as the Committee shall determine.
3.6 Notwithstanding anything contained in Sections 1 and 3.1 hereof,
the Option shall continue to vest in the Grantee as provided by
the terms of Paragraph 3(d)(ii) of the Consulting and Development
Agreement, dated October 14, 1997 (the "Consulting Agreement")
between the Company and Lumenetics, which Consulting Agreement
was subsequently partially terminated pursuant to a certain
Partial Termination Agreement dated as of the February 25, 1999.
The Board of Directors shall be entitled to determine if and when
service to the Company has ceased with respect to the Grantee.
SECTION 4
HOW EXERCISABLE
4.1 Subject to such administrative regulations as the Committee may
from time to time adopt, the Grantee or beneficiary shall, in
order to exercise this Option give to the Company at its
principal office notice in writing in the form of Schedule A
hereto setting out the number of Optioned Shares with respect to
2
<PAGE> 11
which the Option is being exercised. The notice must be
accompanied by payment of a certified check, official bank
cashier's check or money order in an amount equal to the Exercise
Price multiplied by the number of shares requested and a duly
executed copy of this Agreement. At the discretion of the
Committee, the Grantee may pay all or a portion of the purchase
price by tender of Common Stock or a combination of stock and
cash or other means determined by the Committee.
4.2 Any notice under this Section shall include an undertaking to
furnish or execute such documents as the Committee in its
discretion shall deem necessary (i) to evidence such exercise, in
whole or in part, of the Option evidenced by this Agreement, (ii)
to determine whether registration is then required under the
Securities Act of 1933, or any other law, as then in effect, and
(iii) to comply with or satisfy the requirements of the
Securities Act of 1933, or any other law, as then in effect.
4.3 The Grantee agrees that all shares purchased by it under the
Option will be acquired for investment, not distribution, and
that any notice of exercise of the Option must be accompanied by
a written representation to that effect, signed by the Grantee.
SECTION 5
TERMINATION OF OPTION
5.1 The Option granted hereby shall terminate and be of no force or
effect upon the expiration of ten years from the date of the
Grant unless terminated prior to such time as provided below.
5.2 Any determination made by the Committee with respect to any
matter referred to in this Section 5 shall be final and
conclusive on all persons affected thereby. Service to the
Company shall be deemed to include service to any subsidiary of
the Company by the Grantee.
SECTION 6
ADJUSTMENTS TO OPTION
6.1 Subject to any required action by the Committee and shareholders,
the number of shares provided for in the Option, and the price
per share thereof shall be proportionately adjusted for any
increase or decrease in the number of issued shares of the
Company resulting from the payment of a share dividend, a share
split or any transaction which is a "corporate transaction" (as
defined in the Treasury regulations promulgated under Section 424
of the Code.
6.2 Subject to any required action by the Committee and shareholders,
if the Company shall be the surviving entity in any merger or
consolidation, or after a consolidation of the Company and one or
more entities in which the resulting entity is an independent
entity, the Option shall pertain to and apply to the
3
<PAGE> 12
securities of the surviving entity in an amount that the board of
directors of the surviving entity, at its sole discretion,
determines to be equivalent, as nearly as practicable, to the
nearest whole number and class of shares that were subject to the
Option. These shares of stock or other securities shall, after
such merger or consolidation, be deemed to be shares for all
purposes hereof. The aforesaid adjustments, when applicable,
shall be made by the Committee, and the Committee's determination
shall be final, binding and conclusive.
6.3 In the event of a Change of Control (as defined below), any and
all outstanding Options not fully vested shall automatically vest
in full and shall be immediately exercisable. The date on which
such accelerated vesting and immediate exercisability shall occur
shall be the date of the occurrence of the Change of Control.
A "Change of Control" shall be deemed to have taken place upon
(i) the acquisition by a third person, including a "group" as
defined in Section 13(d)(3) of the Securities Exchange Act of
1934, as amended, of shares of the Company having 50% or more of
the total number of votes that may be cast for the election of
Directors of the Company; (ii) shareholder approval of a
transaction for the acquisition of the Company, or substantially
all of its assets by another entity or for a merger,
reorganization, consolidation or other business combination to
which the Company is a part; or (iii) the election during any
period of 24 months or less of 50% or more of the Directors of
the Company where such Directors were not in office immediately
prior to such period provided, however, that no "Change of
Control" shall be deemed to have taken place if the Directors of
the Company in office on the date of adoption of the Plan, or
their successors in office nominated by such Directors,
affirmatively approve a resolution to such effect.
Except as provided with respect to a Grantee in its stock option
agreement or other controlling agreement between it and the
Company, to the extent that the acceleration, exercisability or
parachute payment attributable to the Option following a Change
of Control would result in "excess parachute payments"(1) when
the former are aggregated with other payments or benefits to the
Grantee, such parachute payments or benefits provided to a
Grantee under this Agreement shall be reduced to the extent
necessary so that no portion thereof shall be subject to the
excise tax imposed by Section 4999 of the Code. This reduction
will only be made if it will cause the Grantee's net after-tax
benefit to exceed the net after-tax benefit that would have
existed if such reduction were not made. "Net after-tax benefit"
shall be the sum of (i) all payments and benefits which a Grantee
receives or is entitled to receive that would constitute a
"parachute payment" under Section 280G of the Code, less (ii) the
amount of federal income taxes payable with respect to the
payments and benefits described in (i) above,
- -------------------
(1) "Excess parachute payments" are defined in Section 280G of the Code
and are determined by tax counsel of the Company.
4
<PAGE> 13
calculated at the maximum marginal income tax rate(2) for the
year in which such payments and benefits shall be paid to the
Grantee, less (iii) the amount of excise taxes imposed with
respect to the payments and benefits described in (i) above by
Section 4999 of the Code.
6.4 In the event of a change in the Company's shares which is limited
to a change of all of its authorized shares with par value into
the same number of shares with a different par value or without
par value, the shares resulting from any such change shall be
deemed to be shares within the meaning of this Agreement.
6.5 Except as herein before expressly provided in Paragraphs 6.1,
6.2, 6.3 and 6.4 of this Section 6, the Grantee shall have no
rights by reason of any subdivision or consolidation of shares of
any class or payment of any share dividend or any other increase
or decrease in the number of shares of any class or by reason of
any dissolution, liquidation, merger, consolidation or spin-off
of assets or stock of another corporation and any issuance by the
Company of shares of any class, or securities convertible into
shares of any class, shall not affect the Option, and no
adjustment by reason thereof shall be made with respect to the
number or price of the Company's shares subject to the Option.
The grant of the 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
or to merge, consolidate, dissolve, liquidate, sell or transfer
all or any part of its business or assets.
SECTION 7
TRANSFER
7.1 This Option shall not be transferable by the Grantee in any way.
During the existence of the Grantee, the Option shall be
exercisable only by it. Any other attempted assignment, transfer,
pledge, hypothecation or other disposition of the Option shall be
void and have no effect unless in accordance with the terms set
forth herein.
SECTION 8
WITHHOLDING TAXES
8.1 The Company shall have the right to retain and withhold from any
payment, under the Option granted, any amount that is to be
withheld or otherwise deducted and paid with respect to such
payment. At its discretion, the Company may require the Grantee,
if it receives shares under a nonqualified stock option grant, to
reimburse the Company for any taxes that are required to be
withheld by the Company, and may withhold any distribution in
whole or in part until the Company is so reimbursed. In lieu
thereof, the Company shall have the right to
- ---------------------
(2) "This rate is based on the rate for the year set forth in the Code
at the time of the first payment to the participant.
5
<PAGE> 14
withhold from any other cash amounts due (or to become due) to
the Grantee an amount equal to such taxes required to be withheld
by the Company to reimburse the Company for any such taxes, or
the Company may retain and withhold a number of shares of Common
Stock having a market value not less than the amount of such
taxes and cancel (in whole or in part) any shares of Common Stock
so withheld in order to reimburse the Company for any such taxes.
SECTION 9
IMPACT ON OTHER BENEFITS
9.1 The value of the Option (either on the date of grant of the
Option or at the time the shares are vested) shall not be
includable as compensation or earnings for purposes of any other
benefit plan offered by the Company.
SECTION 10
ADMINISTRATION
10.1 The Committee shall have full authority and discretion to decide
all matters relating to the administration and interpretation of
this Agreement. All such Committee determinations shall be final,
conclusive and binding upon the Company, the Grantee and any and
all interested parties.
SECTION 11
AGREEMENT TO CONTINUE IN EMPLOYMENT
OR SERVICE AS A CONSULTANT
11.1 Nothing in this Agreement shall confer on a Grantee any right to
continue in the employ of the Company or in the service of the
Company as a consultant or interfere in any way with the right of
the Company to terminate such consulting relationship at any
time.
SECTION 12
AMENDMENT(S)
12.1 This Agreement may not in any way be amended or terminated
without the Grantee's written consent.
SECTION 13
FORCE AND EFFECT
13.1 The various provisions of this Agreement are severable in their
entirety. Any determination of invalidity or unenforceability of
any one provision shall have no effect on the continuing force
and effect of the remaining provisions.
6
<PAGE> 15
SECTION 14
NOTICE OF DISPOSITION OF SHARES
14.1 The Grantee agrees that if it should dispose of any shares of
Common Stock acquired on the exercise of the Option, including a
disposition by sale, exchange, gift or transfer of legal title
within twelve (12) months of the date such shares are transferred
to the Grantee, the Grantee will notify the Company promptly of
such disposition.
SECTION 15
NOTICES
15.1 All notices which may be or are required to be given by one party
to the other party pursuant to this Agreement shall be in writing
and shall be mailed by first class or certified mail, return
receipt requested, postage prepaid, or transmitted by hand
delivery as follows:
If to the Company: DUSA Pharmaceuticals, Inc.
181 University Avenue
Suite 1208
Toronto, ON M5H 3M7
CANADA
Attention: Dr. D. Geoffrey Shulman
If to the Grantee: Ronald L. Carroll
166 Otis Street
Hingham, Massachusetts 02043
or such other address as to which either party may from time to
time notify the other as aforesaid.
SECTION 16
RESTRICTIONS ON TRANSFER
16.1 The Grantee understands and acknowledges that it is subject to
certain restrictions on transfer under the Securities Act of 1933
of the United States, as amended, (the "1933 Act") of the shares
issued pursuant to the exercise of the Option; such restrictions
provide that the shares may not be sold without registration or
exemption from registration under the 1933 Act.
SECTION 17
REPORTING REQUIREMENTS
17.1 The Grantee understands and acknowledges that it may be subject
to certain reporting requirements upon its receipt and exercise
of the Option, and in
7
<PAGE> 16
connection therewith, upon the receipt and exercise of the
Option, the Grantee agrees to timely file with the Securities and
Exchange Commission, the National Association of Securities
Dealers, Inc., and any appropriate Canadian securities regulatory
authorities, the appropriate documentation regarding his
ownership of the Company's securities.
SECTION 18
GOVERNING LAW
18.1 This Agreement shall be construed and enforced in accordance with
and governed by the laws of the State of New Jersey.
IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto.
Attest: DUSA PHARMACEUTICALS, INC.,
a New Jersey corporation
s/Nanette W. Mantell By: s/D. Geoffrey Shulman
- ---------------------------------- -------------------------------
Nanette W. Mantell, Secretary Dr. D. Geoffrey Shulman, President
PARTICIPANT
s/ Ronald L. Carroll
-----------------------------------
Ronald L. Carroll
8
<PAGE> 17
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of DUSA Pharmaceuticals, Inc.
Pursuant to the terms and subject to the conditions set forth in the
Nonqualified Stock Option Agreement (the "Agreement") dated , between DUSA
Pharmaceuticals, Inc. and the undersigned, and the Option granted to the
undersigned by such Agreement, I hereby elect to purchase shares of
Common Stock of DUSA Pharmaceuticals, Inc. which were the subject of such
Option. I understand that such purchase is subject to all the terms and
conditions of the Agreement. I request that the certificates for such shares of
Common Stock shall be issued in the name of:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(please print or type name and address)
The undersigned hereby represents and warrants to, and agrees with the
Company as follows:
(a) The shares are being purchased for the undersigned's own account,
for investment purposes only, and not for the account of any other person, and
not with a view to distribution, assignment, or resale to others, or to
fractionalization in whole or in part and that the offering and sale of the
shares is intended to be exempt from registration under the Securities Act of
1933 (the "Act"). In furtherance thereof, the undersigned represents, warrants
and agrees as follows: (i) no other person has or will have a direct or indirect
beneficial interest in such shares and the undersigned will not sell,
hypothecate, or otherwise transfer his shares except in accordance with the Act
and applicable state securities laws or unless in the opinion of counsel for the
Company, an exemption from the registration requirements of the Act and such
laws is available; and (ii) the Company is under no obligation to register the
shares on behalf of the undersigned or to assist the undersigned in complying
with any exemption from registration.
<PAGE> 18
(b) The undersigned has such knowledge and experience in financial and
business matters that the undersigned is capable of evaluating the merits and
risks of investment in the Company and of making an informed investment
decision.
In full payment of the purchase price with respect to the Option
exercised, the undersigned hereby tenders payment of $___________ by certified
check or official bank cashier's check or money order payable in Canadian or
United States currency to the order of DUSA Pharmaceuticals, Inc.
Dated: X
--------------------------------------
(Signature)
-------------------------------------
Name (Please Print)
-------------------------------------
(Address)
-------------------------------------
Taxpayer Identification Number
<PAGE> 1
Exhibit 4.15(a)
STOCK OPTION AGREEMENT
THIS AGREEMENT is made as of the 14 day of April, 1994 between DUSA
PHARMACEUTICALS, INC., a corporation incorporated under the laws of the State of
New Jersey (hereinafter referred to as the "Company") and SCOTT LUNDAHL, who
resides at 4 Morris Street, Lexington, Massachusetts 02173 (hereinafter referred
to as the "Participant").
WITNESSETH:
WHEREAS, the Company granted on April 14, 1994 (the "Grant Date") to
Lumenetics, Inc., a corporation incorporated under the laws of the State of
Delaware, ("Lumenetics") stock options for 20,000 shares of the Company's common
stock (the "Options"); and
WHEREAS, Lumenetics has determined to assign its interest in the Options
to Ronald L. Carroll and Scott Lundahl, the principal shareholders of
Lumenetics; and
WHEREAS, the Company has determined that it is in the Company's interest
to acknowledge the assignment by Lumenetics of the Options to purchase shares of
the Company's common stock ("Shares") on the terms and conditions set forth in
this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
expressed herein, it is agreed by and between the parties as follows:
1.1 DEFINITIONS
In this Agreement:
"Board of Directors" means the board of directors of the Company;
"Exercise Price" means U.S. $3.625;
"Expiration Date" means 5:00 p.m. (Eastern Standard Time) on the later
of the dates provided in Section 2.2;
"Optioned Shares" means that number of Shares which are subject to the
option granted by the Company to the Participant pursuant to this
Agreement;
"Services" means consulting or other services provided by the
Participant to the Company; and
"Shares" means shares of common stock, without par value, of the
Company.
<PAGE> 2
2.1 GRANT OF OPTION
The Company hereby grants to the Participant an option to purchase, in
accordance with the vesting rights outlined in Sections 2.6 and 2.7
hereof, up to 10,000 SHARES for an amount per Share equal to the
Exercise Price, upon the terms and subject to the conditions herein
contained.
2.2 Subject to Sections 2.6, 2.7 and 3.1 hereof, the Participant shall have
the right, at any time prior to 5:00 p.m. (Eastern Standard Time) on the
tenth (10th) anniversary date hereof, being April 14, 2004 (provided
that if such day is not a day on which the Company is open for business
then on the first following day on which the Company is open for
business) to exercise this option for any number of the Optioned Shares
up to the maximum number of Shares specified in Section 2.1 above.
2.3 The option may be exercised by the Participant or by his executors or
personal representatives in the circumstances described in Section 4.1
by providing to the Company notice in writing in the form of Schedule A
hereto setting out the number of Optioned Shares with respect to which
the option is being exercised. The notice must be accompanied by a
certified check, official bank cashier's check or money order in an
amount equal to the Exercise Price multiplied by the number of Shares
requested and a duly executed copy of this Agreement.
2.4 The Company shall cause its registrar and transfer agent to deliver to
the Participant as soon as practicable after receipt of such notice and
payment a certificate or certificates registered in the name of the
Participant or as the Participant may direct for the number of Shares
with respect to which the option is duly exercised.
2.5 Nothing contained in this Agreement or action taken pursuant hereto
shall obligate the Participant to purchase and/or pay for, or the
Company to issue, any Shares except those Optioned Shares with respect
to which the Participant shall have duly exercised the option to
purchase in accordance with this Agreement.
2.6 Subject to Section 2.7 hereof, the option granted hereunder shall vest
in the following manner:
(a) one-quarter of the option on the first anniversary of the day
immediately preceding the date hereof, being April 13, 1995;
(b) one-quarter of the option on the second anniversary of the day
immediately preceding the date hereof, being April 13, 1996;
(c) one-quarter of the option on the third anniversary of the day
immediately preceding the date hereof, being April 13, 1997; and
(d) one-quarter of the option on the fourth anniversary of the day
immediately preceding the date hereof, being April 13, 1998;
2
<PAGE> 3
and, except as provided by Section 6.1, the Participant shall only be
entitled to exercise this option in the amounts set out above and from
and after the dates so specified.
2.7 Notwithstanding anything contained in Section 2.6 hereof, the option
shall continue to vest only so long as the Participant continues to
provide Services to the Company. Should the Participant cease to provide
such Services ("Termination"), no further vesting of the option shall
occur unless the Board of Directors determines otherwise and the
provisions of Section 3.1 shall apply with respect to the exercise of
the option to the extent that it has vested and has not yet been
exercised.
3.1 EXPIRATION ON TERMINATION
Subject to Section 4.1 hereof, upon Termination, such part of the option
as is then vested but unexercised may be exercised by the Participant
for a period of ninety (90) days after Termination or such later date as
the Board of Directors may approve after which time this option shall
expire; provided, however, that in no event may this option be exercised
after the Expiration Date.
4.1 DEATH OR PERMANENT DISABILITY
In the event that on or prior to the Expiration Date, the Participant
dies or becomes totally and permanently disabled while providing
Services to the Company, this option, to the extent then vested but
unexercised, may be exercised by the Participant for a period up to six
(6) months after the death or disability of the Participant; provided,
however, that in no event may this option be exercised after the
Expiration Date. Disability shall be defined as in Section 22(e)(3) of
the Internal Revenue Code of 1986, as amended. For the purposes of this
provision only, reference to the Participant in this Agreement shall be
construed as including the executors or personal representatives of a
deceased Participant. In the event that this option is not exercised
within the period of six (6) months set out above, this option shall
expire.
5.1 SUBDIVISION, CONSOLIDATION OR REORGANIZATION
(a) In the event of any subdivision, redivision or change of the Shares
of the Company into a greater number of Shares at any time after the
date of this Agreement and prior to the Expiration Date of this option,
the Company shall deliver at the time of exercise of this option, but
for the same aggregate consideration payable therefor, such additional
number of Shares as the Participant would have been entitled to receive
as a result of such subdivision, redivision or change if on the record
date thereof the Participant had been the registered holder of the
number of such Shares with respect to which the option is later
exercised.
(b) In the event of any consolidation or change of the Shares of the
Company into a lesser number of Shares at any time after the date of
this Agreement and prior to the expiration of this option, the Company
shall deliver at the time of exercise of this option, but for the same
aggregate consideration payable therefor, such reduced number of Shares,
as the Participant would have been entitled to receive upon such
consolidation or change if on
3
<PAGE> 4
the record date thereof the Participant had been the registered holder
of the number of such Shares with respect to which the option is later
exercised.
(c) If at any time after the date of this Agreement and prior to the
expiration of this option, the Shares shall be reclassified or
reorganized, otherwise than as specified in Sections 5.1(a) and (b), the
Participant shall be entitled to receive upon the exercise of this
option and shall accept in lieu of the number of Shares then subscribed
for, but for the same aggregate consideration payable therefor, the same
aggregate number of shares of the appropriate class of shares that the
Participant would have been entitled to receive as a result of such
reclassification or other reorganization of Shares if on the record date
thereof the Participant had been the registered holder of the number of
such Shares with respect to which the option is later exercised.
6.1 TAKE-OVER BID
If an offeror makes an offer to purchase 50% or more of the outstanding
Shares to substantially all holders of the Shares or, if an insider of
the Company makes an offer to purchase Shares to substantially all
holders of the Shares, and the Board of Directors recommends acceptance
of such offer to the shareholders of the Company and the offer price is
greater than the Exercise Price, then this option, whether or not it has
vested in whole or in part, shall become immediately exercisable. The
Participant shall be bound to exercise this option and to tender the
Optioned Shares issued upon exercise of this option into the offer upon
receipt of notice from the Company if the Company provides an
interest-free loan to the Participant in the amount of the Exercise
Price for all of the Optioned Shares issuable upon exercise of this
option, subject to the execution of a security agreement by the
Participant in favor of the Company securing repayment of the loan.
7.1 NO ASSIGNMENT
The Participant may not assign, transfer, pledge or hypothecate any of
his rights hereunder in any way (whether by operation of law or
otherwise) except by will or by the laws of succession on intestacy
which may apply to the estate of the Participant upon his death. The
option granted herein shall not be subject to execution, attachment or
similar process. Upon any attempt to assign, transfer, pledge,
hypothecate or otherwise dispose of this option contrary to the
provisions hereof, or upon the levy of any attachment or similar process
upon the option granted herein, such option shall immediately become
void.
8.1 GENERAL
(a) Time shall be of the essence of this Agreement.
(b) In this Agreement, words importing the singular number include the
plural and vice versa and words importing the masculine gender include
the feminine and neuter genders.
(c) All notices which may be or are required to be given by one party to
the other party pursuant to this Agreement shall be in writing and shall
be mailed by first class or certified mail, return receipt requested,
postage prepaid, or transmitted by hand delivery as follows:
4
<PAGE> 5
<TABLE>
<S> <C>
If to the Company: DUSA Pharmaceuticals, Inc.
181 University Avenue, Suite 1208
Toronto, ON M5H 3M7
CANADA
Attention: Dr. D. Geoffrey Shulman
with a copy to: Nanette W. Mantell, Esq., Corporate Secretary
Lane and Mantell
991 Route 22 West
PO Box 8539
Somerville, NJ 08876
U.S.A.
If to the Participant: at the address of the Participant
from time to time in the records of the Company,
</TABLE>
or such other address as to which either party may from time to time
notify the other as aforesaid.
9.1 RESTRICTIONS ON TRANSFER
The Participant understands and acknowledges that the option and Shares
underlying the option have not been registered and that they are subject
to certain restrictions on transfer under the Securities Act of 1933 of
the United States, as amended, (the "1933 Act"); such restrictions
provide that the Shares may not be sold without registration or
exemption from registration under the 1933 Act; and, for purposes of the
Securities Act (Ontario) (the "Ontario Act"), the first trade of the
Shares issued pursuant to the exercise of the option, other than a trade
exempted by the Ontario Act, will be a distribution unless the Company
has been a reporting issuer for at least twelve (12) months and the
Company is not in default of any requirement of the Ontario Act,
disclosure has been made to the Ontario Securities Commission of the
exempt trade, no unusual effort is made to prepare the market or create
a demand for the Shares, and no extraordinary commission or
consideration is paid with respect to the trade, provided that such
first trade is not from the holdings of a so-called "control block".
5
<PAGE> 6
IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto.
Attest: DUSA PHARMACEUTICALS, INC.
a New Jersey corporation
s/Nanette W. Mantell By: s/D. Geoffrey Shulman
- ------------------------------------- -------------------------------
Nanette W. Mantell, Secretary Dr. D. Geoffrey Shulman, President
PARTICIPANT
s/ Scott Lundahl
-----------------------------------
Scott Lundahl
6
<PAGE> 7
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of DUSA Pharmaceuticals, Inc.
