Exercise Closing. (a) Grantee and/or any other person that shall become a holder of all or part of the Option in accordance with the terms of this Agreement (each such person being referred to herein as the "Holder") may exercise the Option, in whole or part, if, but only if, the Termination Fee provided for in Section 8.