Pursuant to the terms and subject to the conditions set forth in the
Stock Option Agreement (the "Agreement") dated , between DUSA
Pharmaceuticals, Inc. and the undersigned, I hereby elect to purchase shares
of Common Stock of DUSA Pharmaceuticals, Inc. I understand that such purchase is
subject to all the terms and conditions of the Agreement. I request that the
certificates for such shares of Common Stock shall be issued in the name of:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
In full payment of the purchase price with respect to the Optioned
Shares exercised, the undersigned hereby tenders payment of $___________ by
certified check or official bank cashier's check or money order payable in
Canadian currency to the order of DUSA Pharmaceuticals, Inc.
Dated: X
--------------------------------------
(Signature)
-------------------------------------
Name (Please Print)
-------------------------------------
(Address)
-------------------------------------
Taxpayer Identification Number
<PAGE> 8
Exhibit 4.15(b)
NONQUALIFIED STOCK OPTION AGREEMENT
AGREEMENT made and entered into as of the 13TH day of MARCH, 1997, by
and between DUSA Pharmaceuticals, Inc., a corporation incorporated under the
laws of the State of New Jersey (the "Company"), and SCOTT LUNDAHL, who resides
at 4 Morris Street, Lexington, Massachusetts 02173 (the "Grantee").
WHEREAS, the Company granted on March 13, 1997 (the "Grant Date") to
Lumenetics, Inc., a corporation incorporated under the laws of the State of
Delaware, ("Lumenetics") stock options for 100,000 shares of the Company's
common stock (the "Options"); and
WHEREAS, Lumenetics has determined to assign its interest in the Options
to Ronald L. Carroll and Scott Lundahl, the principal shareholders of
Lumenetics; and
WHEREAS, the Company has determined that its interests will be advanced
by acknowledging the assignment by Lumenetics of the Options.
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, the parties hereby agree as follows:
SECTION 1
GRANT
1.1 The Company hereby acknowledges the assignment to the Grantee of
the right and option (the "Option") to purchase, in accordance
with the vesting rights outlined in Sections 3.1 and 3.6 hereof,
up to 50,000 shares of authorized but unissued Common Stock,
without par value ("Common Stock"), of the Company on the terms
and conditions herein set forth in this Agreement.
SECTION 2
PRICE
2.1 The purchase price of the shares of Common Stock subject to this
Option shall be the fair market value of the shares of Common
Stock on the Grant Date ($6.125 per share)(the "Exercise Price").
SECTION 3
WHEN EXERCISABLE
3.1 The aggregate number of shares of Common Stock of the Company
optioned by this Agreement (the "Optioned Shares") shall vest in
the Grantee as follows:
(a) 25% of the Option on the day of the grant, being March 13,
1997;
<PAGE> 9
(b) 25% of the Option on the second anniversary of the day of
grant, being March 13, 1999;
(c) 25% of the Option on the third anniversary of the day of
the grant, being March 13, 2000;
(d) 25% of the Option on the fourth anniversary of the day of
the grant, being March 13, 2001; and
and, except as provided by Sections 3.6 and 6.3 hereof, the Grantee
shall only be entitled to exercise this Option, in whole or in part, in
the amounts set out above and from and after the dates so specified.
3.2 Subject to Sections 3.1 and 3.6 hereof, the Grantee shall have
the right, at any time prior to 5:00 p.m. (Eastern Standard Time)
on the date prior to the tenth anniversary date of the grant,
being March 12, 2007, provided that if such day is not a day on
which the Company is open for business then on the first
following day on which the Company is open for business, to
exercise this Option for any number of the Optioned Shares up to
the maximum number of shares specified in Section 1.1 above.
3.3 No less than one thousand (1,000) shares may be purchased upon
any one exercise of the Option granted hereby unless the number
of shares purchased at such time is the total number of shares in
respect of which the Option hereby granted is then exercisable.
3.4 In no event shall any Option granted hereby be exercisable for a
fractional share.
3.5 From time to time, in its discretion, the Company's Stock Option
Committee (the "Committee") may offer the Grantee the right to
cancel any Option granted hereunder in exchange for such
consideration as the Committee shall determine.
3.6 Notwithstanding anything contained in Sections 1 and 3.1 hereof,
the Option shall continue to vest in the Grantee as provided by
the terms of Paragraph 3(d)(ii) of the Consulting and Development
Agreement, dated October 14, 1997 (the "Consulting Agreement")
between the Company and Lumenetics, which Consulting Agreement
was subsequently partially terminated pursuant to a certain
Partial Termination Agreement dated as of the February 25, 1999.
The Board of Directors shall be entitled to determine if and when
service to the Company has ceased with respect to the Grantee.
SECTION 4
HOW EXERCISABLE
4.1 Subject to such administrative regulations as the Committee may
from time to time adopt, the Grantee or beneficiary shall, in
order to exercise this Option give to the Company at its
principal office notice in writing in the form of Schedule A
hereto setting out the number of Optioned Shares with respect to
2
<PAGE> 10
which the Option is being exercised. The notice must be
accompanied by payment of a certified check, official bank
cashier's check or money order in an amount equal to the Exercise
Price multiplied by the number of shares requested and a duly
executed copy of this Agreement. At the discretion of the
Committee, the Grantee may pay all or a portion of the purchase
price by tender of Common Stock or a combination of stock and
cash or other means determined by the Committee.
4.2 Any notice under this Section shall include an undertaking to
furnish or execute such documents as the Committee in its
discretion shall deem necessary (i) to evidence such exercise, in
whole or in part, of the Option evidenced by this Agreement, (ii)
to determine whether registration is then required under the
Securities Act of 1933, or any other law, as then in effect, and
(iii) to comply with or satisfy the requirements of the
Securities Act of 1933, or any other law, as then in effect.
4.3 The Grantee agrees that all shares purchased by it under the
Option will be acquired for investment, not distribution, and
that any notice of exercise of the Option must be accompanied by
a written representation to that effect, signed by the Grantee.
SECTION 5
TERMINATION OF OPTION
5.1 The Option granted hereby shall terminate and be of no force or
effect upon the expiration of ten years from the date of the
Grant unless terminated prior to such time as provided below.
5.2 Any determination made by the Committee with respect to any
matter referred to in this Section 5 shall be final and
conclusive on all persons affected thereby. Service to the
Company shall be deemed to include service to any subsidiary of
the Company by the Grantee.
SECTION 6
ADJUSTMENTS TO OPTION
6.1 Subject to any required action by the Committee and shareholders,
the number of shares provided for in the Option, and the price
per share thereof shall be proportionately adjusted for any
increase or decrease in the number of issued shares of the
Company resulting from the payment of a share dividend, a share
split or any transaction which is a "corporate transaction" (as
defined in the Treasury regulations promulgated under Section 424
of the Code.
6.2 Subject to any required action by the Committee and shareholders,
if the Company shall be the surviving entity in any merger or
consolidation, or after a consolidation of the Company and one or
more entities in which the resulting entity is an independent
entity, the Option shall pertain to and apply to the
3
<PAGE> 11
securities of the surviving entity in an amount that the board of
directors of the surviving entity, at its sole discretion,
determines to be equivalent, as nearly as practicable, to the
nearest whole number and class of shares that were subject to the
Option. These shares of stock or other securities shall, after
such merger or consolidation, be deemed to be shares for all
purposes hereof. The aforesaid adjustments, when applicable,
shall be made by the Committee, and the Committee's determination
shall be final, binding and conclusive.
6.3 In the event of a Change of Control (as defined below), any and
all outstanding Options not fully vested shall automatically vest
in full and shall be immediately exercisable. The date on which
such accelerated vesting and immediate exercisability shall occur
shall be the date of the occurrence of the Change of Control.
A "Change of Control" shall be deemed to have taken place upon
(i) the acquisition by a third person, including a "group" as
defined in Section 13(d)(3) of the Securities Exchange Act of
1934, as amended, of shares of the Company having 50% or more of
the total number of votes that may be cast for the election of
Directors of the Company; (ii) shareholder approval of a
transaction for the acquisition of the Company, or substantially
all of its assets by another entity or for a merger,
reorganization, consolidation or other business combination to
which the Company is a part; or (iii) the election during any
period of 24 months or less of 50% or more of the Directors of
the Company where such Directors were not in office immediately
prior to such period provided, however, that no "Change of
Control" shall be deemed to have taken place if the Directors of
the Company in office on the date of adoption of the Plan, or
their successors in office nominated by such Directors,
affirmatively approve a resolution to such effect.
Except as provided with respect to a Grantee in its stock option
agreement or other controlling agreement between it and the
Company, to the extent that the acceleration, exercisability or
parachute payment attributable to the Option following a Change
of Control would result in "excess parachute payments"(1) when
the former are aggregated with other payments or benefits to the
Grantee, such parachute payments or benefits provided to a
Grantee under this Agreement shall be reduced to the extent
necessary so that no portion thereof shall be subject to the
excise tax imposed by Section 4999 of the Code. This reduction
will only be made if it will cause the Grantee's net after-tax
benefit to exceed the net after-tax benefit that would have
existed if such reduction were not made. "Net after-tax benefit"
shall be the sum of (i) all payments and benefits which a Grantee
receives or is entitled to receive that would constitute a
"parachute payment" under Section 280G of the Code, less (ii) the
amount of federal income taxes payable with respect to the
payments and benefits described in (i) above,
- -------------------
(1) "Excess parachute payments" are defined in Section 280G of the Code
and are determined by tax counsel of the Company.
4
<PAGE> 12
calculated at the maximum marginal income tax rate(2) for the
year in which such payments and benefits shall be paid to the
Grantee, less (iii) the amount of excise taxes imposed with
respect to the payments and benefits described in (i) above by
Section 4999 of the Code.
6.4 In the event of a change in the Company's shares which is limited
to a change of all of its authorized shares with par value into
the same number of shares with a different par value or without
par value, the shares resulting from any such change shall be
deemed to be shares within the meaning of this Agreement.
6.5 Except as herein before expressly provided in Paragraphs 6.1,
6.2, 6.3 and 6.4 of this Section 6, the Grantee shall have no
rights by reason of any subdivision or consolidation of shares of
any class or payment of any share dividend or any other increase
or decrease in the number of shares of any class or by reason of
any dissolution, liquidation, merger, consolidation or spin-off
of assets or stock of another corporation and any issuance by the
Company of shares of any class, or securities convertible into
shares of any class, shall not affect the Option, and no
adjustment by reason thereof shall be made with respect to the
number or price of the Company's shares subject to the Option.
The grant of the 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
or to merge, consolidate, dissolve, liquidate, sell or transfer
all or any part of its business or assets.
SECTION 7
TRANSFER
7.1 This Option shall not be transferable by the Grantee in any way.
During the existence of the Grantee, the Option shall be
exercisable only by it. Any other attempted assignment, transfer,
pledge, hypothecation or other disposition of the Option shall be
void and have no effect unless in accordance with the terms set
forth herein.
SECTION 8
WITHHOLDING TAXES
8.1 The Company shall have the right to retain and withhold from any
payment, under the Option granted, any amount that is to be
withheld or otherwise deducted and paid with respect to such
payment. At its discretion, the Company may require the Grantee,
if it receives shares under a nonqualified stock option grant, to
reimburse the Company for any taxes that are required to be
withheld by the Company, and may withhold any distribution in
whole or in part until the Company is so reimbursed. In lieu
thereof, the Company shall have the right to
- ----------------------
(2) "This rate is based on the rate for the year set forth in the Code
at the time of the first payment to the participant.
5
<PAGE> 13
withhold from any other cash amounts due (or to become due) to
the Grantee an amount equal to such taxes required to be withheld
by the Company to reimburse the Company for any such taxes, or
the Company may retain and withhold a number of shares of Common
Stock having a market value not less than the amount of such
taxes and cancel (in whole or in part) any shares of Common Stock
so withheld in order to reimburse the Company for any such taxes.
SECTION 9
IMPACT ON OTHER BENEFITS
9.1 The value of the Option (either on the date of grant of the
Option or at the time the shares are vested) shall not be
includable as compensation or earnings for purposes of any other
benefit plan offered by the Company.
SECTION 10
ADMINISTRATION
10.1 The Committee shall have full authority and discretion to decide
all matters relating to the administration and interpretation of
this Agreement. All such Committee determinations shall be final,
conclusive and binding upon the Company, the Grantee and any and
all interested parties.
SECTION 11
AGREEMENT TO CONTINUE IN EMPLOYMENT
OR SERVICE AS A CONSULTANT
11.1 Nothing in this Agreement shall confer on a Grantee any right to
continue in the employ of the Company or in the service of the
Company as a consultant or interfere in any way with the right of
the Company to terminate such consulting relationship at any
time.
SECTION 12
AMENDMENT(S)
12.1 This Agreement may not in any way be amended or terminated
without the Grantee's written consent.
SECTION 13
FORCE AND EFFECT
13.1 The various provisions of this Agreement are severable in their
entirety. Any determination of invalidity or unenforceability of
any one provision shall have no effect on the continuing force
and effect of the remaining provisions.
6
<PAGE> 14
SECTION 14
NOTICE OF DISPOSITION OF SHARES
14.1 The Grantee agrees that if it should dispose of any shares of
Common Stock acquired on the exercise of the Option, including a
disposition by sale, exchange, gift or transfer of legal title
within twelve (12) months of the date such shares are transferred
to the Grantee, the Grantee will notify the Company promptly of
such disposition.
SECTION 15
NOTICES
15.1 All notices which may be or are required to be given by one party
to the other party pursuant to this Agreement shall be in writing
and shall be mailed by first class or certified mail, return
receipt requested, postage prepaid, or transmitted by hand
delivery as follows:
If to the Company: DUSA Pharmaceuticals, Inc.
181 University Avenue
Suite 1208
Toronto, ON M5H 3M7
CANADA
Attention: Dr. D. Geoffrey Shulman
If to the Grantee: Scott Lundahl
4 Morris Street
Lexington, Massachusetts 02173
or such other address as to which either party may from time to
time notify the other as aforesaid.
SECTION 16
RESTRICTIONS ON TRANSFER
16.1 The Grantee understands and acknowledges that it is subject to
certain restrictions on transfer under the Securities Act of 1933
of the United States, as amended, (the "1933 Act") of the shares
issued pursuant to the exercise of the Option; such restrictions
provide that the shares may not be sold without registration or
exemption from registration under the 1933 Act.
SECTION 17
REPORTING REQUIREMENTS
17.1 The Grantee understands and acknowledges that it may be subject
to certain reporting requirements upon its receipt and exercise
of the Option, and in
7
<PAGE> 15
connection therewith, upon the receipt and exercise of the
Option, the Grantee agrees to timely file with the Securities and
Exchange Commission, the National Association of Securities
Dealers, Inc., and any appropriate Canadian securities regulatory
authorities, the appropriate documentation regarding his
ownership of the Company's securities.
SECTION 18
GOVERNING LAW
18.1 This Agreement shall be construed and enforced in accordance with
and governed by the laws of the State of New Jersey.
IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto.
Attest: DUSA PHARMACEUTICALS, INC.,
a New Jersey corporation
s/Nanette W. Mantell By: s/D. Geoffrey Shulman
- ----------------------------------- -------------------------------
Nanette W. Mantell, Secretary Dr. D. Geoffrey Shulman, President
PARTICIPANT
s/ Scott Lundahl
-----------------------------------
Scott Lundahl
8
<PAGE> 16
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of DUSA Pharmaceuticals, Inc.
Pursuant to the terms and subject to the conditions set forth in the
Nonqualified Stock Option Agreement (the "Agreement") dated , between DUSA
Pharmaceuticals, Inc. and the undersigned, and the Option granted to the
undersigned by such Agreement, I hereby elect to purchase shares of Common
Stock of DUSA Pharmaceuticals, Inc. which were the subject of such Option. I
understand that such purchase is subject to all the terms and conditions of the
Agreement. I request that the certificates for such shares of Common Stock shall
be issued in the name of:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(please print or type name and address)
The undersigned hereby represents and warrants to, and agrees with the
Company as follows:
(a) The shares are being purchased for the undersigned's own account,
for investment purposes only, and not for the account of any other person, and
not with a view to distribution, assignment, or resale to others, or to
fractionalization in whole or in part and that the offering and sale of the
shares is intended to be exempt from registration under the Securities Act of
1933 (the "Act"). In furtherance thereof, the undersigned represents, warrants
and agrees as follows: (i) no other person has or will have a direct or indirect
beneficial interest in such shares and the undersigned will not sell,
hypothecate, or otherwise transfer his shares except in accordance with the Act
and applicable state securities laws or unless in the opinion of counsel for the
Company, an exemption from the registration requirements of the Act and such
laws is available; and (ii) the Company is under no obligation to register the
shares on behalf of the undersigned or to assist the undersigned in complying
with any exemption from registration.
<PAGE> 17
(b) The undersigned has such knowledge and experience in financial and
business matters that the undersigned is capable of evaluating the merits and
risks of investment in the Company and of making an informed investment
decision.
In full payment of the purchase price with respect to the Option
exercised, the undersigned hereby tenders payment of $___________ by certified
check or official bank cashier's check or money order payable in Canadian or
United States currency to the order of DUSA Pharmaceuticals, Inc.
Dated: X
-----------------------------------------
(Signature)
-------------------------------------
Name (Please Print)
-------------------------------------
(Address)
-------------------------------------
Taxpayer Identification Number
<PAGE> 1
Exhibit 4.16
NONQUALIFIED STOCK OPTION AGREEMENT
DUSA PHARMACEUTICALS, INC.
AGREEMENT made and entered into as of the 13TH day of MARCH, 1997, by and
between DUSA Pharmaceuticals, Inc., a corporation incorporated under the laws of
the State of New Jersey (the "Company"), and DANIEL PIACQUADIO, with an address
c/o Therapeutics, Inc., 4180 La Jolla Village Drive, Suite 210, La Jolla,
California 92037 (the "Grantee").
WHEREAS, the Company granted on March 13, 1997 (the "Grant Date") to
THERAPEUTICS, INC., a corporation with offices in the State of California,
("Therapeutics") stock options for 15,000 shares of the Company's common stock
(the "Options"); and
WHEREAS, Therapeutics has determined to assign its interest in the Options
to the Grantee, its principal shareholder, and the individual providing services
to the Company; and
WHEREAS, the Company has determined that its interests will be advanced by
acknowledging the assignment by Therapeutics of the Options.
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, the parties hereby agree as follows:
SECTION 1
GRANT
1.1 The Company hereby acknowledges the assignment to the Grantee of the
right and option (the "Option") to purchase, in accordance with the
vesting rights outlined in Sections 3.1 and 3.6 hereof, up to 15,000
shares of authorized but unissued Common Stock, without par value
("Common Stock"), of the Company on the terms and conditions herein
set forth in this Agreement.
SECTION 2
PRICE
2.1 The purchase price of the shares of Common Stock subject to this
Option shall be the fair market value of the shares of Common Stock on
the Grant Date ($6.125 per share)(the "Exercise Price").
SECTION 3
WHEN EXERCISABLE
3.1 The aggregate number of shares of Common Stock of the Company optioned
by this Agreement (the "Optioned Shares") shall vest in the Grantee as
follows:
<PAGE> 2
(a) 20% of the Option shall vest as of June 14, 1997;
(b) 20% of the Option on June 14, 1998;
(c) 20% of the Option on June 14, 1999;
(d) 20% of the Option on June 14, 2000; and
(e) 20% of the Option on June 14, 2001;
and, except as provided by Sections 3.6 and 6.3 hereof, the Grantee shall only
be entitled to exercise this Option, in whole or in part, in the amounts set out
above and from and after the dates so specified.
3.2 Subject to Sections 3.1 and 3.6 hereof, the Grantee shall have the
right, at any time prior to 5:00 p.m. (Eastern Standard Time) on March
13, 2007, provided that if such day is not a day on which the Company
is open for business then on the first following day on which the
Company is open for business, to exercise this Option for any number
of the Optioned Shares up to the maximum number of shares specified in
Section 1.1 above.
3.3 No less than one thousand (1,000) shares may be purchased upon any one
exercise of the Option granted hereby unless the number of shares
purchased at such time is the total number of shares in respect of
which the Option hereby granted is then exercisable.
3.4 In no event shall any Option granted hereby be exercisable for a
fractional share.
3.5 From time to time, in its discretion, the Company's Stock Option
Committee (the "Committee") may offer the Grantee the right to cancel
any Option granted hereunder in exchange for such consideration as the
Committee shall determine.
3.6 Notwithstanding anything contained in Sections 1 and 3.1 hereof, the
Option shall continue to vest in the Grantee only so long as the
Grantee shall continue to provide services to the Company. Should the
Grantee cease to serve the Company, the Option shall not further vest
or become exercisable, and the provisions of Section 5.2 shall apply
with respect to the exercise of the Option which has already vested in
the Grantee and has not yet been exercised. The Board of Directors
shall be entitled to determine if and when service to the Company has
ceased with respect to the Grantee.
SECTION 4
HOW EXERCISABLE
4.1 Subject to such administrative regulations as the Committee may from
time to time adopt, the Grantee or beneficiary shall, in order to
exercise this Option give to the Company at its principal office
notice in writing in the form of Schedule A hereto setting out the
number of Optioned Shares with respect to which the Option is being
2
<PAGE> 3
exercised. The notice must be accompanied by payment of a certified
check, official bank cashier's check or money order in an amount equal
to the Exercise Price multiplied by the number of shares requested and
a duly executed copy of this Agreement. At the discretion of the
Committee, the Grantee may pay all or a portion of the purchase price
by tender of Common Stock or a combination of stock and cash or other
means determined by the Committee.
4.2 Any notice under this Section shall include an undertaking to furnish
or execute such documents as the Committee in its discretion shall
deem necessary (i) to evidence such exercise, in whole or in part, of
the Option evidenced by this Agreement, (ii) to determine whether
registration is then required under the Securities Act of 1933, or any
other law, as then in effect, and (iii) to comply with or satisfy the
requirements of the Securities Act of 1933, or any other law, as then
in effect.
4.3 The Grantee agrees that all shares purchased by it under the Option
will be acquired for investment, not distribution, and that any notice
of exercise of the Option must be accompanied by a written
representation to that effect, signed by the Grantee.
SECTION 5
TERMINATION OF OPTION
5.1 The Option granted hereby shall terminate and be of no force or effect
upon the expiration of ten years from the date of the Grant (i.e.,
March 13, 2007) unless terminated prior to such time as provided
below.
5.2 Subject to Section 3.6 hereof, should the Grantee cease to serve the
Company, the Grantee's Option shall be exercised as follows:
(a) If the Grantee's termination of service is other than for Cause,
the Option may be exercised, to the extent exercisable, for a period
of three months after the date of such termination of service;
(b) If the Grantee's termination of service is by reason of
retirement or disability, the Option may be exercised, to the extent
exercisable, for a period of 12 months after the date of such
termination of service;
(c) In the event of death of Grantee within three months after
termination of service pursuant to (a) or (b) above, the person or
persons to whom the Grantee's rights are transferred if at all, by
will or the laws of descent and distribution shall have a period of
three years from the date of termination of the Grantee's service to
exercise the Option which could have been exercised during such
period; and
(d) In the event of death of Grantee while Grantee is providing
services to the Company under the Consulting Agreement, the Option
shall become fully and immediately exercisable and may be exercised by
the person or persons to whom the Grantee's rights are transferred if
at all, by will or the laws of descent and distribution for a period
of three years after the Grantee's death, subject to exercise during
the remaining term of the Option;
3
<PAGE> 4
5.3 Any determination made by the Committee with respect to any matter
referred to in this Section 5 shall be final and conclusive on all
persons affected thereby. Service to the Company shall be deemed to
include service to any subsidiary of the Company by the Grantee.
SECTION 6
ADJUSTMENTS TO OPTION
6.1 Subject to any required action by the Committee and shareholders, the
number of shares provided for in the Option, and the price per share
thereof shall be proportionately adjusted for any increase or decrease
in the number of issued shares of the Company resulting from the
payment of a share dividend, a share split or any transaction which is
a "corporate transaction" (as defined in the Treasury regulations
promulgated under Section 424 of the Code.
6.2 Subject to any required action by the Committee and shareholders, if
the Company shall be the surviving entity in any merger or
consolidation, or after a consolidation of the Company and one or more
entities in which the resulting entity is an independent entity, the
Option shall pertain to and apply to the securities of the surviving
entity in an amount that the board of directors of the surviving
entity, at its sole discretion, determines to be equivalent, as nearly
as practicable, to the nearest whole number and class of shares that
were subject to the Option. These shares of stock or other securities
shall, after such merger or consolidation, be deemed to be shares for
all purposes of this Agreement. The aforesaid adjustments, when
applicable, shall be made by the Committee, and the Committee's
determination shall be final, binding and conclusive.
6.3 In the event of a Change of Control (as defined below), any and all
outstanding Options not fully vested shall automatically vest in full
and shall be immediately exercisable. The date on which such
accelerated vesting and immediate exercisability shall occur shall be
the date of the occurrence of the Change of Control.
A "Change of Control" shall be deemed to have taken place upon (i) the
acquisition by a third person, including a "group" as defined in
Section 13(d)(3) of the Securities Exchange Act of 1934, as amended,
of shares of the Company having 50% or more of the total number of
votes that may be cast for the election of Directors of the Company;
(ii) shareholder approval of a transaction for the acquisition of the
Company, or substantially all of its assets by another entity or for a
merger, reorganization, consolidation or other business combination to
which the Company is a part; or (iii) the election during any period
of 24 months or less of 50% or more of the Directors of the Company
where such Directors were not in office immediately prior to such
period provided, however, that no "Change of Control" shall be deemed
to have taken place if the Directors of the Company in office on the
date of adoption of the Plan, or their successors in office nominated
by such Directors, affirmatively approve a resolution to such effect.
4
<PAGE> 5
Except as provided with respect to a Grantee in its stock option
agreement or other controlling agreement between it and the Company,
to the extent that the acceleration, exercisability or parachute
payment attributable to the Option following a Change of Control would
result in "excess parachute payments"1 when the former are aggregated
with other payments or benefits to the Grantee, such parachute
payments or benefits provided to a Grantee under this Agreement shall
be reduced to the extent necessary so that no portion thereof shall be
subject to the excise tax imposed by Section 4999 of the Code. This
reduction will only be made if it will cause the Grantee's net
after-tax benefit to exceed the net after-tax benefit that would have
existed if such reduction were not made. "Net after-tax benefit" shall
be the sum of (i) all payments and benefits which a Grantee receives
or is entitled to receive that would constitute a "parachute payment"
under Section 280G of the Code, less (ii) the amount of federal income
taxes payable with respect to the payments and benefits described in
(i) above, calculated at the maximum marginal income tax rate2 for the
year in which such payments and benefits shall be paid to the Grantee,
less (iii) the amount of excise taxes imposed with respect to the
payments and benefits described in (i) above by Section 4999 of the
Code.
6.4 In the event of a change in the Company's shares which is limited to a
change of all of its authorized shares with par value into the same
number of shares with a different par value or without par value, the
shares resulting from any such change shall be deemed to be shares
within the meaning of this Agreement.
6.5 Except as herein before expressly provided in Paragraphs 6.1, 6.2, 6.3
and 6.4 of this Section 6, the Grantee shall have no rights by reason
of any subdivision or consolidation of shares of any class or payment
of any share dividend or any other increase or decrease in the number
of shares of any class or by reason of any dissolution, liquidation,
merger, consolidation or spin-off of assets or stock of another
corporation and any issuance by the Company of shares of any class, or
securities convertible into shares of any class, shall not affect the
Option, and no adjustment by reason thereof shall be made with respect
to the number or price of the Company's shares subject to the Option.
The grant of the 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 or to merge,
consolidate, dissolve, liquidate, sell or transfer all or any part of
its business or assets.
SECTION 7
TRANSFER
7.1 This Option shall not be transferable by the Grantee in any way other
than by will and the laws of descent and distribution. During the
lifetime of the Grantee, the
- -------------
(1)"Excess parachute payments" are defined in Section 280G of the Code and
are determined by tax counsel of the Company.
(2) This rate is based on the rate for the year set forth in the Code at
the time of the first payment to the participant.
5
<PAGE> 6
Option shall be exercisable only by him. Any other attempted
assignment, transfer, pledge, hypothecation or other disposition of
the Option shall be void and have no effect unless in accordance with
the terms set forth herein.
SECTION 8
WITHHOLDING TAXES
8.1 The Company shall have the right to retain and withhold from any
payment, under the Option granted, any amount that is to be withheld
or otherwise deducted and paid with respect to such payment. At its
discretion, the Company may require the Grantee, if he receives shares
under a nonqualified stock option grant, to reimburse the Company for
any taxes that are required to be withheld by the Company, and may
withhold any distribution in whole or in part until the Company is so
reimbursed. In lieu thereof, the Company shall have the right to
withhold from any other cash amounts due (or to become due) to the
Grantee an amount equal to such taxes required to be withheld by the
Company to reimburse the Company for any such taxes, or the Company
may retain and withhold a number of shares of Common Stock having a
market value not less than the amount of such taxes and cancel (in
whole or in part) any shares of Common Stock so withheld in order to
reimburse the Company for any such taxes.
SECTION 9
IMPACT ON OTHER BENEFITS
9.1 The value of the Option (either on the date of grant of the Option or
at the time the shares are vested) shall not be includable as
compensation or earnings for purposes of any other benefit plan
offered by the Company.
SECTION 10
ADMINISTRATION
10.1 The Committee shall have full authority and discretion to decide all
matters relating to the administration and interpretation of this
Agreement. All such Committee determinations shall be final,
conclusive and binding upon the Company, the Grantee and any and all
interested parties.
SECTION 11
AGREEMENT TO CONTINUE IN EMPLOYMENT
OR SERVICE AS A CONSULTANT
11.1 Nothing in this Agreement shall confer on a Grantee any right to
continue in the employ of the Company or in the service of the Company
as a consultant or interfere in any way with the right of the Company
to terminate such consulting relationship at any time.
6
<PAGE> 7
SECTION 12
AMENDMENT(S)
12.1 This Agreement may not in any way be amended or terminated without the
Grantee's written consent.
SECTION 13
FORCE AND EFFECT
13.1 The various provisions of this Agreement are severable in their
entirety. Any determination of invalidity or unenforceability of any
one provision shall have no effect on the continuing force and effect
of the remaining provisions.
SECTION 14
NOTICE OF DISPOSITION OF SHARES
14.1 The Grantee agrees that if he should dispose of any shares of Common
Stock acquired on the exercise of the Option, including a disposition
by sale, exchange, gift or transfer of legal title within twelve (12)
months of the date such shares are transferred to the Grantee, the
Grantee will notify the Company promptly of such disposition.
SECTION 15
NOTICES
15.1 All notices which may be or are required to be given by one party to
the other party pursuant to this Agreement shall be in writing and
shall be mailed by first class or certified mail, return receipt
requested, postage prepaid, or transmitted by hand delivery as
follows:
If to the Company: DUSA Pharmaceuticals, Inc.
181 University Avenue
Suite 1208
Toronto, ON M5H 3M7
CANADA
Attention: Dr. D. Geoffrey Shulman
If to the Grantee: Daniel Piacquadio
c/o Therapeutics, Inc.
4180 La Jolla Village Drive, Suite 210
La Jolla, California 92037
or such other address as to which either party may from time to time
notify the other as aforesaid.
7
<PAGE> 8
SECTION 16
RESTRICTIONS ON TRANSFER
16.1 The Grantee understands and acknowledges that he is subject to certain
restrictions on transfer under the Securities Act of 1933 of the
United States, as amended, (the "1933 Act") of the shares issued
pursuant to the exercise of the Option; such restrictions provide that
the shares may not be sold without registration or exemption from
registration under the 1933 Act.
SECTION 17
GOVERNING LAW
17.1 This Agreement shall be construed and enforced in accordance with and
governed by the laws of the State of New Jersey.
IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto.
Attest: DUSA PHARMACEUTICALS, INC.,
a New Jersey corporation
s/ Nanette W. Mantell By: s/D. Geoffrey Shulman
- ------------------------------ --------------------------
Nanette W. Mantell, Secretary Dr. D. Geoffrey Shulman, President
GRANTEE
s/Daniel Piacquadio
------------------------------
Daniel Piacquadio
8
<PAGE> 9
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of DUSA Pharmaceuticals, Inc.
Pursuant to the terms and subject to the conditions set forth in the
Nonqualified Stock Option Agreement (the "Agreement") dated MARCH 13, 1997
between DUSA Pharmaceuticals, Inc. and the undersigned, and the Option granted
to the undersigned by such Agreement, I hereby elect to purchase _______________
shares of Common Stock of DUSA Pharmaceuticals, Inc. which were the subject of
such Option. I understand that such purchase is subject to all the terms and
conditions of the Agreement. I request that the certificates for such shares of
Common Stock shall be issued in the name of:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(please print or type name and address)
The undersigned hereby represents and warrants to, and agrees with the
Company as follows:
(a) The shares are being purchased for the undersigned's own account, for
investment purposes only, and not for the account of any other person, and not
with a view to distribution, assignment, or resale to others, or to
fractionalization in whole or in part and that the offering and sale of the
shares is intended to be exempt from registration under the Securities Act of
1933 (the "Act"). In furtherance thereof, the undersigned represents, warrants
and agrees as follows: (i) no other person has or will have a direct or indirect
beneficial interest in such shares and the undersigned will not sell,
hypothecate, or otherwise transfer his shares except in accordance with the Act
and applicable state securities laws or unless in the opinion of counsel for the
Company, an exemption from the registration requirements of the Act and such
laws is available; and (ii) the Company is under no obligation to register the
shares on behalf of the undersigned or to assist the undersigned in complying
with any exemption from registration.
<PAGE> 10
(b) The undersigned has such knowledge and experience in financial and
business matters that the undersigned is capable of evaluating the merits and
risks of investment in the Company and of making an informed investment
decision.
In full payment of the purchase price with respect to the Option exercised,
the undersigned hereby tenders payment of $___________ by certified check or
official bank cashier's check or money order payable in United States currency
to the order of DUSA Pharmaceuticals, Inc.
Dated: X
------------------------------------------
(Signature)
---------------------------------------
Name (Please Print)
---------------------------------------
(Address)
---------------------------------------
Taxpayer Identification Number
<PAGE> 1
Exhibit 4.17
STOCK OPTION AGREEMENT
THIS AGREEMENT is made as of the 14 day of April, 1994 between DUSA
PHARMACEUTICALS, INC., a corporation incorporated under the laws of the State of
New Jersey (hereinafter referred to as the "Company") and ALLYN L. GOLUB, PHD,
c/o Guidelines, Inc., 18441 NW 2nd Avenue, Miami, Florida, (hereinafter referred
to as the "Participants").
WITNESSETH:
WHEREAS, the Board of Directors of the Company has determined that in
consideration for services rendered on the Company's behalf and in order to
provide an inducement to the Participant to acquire a proprietary interest in
the Company, it is in the Company's best interest to grant an option to him to
purchase shares of the Company's common stock ("Shares") on the terms and
conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
expressed herein, it is agreed by and between the parties as follows:
1.1 DEFINITIONS
In this Agreement:
"Board of Directors" means the board of directors of the Company;
"Exercise Price" means U.S. $3.625;
"Expiration Date" means 5:00 p.m. (Eastern Standard Time) on the later of
the dates provided in Section 2.2;
"Optioned Shares" means that number of Shares which are subject to the
option granted by the Company to the Participants pursuant to this
Agreement;
"Services" means consulting or other services provided by the Participants
to the Company pursuant to the Consulting Agreement between the
Participants and the Company; and
"Shares" means shares of common stock, without par value, of the Company.
<PAGE> 2
2.1 GRANT OF OPTION
The Company hereby grants to the Participant an option to purchase, in
accordance with the vesting rights outlined in Sections 2.6 and 2.7 hereof,
up to 10,000 Shares, for an amount per Share equal to the Exercise Price,
upon the terms and subject to the conditions herein contained.
2.2 Subject to Sections 2.6, 2.7 and 3.1 hereof, the Participant shall have the
right, at any time prior to 5:00 p.m. (Eastern Standard Time) on the fifth
anniversary date hereof, being April 14, 1999 (provided that if such day is
not a day on which the Company is open for business then on the first
following day on which the Company is open for business) to exercise this
option for any number of the Optioned Shares up to the maximum number of
Shares specified in Section 2.1 above.
2.3 The option may be exercised by the Participant or by his executors or
personal representatives in the circumstances described in Section 4.1 by
providing to the Company notice in writing in the form of Schedule A hereto
setting out the number of Optioned Shares with respect to which the option
is being exercised. The notice must be accompanied by a certified check,
official bank cashier's check or money order in an amount equal to the
Exercise Price multiplied by the number of Shares requested and a duly
executed copy of this Agreement.
2.4 The Company shall cause its registrar and transfer agent to deliver to the
Participant as soon as practicable after receipt of such notice and payment
a certificate or certificates registered in the name of the Participant or
as the Participant may direct for the number of Shares with respect to
which the option is duly exercised.
2.5 Nothing contained in this Agreement or action taken pursuant hereto shall
obligate the Participant to purchase and/or pay for, or the Company to
issue, any Shares except those Optioned Shares with respect to which the
Participant shall have duly exercised the option to purchase in accordance
with this Agreement.
2.6 Subject to Section 2.7 hereof, the option granted hereunder shall vest in
the following manner:
(a) one-quarter of the option on the first anniversary of the day
immediately preceding the date hereof, being April 13, 1995;
(b) one-quarter of the option on the second anniversary of the day
immediately preceding the date hereof, being April 13, 1996;
(c) one-quarter of the option on the third anniversary of the day
immediately preceding the date hereof, being April 13, 1997; and
(d) one-quarter of the option on the fourth anniversary of the day
immediately preceding the date hereof, being April 13, 1998;
2
<PAGE> 3
and, except as provided by Section 6.1, the Participant shall only be
entitled to exercise this option in the amounts set out above and from and
after the dates so specified.
2.7 Notwithstanding anything contained in Section 2.6 hereof, the option shall
continue to vest only so long as the Participant continues to provide
Services to the Company. Should the Participant ceases to provide such
Services ("Termination"), no further vesting of the option shall occur
unless the Board of Directors determines otherwise and the provisions of
Section 3.1 shall apply with respect to the exercise of the option to the
extent that it has vested and has not yet been exercised.
3.1 EXPIRATION ON TERMINATION
Subject to Section 4.1 hereof, upon Termination, such part of the option as
is then vested but unexercised may be exercised by the Participant for a
period of ninety (90) days after Termination or such later date as the
Board of Directors may approve after which time this option shall expire;
provided, however, that in no event may this option be exercised after the
Expiration Date.
4.1 DEATH OR PERMANENT DISABILITY
In the event that on or prior to the Expiration Date, the Participant dies
or becomes totally and permanently disabled while providing Services to the
Company, this option, to the extent then vested but unexercised, may be
exercised by the Participant for a period up to six (6) months after the
death or disability of the Participant; provided, however, that in no event
may this option be exercised after the Expiration Date. Disability shall be
defined as in Section 22(e)(3) of the Internal Revenue Code of 1986, as
amended. For the purposes of this provision only, reference to the
Participant in this Agreement shall be construed as including the executors
or personal representatives of a deceased Participant. In the event that
this option is not exercised within the period of six (6) months set out
above, this option shall expire.
5.1 SUBDIVISION, CONSOLIDATION OR REORGANIZATION
(a) In the event of any subdivision, redivision or change of the Shares of
the Company into a greater number of Shares at any time after the date of
this Agreement and prior to the Expiration Date of this option, the Company
shall deliver at the time of exercise of this option, but for the same
aggregate consideration payable therefor, such additional number of Shares
as the Participant would have been entitled to receive as a result of such
subdivision, redivision or change if on the record date thereof the
Participant had been the registered holder of the number of such Shares
with respect to which the option is later exercised.
(b) In the event of any consolidation or change of the Shares of the
Company into a lesser number of Shares at any time after the date of this
Agreement and prior to the expiration of this option, the Company shall
deliver at the time of exercise of this option, but for the same aggregate
consideration payable therefor, such reduced number of Shares, as the
Participant would have been entitled to receive upon such consolidation or
change if on
3
<PAGE> 4
the record date thereof the Participant had been the registered holder of
the number of such Shares with respect to which the option is later
exercised.
(c) If at any time after the date of this Agreement and prior to the
expiration of this option, the Shares shall be reclassified or reorganized,
otherwise than as specified in Sections 5.1(a) and (b), the Participant
shall be entitled to receive upon the exercise of this option and shall
accept in lieu of the number of Shares then subscribed for, but for the
same aggregate consideration payable therefor, the same aggregate number of
shares of the appropriate class of shares that the Participant would have
been entitled to receive as a result of such reclassification or other
reorganization of Shares if on the record date thereof the Participant had
been the registered holder of the number of such Shares with respect to
which the option is later exercised.
6.1 TAKE-OVER BID
If an offeror makes an offer to purchase 50% or more of the outstanding
Shares to substantially all holders of the Shares or, if an insider of the
Company makes an offer to purchase Shares to substantially all holders of
the Shares, and the Board of Directors recommends acceptance of such offer
to the shareholders of the Company and the offer price is greater than the
Exercise Price, then this option, whether or not it has vested in whole or
in part, shall become immediately exercisable. The Participant shall be
bound to exercise this option and to tender the Optioned Shares issued upon
exercise of this option into the offer upon receipt of notice from the
Company if the Company provides an interest-free loan to the Participant in
the amount of the Exercise Price for all of the Optioned Shares issuable
upon exercise of this option, subject to the execution of a security
agreement by the Participant in favor of the Company securing repayment of
the loan.
7.1 NO ASSIGNMENT
The Participant may not assign, transfer, pledge or hypothecate any of his
rights hereunder in any way (whether by operation of law or otherwise)
except by will or by the laws of succession on intestacy which may apply to
the estate of the Participant upon his death. The option granted herein
shall not be subject to execution, attachment or similar process. Upon any
attempt to assign, transfer, pledge, hypothecate or otherwise dispose of
this option contrary to the provisions hereof, or upon the levy of any
attachment or similar process upon the option granted herein, such option
shall immediately become void.
8.1 GENERAL
(a) Time shall be of the essence of this Agreement.
(b) In this Agreement, words importing the singular number include the
plural and vice versa and words importing the masculine gender include the
feminine and neuter genders.
(c) All notices which may be or are required to be given by one party to
the other party pursuant to this Agreement shall be in writing and shall be
mailed by first class or certified mail, return receipt requested, postage
prepaid, or transmitted by hand delivery as follows:
4
<PAGE> 5
If to the Company: DUSA Pharmaceuticals, Inc.
6870 Goreway Drive
Mississauga, ON L4V 1P1
Attention: Dr. D. Geoffrey Shulman
with a copy to: Nanette W. Mantell, Esq., Corporate Secretary
Lane and Mantell
991 Route 22 West
PO Box 8539
Somerville, NJ 08876
U.S.A.
If to the Participant: at the address of the Participant from
time to time in the records of the
Company,
or such other address as to which either party may from time to time notify
the other as aforesaid.
9.1 RESTRICTIONS ON TRANSFER
The Participant understands and acknowledges that the option and Shares
underlying the option have not been registered and that they are subject to
certain restrictions on transfer under the Securities Act of 1933 of the
United States, as amended, (the "1933 Act"); such restrictions provide that
the Shares may not be sold without registration or exemption from
registration under the 1933 Act; and, for purposes of the Securities Act
(Ontario) (the "Ontario Act"), the first trade of the Shares issued
pursuant to the exercise of the option, other than a trade exempted by the
Ontario Act, will be a distribution unless the Company has been a reporting
issuer for at least twelve (12) months and the Company is not in default of
any requirement of the Ontario Act, disclosure has been made to the Ontario
Securities Commission of the exempt trade, no unusual effort is made to
prepare the market or create a demand for the Shares, and no extraordinary
commission or consideration is paid with respect to the trade, provided
that such first trade is not from the holdings of a so-called "control
block".
5
<PAGE> 6
IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto.
Attest: DUSA PHARMACEUTICALS, INC.
a New Jersey corporation
s/ Edward L. Foster By: s/D. Geoffrey Shulman
- --------------------------- ------------------------------------
Edward L. Foster, Treasurer Dr. D. Geoffrey Shulman, President
Witness: PARTICIPANT
s/Caren R. Bezach s/Allyn L. Golub
- --------------------------- --------------------------------------
ALLYN L. GOLUB
6
<PAGE> 7
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of DUSA Pharmaceuticals, Inc.
Pursuant to the terms and subject to the conditions set forth in the Stock
Option Agreement (the "Agreement") dated , between DUSA Pharmaceuticals,
Inc. and the undersigned, I hereby elect to purchase shares of Common Stock
of DUSA Pharmaceuticals, Inc. I understand that such purchase is subject to all
the terms and conditions of the Agreement. I request that the certificates for
such shares of Common Stock shall be issued in the name of:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
In full payment of the purchase price with respect to the Optioned Shares
exercised, the undersigned hereby tenders payment of $___________ by certified
check or official bank cashier's check or money order payable in Canadian
currency to the order of DUSA Pharmaceuticals, Inc.
Dated: X
-------------------------------------
(Signature)
---------------------------------
Name (Please Print)
---------------------------------
(Address)
---------------------------------
Taxpayer Identification Number
<PAGE> 1
Exhibit 4.18
STOCK OPTION AGREEMENT
THIS AGREEMENT is made as of the 14 day of April, 1994 between DUSA
PHARMACEUTICALS, INC., a corporation incorporated under the laws of the State of
New Jersey (hereinafter referred to as the "Company") and DAVID M. COHEN, PHD,
c/o Guidelines, Inc., 18441 NW 2nd Avenue, Miami, Florida, (hereinafter referred
to as the "Participants").
WITNESSETH:
WHEREAS, the Board of Directors of the Company has determined that in
consideration for services rendered on the Company's behalf and in order to
provide an inducement to the Participant to acquire a proprietary interest in
the Company, it is in the Company's best interest to grant an option to him to
purchase shares of the Company's common stock ("Shares") on the terms and
conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
expressed herein, it is agreed by and between the parties as follows:
1.1 DEFINITIONS
In this Agreement:
"Board of Directors" means the board of directors of the Company;
"Exercise Price" means U.S. $3.625;
"Expiration Date" means 5:00 p.m. (Eastern Standard Time) on the later of
the dates provided in Section 2.2;
"Optioned Shares" means that number of Shares which are subject to the
option granted by the Company to the Participants pursuant to this
Agreement;
"Services" means consulting or other services provided by the Participants
to the Company pursuant to the Consulting Agreement between the
Participants and the Company; and
"Shares" means shares of common stock, without par value, of the Company.
<PAGE> 2
2.1 GRANT OF OPTION
The Company hereby grants to the Participant an option to purchase, in
accordance with the vesting rights outlined in Sections 2.6 and 2.7 hereof,
up to 10,000 Shares, for an amount per Share equal to the Exercise Price,
upon the terms and subject to the conditions herein contained.
2.2 Subject to Sections 2.6, 2.7 and 3.1 hereof, the Participant shall have the
right, at any time prior to 5:00 p.m. (Eastern Standard Time) on the fifth
anniversary date hereof, being April 14, 1999 (provided that if such day is
not a day on which the Company is open for business then on the first
following day on which the Company is open for business) to exercise this
option for any number of the Optioned Shares up to the maximum number of
Shares specified in Section 2.1 above.
2.3 The option may be exercised by the Participant or by his executors or
personal representatives in the circumstances described in Section 4.1 by
providing to the Company notice in writing in the form of Schedule A hereto
setting out the number of Optioned Shares with respect to which the option
is being exercised. The notice must be accompanied by a certified check,
official bank cashier's check or money order in an amount equal to the
Exercise Price multiplied by the number of Shares requested and a duly
executed copy of this Agreement.
2.4 The Company shall cause its registrar and transfer agent to deliver to the
Participant as soon as practicable after receipt of such notice and payment
a certificate or certificates registered in the name of the Participant or
as the Participant may direct for the number of Shares with respect to
which the option is duly exercised.
2.5 Nothing contained in this Agreement or action taken pursuant hereto shall
obligate the Participant to purchase and/or pay for, or the Company to
issue, any Shares except those Optioned Shares with respect to which the
Participant shall have duly exercised the option to purchase in accordance
with this Agreement.
2.6 Subject to Section 2.7 hereof, the option granted hereunder shall vest in
the following manner:
(a) one-quarter of the option on the first anniversary of the day
immediately preceding the date hereof, being April 13, 1995;
(b) one-quarter of the option on the second anniversary of the day
immediately preceding the date hereof, being April 13, 1996;
(c) one-quarter of the option on the third anniversary of the day
immediately preceding the date hereof, being April 13, 1997; and
(d) one-quarter of the option on the fourth anniversary of the day
immediately preceding the date hereof, being April 13, 1998;
<PAGE> 3
and, except as provided by Section 6.1, the Participant shall only be
entitled to exercise this option in the amounts set out above and from and
after the dates so specified.
2.7 Notwithstanding anything contained in Section 2.6 hereof, the option shall
continue to vest only so long as the Participant continues to provide
Services to the Company. Should the Participant ceases to provide such
Services ("Termination"), no further vesting of the option shall occur
unless the Board of Directors determines otherwise and the provisions of
Section 3.1 shall apply with respect to the exercise of the option to the
extent that it has vested and has not yet been exercised.
3.1 EXPIRATION ON TERMINATION
Subject to Section 4.1 hereof, upon Termination, such part of the option as
is then vested but unexercised may be exercised by the Participant for a
period of ninety (90) days after Termination or such later date as the
Board of Directors may approve after which time this option shall expire;
provided, however, that in no event may this option be exercised after the
Expiration Date.
4.1 DEATH OR PERMANENT DISABILITY
In the event that on or prior to the Expiration Date, the Participant dies
or becomes totally and permanently disabled while providing Services to the
Company, this option, to the extent then vested but unexercised, may be
exercised by the Participant for a period up to six (6) months after the
death or disability of the Participant; provided, however, that in no event
may this option be exercised after the Expiration Date. Disability shall be
defined as in Section 22(e)(3) of the Internal Revenue Code of 1986, as
amended. For the purposes of this provision only, reference to the
Participant in this Agreement shall be construed as including the executors
or personal representatives of a deceased Participant. In the event that
this option is not exercised within the period of six (6) months set out
above, this option shall expire.
5.1 SUBDIVISION, CONSOLIDATION OR REORGANIZATION
(a) In the event of any subdivision, redivision or change of the Shares of
the Company into a greater number of Shares at any time after the date of
this Agreement and prior to the Expiration Date of this option, the Company
shall deliver at the time of exercise of this option, but for the same
aggregate consideration payable therefor, such additional number of Shares
as the Participant would have been entitled to receive as a result of such
subdivision, redivision or change if on the record date thereof the
Participant had been the registered holder of the number of such Shares
with respect to which the option is later exercised.
(b) In the event of any consolidation or change of the Shares of the
Company into a lesser number of Shares at any time after the date of this
Agreement and prior to the expiration of this option, the Company shall
deliver at the time of exercise of this option, but for the same aggregate
consideration payable therefor, such reduced number of Shares, as
<PAGE> 4
the Participant would have been entitled to receive upon such consolidation
or change if on the record date thereof the Participant had been the
registered holder of the number of such Shares with respect to which the
option is later exercised.
(c) If at any time after the date of this Agreement and prior to the
expiration of this option, the Shares shall be reclassified or reorganized,
otherwise than as specified in Sections 5.1(a) and (b), the Participant
shall be entitled to receive upon the exercise of this option and shall
accept in lieu of the number of Shares then subscribed for, but for the
same aggregate consideration payable therefor, the same aggregate number of
shares of the appropriate class of shares that the Participant would have
been entitled to receive as a result of such reclassification or other
reorganization of Shares if on the record date thereof the Participant had
been the registered holder of the number of such Shares with respect to
which the option is later exercised.
6.1 TAKE-OVER BID
If an offeror makes an offer to purchase 50% or more of the outstanding
Shares to substantially all holders of the Shares or, if an insider of the
Company makes an offer to purchase Shares to substantially all holders of
the Shares, and the Board of Directors recommends acceptance of such offer
to the shareholders of the Company and the offer price is greater than the
Exercise Price, then this option, whether or not it has vested in whole or
in part, shall become immediately exercisable. The Participant shall be
bound to exercise this option and to tender the Optioned Shares issued upon
exercise of this option into the offer upon receipt of notice from the
Company if the Company provides an interest-free loan to the Participant in
the amount of the Exercise Price for all of the Optioned Shares issuable
upon exercise of this option, subject to the execution of a security
agreement by the Participant in favor of the Company securing repayment of
the loan.
7.1 NO ASSIGNMENT
The Participant may not assign, transfer, pledge or hypothecate any of his
rights hereunder in any way (whether by operation of law or otherwise)
except by will or by the laws of succession on intestacy which may apply to
the estate of the Participant upon his death. The option granted herein
shall not be subject to execution, attachment or similar process. Upon any
attempt to assign, transfer, pledge, hypothecate or otherwise dispose of
this option contrary to the provisions hereof, or upon the levy of any
attachment or similar process upon the option granted herein, such option
shall immediately become void.
8.1 GENERAL
(a) Time shall be of the essence of this Agreement.
(b) In this Agreement, words importing the singular number include the
plural and vice versa and words importing the masculine gender include the
feminine and neuter genders.
(c) All notices which may be or are required to be given by one party
to the other party
<PAGE> 5
pursuant to this Agreement shall be in writing and shall be mailed by first
class or certified mail, return receipt requested, postage prepaid, or
transmitted by hand delivery as follows:
If to the Company: DUSA Pharmaceuticals, Inc.
6870 Goreway Drive
Mississauga, ON L4V 1P1
Attention: Dr. D. Geoffrey Shulman
with a copy to: Nanette W. Mantell, Esq., Corporate Secretary
Lane and Mantell
991 Route 22 West
PO Box 8539
Somerville, NJ 08876
U.S.A.
If to the Participant: at the address of the Participant from
time to time in the records of the
Company,
or such other address as to which either party may from time to time notify
the other as aforesaid.
9.1 RESTRICTIONS ON TRANSFER
The Participant understands and acknowledges that the option and Shares
underlying the option have not been registered and that they are subject to
certain restrictions on transfer under the Securities Act of 1933 of the
United States, as amended, (the "1933 Act"); such restrictions provide that
the Shares may not be sold without registration or exemption from
registration under the 1933 Act; and, for purposes of the Securities Act
(Ontario) (the "Ontario Act"), the first trade of the Shares issued
pursuant to the exercise of the option, other than a trade exempted by the
Ontario Act, will be a distribution unless the Company has been a reporting
issuer for at least twelve (12) months and the Company is not in default of
any requirement of the Ontario Act, disclosure has been made to the Ontario
Securities Commission of the exempt trade, no unusual effort is made to
prepare the market or create a demand for the Shares, and no extraordinary
commission or consideration is paid with respect to the trade, provided
that such first trade is not from the holdings of a so-called "control
block".
<PAGE> 6
IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto.
Attest: DUSA PHARMACEUTICALS, INC.
a New Jersey corporation
s/ Edward L. Foster By: s/D. Geoffrey Shulman
- ------------------------------- -------------------------------
Edward L. Foster, Treasurer Dr. D. Geoffrey Shulman, President
Witness: PARTICIPANT
s/David M. Cohen
- ------------------------------- -----------------------------------
DAVID M. COHEN
<PAGE> 7
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of DUSA Pharmaceuticals, Inc.
Pursuant to the terms and subject to the conditions set forth in the Stock
Option Agreement (the "Agreement") dated , between DUSA Pharmaceuticals,
Inc. and the undersigned, I hereby elect to purchase shares of Common
Stock of DUSA Pharmaceuticals, Inc. I understand that such purchase is subject
to all the terms and conditions of the Agreement. I request that the
certificates for such shares of Common Stock shall be issued in the name of:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
In full payment of the purchase price with respect to the Optioned Shares
exercised, the undersigned hereby tenders payment of $___________ by certified
check or official bank cashier's check or money order payable in Canadian
currency to the order of DUSA Pharmaceuticals, Inc.
Dated: X
-------------------------------------
(Signature)
-------------------------------------
Name (Please Print)
-------------------------------------
(Address)
-------------------------------------
Taxpayer Identification Number
<PAGE> 1
Exhibit 4.19
DEPRENYL USA, INC.
a New Jersey corporation
NON-TRANSFERABLE CLASS B WARRANT
<TABLE>
Class B
Warrant Number of
Certificate No. Warrants
- --------------- --------
<S> <C>
1 350,000
</TABLE>
THIS CERTIFIES THAT, for value received
D. GEOFFREY SHULMAN, MD, FRCPC
or registered assigns (the "Registered Holder") is the owner of the number of
Non-transferable Class B Warrants (the "Class B Warrants") specified above. Each
Class B Warrant initially entitles the Registered Holder to purchase subject to
the terms and conditions set forth in this Class B Warrant Certificate (the
"Certificate) one (1) fully paid and non-assessable share of Common Stock, no
par value, of Deprenyl USA, Inc., a New Jersey corporation (the "Company"), at
any time prior to the Expiration Date (as hereinafter defined) upon the
presentation and surrender of the Certificate with the Subscription Form
attached hereto duly executed at the corporate offices of the Company, 378
Roncesvalles Avenue, Toronto, Ontario M6R 2M7, CANADA, accompanied by payment of
the Canadian dollar equivalent on the date of issue of this Certificate of U.S.
$6.00 per share of Common Stock based on the Bank of Canada's noon rate of
exchange on such date (the "Class B Warrant Exercise Price") in lawful money of
Canada in cash or by official bank or certified check made payable to the
Company. The Company may, at its election, reduce the purchase price, subject to
any applicable regulatory requirements.
This Certificate and each Class B Warrant represented hereby are issued
pursuant to and are subject in all respects to the terms and conditions set
forth herein.
These Class B Warrants are non-transferable and will not be listed or
included for trading by the Company on any stock exchange or other organized
market for securities.
In the event of a merger, consolidation, reclassification,
recapitalization, or other similar transaction, the Class B Exercise Price or
the number of shares of Common Stock subject to purchase upon the exercise of
each Class B Warrant represented hereby are subject to modification or
adjustment, as set forth in the agreement dated January 17, 1992 between the
Company and its warrant agent, American Stock Transfer and Trust Company (the
"Warrant Agreement"),
The Class B Warrants represented hereby are exercisable at the option of
the Registered Holder, but no fractional shares of Common Stock will be issued
and the Registered Holder understands and agrees that such holder will not be
entitled to any cash payment or other form of compensation in respect of a
fractional share of Common Stock that might otherwise have been
<PAGE> 2
issued. In the case of the exercise of less than all the Class B Warrants
represented hereby, the Company shall cancel this Certificate upon the surrender
hereof and shall execute and deliver a new Class B Warrant Certificate or Class
B Warrant Certificates of like tenor for the balance of such Class B Warrants.
The term "Expiration Date" shall mean 5:00 p.m., Eastern Standard Time, on
January 29, 1997. If such date shall in the State of New York or the Province of
Ontario be a holiday or a day on which the banks are authorized to close, then
the Expiration Date shall mean 5:00 p.m., Eastern Standard Time, the next
following day which in the State of New York and the Province of Ontario is not
a holiday or a day on which the banks are authorized to close. The Company may
at its election extend the Expiration Date, subject to any applicable regulatory
requirements.
The Company shall not be obligated to deliver any securities pursuant to
the exercise of any Class B Warrants represented hereby in the United States
unless a registration statement under the Securities Act of 1933, as amended,
with respect to such securities is effective. The Company has consented and
agreed that it will use its reasonable best efforts to file a registration
statement and to cause the same to become effective and to keep such
registration statement current while any of the Class B Warrants are
outstanding. Any Class B Warrant represented hereby shall not be exercisable by
a Registered Holder in any state of the United States or province of Canada
where such exercise would be unlawful.
Prior to the exercise of any Class B Warrant represented hereby, the
Registered Holder shall not be entitled to any rights as a shareholder of the
Company, including, without limitation, the right to vote or to receive
dividends or other distributions and shall not be entitled to receive any notice
of any proceedings of the Company except as provided by the Warrant Agreement.
Prior to due presentment for registration hereof, the Company may deem and
treat the Registered Holder as the absolute owner hereof and of each Class B
Warrant represented hereby, (notwithstanding any notations of ownership or
writing thereon made by anyone other than a duly authorized officer of the
Company) for all purposes and shall not be affected by any notice to the
contrary.
This Certificate shall be governed by and construed in accordance with the
laws of the State of New Jersey.
This Certificate is not valid unless countersigned by the President of the
Company and attested by the Secretary or Assistant Secretary.
The Company may delegate its duties as warrant agent hereunder to such
other company engaged in the business of corporate stock transfer as the Company
sees fit. The Company will give notice of such delegation to the Registered
Holder at his last known address.
<PAGE> 3
IN WITNESS WHEREOF, the Company has caused this Certificate to be duly
executed, manually or in facsimile by two of its officers thereunto duly
authorized and a facsimile of its corporate seal to be imprinted hereon.
DEPRENYL USA, INC.
By: s/D. Geoffrey Shulman
-----------------------------------
D. Geoffrey Shulman, President
By: s/Edward L. Foster
------------------------------------
Edward L. Foster, Secretary
<PAGE> 4
SUBSCRIPTION FORM
To Be Executed by the Registered Holder
in Order to Exercise Class B Warrants
The undersigned Registered Holder hereby irrevocably elects to exercise,
upon the terms and subject to the conditions set forth herein and in the Warrant
Agreement dated *, 1992, Class B Warrants represented by this Class B Warrant
Certificate and to purchase the securities issuable upon the exercise of such
Class B Warrants, and requests that certificates for such securities shall be
issued in the name of
(PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(please print or type name and address)
and if such number of Class B Warrants shall not be all the Class B Warrants
evidenced by this Class B Warrant Certificate, that a new Class B Warrant
Certificate for the issuance of such Class B Warrants be registered in the name
of, and delivered to, the Registered Holder at the address stated below.
<PAGE> 5
In full payment of the Purchase Price with respect to the Class B Warrants
exercised, the undersigned hereby tenders payment of $__________ in cash or by
official bank or certified check, payable in United States currency to the order
of Deprenyl USA, Inc., and undertakes to provide to the Warrant Agent any
additional tax or charge within five (5) business days hereof.
Dated: X
------------------------ -----------------------------------
(Signature)
Certificate Nos:
-----------------------------------
(Name - Please Print)
- ----------------------------------- -----------------------------------
Number of Warrants (Address)
- ----------------------------------- -----------------------------------
Taxpayer Identification Number
------------------------------
Signature Guaranteed
------------------------------
<PAGE> 6
ASSIGNMENT
To Be Executed by the Registered Holder
in order to Assign Class B Warrants
FOR VALUE RECEIVED,___________________hereby sells, assigns, and transfers unto
(PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(please print or type name and address)
________________________of the Class B Warrants represented by this Class B
Warrant Certificate, and hereby irrevocably constitutes and appoints
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Attorney to transfer this Class B Warrant Certificate on the books of the
Company, with full power of substitution in the premises.
Dated: X
------------------------ ------------------------------
(Signature)
Certificate Nos: ------------------------------
(Name - Please Print)
- ------------------------------
Number of Warrants ------------------------------
(Address)
- ------------------------------ ------------------------------
Taxpayer Identification Number
------------------------------
Signature Guaranteed
------------------------------
THE SIGNATURE TO THIS ASSIGNMENT OR THE SUBSCRIPTION FORM MUST CORRESPOND TO THE
NAME AS WRITTEN UPON THE FACE OF THIS CLASS B
<PAGE> 7
WARRANT CERTIFICATE IN EVERY PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT OR
ANY CHANGE WHATSOEVER, AND MUST BE GUARANTEED BY A COMMERCIAL BANK OR TRUST
COMPANY OR A MEMBER FIRM OF THE AMERICAN STOCK EXCHANGE, NEW YORK STOCK
EXCHANGE, PACIFIC STOCK EXCHANGE, MIDWEST STOCK EXCHANGE, OR TORONTO STOCK
EXCHANGE.
<PAGE> 1
LANE AND MANTELL Exhibits 5.1
a professional corporation and 23.2
ATTORNEYS AT LAW
991 Route 22 West, Post Office Box 8539, Suite 102
Somerville, New Jersey 08876
Nanette Weitman Mantell Telephone (908) 253-9333
Steven R. Lane Facsimile (908) 253-9339
------------
Rosemary Farr Howard Freeman
Of Counsel
December 7, 1999
DUSA Pharmaceuticals, Inc.
25 Upton Drive
Wilmington, Massachusetts 02061
Re: DUSA Pharmaceuticals, Inc. (the "Company")
Registration Statement on Form S-8
Gentlemen:
We have examined the Company's registration statement on Form S-8 (the
"Registration Statement") which is being filed with the Securities and Exchange
Commission (the "SEC") in connection with the registration under the Securities
Act of 1933, as amended (the "Act") of an aggregate of 2,591,855 shares (the
"Optioned Shares") of the Company's common stock, without par value (the "Common
Stock") under the 1991 Incentive Stock Option Plan of Deprenyl USA, Inc., the
DUSA Pharmaceuticals, Inc. 1994 Restricted Stock Option Plan, the DUSA
Pharmaceuticals, Inc. 1996 Omnibus Plan, as amended and pursuant to various
agreements between the Company and individual holders of options or other rights
to acquire the Company's Common Stock (collectively "the Plans").
This opinion is being furnished in accordance with the requirements of Item
8 of Form S-8 and Item 601(b)(5)(i) of Regulation S-K.
As legal counsel to the Company, we have examined the proceedings taken and
proposed to be taken in connection with the issuance, sale and payment of
consideration for the Optioned Shares under the Plans. We have also examined the
original or a photostatic or certified copy of (i) the Certificate of
Incorporation of the Company, and all amendments to the Certificate of
Incorporation filed by the Company in the Office of the Secretary of State of
the State of New Jersey; (ii) the By-laws of the Company; and (iii) such records
of corporate proceedings and other documents as we have deemed necessary in
order to enable us to express the opinion set forth below. In our examination,
we have assumed the genuineness of all signatures, the authenticity of all
documents submitted to us as originals and the conformity with the original of
all documents
<PAGE> 2
DUSA Pharmaceuticals, Inc.
December 7, 1999
Page 2
submitted to us as copies thereof. Our opinion set forth below is
limited to the Business Corporation Law of the State of New Jersey.
Based on the foregoing examination, subject to the assumptions stated and
relying on statements of fact contained in the documents that we have examined,
we are of the opinion that the Optioned Shares have been duly authorized and
reserved for issuance and that when issued and sold in the manner described in
the Plans and pursuant to the agreement which may accompany each grant under the
Plans, the Optioned Shares will be legally and validly issued, fully paid and
non-assessable.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement. We also consent to the reference to our firm's name
wherever appearing in the Registration Statement, including any prospectus
constituting a part thereof, and any amendments thereto. This opinion may be
incorporated by reference in any abbreviated registration statement filed
pursuant to General Instruction E of Form S-8 under the Act with respect to the
Registration Statement.
Very truly yours,
LANE AND MANTELL
a professional corporation
/s/Nanette W. Mantell
By: NANETTE W. MANTELL
NWM/
<PAGE> 1
DELOITTE & TOUCHE LLP EXHIBIT 23.1
BCE PLACE
181 BAY STREET
SUITE 1400
TORONTO, ONTARIO M5J2V1
CANADA
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Dusa Pharmaceuticals, Inc. on Form S-8 of our report dated February 4, 1999
(which expresses an unqualified opinion and includes an emphasis paragraph
indicating that the Company is in the development stage), appearing in the
Annual Report on Form 10-K of Dusa Pharmaceuticals, Inc. for the year ended
December 31, 1998.
/s/ Deloitte & Touche LLP
Chartered Accountants
Toronto, Ontario
December 7, 1999
<PAGE> 1
Exhibit 99.1
DEPRENYL USA, INC.
INCENTIVE STOCK OPTION AGREEMENT
DEPRENYL USA, INC., a New Jersey corporation (the "Company") hereby grants
to * ("You") an option (the "Option") to purchase a total of * shares of common
stock of the Company (the "Shares") at a price determined in accordance with the
Company's Incentive Stock Option Plan as adopted on September 26, 1991 (the
"Plan") which is incorporated herein by reference. Unless otherwise defined
herein, the terms shall have the same meanings as in the Plan.
1. Nature of the Option. This Option is intended to qualify as an
incentive stock option as such term is defined in Section 422 of the Internal
Revenue Code (the "Code").
2. Exercise Price. The exercise price for each Share (the "Option Price")
is *, which is not less than the fair market value per Share on the date of
grant (i.e.,*).
3. Exercise of Option. This Option shall be exercisable during its term
in accordance with the provisions of Section 4 of the Plan as follows:
a. Right to Exercise. You may purchase twenty-five percent (25%) of
the Shares with respect to which the Option has been granted on and after
the first anniversary of the date of the grant, and an additional
twenty-five percent (25%) of the Shares with respect to which the Option
has been granted on and after each of the three (3) succeeding
anniversaries of said date. Installments or portions thereof not exercised
in earlier periods shall be accumulated and be available for exercise in
later periods. In exercising the Option, you may exercise less than the
full installment available, but each exercise must be in full Shares. You
are limited to ten (10) exercises during the term of the Option. The Option
may
<PAGE> 2
be exercised by paying in accordance with the terms as provided for in
Section 4 hereof. Upon payment of the Option Price, the Shares so purchased
shall be delivered to you; provided, however, until the Option is paid, you
shall not be considered a holder of any Shares purchased pursuant hereto.
The exercise of the Option shall be subject to the following additional
conditions:
i. No Option may be exercised within one (1) year after the date
on which the Option is granted; ii. Any Option received, other than by
employees described in Section 3.2 of the Plan, must be exercised
within ten (10) years after the date on which the Option is granted.
iii. Each Option may be exercised in part or in full, but must be
exercised in the order in which each Option is granted. As long as a
previously issued Option has not been completely exercised, or has not
lapsed, no subsequently issued Option may be exercised.
iv. No Option may be exercised during a calendar year which would
result in the purchase of Shares of the Company having an aggregate
fair market value (determined at the time of the grant of the Option)
in excess of One Hundred Thousand Dollars ($100,000.00), except and to
the extent that such Options were first exercisable in preceding
calendar years.
b. Method of Exercise. This Option shall be exercisable by written
notice, a form of which is attached hereto as Schedule A, which shall state
the election to exercise the Option, the number of Shares with respect to
which the Option is being exercised, and such other representations and
agreements as may be required by the Company with respect to
2
<PAGE> 3
such Shares. No Shares will be issued upon the exercise of an Option unless
such issuance and such exercise shall comply with all relevant provisions
of law and the requirements of any stock exchange upon which the Shares may
then be issued. Assuming such compliance, for income tax purposes, the
Shares shall be considered transferred to you on the date on which the
Option is exercised with respect to such Shares.
4. Method of Payment. Payment for Shares purchased upon any exercise of
an Option granted hereby shall be made in full in cash or its equivalent
concurrently with such exercise, except that, if the Company is not then
prohibited from purchasing or acquiring Shares, such payment may be made in
whole or in part with shares of the same class of stock as that which are then
subject to the Option, delivered in lieu of cash concurrently with such
exercise, the shares so delivered to be valued on the basis of the fair market
value of the stock determined in accordance with the procedure specified in
Section 4.1 of the Plan on the day preceding the date of exercise.
5. Restriction on Exercise. This Option may not be exercised if the
issuance of such Shares, upon such exercise or the method of payment of
consideration for such Shares, would constitute a violation of any applicable
federal or state securities or other law or regulation.
6. Factors Relating to Employment.
a. Termination of Employment. If, prior to the termination of the
Plan, you cease to be employed by the Company, other than by reason of
death or disability, each Option shall be exercisable only for a period of
three (3) months from the date of the cessation of employment or the Option
expiration date, whichever is earlier. Thereafter, all unexercised Options
and the rights thereunder shall terminate.
b. Disability of Employee. If, prior to the termination of the Plan,
you cease to be employed by the Company by reason of a disability, as
defined in Section 22(e)(3) of the
3
<PAGE> 4
Code, you shall be entitled to exercise each Option within one (1) year
from the cessation of employment or on the Option expiration date,
whichever is earlier. Thereafter, all unexercised Options and the rights
thereunder shall terminate. Notwithstanding the provisions of this
paragraph, however, if you shall be discharged for cause (which shall be
defined as participation in conduct during employment consisting of fraud,
felony, willful misconduct or commission of any act which causes or may
reasonably be expected to cause substantial damage to the Company), each
Option to the extent not previously exercised shall terminate at once.
c. Death of Employee. If, prior to the termination date of the Plan,
you die while holding an Option, the Option may be exercised, to the same
extent that you could have exercised the Option at the time of death, by
your estate or by a person who acquired the right to exercise the Option by
a written designation, a form of which is attached hereto as Schedule B,
made by you, or by bequest, inheritance or under the laws of descent and
distribution of the applicable jurisdiction. The Option shall be exercised
within the earlier of one (1) year after your death or upon the Option
expiration date.
7. Transferability of the Option. The Option granted hereby shall be
nontransferable by you other than by will or the laws of descent and
distribution and is exercisable during your lifetime only by you or by your
guardian or legal representative. Nothing shall preclude you from designating
the person who after your death may exercise the Option pursuant to the Plan. If
you attempt to alienate, assign, hypothecate, pledge or otherwise dispose of any
Option, except as herein provided, or in the event of attachment, execution or
similar process upon the rights or interest herein conferred, the Option shall
become immediately null and void and without legal effect.
8. Term of the Option. This Option may not be exercised more than ten
(10) years from
4
<PAGE> 5
the date of the grant of this Option and may be exercised during such term only
in accordance with the terms of the Plan and the terms of this Option.
9. Restricted Stock. Shares of the Company's Common Stock issued upon the
exercise of this Option may, upon the issuance, be subject to the following
restrictions:
a. Such Shares (hereinafter referred to as "Restricted Stock") may
not be sold or otherwise transferred or hypothecated, unless in accordance
with the terms hereof and the terms of the Plan;
b. If the employment of the holder of the Restricted Stock with the
Company or a subsidiary is terminated for any reason other than by death,
normal or early retirement in accordance with the Company's established
retirement policies or practices, or total disability, the Company (or any
subsidiary designated by the Company) shall have the option for sixty (60)
days after such termination of employment to purchase for cash all or any
part of the Restricted Stock granted to you at the fair market value of the
Restricted Stock on the date of such termination of employment as set forth
in Section 6 hereof.
The restrictions imposed under Section 8.1 of the Plan shall apply as well to
all Shares or other securities issued in respect of the Restricted Stock in
connection with any stock split, reverse stock split, stock dividend,
recapitalization, reclassification, spin-off, split-off, merger, consolidation
or reorganization. Any and all Shares received upon the exercise of this Option
shall bear the following legend:
The securities represented by this certificate
have not been registered under the Securities
Act of 1933 of the United States of America, as
amended (the "Act"), and may not be sold or
transferred in the absence of an effective
registration statement under the Act or an
5
<PAGE> 6
exemption from registration thereunder.
Date of Grant: DEPRENYL USA, INC.
*
By:
-------------------------------------------
Dr. D. Geoffrey Shulman,
President and CEO
OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO
SECTION 3 HEREOF IS EARNED ONLY BY CONTINUING EMPLOYMENT AT THE WILL OF THE
COMPANY (NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED THIS OPTION, OR
ACQUIRING SHARES HEREUNDER). OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT
NOTHING IN THIS AGREEMENT, NOR IN THE COMPANY'S INCENTIVE STOCK OPTION PLAN
WHICH IS INCORPORATED HEREIN BY REFERENCE, SHALL CONFER UPON OPTIONEE ANY RIGHT
WITH RESPECT TO CONTINUATION OF EMPLOYMENT BY THE COMPANY, NOR SHALL IT
INTERFERE, IN ANY WAY, WITH HIS/HER RIGHT, OR THE COMPANY'S RIGHT, TO TERMINATE
HIS/HER EMPLOYMENT AT ANY TIME, WITH OR WITHOUT CAUSE.
6
<PAGE> 7
OPTIONEE ACKNOWLEDGES RECEIPT OF A COPY OF THE PLAN AND CERTAIN INFORMATION
RELATED THERETO AND REPRESENTS THAT HE/SHE IS FAMILIAR WITH THE TERMS AND
PROVISIONS THEREOF AND HEREBY ACCEPTS THIS OPTION SUBJECT TO ALL OF THE TERMS
AND PROVISIONS THEREOF. OPTIONEE HAS REVIEWED THE PLAN AND THIS OPTION, IN THEIR
ENTIRETY, HAS HAD AN OPPORTUNITY TO OBTAIN ADVICE OF COUNSEL PRIOR TO EXECUTING
THIS OPTION, AND FULLY UNDERSTANDS ALL PROVISIONS OF THE OPTION. OPTIONEE HEREBY
AGREES TO ACCEPT AS BINDING, CONCLUSIVE AND FINAL, ALL DECISIONS AND
INTERPRETATIONS OF THE BOARD, UPON ANY QUESTIONS ARISING UNDER THE PLAN.
OPTIONEE FURTHER AGREES TO NOTIFY THE COMPANY UPON ANY CHANGE IN RESIDENCE
ADDRESS.
OPTIONEE
-------------------------------------
*
Residence Address: *
7
<PAGE> 8
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of Deprenyl USA, Inc.
Pursuant to the terms and subject to the conditions set forth in the
Incentive Stock Option Agreement (the "Agreement") dated , between
Deprenyl USA, Inc. and the undersigned, I hereby elect to purchase shares
of Common Stock of Deprenyl USA, Inc. I understand that such purchase is subject
to all the terms and conditions of the Agreement. I request that the
certificates for such shares of Common Stock shall be issued in the name of:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
In full payment of the purchase price with respect to the Optioned Shares
exercised, the undersigned hereby tenders payment of $___________ by certified
check or official bank cashier's check or money order payable in Canadian
currency to the order of Deprenyl USA, Inc.
Dated: X
------------------------------------------
(Signature)
---------------------------------------
Name (Please Print)
---------------------------------------
(Address)
---------------------------------------
Taxpayer Identification Number
<PAGE> 9
SCHEDULE B
DESIGNATION OF BENEFICIARY FORM
1. Name of Plan ("Plan"):
--------------------------------------------------
2. Name of Participant ("Participant"):
--------------------------------------
3. Name of Participant's Spouse ("Spouse"):
----------------------------------
4. Any designation previously made by the Participant of the beneficiary who
may exercise options granted to the Participant under the Plan by reason of
the death of such Participant is canceled by the designation of any other
beneficiary in this form.
5. BENEFICIARY DESIGNATION.
The Beneficiary who may exercise options granted to the Participant under
the terms of the Plan by reason of the death of the Participant shall be:
(a) Primary:
Name Relationship
-------------------- ---------------------
Address
--------------------------------------------------------------
(b) Secondary:
--------------------------------------------------------------
---------------------------------------------------------------------------
6. This Designation of Beneficiary Form may be revoked or changed at any time
by a written form acceptable to the Company which is signed by the
Participant and delivered to the Company's Secretary at Lane and Mantell,
991 Route 22 West, Post Office Box 8539, Bridgewater, New Jersey 08876.
In witness whereof, the Participant has signed this application on the date
hereafter indicated.
Dated:
------------------ ---------------------------------
9
<PAGE> 1
Exhibit 99.2
STOCK OPTION AGREEMENT
THIS AGREEMENT is made as of the *nd day of *, 199* between DUSA
PHARMACEUTICALS, INC., a corporation incorporated under the laws of the State of
New Jersey (hereinafter referred to as the "Company") and *, an individual
residing in * (hereinafter referred to as the "Participant").
WITNESSETH:
WHEREAS, the Board of Directors of the Company has determined that in
consideration for services rendered on the Company's behalf and in order to
provide an inducement to the Participant to acquire a proprietary interest in
the Company, it is in the Company's best interest to grant him an option to
purchase Shares on the terms and conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
expressed herein, it is agreed by and between the parties as follows:
1.1 DEFINITIONS
In this Agreement:
"Board of Directors" means the board of directors of the Company;
"Exercise Price" means *;
"Expiration Date" means 5:00 p.m. (Eastern Standard Time) on the later of
the dates provided in Section 2.2;
"Optioned Shares" means that number of Shares which are subject to the
option granted by the Company to the Participant pursuant to this
Agreement; and
"Shares" means shares of Common Stock in the share capital of the Company.
2.1 GRANT OF OPTION
Subject to shareholder approval, the Company hereby grants to the
Participant an option to purchase, in accordance with the vesting rights
outlined in Sections 2.6 and 2.7 hereof, up to * Shares for an amount per
Share equal to the Exercise Price, upon the terms and subject to the
conditions herein contained. This grant is automatic pursuant to the
Company's Restricted Stock Option Plan and Rule 16b-3(c)(2)(ii) of the
General Rules and Regulations under the Securities Exchange Act of 1934, as
amended from time to time.
2.2 Subject to Sections 2.6, 2.7 and 3.1 hereof, the Participant shall have the
right, at any time prior to 5:00 p.m. (Eastern Standard Time) on the tenth
anniversary date hereof, being *,
<PAGE> 2
provided that if such day is not a day on which the Company is open for
business then on the first following day on which the Company is open for
business, to exercise this option for any number of the Optioned Shares up
to the maximum number of Shares specified in Section 2.1 above.
2.3 The option may be exercised by the Participant or by his executors or
personal representatives in the circumstances described in Section 4.1 by
giving to the Company at its registered office notice in writing in the
form of Schedule A hereto setting out the number of Optioned Shares with
respect to which the option is being exercised. The notice must be
accompanied by a certified check, official bank cashier's check or money
order in an amount equal to the Exercise Price multiplied by the number of
Shares requested and a duly executed copy of this Agreement.
2.4 The Company shall cause its registrar and transfer agent to deliver to the
Participant as soon as practicable after receipt of such notice and payment
a certificate or certificates registered in the name of the Participant or
as the Participant may direct for the number of Shares with respect to
which the option is duly exercised.
2.5 Nothing contained in this Agreement or done pursuant hereto shall obligate
the Participant to purchase and/or pay for, or the Company to issue, any
Shares except those Optioned Shares with respect to which the Participant
shall have duly exercised the option to purchase in accordance with this
Agreement.
2.6 Subject to Sections 2.1 and 2.7 hereof, the option granted hereunder shall
vest in the Participant in the following manner:
(a) one-quarter of the option on the first anniversary of the day
immediately preceding the date hereof, being *;
(b) one-quarter of the option on the second anniversary of the day
immediately preceding the date hereof, being *;
(c) one-quarter of the option on the third anniversary of the day
immediately preceding the date hereof, being *; and
(d) one-quarter of the option on the fourth anniversary of the day
immediately preceding the date hereof, being *;
and, except as provided by Section 6.1, the Participant shall only be
entitled to exercise this option in the amounts set out above and from and
after the dates so specified.
2.7 Notwithstanding anything contained in Sections 2.1 and 2.6 hereof, options
shall continue to vest in the Participant only so long as the Participant
shall continue to serve the Company as a director and/or officer. Should
the Participant cease to serve in such capacity (the "Termination"), no
further options shall vest or become exercisable, except at the discretion
of the Board of Directors, and the provisions of Section 3.1 shall apply
with respect to the exercise of those options which have already vested in
the Participant and have not yet been
2
<PAGE> 3
exercised. The Board of Directors shall be entitled to determine if and
when Termination has occurred with respect to the Participant.
3.1 EXPIRATION ON TERMINATION
Subject to Section 4.1 hereof, upon Termination, such part of the option as
is then exercisable but unexercised may be exercised by the Participant for
a period of ninety (90) days after Termination or such later date as the
Board of Directors may approve after which time this option shall expire;
provided, however, that in no event may this option be exercised after the
Expiration Date.
4.1 DEATH OR PERMANENT DISABILITY OF EMPLOYEE
In the event that on or prior to the Expiration Date, the Participant dies
or becomes totally and permanently disabled while serving the Company as a
director or officer, this option, to the extent then exercisable but
unexercised, may be exercised by the Participant for a period of six (6)
months after the death or disability of the Participant, notwithstanding
the Expiration Date. The Board of Directors shall be entitled to determine
if and when a Participant has become permanently disabled. For the purposes
of this provision only, reference to the Participant in this Agreement
shall be construed as including the executors or personal representatives
of a deceased Participant. In the event that this option is not exercised
within the period of six (6) months set out above, this option shall
expire.
5.1 SUBDIVISION, CONSOLIDATION OR REORGANIZATION
(a) In the event of any subdivision, redivision or change of the Shares of
the Company into a greater number of Shares at any time after the date of
this Agreement and prior to the Expiration Date of this option, the Company
shall deliver at the time of exercise of this option, but for the same
aggregate consideration payable therefor, such additional number of Shares
as the Participant would have been entitled to receive as a result of such
subdivision, redivision or change if on the record date thereof the
Participant had been the registered holder of the number of such Shares
with respect to which the option is later exercised.
(b) In the event of any consolidation or change of the Shares of the
Company into a lesser number of Shares at any time after the date of this
Agreement and prior to the expiration of this option, the Company shall
deliver at the time of exercise of this option, but for the same aggregate
consideration payable therefor, such reduced number of Shares, as the
Participant would have been entitled to receive upon such consolidation or
change if on the record date thereof the Participant had been the
registered holder of the number of such Shares with respect to which the
option is later exercised.
(c) If at any time after the date of this Agreement and prior to the
expiration of this option, the Shares shall be reclassified or reorganized,
otherwise than as specified in Sections 5.1(a) and (b), the Participant
shall be entitled to receive upon the exercise of this option and shall
accept in lieu of the number of Shares then subscribed for, but for the
same aggregate consideration payable therefor, the same aggregate number of
shares of the appropriate class
3
<PAGE> 4
of shares that the Participant would have been entitled to receive as a
result of such reclassification or other reorganization of Shares if on the
record date thereof the Participant had been the registered holder of the
number of such Shares with respect to which the option is later exercised.
6.1 TENDER OFFER
If an offeror makes an offer to purchase 50% or more of the outstanding
Shares to substantially all holders of the Shares or, if an insider of the
Company makes an offer to purchase Shares to substantially all holders of
the Shares, and the Board of Directors recommends acceptance of such offer
to the shareholders of the Company and the offer price is greater than the
Exercise Price, then this option, whether or not it has vested in whole or
in part in the Participant, shall become immediately exercisable. The
Participant shall be bound to exercise this option and to tender the
Optioned Shares issued upon exercise of this option into the offer upon
receipt of notice from the Company if the Company provides an interest-free
loan to the Participant in the amount of the Exercise Price for all of the
Optioned Shares issuable upon exercise of this option, subject to the
execution of a security agreement by the Participant in favor of the
Company securing repayment of the loan.
7.1 NO ASSIGNMENT
The Participant may not assign, transfer, pledge or hypothecate any of his
rights hereunder in any way (whether by operation of law or otherwise)
except by will or by the laws of succession on intestacy which may apply to
the estate of the Participant upon his death. The option granted herein
shall not be subject to execution, attachment or similar process. Upon any
attempt to assign, transfer, pledge, hypothecate or otherwise dispose of
this option contrary to the provisions hereof, or upon the levy of any
attachment or similar process upon the option granted herein, such option
shall immediately become void.
8.1 GENERAL
(a) Time shall be of the essence of this Agreement.
(b) In this Agreement, words importing the singular number include the
plural and vice versa and words importing the masculine gender include the
feminine and neuter genders.
(c) All notices which may be or are required to be given by one party to
the other party pursuant to this Agreement shall be in writing and shall be
mailed by first class or certified mail, return receipt requested, postage
prepaid, or transmitted by hand delivery as follows:
If to the Company: DUSA Pharmaceuticals, Inc.
6870 Goreway Drive
Mississauga, ON L4V 1P1
CANADA
Attention: Dr. D. Geoffrey Shulman
4
<PAGE> 5
If to the Participant: *
at the address of the Participant from
time to time in the records of the
Company,
or such other address as to which either party may from time to time notify
the other as aforesaid.
9.1 RESTRICTIONS ON TRANSFER
The Participant understands and acknowledges that he is subject to certain
restrictions on transfer under the Securities Act of 1933 of the United
States, as amended, (the "1933 Act") of the Shares issued pursuant to the
exercise of the option; such restrictions provide that the Shares may not
be sold without registration or exemption from registration under the 1933
Act; and, for purposes of the Securities Act (Ontario) (the "Ontario Act"),
the first trade of such Shares, other than a trade exempted by the Ontario
Act, will be a distribution unless the Company has been a reporting issuer
for at least twelve (12) months and the Company is not in default of any
requirement of the Ontario Act, disclosure has been made to the Ontario
Securities Commission of the exempt trade, no unusual effort is made to
prepare the market or create a demand for the Shares, and no extraordinary
commission or consideration is paid with respect to the trade, provided
that such first trade is not from the holdings of a so-called "control
block".
10.1 REPORTING REQUIREMENTS
The Participant understands and acknowledges that he may be subject to
certain reporting requirements upon his receipt and exercise of the option,
and in connection therewith, upon the receipt and exercise of the option,
the Participant agrees to timely file with the Securities and Exchange
Commission, the National Association of Securities Dealers, Inc., and any
appropriate Canadian securities regulatory authorities, the appropriate
documentation regarding his ownership of the Company's securities.
IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto.
Attest: DUSA PHARMACEUTICALS, INC.,
a New Jersey corporation
By:
- ----------------------------- -----------------------------------
Nanette W. Mantell, Secretary Dr. D. Geoffrey Shulman, President
PARTICIPANT
--------------------------------------
5
<PAGE> 6
*
6
<PAGE> 7
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of DUSA Pharmaceuticals, Inc.
Pursuant to the terms and subject to the conditions set forth in the Stock
Option Agreement (the "Agreement") dated , between DUSA Pharmaceuticals,
Inc. and the undersigned, and Stock Options granted to the undersigned by such
Agreement, I hereby elect to purchase shares of Common Stock of DUSA
Pharmaceuticals, Inc. which were the subject of such Stock Options. I understand
that such purchase is subject to all the terms and conditions of the Agreement.
I request that the certificates for such shares of Common Stock shall be issued
in the name of:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
(please print or type name and address)
(a) The Shares are being purchased for the undersigned's own account, for
investment purposes only, and not for the account of any other person, and not
with a view to distribution, assignment, or resale to others, or to
fractionalization in whole or in part and that the offering and sale of the
Shares is intended to be exempt from registration under the Securities Act of
1933 (the "Act"). In furtherance thereof, the undersigned represents, warrants
and agrees as follows: (i) no other person has or will have a direct or indirect
beneficial interest in such Share and the undersigned will not sell,
hypothecate, or otherwise transfer his shares except in accordance with the Act
and applicable state securities laws or unless in the opinion of counsel for the
Company, an exemption from the registration requirements of the Act and such
laws is available; and (ii) the Company is under no obligation to register the
Shares on behalf of the undersigned or to assist the undersigned in complying
with any exemption from registration.
<PAGE> 8
(b) The undersigned has such knowledge and experience in financial and
business matters that the undersigned is capable of evaluating the merits and
risks of investment in the Company and of making an informed investment
decision.
In full payment of the purchase price with respect to the Stock Options
exercised, the undersigned hereby tenders payment of $___________ by certified
check or official bank cashier's check or money order payable in Canadian or
United States currency to the order of DUSA Pharmaceuticals, Inc.
Dated: X
------------------------------------------------
(Signature)
-------------------------------------
Name (Please Print)
-------------------------------------
(Address)
-------------------------------------
Taxpayer Identification Number
8
<PAGE> 1
Exhibit 99.3
NONQUALIFIED STOCK OPTION AGREEMENT
UNDER THE DUSA PHARMACEUTICALS, INC. 1996 OMNIBUS PLAN, AS AMENDED
AGREEMENT made and entered into as of the ___ day of _______, 199_, by
and between DUSA Pharmaceuticals, Inc., a corporation incorporated under the
laws of the State of New Jersey (the "Company"), and
_____________________________, an individual residing in the State of (the
"Grantee").
WHEREAS, pursuant to the DUSA Pharmaceuticals, Inc. 1996 Omnibus Plan,
as amended (the "Plan"), the Company has determined that its interests will be
advanced by providing an incentive to the Grantee to acquire a proprietary
interest in the Company and, as a shareholder, to share in its success, with
added incentive to work effectively for and in the Company's interest;
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, the parties hereby agree as follows:
SECTION 1
GRANT
1.1 The Company hereby grants to the Grantee, as a matter of
separate agreement and not in lieu of salary or any other compensation
for services, the right and option (the "Option") to purchase, in
accordance with the vesting rights outlined in Sections 3.1 and 3.6
hereof, up to ! shares of authorized but unissued Common Stock, without
par value ("Common Stock"), of the Company on the terms and conditions
herein set forth in this Agreement. [For directors grants add the
following: This grant is automatic pursuant to the Plan.]
SECTION 2
PRICE
2.1 The purchase price of the shares of Common Stock subject to this
Option shall be the fair market value of the shares of Common Stock on
the date of the grant ($ per share)(the "Exercise Price").
SECTION 3
WHEN EXERCISABLE
3.1 The aggregate number of shares of Common Stock of the Company
optioned by this Agreement (the "Optioned Shares") shall vest in the
Grantee as follows:
(a) one-quarter of the Option on the first anniversary of
the day of the grant, being ;
<PAGE> 2
(b) one-quarter of the Option on the second anniversary
of the day of the grant, being ;
(c) one-quarter of the Option on the third anniversary of
the day of the grant, being ; and
(d) one-quarter of the Option on the fourth anniversary
of the day of the grant, being ;
and, except as provided by Sections 3.6 and 6.3 hereof, the Grantee
shall only be entitled to exercise this Option, in whole or in part, in
the amounts set out above and from and after the dates so specified.
3.2 Subject to Sections 3.1 and 3.6 hereof, the Grantee shall have
the right, at any time prior to 5:00 p.m. (Eastern Standard Time) on
the date prior to the tenth anniversary date hereof, being , provided
that if such day is not a day on which the Company is open for business
then on the first following day on which the Company is open for
business, to exercise this Option for any number of the Optioned Shares
up to the maximum number of shares specified in Section 1.1 above.
3.3 No less than one thousand (1,000) shares may be purchased upon
any one exercise of the Option granted hereby unless the number of
shares purchased at such time is the total number of shares in respect
of which the Option hereby granted is then exercisable.
3.4 In no event shall any Option granted hereby be exercisable for a
fractional share.
3.5 From time to time, in its discretion, the Committee may offer
the Grantee the right to cancel any Option granted hereunder in
exchange for such consideration as the Committee shall determine.
3.6 Notwithstanding anything contained in Sections 1 and 3.1 hereof,
the Option shall continue to vest in the Grantee only so long as the
Grantee shall continue to serve the Company. Should the Grantee cease
to serve in all such capacities, the Option shall not further vest or
become exercisable, and the provisions of Section 5.2 shall apply with
respect to the exercise of the Option which has already vested in the
Grantee and has not yet been exercised. The Board of Directors shall be
entitled to determine if and when employment or service to the Company
has ceased with respect to the Grantee.
SECTION 4
HOW EXERCISABLE
4.1 Subject to such administrative regulations as the Committee may
from time to time adopt, the Grantee or beneficiary shall, in order to
exercise this Option give to the Company at its principal office notice
in writing in the form of Schedule A hereto setting out the number of
Optioned Shares with respect to which the Option is being exercised.
The notice must be accompanied by payment of a certified check,
official bank cashier's check or money order in an amount equal to the
Exercise Price multiplied by the number of shares requested and a duly
executed copy of this Agreement.
-2-
<PAGE> 3
4.2 Any notice under this Section shall include an undertaking to
furnish or execute such documents as the Committee in its discretion
shall deem necessary (i) to evidence such exercise, in whole or in
part, of the Option evidenced by this Agreement, (ii) to determine
whether registration is then required under the Securities Act of 1933,
or any other law, as then in effect, and (iii) to comply with or
satisfy the requirements of the Securities Act of 1933, or any other
law, as then in effect.
4.3 The Grantee agrees that all shares purchased by him or her under
the Option will be acquired for investment, not distribution, and that
any notice of exercise of the Option must be accompanied by a written
representation to that effect, signed by the Grantee.
SECTION 5
TERMINATION OF OPTION
5.1 The Option granted hereby shall terminate and be of no force or
effect upon the expiration of ten years from the date of the Grant
unless terminated prior to such time as provided below.
5.2 Subject to Section 3.6 hereof, should the Grantee cease to serve
the Company, the Grantee's Option shall be exercised as follows:
(a) If the Grantee's termination of employment or service is
other than for cause or for the reasons provided in
subsections (b)-(d) below, the Option may be exercised, to the
extent exercisable, for a period of three months after the
date of such termination of employment;
(b) If the Grantee's termination of employment or service is
by reason of retirement or disability, the Option may be
exercised, to the extent exercisable, for a period of 12
months after the date of such termination;
(c) In the event of death of the Grantee after termination of
employment or service pursuant to (a) or (b) above, the person
or persons to whom the Grantee's rights are transferred by
will or the laws of descent and distribution shall have a
period of three years from the date of termination of the
Grantee's employment or service to exercise the Option which
could have been exercised during such period; and
(d) In the event of death of the Grantee while employed, the
Option shall become fully and immediately exercisable and may
be exercised by the person or persons to whom the Grantee's
rights are transferred by will or the laws of descent and
distribution for a period of three years after the Grantee's
death, subject to exercise during the remaining term of the
Option;
5.3 Any determination made by the Committee with respect to any
matter referred to in this Section 5 shall be final and conclusive on
all persons affected thereby. Employment by, or service to, the Company
shall be deemed to include employment by, or service to, any subsidiary
of the Company by the Grantee.
-3-
<PAGE> 4
-4-
<PAGE> 5
SECTION 6
ADJUSTMENTS TO OPTION
6.1 Subject to any required action by the Committee and the
Company's shareholders, the number of shares provided for in the
Option, the price per share thereof and the number of shares provided
for in the Plan shall be proportionately adjusted for any increase or
decrease in the number of issued shares of the Company resulting from
the payment of a share dividend, a share split or any transaction which
is a "corporate transaction" (as defined in the Treasury regulations
promulgated under Section 424 of the Code.
6.2 Subject to any required action by the Committee and the
Company's shareholders, if the Company shall be the surviving entity in
any merger or consolidation, or after a consolidation of the Company
and one or more entities in which the resulting entity is an
independent entity, the Option shall pertain to and apply to the
securities of the surviving entity in an amount that the board of
directors of the surviving entity, at its sole discretion, determines
to be equivalent, as nearly as practicable, to the nearest whole number
and class of shares that were subject to the Option. These shares of
stock or other securities shall, after such merger or consolidation, be
deemed to be shares for all purposes of the Plan. The aforesaid
adjustments, when applicable, shall be made by the Committee, and the
Committee's determination shall be final, binding and conclusive.
6.3 In the event of a Change of Control (as defined below), any and
all outstanding Options not fully vested shall automatically vest in
full and shall be immediately exercisable. The date on which such
accelerated vesting and immediate exercisability shall occur shall be
the date of the occurrence of the Change of Control.
A "Change of Control" shall be deemed to have taken place upon
(i) the acquisition by a third person, including a "group" as defined
in Section 13(d)(3) of the Securities Exchange Act of 1934, as amended,
of shares of the Company having 50% or more of the total number of
votes that may be cast for the election of Directors of the Company;
(ii) shareholder approval of a transaction for the acquisition of the
Company, or substantially all of its assets by another entity or for a
merger, reorganization, consolidation or other business combination to
which the Company is a part; or (iii) the election during any period of
24 months or less of 50% or more of the Directors of the Company where
such Directors were not in office immediately prior to such period
provided, however, that no "Change of Control" shall be deemed to have
taken place if the Directors of the Company in office on the date of
adoption of the Plan, or their successors in office nominated by such
Directors, affirmatively approve a resolution to such effect.
Except as provided with respect to a Grantee in his or her
stock option agreement or other controlling agreement between him or
her and the Company, to the extent that the acceleration,
exercisability or parachute payment attributable to the Option
following a Change of Control would result in "excess parachute
payments"(1) when the former are aggregated with other payments or
benefits to the Grantee (whether or not payable by the Plan), such
parachute payments or benefits provided to a Grantee under this
Agreement shall
- --------
(1)"Excess parachute payments" are defined in Section 280G of the Code and
are determined by tax counsel of the Company.
-5-
<PAGE> 6
be reduced to the extent necessary so that no portion thereof shall be
subject to the excise tax imposed by Section 4999 of the Code. This
reduction will only be made if it will cause the Grantee's net
after-tax benefit to exceed the net after-tax benefit that would have
existed if such reduction were not made. "Net after-tax benefit" shall
be the sum of (i) all payments and benefits which a Grantee receives or
is entitled to receive that would constitute a "parachute payment"
under Section 280G of the Code, less (ii) the amount of federal income
taxes payable with respect to the payments and benefits described in
(i) above, calculated at the maximum marginal income tax rate(2) for
the year in which such payments and benefits shall be paid to the
Grantee, less (iii) the amount of excise taxes imposed with respect to
the payments and benefits described in (i) above by Section 4999 of the
Code.
6.4 In the event of a change in the Company's shares which is
limited to a change of all of its authorized shares with par value into
the same number of shares with a different par value or without par
value, the shares resulting from any such change shall be deemed to be
shares within the meaning of the Plan.
6.5 Except as herein before expressly provided in Paragraphs 6.1,
6.2, 6.3 and 6.4 of this Section 6, the Grantee shall have no rights by
reason of any subdivision or consolidation of shares of any class or
payment of any share dividend or any other increase or decrease in the
number of shares of any class or by reason of any dissolution,
liquidation, merger, consolidation or spin-off of assets or stock of
another corporation and any issuance by the Company of shares of any
class, or securities convertible into shares of any class, shall not
affect the Option, and no adjustment by reason thereof shall be made
with respect to the number or price of the Company's shares subject to
the Option. The grant of the 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 or to
merge, consolidate, dissolve, liquidate, sell or transfer all or any
part of its business or assets.
SECTION 7
TRANSFER
7.1 This Option shall not be transferable by any individual Grantee
in any way other than by will and the laws of descent and distribution.
During the lifetime of any individual Grantee, the Option shall be
exercisable only by him or her. Any other attempted assignment,
transfer, pledge, hypothecation or other disposition of the Option by
any Grantee shall be void and have no effect unless in accordance with
the terms set forth herein.
SECTION 8
WITHHOLDING TAXES
8.1 The Company shall have the right to retain and withhold from any
payment, under the Option granted, any amount that is to be withheld or
otherwise deducted and paid with respect to such payment. At its
discretion, the Company may require the Grantee, if he or
- --------------------
(2)"This rate is based on the rate for the year set forth in the Code at
the time of the first payment to the participant.
-6-
<PAGE> 7
she receives shares under a nonqualified stock option grant, to
reimburse the Company for any taxes that are required to be withheld by
the Company, and may withhold any distribution in whole or in part
until the Company is so reimbursed. In lieu thereof, the Company shall
have the right to withhold from any other cash amounts due (or to
become due) to the Grantee an amount equal to such taxes required to be
withheld by the Company to reimburse the Company for any such taxes, or
the Company may retain and withhold a number of shares of Common Stock
having a market value not less than the amount of such taxes and cancel
(in whole or in part) any shares of Common Stock so withheld in order
to reimburse the Company for any such taxes.
SECTION 9
IMPACT ON OTHER BENEFITS
9.1 The value of the Option (either on the date of grant of the
Option or at the time the shares are vested) shall not be includable as
compensation or earnings for purposes of any other benefit plan offered
by the Company.
SECTION 10
ADMINISTRATION
10.1 The Committee shall have full authority and discretion (subject
only to the express provisions of the 1996 Omnibus Plan, as amended) to
decide all matters relating to the administration and interpretation of
the Plan and this Agreement. All such Committee determinations shall be
final, conclusive and binding upon the Company, the Grantee and any and
all interested parties.
SECTION 11
AGREEMENT TO CONTINUE IN EMPLOYMENT
OR SERVICE AS A CONSULTANT
11.1 Nothing in the Plan or this Agreement shall confer on a Grantee
any right to continue in the employ of the Company or in the service of
the Company as a consultant or interfere in any way with the right of
the Company to terminate his or her employment or consultantship at any
time.
SECTION 12
AMENDMENT(S)
12.1 This Agreement shall be subject to the terms of the Plan as
amended except that the Option that is the subject of this Agreement
may not in any way be amended or terminated without the Grantee's
written consent.
-7-
<PAGE> 8
SECTION 13
FORCE AND EFFECT
13.1 The various provisions of this Agreement are severable in their
entirety. Any determination of invalidity or unenforceability of any
one provision shall have no effect on the continuing force and effect
of the remaining provisions.
SECTION 14
NOTICE OF DISPOSITION OF SHARES
14.1 The Grantee agrees that if it, he or she should dispose of any
shares of Common Stock acquired on the exercise of the Option,
including a disposition by sale, exchange, gift or transfer of legal
title within six months of the date such shares are transferred to the
Grantee, the Grantee will notify the Company promptly of such
disposition.
SECTION 15
NOTICES
15.1 All notices which may be or are required to be given by one
party to the other party pursuant to this Agreement shall be in writing
and shall be mailed by first class or certified mail, return receipt
requested, postage prepaid, or transmitted by hand delivery as follows:
<TABLE>
<S> <C>
If to the Company: DUSA Pharmaceuticals, Inc.
181 University Drive, Suite 1208
Toronto, ON M5H 3M7
CANADA
Attention: Dr. D. Geoffrey Shulman
If to the Grantee:
at the address of the Grantee from
time to time in the records of the
Company,
</TABLE>
or such other address as to which either party may from time
to time notify the other as aforesaid.
-8-
<PAGE> 9
SECTION 16
RESTRICTIONS ON TRANSFER
16.1 The Grantee understands and acknowledges that it, he or she is
subject to certain restrictions on transfer under the Securities Act of
1933 of the United States, as amended, (the "1933 Act") of the shares
issued pursuant to the exercise of the Option; such restrictions
provide that the shares may not be sold without registration or
exemption from registration under the 1933 Act; and, for purposes of
the Securities Act (Ontario) (the "Ontario Act"), the first trade of
such shares, other than a trade exempted by the Ontario Act, will be a
distribution unless the Company has been a reporting issuer for at
least twelve (12) months and the Company is not in default of any
requirement of the Ontario Act, disclosure has been made to the Ontario
Securities Commission of the exempt trade, no unusual effort is made to
prepare the market or create a demand for the shares, and no
extraordinary commission or consideration is paid with respect to the
trade, provided that such first trade is not from the holdings of a
so-called "control block".
SECTION 17
REPORTING REQUIREMENTS
17.1 The Grantee understands and acknowledges that it, he or she may
be subject to certain reporting requirements upon his receipt and
exercise of the Option, and in connection therewith, upon the receipt
and exercise of the Option, the Grantee agrees to timely file with the
Securities and Exchange Commission, the National Association of
Securities Dealers, Inc., and any appropriate Canadian securities
regulatory authorities, the appropriate documentation regarding his
ownership of the Company's securities.
SECTION 18
GOVERNING LAW
18.1 This Agreement shall be construed and enforced in accordance
with and governed by the laws of the State of New Jersey.
IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties hereto.
Attest: DUSA PHARMACEUTICALS, INC.,
a New Jersey corporation
By:
- ---------------------------------- -----------------------------------
Nanette W. Mantell, Secretary Dr. D. Geoffrey Shulman, President
GRANTEE
-----------------------------------
-9-
<PAGE> 10
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of DUSA Pharmaceuticals, Inc.
Pursuant to the terms and subject to the conditions set forth in the
Nonqualified Stock Option Agreement (the "Agreement") dated , between DUSA
Pharmaceuticals, Inc. and the undersigned, and the Option granted to the
undersigned by such Agreement, I hereby elect to purchase shares of Common
Stock of DUSA Pharmaceuticals, Inc. which were the subject of such Option. I
understand that such purchase is subject to all the terms and conditions of the
Agreement. I request that the certificates for such shares of Common Stock shall
be issued in the name of:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(please print or type name and address)
The undersigned hereby represents and warrants to, and agrees with the
Company as follows:
(a) The shares are being purchased for the undersigned's own account,
for investment purposes only, and not for the account of any other person, and
not with a view to distribution, assignment, or resale to others, or to
fractionalization in whole or in part and that the offering and sale of the
shares is intended to be exempt from registration under the Securities Act of
1933 (the "Act"). In furtherance thereof, the undersigned represents, warrants
and agrees as follows: (i) no other person has or will have a direct or indirect
beneficial interest in such shares and the undersigned will not sell,
hypothecate, or otherwise transfer his shares except in accordance with the Act
and applicable state securities laws or unless in the opinion of counsel for the
Company, an exemption from the registration requirements of the Act and such
laws is available; and (ii) the Company is under no obligation to register the
shares on behalf of the undersigned or to assist the undersigned in complying
with any exemption from registration.
(b) The undersigned has such knowledge and experience in financial and
business matters that the undersigned is capable of evaluating the merits and
risks of investment in the Company and of making an informed investment
decision.
<PAGE> 11
In full payment of the purchase price with respect to the Option
exercised, the undersigned hereby tenders payment of $___________ by certified
check or official bank cashier's check or money order payable in Canadian or
United States currency to the order of DUSA Pharmaceuticals, Inc.
Dated: X
----------------------------------
(Signature)
-----------------------------------------
Name (Please Print)
-----------------------------------------
(Address)
-----------------------------------------
Taxpayer Identification Number
-11-
<PAGE> 1
Exhibit 99.4
INCENTIVE STOCK OPTION AGREEMENT
UNDER THE DUSA PHARMACEUTICALS, INC. 1996 OMNIBUS PLAN, AS AMENDED
THIS AGREEMENT made as of the th day of , 199 , by and between DUSA
Pharmaceuticals, Inc., a corporation incorporated under the laws of the State of
New Jersey (the "Company"), and (the "Grantee").
WHEREAS, pursuant to the DUSA Pharmaceuticals, Inc. 1996 Omnibus Plan
(the "Plan"), the Company has determined that its interests will be advanced by
providing an incentive to the Grantee to acquire a proprietary interest in the
Company and, as a shareholder, to share in its success, with added incentive to
work effectively for and in the Company's interest;
WHEREAS, the Board of Directors of the Company approved a resolution,
effective , 199 , directing the officers of the Company to grant incentive
stock options to certain employees of the Company, subject to regulatory
approval;
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, the parties hereby agree as follows:
SECTION 1
GRANT
1.1 The Company hereby grants to the Grantee, as a matter of
separate agreement and not in lieu of salary or any other
compensation for services, the right and option (the "Option")
to purchase, in accordance with the vesting rights outlined in
Sections 3.1 and 3.6 hereof, up to shares of authorized but
unissued Common Stock, without par value ("Common Stock"), of
the Company on the terms and conditions herein set forth in
this Agreement.
SECTION 2
PRICE
2.1 The purchase price of the shares of Common Stock subject to
this Option shall be the fair market value of the shares of
Common Stock on the date of the grant ($ per share)(the
"Exercise Price").
<PAGE> 2
SECTION 3
WHEN EXERCISABLE
3.1 The aggregate number of shares of Common Stock of the Company
optioned by this Agreement (the "Optioned Shares") shall vest
in the Grantee as follows:
(a) one-quarter of the Option on the first anniversary of
the day of the grant, being ;
(b) one-quarter of the Option on the second anniversary
of the day of the grant, being ;
(c) one-quarter of the Option on the third anniversary of
the day of the grant, being ; and
(d) one-quarter of the Option on the fourth anniversary
of the day of the grant, being ;
and, except as provided by Sections 3.6 and 6.3 hereof, the Grantee
shall only be entitled to exercise this Option, in whole or in part, in
the amounts set out above and from and after the dates so specified.
3.2 Subject to Sections 3.1 and 3.6 hereof, the Grantee shall have
the right, at any time prior to 5:00 p.m. (Eastern Standard
Time) on the date prior to the tenth anniversary date hereof,
, provided that if such day is not a day on which the Company
is open for business then on the first following day on which
the Company is open for business, to exercise this Option for
any number of the Optioned Shares up to the maximum number of
shares specified in Section 1.1 above.
3.3 No less than one thousand (1,000) shares may be purchased upon
any one exercise of the Option granted hereby unless the
number of shares purchased at such time is the total number of
shares in respect of which the Option hereby granted is then
exercisable.
3.4 In no event shall any Option granted hereby be exercisable for
a fractional share.
3.5 From time to time, in its discretion, the Committee may offer
the Grantee the right to cancel any Option granted hereunder
in exchange for such consideration as the Committee shall
determine.
3.6 Notwithstanding anything contained in Sections 1 and 3.1
hereof, the Option shall continue to vest in the Grantee only
so long as the Grantee shall continue to serve the Company.
Should the Grantee cease to serve the Company, the provisions
of Section 5.2 shall apply with respect to the vesting and
exercise of the Option. The Board of
-2-
<PAGE> 3
Directors shall be entitled to determine if and when
employment or service to the Company has ceased with respect
to the Grantee.
3.7 To the extent not exercised, installments shall accumulate and
be exercisable by the Grantee, in whole or in part, in any
subsequent year included in the Option Period but not later
than the expiration of the Option Period.
3.8 The Options shall be exercised in accordance with Section 422
of the Internal Revenue Code of regulations as amended. To the
extent that the exercise of the Option does not meet the
requirements of Section 422 as hereinafter amended, the Option
shall be considered a nonqualified stock option.
3.9 No Option may be exercised during a calendar year which would
result in the purchase of shares of the Company having an
aggregate fair market value (determined at the time of the
grant of the Option ) in excess of One Hundred Thousand
Dollars ($100,000.00) except and to the extent that such
Option was first exercisable in preceding calendar years.
SECTION 4
HOW EXERCISABLE
4.1 Subject to such administrative regulations as the Committee
may from time to time adopt, the Grantee or beneficiary shall,
in order to exercise this Option give to the Company at its
principal office notice in writing in the form of Schedule A
hereto setting out the number of Optioned Shares with respect
to which the Option is being exercised. The notice must be
accompanied by payment of a certified check, official bank
cashier's check or money order in an amount equal to the
Exercise Price multiplied by the number of shares requested
and a duly executed copy of this Agreement. At the discretion
of the Committee, the Grantee may pay all or a portion of the
purchase price by tender of Common Stock or a combination of
stock and cash or other means determined by the Committee.
4.2 Any notice under this Section shall include an undertaking to
furnish or execute such documents as the Committee in its
discretion shall deem necessary (i) to evidence such exercise,
in whole or in part, of the Option evidenced by this
Agreement, (ii) to determine whether registration is then
required under the Securities Act of 1933, or any other law,
as then in effect, and (iii) to comply with or satisfy the
requirements of the Securities Act of 1933, or any other law,
as then in effect.
4.3 The Grantee agrees that all shares purchased by him or her
under the Option will be acquired for investment, not
distribution, and that any notice of exercise of the Option
must be accompanied by a written representation to that
effect, signed by the Grantee.
-3-
<PAGE> 4
SECTION 5
TERMINATION OF OPTION
5.1 The Option granted hereby shall terminate and be of no force
or effect upon the expiration of ten years from the date of
the Grant unless terminated prior to such time as provided
below.
5.2 Subject to Section 3.6 hereof, should the Grantee cease to
serve the Company, the Grantee's Option shall be exercised as
follows:
(a) If the Grantee's termination of service is other than for
cause, or for the reasons provided in subsections (b) - (d)
below, the Option may be exercised, to the extent exercisable,
for a period of three months after the date of such
termination of employment;
(b) If the Grantee's termination of service is by reason of
retirement or disability, the Option may be exercised, to the
extent exercisable, for a period of 12 months after the date
of such termination;
(c) In the event of death of the Grantee after termination of
service pursuant to (a) or (b) above, the person or persons to
whom the Grantee's rights are transferred by will or the laws
of descent and distribution shall have a period of three years
from the date of termination of the Grantee's employment or
service to exercise the Option which could have been exercised
during such period, subject to exercise during the remaining
term of the Option, subject to exercise during the remaining
term of the Option; and
(d) In the event of death of the Grantee while employed, the
Option shall become fully and immediately exercisable and may
be exercised by the person or persons to whom the Grantee's
rights are transferred by will or the laws of descent and
distribution for a period of three years after the Grantee's
death, subject to exercise during the remaining term of the
Option;
5.3 Any determination made by the Committee with respect to any
matter referred to in this Section 5 shall be final and
conclusive on all persons affected thereby. Employment by, or
service to, the Company shall be deemed to include employment
by, or service to, any subsidiary of the Company by the
Grantee.
SECTION 6
ADJUSTMENTS TO OPTION
6.1 Subject to any required action by the Committee and
shareholders, the number of shares provided for in the Option,
the price per share thereof and the number of shares provided
for in the Plan shall be proportionately adjusted for any
increase or
-4-
<PAGE> 5
decrease in the number of issued shares of the Company
resulting from the payment of a share dividend, a share split
or any transaction which is a "corporate transaction" (as
defined in the Treasury regulations promulgated under Section
424 of the Code).
6.2 Subject to any required action by the Committee and
shareholders, if the Company shall be the surviving entity in
any merger or consolidation, or after a consolidation of the
Company and one or more entities in which the resulting entity
is an independent entity, the Option shall pertain to and
apply to the securities of the surviving entity in an amount
that the board of directors of the surviving entity, at its
sole discretion, determines to be equivalent, as nearly as
practicable, to the nearest whole number and class of shares
that were subject to the Option. These shares of stock or
other securities shall, after such merger or consolidation, be
deemed to be shares for all purposes of the Plan. The
aforesaid adjustments, when applicable, shall be made by the
Committee, and the Committee's determination shall be final,
binding and conclusive. Any such adjustment in the shares or
other securities subject to the ISO (including any adjustment
in the Exercise Price) shall be made in such manner as not to
constitute a modification as defined by Section 424(h) (3) of
the Code and only to the extent permitted by Sections 422 and
424 of the Code.
6.3 In the event of a Change of Control (as defined below), any
and all outstanding Options not fully vested shall
automatically vest in full and shall be immediately
exercisable. The date on which such accelerated vesting and
immediate exercisability shall occur shall be the date of the
occurrence of the Change of Control.
A "Change of Control" shall be deemed to have taken place upon
(i) the acquisition by a third person, including a "group" as
defined in Section 13(d)(3) of the Securities Exchange Act of
1934, as amended, of shares of the Company having 50% or more
of the total number of votes that may be cast for the election
of Directors of the Company; (ii) shareholder approval of a
transaction for the acquisition of the Company, or
substantially all of its assets by another entity or for a
merger, reorganization, consolidation or other business
combination to which the Company is a part; or (iii) the
election during any period of 24 months or less of 50% or more
of the Directors of the Company where such Directors were not
in office immediately prior to such period provided, however,
that no "Change of Control" shall be deemed to have taken
place if the Directors of the Company in office on the date of
adoption of the Plan, or their successors in office nominated
by such Directors, affirmatively approve a resolution to such
effect.
Except as provided with respect to a Grantee in his or her
stock option agreement or other controlling agreement between
him or her and the Company, to the extent that the
acceleration, exercisability or parachute payment attributable
to the Option
-5-
<PAGE> 6
following a Change of Control would result in "excess
parachute payments"(1) when the former are aggregated with
other payments or benefits to the Grantee (whether or not
payable by the Plan), such parachute payments or benefits
provided to a Grantee under this Agreement shall be reduced to
the extent necessary so that no portion thereof shall be
subject to the excise tax imposed by Section 4999 of the Code.
This reduction will only be made if it will cause the
Grantee's net after-tax benefit to exceed the net after-tax
benefit that would have existed if such reduction were not
made. "Net after-tax benefit" shall be the sum of (i) all
payments and benefits which a Grantee receives or is entitled
to receive that would constitute a "parachute payment" under
Section 280G of the Code, less (ii) the amount of federal
income taxes payable with respect to the payments and benefits
described in (i) above, calculated at the maximum marginal
income tax rate(2) for the year in which such payments and
benefits shall be paid to the Grantee, less (iii) the amount
of excise taxes imposed with respect to the payments and
benefits described in (i) above by Section 4999 of the Code.
6.4 In the event of a change in the Company's shares which is
limited to a change of all of its authorized shares with par
value into the same number of shares with a different par
value or without par value, the shares resulting from any such
change shall be deemed to be shares within the meaning of the
Plan.
6.5 Except as herein before expressly provided in Paragraphs 6.1,
6.2, 6.3 and 6.4 of this Section 6, the Grantee shall have no
rights by reason of any subdivision or consolidation of shares
of any class or payment of any share dividend or any other
increase or decrease in the number of shares of any class or
by reason of any dissolution, liquidation, merger,
consolidation or spin-off of assets or stock of another
corporation and any issuance by the Company of shares of any
class, or securities convertible into shares of any class,
shall not affect the Option, and no adjustment by reason
thereof shall be made with respect to the number or price of
the Company's shares subject to the Option. The grant of the
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 or to merge, consolidate, dissolve, liquidate, sell
or transfer all or any part of its business or assets.
- ----------------------
(1) "Excess parachute payments" are defined in Section 280G of the Code
and are determined by tax counsel of the Company.
(2) "This rate is based on the rate for the year set forth in the Code at
the time of the first payment to the participant.
-6-
<PAGE> 7
SECTION 7
TRANSFER
7.1 This Option shall not be transferable by the Grantee in any
way other than by will and the laws of descent and
distribution, except as may be otherwise permitted by written
agreement of the Company or securities regulatory authorities.
Any other attempted assignment, transfer, pledge,
hypothecation or other disposition of the Option shall be void
and have no effect unless in accordance with the terms set
forth herein.
SECTION 8
WITHHOLDING TAXES
8.1 The Company shall have the right to retain and withhold from
any payment, under the Option granted, any amount that is to
be withheld or otherwise deducted and paid with respect to
such payment. At its discretion, the Company may require the
Grantee, if he or she receives shares under a nonqualified
stock option grant, to reimburse the Company for any taxes
that are required to be withheld by the Company, and may
withhold any distribution in whole or in part until the
Company is so reimbursed. In lieu thereof, the Company shall
have the right to withhold from any other cash amounts due (or
to become due) to the Grantee an amount equal to such taxes
required to be withheld by the Company to reimburse the
Company for any such taxes, or the Company may retain and
withhold a number of shares of Common Stock having a market
value not less than the amount of such taxes and cancel (in
whole or in part) any shares of Common Stock so withheld in
order to reimburse the Company for any such taxes.
SECTION 9
IMPACT ON OTHER BENEFITS
9.1 The value of the Option (either on the date of grant of the
Option or at the time the shares are vested) shall not be
includable as compensation or earnings for purposes of any
other benefit plan offered by the Company.
SECTION 10
ADMINISTRATION
10.1 The Committee shall have full authority and discretion
(subject only to the express provisions of the 1996 Omnibus
Plan, as amended) to decide all matters relating to the
administration and interpretation of the Plan and this
Agreement. All such Committee determinations shall be final,
conclusive and binding upon the Company, the Grantee and any
and all interested parties.
-7-
<PAGE> 8
SECTION 11
AGREEMENT TO CONTINUE IN EMPLOYMENT
OR SERVICE AS A CONSULTANT
11.1 The vesting of this Option is earned only by continuing
service to the Company at the will of the Company and not
through the act of being hired, being granted this Option, or
acquiring shares hereunder. Nothing in the Plan or this
Agreement shall confer on a Grantee any right to continue in
the employ of the Company or in the service of the Company as
a consultant or interfere in any way with the right of the
Company to terminate his or her employment or consultantship
at any time.
SECTION 12
AMENDMENT(S)
12.1 This Agreement shall be subject to the terms of the Plan as
amended except that the Option that is the subject of this
Agreement may not in any way be amended or terminated without
the Grantee's written consent.
SECTION 13
FORCE AND EFFECT
13.1 The various provisions of this Agreement are severable in
their entirety. Any determination of invalidity or
unenforceability of any one provision shall have no effect on
the continuing force and effect of the remaining provisions.
SECTION 14
NOTICE OF DISPOSITION OF SHARES
14.1 The Grantee agrees that if he or she should dispose of any
shares of Common Stock acquired on the exercise of the Option,
including a disposition by sale, exchange, gift or transfer of
legal title within six months of the date such shares are
transferred to the Grantee, the Grantee will notify the
Company promptly of such disposition.
SECTION 15
NOTICES
15.1 All notices which may be or are required to be given by one
party to the other party pursuant to this Agreement shall be
in writing and shall be mailed by first class or certified
mail, return receipt requested, postage prepaid, or
transmitted by hand delivery as follows:
-8-
<PAGE> 9
<TABLE>
<S> <C>
If to the Company: DUSA Pharmaceuticals, Inc.
181 University Avenue
Suite 1208
Toronto, ON M5H 3M7
CANADA
Attention: Dr. D. Geoffrey Shulman
If to the Grantee:
at the address of the Grantee from
time to time in the records of the
Company,
</TABLE>
or such other address as to which either party may from time
to time notify the other as aforesaid.
SECTION 16
RESTRICTIONS ON TRANSFER
16.1 The Grantee understands and acknowledges that he is subject to
certain restrictions on transfer under the Securities Act of
1933 of the United States, as amended, (the "1933 Act") of the
shares issued pursuant to the exercise of the Option; such
restrictions provide that the shares may not be sold without
registration or exemption from registration under the 1933
Act; and, for purposes of the Securities Act (Ontario) (the
"Ontario Act"), the first trade of such shares, other than a
trade exempted by the Ontario Act, will be a distribution
unless the Company has been a reporting issuer for at least
twelve (12) months and the Company is not in default of any
requirement of the Ontario Act, disclosure has been made to
the Ontario Securities Commission of the exempt trade, no
unusual effort is made to prepare the market or create a
demand for the shares, and no extraordinary commission or
consideration is paid with respect to the trade, provided that
such first trade is not from the holdings of a so-called
"control block".
SECTION 17
REPORTING REQUIREMENTS
17.1 The Grantee understands and acknowledges that he may be
subject to certain reporting requirements upon his receipt and
exercise of the Option, and in connection therewith, upon the
receipt and exercise of the Option, the Grantee agrees to
timely file with the Securities and Exchange Commission, the
National Association of Securities Dealers, Inc., and any
appropriate Canadian securities regulatory authorities, the
appropriate documentation regarding his ownership of the
Company's securities.
-9-
<PAGE> 10
SECTION 18
GOVERNING LAW
18.1 This Agreement shall be construed and enforced in accordance
with and governed by the laws of the State of New Jersey.
IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties hereto.
<TABLE>
<S> <C>
Attest: DUSA PHARMACEUTICALS, INC.,
a New Jersey Corporation
By
- -------------------------------- -----------------------------------
Nanette W. Mantell, Secretary Dr. D. Geoffrey Shulman, President
GRANTEE
---------------------
</TABLE>
-10-
<PAGE> 11
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of DUSA Pharmaceuticals, Inc.
Pursuant to the terms and subject to the conditions set forth in the
Incentive Stock Option Agreement (the "Agreement") dated , between
DUSA Pharmaceuticals, Inc. and the undersigned, and the Option granted to the
undersigned by such Agreement, I hereby elect to purchase shares
of Common Stock of DUSA Pharmaceuticals, Inc. which were the subject of such
Option. I understand that such purchase is subject to all the terms and
conditions of the Agreement. I request that the certificates for such shares of
Common Stock shall be issued in the name of:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(please print or type name and address)
The undersigned hereby represents and warrants to, and agrees with the
Company as follows:
(a) The shares are being purchased for the undersigned's own account,
for investment purposes only, and not for the account of any other person, and
not with a view to distribution, assignment, or resale to others, or to
fractionalization in whole or in part and that the offering and sale of the
shares is intended to be exempt from registration under the Securities Act of
1933 (the "Act"). In furtherance thereof, the undersigned represents, warrants
and agrees as follows: (i) no other person has or will have a direct or indirect
beneficial interest in such shares and the undersigned will not sell,
hypothecate, or otherwise transfer his shares except in accordance with the Act
and applicable state securities laws or unless in the opinion of counsel for the
Company, an exemption from the registration requirements of the Act and such
laws is available; and (ii) the Company is under no obligation to register the
shares on behalf of the undersigned or to assist the undersigned in complying
with any exemption from registration.
<PAGE> 12
(b) The undersigned has such knowledge and experience in financial and
business matters that the undersigned is capable of evaluating the merits and
risks of investment in the Company and of making an informed investment
decision.
In full payment of the purchase price with respect to the Option
exercised, the undersigned hereby tenders payment of $___________ by certified
check or official bank cashier's check or money order payable in Canadian or
United States currency to the order of DUSA Pharmaceuticals, Inc.
Dated: X
-------------------------------------
(Signature)
-------------------------------------
Name (Please Print)
-------------------------------------
(Address)
-------------------------------------
Taxpayer Identification Number
-12-
<PAGE> 1
Exhibit 99.5
NONQUALIFIED STOCK OPTION AGREEMENT
UNDER THE DUSA PHARMACEUTICALS, INC. 1996 OMNIBUS PLAN, AS AMENDED
THIS AGREEMENT made as of the th day of , by and between DUSA
Pharmaceuticals, Inc., a corporation incorporated under the laws of the State of
New Jersey (the "Company"), and , an individual residing in the State (the
"Grantee").
WHEREAS, pursuant to the DUSA Pharmaceuticals, Inc. 1996 Omnibus Plan,
as amended (the "Plan"), the Company has determined that its interests will be
advanced by providing an incentive to the Grantee to acquire a proprietary
interest in the Company and, as a shareholder, to share in its success, with
added incentive to work effectively for and in the Company's interest;
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, the parties hereby agree as follows:
SECTION 1
GRANT
1.1 The Company hereby grants to the Grantee, as a matter of
separate agreement and not in lieu of salary or any other
compensation for services, the right and option (the "Option")
to purchase, in accordance with the vesting rights outlined in
Sections 3.1 and 3.6 hereof, up to shares of authorized but
unissued Common Stock, without par value ("Common Stock"), of
the Company on the terms and conditions herein set forth in
this Agreement.
SECTION 2
PRICE
2.1 The exercise price of the shares of Common Stock subject to
this Option shall be determined on the day of the grant based
upon the fair market value of the shares of Common Stock on
such date (i.e., $ per share) and calculated by increasing
such fair market value price by ten percent (10%) per year for
four (4) years, rounded to the nearest cent (the "Exercise
Price").
SECTION 3
WHEN EXERCISABLE
3.1 This Option shall vest in the Grantee, and become exercisable,
as to twenty-five percent (25%) of the shares on the first
anniversary of the date of the grant, and an additional
twenty-five percent (25%) of the shares with respect to which
the Option has been granted on and after each of the three (3)
succeeding anniversaries of said date. Installments or
portions vested and not exercised in earlier periods shall be
accumulated and be available for exercise in later periods at
the then applicable Exercise Price as follows:
<PAGE> 2
3.1.1 up to twenty-five percent (25%) of the shares may be
exercised on or after the first anniversary of the
date of the grant, being at an Exercise Price of $ ;
3.1.2 up to fifty percent (50%) of the shares may be
exercised on or after the second anniversary of the
date of the grant, being at an Exercise Price of $ ;
3.1.3 up to seventy-five percent (75%) of the shares may be
exercised on or after the second anniversary of the
date of the grant, being at an Exercise Price of $ ;
and
3.1.4 up to one hundred percent (100%) of the shares may be
exercised on or after the second anniversary of the
date of the grant, being at an Exercise Price of $ ;
and, except as provided by Sections 3.6 and 6.3 hereof, the
Grantee shall only be entitled to exercise this Option, in
whole or in part, in the amounts and at the Exercise Price set
out above and from and after the dates so specified.
3.2 Subject to Sections 3.1 and 3.6 hereof, the Grantee shall have
the right, at any time prior to 5:00 p.m. (Eastern Standard
Time) on the date prior to the tenth anniversary date hereof,
being , provided that if such day is not a day on which the
Company is open for business then on the first following day
on which the Company is open for business, to exercise this
Option for any number of the Optioned Shares up to the maximum
number of shares specified in Section 1.1 above.
3.3 No less than one thousand (1,000) shares may be purchased upon
any one exercise of the Option granted hereby unless the
number of shares purchased at such time is the total number of
shares in respect of which the Option hereby granted is then
exercisable.
3.4 In no event shall any Option granted hereby be exercisable for
a fractional share.
3.5 From time to time, in its discretion, the Committee may offer
the Grantee the right to cancel any Option granted hereunder
in exchange for such consideration as the Committee shall
determine.
3.6 Notwithstanding anything contained in Sections 1 and 3.1
hereof, the Option shall continue to vest in the Grantee only
so long as the Grantee shall continue to serve the Company.
Should the Grantee cease to serve in all such capacities, the
Option shall not further vest or become exercisable, and the
provisions of Section 5.2 shall apply with respect to the
exercise of the Option which has already vested in the Grantee
and has not yet been exercised. The Board of Directors shall
be entitled to determine if and when employment or service to
the Company has ceased with respect to the Grantee.
SECTION 4
HOW EXERCISABLE
-2-
<PAGE> 3
4.1 Subject to such administrative regulations as the Committee
may from time to time adopt, the Grantee or beneficiary shall,
in order to exercise this Option give to the Company at its
principal office notice in writing in the form of Schedule A
hereto setting out the number of Optioned Shares with respect
to which the Option is being exercised. The notice must be
accompanied by payment of a certified check, official bank
cashier's check or money order in an amount equal to the
Exercise Price multiplied by the number of shares requested
and a duly executed copy of this Agreement.
4.2 Any notice under this Section shall include an undertaking to
furnish or execute such documents as the Committee in its
discretion shall deem necessary (i) to evidence such exercise,
in whole or in part, of the Option evidenced by this
Agreement, (ii) to determine whether registration is then
required under the Securities Act of 1933, or any other law,
as then in effect, and (iii) to comply with or satisfy the
requirements of the Securities Act of 1933, or any other law,
as then in effect.
4.3 The Grantee agrees that all shares purchased by him or her
under the Option will be acquired for investment, not
distribution, and that any notice of exercise of the Option
must be accompanied by a written representation to that
effect, signed by the Grantee.
SECTION 5
TERMINATION OF OPTION
5.1 The Option granted hereby shall terminate and be of no force
or effect upon the expiration of ten years from the date of
the Grant unless terminated prior to such time as provided
below.
5.2 Subject to Section 3.6 hereof, should the Grantee cease to
serve the Company, the Grantee's Option shall be exercised as
follows:
5.2.1 If the Grantee's termination of employment or service
is other than for cause, or for the reasons provided
in subsections (b) - (d) below, the Option may be
exercised, to the extent exercisable, for a period of
three months after the date of such termination of
employment;
5.2.2 If the Grantee's termination of employment or service
is by reason of retirement or disability, the Option
may be exercised, to the extent exercisable, for a
period of 12 months after the date of such
termination;
5.2.3 In the event of death of the Grantee after
termination of employment or service pursuant to (a)
or (b) above, the person or persons to whom the
Grantee's rights are transferred by will or the laws
of descent and distribution shall have a period of
three years from the date of termination of the
Grantee's employment or service to exercise the
Option which could have been exercised during such
period; and
5.2.4 In the event of death of the Grantee while employed,
the Option shall become fully and immediately
exercisable and may be exercised by the person or
-3-
<PAGE> 4
persons to whom the Grantee's rights are transferred
by will or the laws of descent and distribution for a
period of three years after the Grantee's death,
subject to exercise during the remaining term of the
Option;
5.3 Any determination made by the Committee with respect to any
matter referred to in this Section 5 shall be final and
conclusive on all persons affected thereby. Employment by, or
service to, the Company shall be deemed to include employment
by, or service to, any subsidiary of the Company by the
Grantee.
SECTION 6
ADJUSTMENTS TO OPTION
6.1 Subject to any required action by the Committee and the
Company's shareholders, the number of shares provided for in
the Option, the price per share thereof and the number of
shares provided for in the Plan shall be proportionately
adjusted for any increase or decrease in the number of issued
shares of the Company resulting from the payment of a share
dividend, a share split or any transaction which is a
"corporate transaction" (as defined in the Treasury
regulations promulgated under Section 424 of the Code.
6.2 Subject to any required action by the Committee and the
Company's shareholders, if the Company shall be the surviving
entity in any merger or consolidation, or after a
consolidation of the Company and one or more entities in which
the resulting entity is an independent entity, the Option
shall pertain to and apply to the securities of the surviving
entity in an amount that the board of directors of the
surviving entity, at its sole discretion, determines to be
equivalent, as nearly as practicable, to the nearest whole
number and class of shares that were subject to the Option.
These shares of stock or other securities shall, after such
merger or consolidation, be deemed to be shares for all
purposes of the Plan. The aforesaid adjustments, when
applicable, shall be made by the Committee, and the
Committee's determination shall be final, binding and
conclusive.
6.3 In the event of a Change of Control (as defined below), any
and all outstanding Options not fully vested shall
automatically vest in full and shall be immediately
exercisable. The date on which such accelerated vesting and
immediate exercisability shall occur shall be the date of the
occurrence of the Change of Control.
A "Change of Control" shall be deemed to have taken place upon
(i) the acquisition by a third person, including a "group" as
defined in Section 13(d)(3) of the Securities Exchange Act of
1934, as amended, of shares of the Company having 50% or more
of the total number of votes that may be cast for the election
of Directors of the Company; (ii) shareholder approval of a
transaction for the acquisition of the Company, or
substantially all of its assets by another entity or for a
merger, reorganization, consolidation or other business
combination to which the Company is a part; or (iii) the
election during any period of 24 months or less of 50% or more
of the Directors of the Company where such Directors were not
in office immediately prior to such period provided, however,
that no "Change of Control" shall be deemed to have taken
place if the Directors of the Company in office on the date of
adoption
-4-
<PAGE> 5
of the Plan, or their successors in office nominated by such
Directors, affirmatively approve a resolution to such effect.
Except as provided with respect to a Grantee in his or her
stock option agreement or other controlling agreement between
him or her and the Company, to the extent that the
acceleration, exercisability or parachute payment attributable
to the Option following a Change of Control would result in
"excess parachute payments"(1) when the former are aggregated
with other payments or benefits to the Grantee (whether or not
payable by the Plan), such parachute payments or benefits
provided to a Grantee under this Agreement shall be reduced to
the extent necessary so that no portion thereof shall be
subject to the excise tax imposed by Section 4999 of the Code.
This reduction will only be made if it will cause the
Grantee's net after-tax benefit to exceed the net after-tax
benefit that would have existed if such reduction were not
made. "Net after-tax benefit" shall be the sum of (i) all
payments and benefits which a Grantee receives or is entitled
to receive that would constitute a "parachute payment" under
Section 280G of the Code, less (ii) the amount of federal
income taxes payable with respect to the payments and benefits
described in (i) above, calculated at the maximum marginal
income tax rate(2) for the year in which such payments and
benefits shall be paid to the Grantee, less (iii) the amount
of excise taxes imposed with respect to the payments and
benefits described in (i) above by Section 4999 of the Code.
6.4 In the event of a change in the Company's shares which is
limited to a change of all of its authorized shares with par
value into the same number of shares with a different par
value or without par value, the shares resulting from any such
change shall be deemed to be shares within the meaning of the
Plan.
6.5 Except as herein before expressly provided in Paragraphs 6.1,
6.2, 6.3 and 6.4 of this Section 6, the Grantee shall have no
rights by reason of any subdivision or consolidation of shares
of any class or payment of any share dividend or any other
increase or decrease in the number of shares of any class or
by reason of any dissolution, liquidation, merger,
consolidation or spin-off of assets or stock of another
corporation and any issuance by the Company of shares of any
class, or securities convertible into shares of any class,
shall not affect the Option, and no adjustment by reason
thereof shall be made with respect to the number or price of
the Company's shares subject to the Option. The grant of the
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 or to merge, consolidate, dissolve, liquidate, sell
or transfer all or any part of its business or assets.
SECTION 7
TRANSFER
- ---------------
(1)"Excess parachute payments" are defined in Section 280G of the Code and
are determined by tax counsel of the Company.
(2)"This rate is based on the rate for the year set forth in the Code at
the time of the first payment to the participant.
-5-
<PAGE> 6
7.1 This Option shall not be transferable by any individual
Grantee in any way other than by will and the laws of descent
and distribution. During the lifetime of any individual
Grantee, the Option shall be exercisable only by him or her.
Any other attempted assignment, transfer, pledge,
hypothecation or other disposition of the Option by any
Grantee shall be void and have no effect unless in accordance
with the terms set forth herein.
SECTION 8
WITHHOLDING TAXES
8.1 The Company shall have the right to retain and withhold from
any payment, under the Option granted, any amount that is to
be withheld or otherwise deducted and paid with respect to
such payment. At its discretion, the Company may require the
Grantee, if he or she receives shares under a nonqualified
stock option grant, to reimburse the Company for any taxes
that are required to be withheld by the Company, and may
withhold any distribution in whole or in part until the
Company is so reimbursed. In lieu thereof, the Company shall
have the right to withhold from any other cash amounts due (or
to become due) to the Grantee an amount equal to such taxes
required to be withheld by the Company to reimburse the
Company for any such taxes, or the Company may retain and
withhold a number of shares of Common Stock having a market
value not less than the amount of such taxes and cancel (in
whole or in part) any shares of Common Stock so withheld in
order to reimburse the Company for any such taxes.
SECTION 9
IMPACT ON OTHER BENEFITS
9.1 The value of the Option (either on the date of grant of the
Option or at the time the shares are vested) shall not be
includable as compensation or earnings for purposes of any
other benefit plan offered by the Company.
SECTION 10
ADMINISTRATION
10.1 The Committee shall have full authority and discretion
(subject only to the express provisions of the 1996 Omnibus
Plan, as amended) to decide all matters relating to the
administration and interpretation of the Plan and this
Agreement. All such Committee determinations shall be final,
conclusive and binding upon the Company, the Grantee and any
and all interested parties.
SECTION 11
AGREEMENT TO CONTINUE IN EMPLOYMENT
OR SERVICE AS A CONSULTANT
11.1 Nothing in the Plan or this Agreement shall confer on a
Grantee any right to continue in the employ of the Company or
in the service of the Company as a consultant or interfere in
any way with the right of the Company to terminate his or her
employment or consultantship at any time.
-6-
<PAGE> 7
-7-
<PAGE> 8
SECTION 12
AMENDMENT(S)
12.1 This Agreement shall be subject to the terms of the Plan as
amended except that the Option that is the subject of this
Agreement may not in any way be amended or terminated without
the Grantee's written consent.
SECTION 13
FORCE AND EFFECT
13.1 The various provisions of this Agreement are severable in
their entirety. Any determination of invalidity or
unenforceability of any one provision shall have no effect on
the continuing force and effect of the remaining provisions.
SECTION 14
NOTICE OF DISPOSITION OF SHARES
14.1 The Grantee agrees that if it, he or she should dispose of any
shares of Common Stock acquired on the exercise of the Option,
including a disposition by sale, exchange, gift or transfer of
legal title within six months of the date such shares are
transferred to the Grantee, the Grantee will notify the
Company promptly of such disposition.
SECTION 15
NOTICES
15.1 All notices which may be or are required to be given by one
party to the other party pursuant to this Agreement shall be
in writing and shall be mailed by first class or certified
mail, return receipt requested, postage prepaid, or
transmitted by hand delivery as follows:
<TABLE>
<S> <C>
If to the Company: DUSA Pharmaceuticals, Inc.
181 University Avenue, Suite 1208
Toronto, ON M5H 3M7
CANADA
Attention: Dr. D. Geoffrey Shulman
If to the Grantee:
at the address of the Grantee from
time to time in the records of the
Company,
</TABLE>
or such other address as to which either party may from time
to time notify the other as aforesaid.
-8-
<PAGE> 9
SECTION 16
RESTRICTIONS ON TRANSFER
16.1 The Grantee understands and acknowledges that it, he or she is
subject to certain restrictions on transfer under the
Securities Act of 1933 of the United States, as amended, (the
"1933 Act") of the shares issued pursuant to the exercise of
the Option; such restrictions provide that the shares may not
be sold without registration or exemption from registration
under the 1933 Act; and, for purposes of the Securities Act
(Ontario) (the "Ontario Act"), the first trade of such shares,
other than a trade exempted by the Ontario Act, will be a
distribution unless the Company has been a reporting issuer
for at least twelve (12) months and the Company is not in
default of any requirement of the Ontario Act, disclosure has
been made to the Ontario Securities Commission of the exempt
trade, no unusual effort is made to prepare the market or
create a demand for the shares, and no extraordinary
commission or consideration is paid with respect to the trade,
provided that such first trade is not from the holdings of a
so-called "control block".
SECTION 17
REPORTING REQUIREMENTS
17.1 The Grantee understands and acknowledges that it, he or she
may be subject to certain reporting requirements upon his
receipt and exercise of the Option, and in connection
therewith, upon the receipt and exercise of the Option, the
Grantee agrees to timely file with the Securities and Exchange
Commission, the National Association of Securities Dealers,
Inc., and any appropriate Canadian securities regulatory
authorities, the appropriate documentation regarding his
ownership of the Company's securities.
SECTION 18
GOVERNING LAW
18.1 This Agreement shall be construed and enforced in accordance
with and governed by the laws of the State of New Jersey.
IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties hereto.
Attest: DUSA PHARMACEUTICALS, INC.,
a New Jersey corporation
By:
- ---------------------------------- ---------------------------
Nanette W, Mantell, Secretary Ronald L. Carroll,
Executive Vice President
GRANTEE
-------------------------------
-9-
<PAGE> 10
-10-
<PAGE> 11
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of DUSA Pharmaceuticals, Inc.
Pursuant to the terms and subject to the conditions set forth in the
Nonqualified Stock Option Agreement (the "Agreement") dated , between DUSA
Pharmaceuticals, Inc. and the undersigned, and the Option granted to the
undersigned by such Agreement, I hereby elect to purchase_______________________
shares of Common Stock of DUSA Pharmaceuticals, Inc. which were the subject of
such Option. I understand that such purchase is subject to all the terms and
conditions of the Agreement. I request that the certificates for such shares of
Common Stock shall be issued in the name of:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(please print or type name and address)
The undersigned hereby represents and warrants to, and agrees with the
Company as follows:
(a) The shares are being purchased for the undersigned's own account,
for investment purposes only, and not for the account of any other person, and
not with a view to distribution, assignment, or resale to others, or to
fractionalization in whole or in part and that the offering and sale of the
shares is intended to be exempt from registration under the Securities Act of
1933 (the "Act"). In furtherance thereof, the undersigned represents, warrants
and agrees as follows: (i) no other person has or will have a direct or indirect
beneficial interest in such shares and the undersigned will not sell,
hypothecate, or otherwise transfer his shares except in accordance with the Act
and applicable state securities laws or unless in the opinion of counsel for the
Company, an exemption from the registration requirements of the Act and such
laws is available; and (ii) the Company is under no obligation to register the
shares on behalf of the undersigned or to assist the undersigned in complying
with any exemption from registration.
(b) The undersigned has such knowledge and experience in financial and
business matters that the undersigned is capable of evaluating the merits and
risks of investment in the Company and of making an informed investment
decision.
<PAGE> 12
In full payment of the purchase price with respect to the Option
exercised, the undersigned hereby tenders payment of $___________ by certified
check or official bank cashier's check or money order payable in Canadian or
United States currency to the order of DUSA Pharmaceuticals, Inc.
Dated: X
----------------------------------
(Signature)
-------------------------------------
Name (Please Print)
-------------------------------------
(Address)
-------------------------------------
Taxpayer Identification Number
-12-
<PAGE> 1
Exhibit 99.6
INCENTIVE STOCK OPTION AGREEMENT
UNDER THE DUSA PHARMACEUTICALS, INC. 1996 OMNIBUS PLAN, AS AMENDED
THIS AGREEMENT made as of the th day of , by and between DUSA
Pharmaceuticals, Inc., a corporation incorporated under the laws of the State of
New Jersey (the "Company"), and , (the "Grantee").
WHEREAS, pursuant to the DUSA Pharmaceuticals, Inc. 1996 Omnibus Plan,
as amended (the "Plan"), the Company has determined that its interests will be
advanced by providing an incentive to the Grantee to acquire a proprietary
interest in the Company and, as a shareholder, to share in its success, with
added incentive to work effectively for and in the Company's interest;
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, the parties hereby agree as follows:
SECTION 1
GRANT
1.1 The Company hereby grants to the Grantee, as a matter of
separate agreement and not in lieu of salary or any other
compensation for services, the right and option (the "Option")
to purchase, in accordance with the vesting rights outlined in
Sections 3.1 and 3.6 hereof, up to shares of authorized but
unissued Common Stock, without par value ("Common Stock"), of
the Company on the terms and conditions herein set forth in
this Agreement.
SECTION 2
PRICE
2.1 The exercise price of the shares of Common Stock subject to
this Option shall be determined on the day of the grant based
upon the fair market value of the shares of Common Stock on
such date (i.e., $ per share) and calculated by increasing
such fair market value price by ten percent (10%) per year for
four (4) years, rounded to the nearest cent (the "Exercise
Price").
SECTION 3
WHEN EXERCISABLE
3.1 This Option shall vest in the Grantee, and become exercisable,
as to twenty-five percent (25%) of the shares on the first
anniversary of the date of the grant, and an
<PAGE> 2
additional twenty-five percent (25%) of the shares with
respect to which the Option has been granted on and after each
of the three (3) succeeding anniversaries of said date.
Installments or portions vested and not exercised in earlier
periods shall be accumulated and be available for exercise in
later periods at the then applicable Exercise Price as
follows:
3.1.1 up to twenty-five percent (25%) of the shares may be
exercised on or after the first anniversary of the
date of the grant, being at an Exercise Price of $ ;
3.1.2 up to fifty percent (50%) of the shares may be
exercised on or after the second anniversary of the
date of the grant, being at an Exercise Price of $ ;
3.1.3 up to seventy-five percent (75%) of the shares may be
exercised on or after the second anniversary of the
date of the grant, being at an Exercise Price of $ ;
and
3.1.4 up to one hundred percent (100%) of the shares may be
exercised on or after the second anniversary of the
date of the grant, being at an Exercise Price of $ ;
and, except as provided by Sections 3.6 and 6.3 hereof, the
Grantee shall only be entitled to exercise this Option, in
whole or in part, in the amounts, at the Exercise Price, set
out above and from and after the dates so specified.
3.2 Subject to Sections 3.1 and 3.6 hereof, the Grantee shall have
the right, at any time prior to 5:00 p.m. (Eastern Standard
Time) on the date prior to the tenth anniversary date hereof,
, provided that if such day is not a day on which the Company
is open for business then on the first following day on which
the Company is open for business, to exercise this Option for
any number of the Optioned Shares up to the maximum number of
shares specified in Section 1.1 above.
3.3 No less than one thousand (1,000) shares may be purchased upon
any one exercise of the Option granted hereby unless the
number of shares purchased at such time is the total number of
shares in respect of which the Option hereby granted is then
exercisable.
3.4 In no event shall any Option granted hereby be exercisable for
a fractional share.
3.5 From time to time, in its discretion, the Committee may offer
the Grantee the right to cancel any Option granted hereunder
in exchange for such consideration as the Committee shall
determine.
3.6 Notwithstanding anything contained in Sections 1 and 3.1
hereof, the Option shall continue to vest in the Grantee only
so long as the Grantee shall continue to serve the
-2-
<PAGE> 3
Company. Should the Grantee cease to serve the Company, the
provisions of Section 5.2 shall apply with respect to the
vesting and exercise of the Option. The Board of Directors
shall be entitled to determine if and when employment or
service to the Company has ceased with respect to the Grantee.
3.7 The Options shall be exercised in accordance with Section 422
of the Internal Revenue Code of regulations as amended. To the
extent that the exercise of the Option does not meet the
requirements of Section 422 as hereinafter amended, the Option
shall be considered a nonqualified stock option.
3.8 No Option may be exercised during a calendar year which would
result in the purchase of shares of the Company having an
aggregate fair market value (determined at the time of the
grant of the Option ) in excess of One Hundred Thousand
Dollars ($100,000.00) except and to the extent that such
Option was first exercisable in preceding calendar years.
SECTION 4
HOW EXERCISABLE
4.1 Subject to such administrative regulations as the Committee
may from time to time adopt, the Grantee or beneficiary shall,
in order to exercise this Option give to the Company at its
principal office notice in writing in the form of Schedule A
hereto setting out the number of Optioned Shares with respect
to which the Option is being exercised. The notice must be
accompanied by payment of a certified check, official bank
cashier's check or money order in an amount equal to the
Exercise Price multiplied by the number of shares requested
and a duly executed copy of this Agreement. At the discretion
of the Committee, the Grantee may pay all or a portion of the
purchase price by tender of Common Stock or a combination of
stock and cash or other means determined by the Committee.
4.2 Any notice under this Section shall include an undertaking to
furnish or execute such documents as the Committee in its
discretion shall deem necessary (i) to evidence such exercise,
in whole or in part, of the Option evidenced by this
Agreement, (ii) to determine whether registration is then
required under the Securities Act of 1933, or any other law,
as then in effect, and (iii) to comply with or satisfy the
requirements of the Securities Act of 1933, or any other law,
as then in effect.
4.3 The Grantee agrees that all shares purchased by him or her
under the Option will be acquired for investment, not
distribution, and that any notice of exercise of the Option
must be accompanied by a written representation to that
effect, signed by the Grantee.
-3-
<PAGE> 4
SECTION 5
TERMINATION OF OPTION
5.1 The Option granted hereby shall terminate and be of no force
or effect upon the expiration of ten years from the date of
the Grant unless terminated prior to such time as provided
below.
5.2 Subject to Section 3.6 hereof, should the Grantee cease to
serve the Company, the Grantee's Option shall be exercised as
follows:
5.2.1 If the Grantee's termination of service is other than
for cause, or for the reasons provided in subsections
(b) - (d) below, the Option may be exercised, to the
extent exercisable, for a period of three months
after the date of such termination of employment;
5.2.2 If the Grantee's termination of service is by reason
of retirement or disability, the Option may be
exercised, to the extent exercisable, for a period of
12 months after the date of such termination;
5.2.3 In the event of death of the Grantee after
termination of service pursuant to (a) or (b) above,
the person or persons to whom the Grantee's rights
are transferred by will or the laws of descent and
distribution shall have a period of three years from
the date of termination of the Grantee's employment
or service to exercise the Option which could have
been exercised during such period, subject to
exercise during the remaining term of the Option,
subject to exercise during the remaining term of the
Option; and
5.2.4 In the event of death of the Grantee while employed,
the Option shall become fully and immediately
exercisable and may be exercised by the person or
persons to whom the Grantee's rights are transferred
by will or the laws of descent and distribution for a
period of three years after the Grantee's death,
subject to exercise during the remaining term of the
Option;
5.3 Any determination made by the Committee with respect to any
matter referred to in this Section 5 shall be final and
conclusive on all persons affected thereby. Employment by, or
service to, the Company shall be deemed to include employment
by, or service to, any subsidiary of the Company by the
Grantee.
SECTION 6
ADJUSTMENTS TO OPTION
6.1 Subject to any required action by the Committee and
shareholders, the number of shares provided for in the Option,
the price per share thereof and the number of
-4-
<PAGE> 5
shares provided for in the Plan shall be proportionately
adjusted for any increase or decrease in the number of issued
shares of the Company resulting from the payment of a share
dividend, a share split or any transaction which is a
"corporate transaction" (as defined in the Treasury
regulations promulgated under Section 424 of the Code).
6.2 Subject to any required action by the Committee and
shareholders, if the Company shall be the surviving entity in
any merger or consolidation, or after a consolidation of the
Company and one or more entities in which the resulting entity
is an independent entity, the Option shall pertain to and
apply to the securities of the surviving entity in an amount
that the board of directors of the surviving entity, at its
sole discretion, determines to be equivalent, as nearly as
practicable, to the nearest whole number and class of shares
that were subject to the Option. These shares of stock or
other securities shall, after such merger or consolidation, be
deemed to be shares for all purposes of the Plan. The
aforesaid adjustments, when applicable, shall be made by the
Committee, and the Committee's determination shall be final,
binding and conclusive. Any such adjustment in the shares or
other securities subject to the ISO (including any adjustment
in the Exercise Price) shall be made in such manner as not to
constitute a modification as defined by Section 424(h) (3) of
the Code and only to the extent permitted by Sections 422 and
424 of the Code.
6.3 In the event of a Change of Control (as defined below), any
and all outstanding Options not fully vested shall
automatically vest in full and shall be immediately
exercisable. The date on which such accelerated vesting and
immediate exercisability shall occur shall be the date of the
occurrence of the Change of Control.
A "Change of Control" shall be deemed to have taken place upon
(i) the acquisition by a third person, including a "group" as
defined in Section 13(d)(3) of the Securities Exchange Act of
1934, as amended, of shares of the Company having 50% or more
of the total number of votes that may be cast for the election
of Directors of the Company; (ii) shareholder approval of a
transaction for the acquisition of the Company, or
substantially all of its assets by another entity or for a
merger, reorganization, consolidation or other business
combination to which the Company is a part; or (iii) the
election during any period of 24 months or less of 50% or more
of the Directors of the Company where such Directors were not
in office immediately prior to such period provided, however,
that no "Change of Control" shall be deemed to have taken
place if the Directors of the Company in office on the date of
adoption of the Plan, or their successors in office nominated
by such Directors, affirmatively approve a resolution to such
effect.
Except as provided with respect to a Grantee in his or her
stock option agreement or other controlling agreement between
him or her and the Company, to the extent that the
acceleration, exercisability or parachute payment attributable
to the Option
-5-
<PAGE> 6
following a Change of Control would result in "excess
parachute payments"(1) when the former are aggregated with
other payments or benefits to the Grantee (whether or not
payable by the Plan), such parachute payments or benefits
provided to a Grantee under this Agreement shall be reduced to
the extent necessary so that no portion thereof shall be
subject to the excise tax imposed by Section 4999 of the Code.
This reduction will only be made if it will cause the
Grantee's net after-tax benefit to exceed the net after-tax
benefit that would have existed if such reduction were not
made. "Net after-tax benefit" shall be the sum of (i) all
payments and benefits which a Grantee receives or is entitled
to receive that would constitute a "parachute payment" under
Section 280G of the Code, less (ii) the amount of federal
income taxes payable with respect to the payments and benefits
described in (i) above, calculated at the maximum marginal
income tax rate(2) for the year in which such payments and
benefits shall be paid to the Grantee, less (iii) the amount
of excise taxes imposed with respect to the payments and
benefits described in (i) above by Section 4999 of the Code.
6.4 In the event of a change in the Company's shares which is
limited to a change of all of its authorized shares with par
value into the same number of shares with a different par
value or without par value, the shares resulting from any such
change shall be deemed to be shares within the meaning of the
Plan.
6.5 Except as herein before expressly provided in Paragraphs 6.1,
6.2, 6.3 and 6.4 of this Section 6, the Grantee shall have no
rights by reason of any subdivision or consolidation of shares
of any class or payment of any share dividend or any other
increase or decrease in the number of shares of any class or
by reason of any dissolution, liquidation, merger,
consolidation or spin-off of assets or stock of another
corporation and any issuance by the Company of shares of any
class, or securities convertible into shares of any class,
shall not affect the Option, and no adjustment by reason
thereof shall be made with respect to the number or price of
the Company's shares subject to the Option. The grant of the
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 or to merge, consolidate, dissolve, liquidate, sell
or transfer all or any part of its business or assets.
- -----------------
(1) "Excess parachute payments" are defined in Section 280G of the Code
and are determined by tax counsel of the Company.
(2) "This rate is based on the rate for the year set forth in the Code at
the time of the first payment to the participant.
-6-
<PAGE> 7
SECTION 7
TRANSFER
7.1 This Option shall not be transferable by the Grantee in any
way other than by will and the laws of descent and
distribution, except as may be otherwise permitted by written
agreement of the Company or securities regulatory authorities.
Any other attempted assignment, transfer, pledge,
hypothecation or other disposition of the Option shall be void
and have no effect unless in accordance with the terms set
forth herein.
SECTION 8
WITHHOLDING TAXES
8.1 The Company shall have the right to retain and withhold from
any payment, under the Option granted, any amount that is to
be withheld or otherwise deducted and paid with respect to
such payment. At its discretion, the Company may require the
Grantee, if he or she receives shares under a nonqualified
stock option grant, to reimburse the Company for any taxes
that are required to be withheld by the Company, and may
withhold any distribution in whole or in part until the
Company is so reimbursed. In lieu thereof, the Company shall
have the right to withhold from any other cash amounts due (or
to become due) to the Grantee an amount equal to such taxes
required to be withheld by the Company to reimburse the
Company for any such taxes, or the Company may retain and
withhold a number of shares of Common Stock having a market
value not less than the amount of such taxes and cancel (in
whole or in part) any shares of Common Stock so withheld in
order to reimburse the Company for any such taxes.
SECTION 9
IMPACT ON OTHER BENEFITS
9.1 The value of the Option (either on the date of grant of the
Option or at the time the shares are vested) shall not be
includable as compensation or earnings for purposes of any
other benefit plan offered by the Company.
SECTION 10
ADMINISTRATION
10.1 The Committee shall have full authority and discretion
(subject only to the express provisions of the 1996 Omnibus
Plan, as amended) to decide all matters relating to the
administration and interpretation of the Plan and this
Agreement. All such Committee determinations shall be final,
conclusive and binding upon the Company, the Grantee and any
and all interested parties.
-7-
<PAGE> 8
SECTION 11
AGREEMENT TO CONTINUE IN EMPLOYMENT
OR SERVICE AS A CONSULTANT
11.1 The vesting of this Option is earned only by continuing
service to the Company at the will of the Company and not
through the act of being hired, being granted this Option, or
acquiring shares hereunder. Nothing in the Plan or this
Agreement shall confer on a Grantee any right to continue in
the employ of the Company or in the service of the Company as
a consultant or interfere in any way with the right of the
Company to terminate his or her employment or consultantship
at any time.
SECTION 12
AMENDMENT(S)
12.1 This Agreement shall be subject to the terms of the Plan as
amended except that the Option that is the subject of this
Agreement may not in any way be amended or terminated without
the Grantee's written consent.
SECTION 13
FORCE AND EFFECT
13.1 The various provisions of this Agreement are severable in
their entirety. Any determination of invalidity or
unenforceability of any one provision shall have no effect on
the continuing force and effect of the remaining provisions.
SECTION 14
NOTICE OF DISPOSITION OF SHARES
14.1 The Grantee agrees that if he or she should dispose of any
shares of Common Stock acquired on the exercise of the Option,
including a disposition by sale, exchange, gift or transfer of
legal title within six months of the date such shares are
transferred to the Grantee, the Grantee will notify the
Company promptly of such disposition.
SECTION 15
NOTICES
15.1 All notices which may be or are required to be given by one
party to the other party pursuant to this Agreement shall be
in writing and shall be mailed by first class or certified
mail, return receipt requested, postage prepaid, or
transmitted by hand delivery as follows:
-8-
<PAGE> 9
<TABLE>
<S> <C>
If to the Company: DUSA Pharmaceuticals, Inc.
181 University Avenue, Suite 1208
Toronto, ON M5H 3M7
CANADA
Attention: Dr. D. Geoffrey Shulman
If to the Grantee:
at the address of the Grantee from time to
time in the records of the Company,
</TABLE>
or such other address as to which either party may from time
to time notify the other as aforesaid.
SECTION 16
RESTRICTIONS ON TRANSFER
16.1 The Grantee understands and acknowledges that he is subject to
certain restrictions on transfer under the Securities Act of
1933 of the United States, as amended, (the "1933 Act") of the
shares issued pursuant to the exercise of the Option; such
restrictions provide that the shares may not be sold without
registration or exemption from registration under the 1933
Act; and, for purposes of the Securities Act (Ontario) (the
"Ontario Act"), the first trade of such shares, other than a
trade exempted by the Ontario Act, will be a distribution
unless the Company has been a reporting issuer for at least
twelve (12) months and the Company is not in default of any
requirement of the Ontario Act, disclosure has been made to
the Ontario Securities Commission of the exempt trade, no
unusual effort is made to prepare the market or create a
demand for the shares, and no extraordinary commission or
consideration is paid with respect to the trade, provided that
such first trade is not from the holdings of a so-called
"control block".
SECTION 17
REPORTING REQUIREMENTS
17.1 The Grantee understands and acknowledges that he may be
subject to certain reporting requirements upon his receipt and
exercise of the Option, and in connection therewith, upon the
receipt and exercise of the Option, the Grantee agrees to
timely file with the Securities and Exchange Commission, the
National Association of Securities Dealers, Inc., and any
appropriate Canadian securities regulatory authorities, the
appropriate documentation regarding his ownership of the
Company's securities.
-9-
<PAGE> 10
SECTION 18
GOVERNING LAW
18.1 This Agreement shall be construed and enforced in accordance with and
governed by the laws of the State of New Jersey.
IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties hereto.
Attest: DUSA PHARMACEUTICALS, INC.,
a New Jersey Corporation
By:
- ---------------------------------- --------------------------------
Nanette W. Mantell, Secretary D. Geoffrey Shulman, President
GRANTEE
By:
--------------------------------
-10-
<PAGE> 11
SCHEDULE A
SUBSCRIPTION FORM
To: The Secretary of DUSA Pharmaceuticals, Inc.
Pursuant to the terms and subject to the conditions set forth in the
Nonqualified Stock Option Agreement (the "Agreement") dated , between DUSA
Pharmaceuticals, Inc. and the undersigned, and the Option granted to the
undersigned by such Agreement, I hereby elect to purchase____________________
shares of Common Stock of DUSA Pharmaceuticals, Inc. which were the subject of
such Option. I understand that such purchase is subject to all the terms and
conditions of the Agreement. I request that the certificates for such shares of
Common Stock shall be issued in the name of:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(please print or type name and address)
and be delivered to:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
(please print or type name and address)
The undersigned hereby represents and warrants to, and agrees with the
Company as follows:
(a) The shares are being purchased for the undersigned's own account,
for investment purposes only, and not for the account of any other person, and
not with a view to distribution, assignment, or resale to others, or to
fractionalization in whole or in part and that the offering and sale of the
shares is intended to be exempt from registration under the Securities Act of
1933 (the "Act"). In furtherance thereof, the undersigned represents, warrants
and agrees as follows: (i) no other person has or will have a direct or indirect
beneficial interest in such shares and the undersigned will not sell,
hypothecate, or otherwise transfer his shares except in accordance with the Act
and applicable state securities laws or unless in the opinion of counsel for the
Company, an exemption from the registration requirements of the Act and such
laws is available; and (ii) the Company is under no obligation to register the
shares on behalf of the undersigned or to assist the undersigned in complying
with any exemption from registration.
<PAGE> 12
(b) The undersigned has such knowledge and experience in financial and
business matters that the undersigned is capable of evaluating the merits and
risks of investment in the Company and of making an informed investment
decision.
In full payment of the purchase price with respect to the Option
exercised, the undersigned hereby tenders payment of $___________ by certified
check or official bank cashier's check or money order payable in Canadian or
United States currency to the order of DUSA Pharmaceuticals, Inc.
Dated: X
-----------------------------------
(Signature)
-------------------------------------
Name (Please Print)
-------------------------------------
(Address)
-------------------------------------
Taxpayer Identification Number
-12-
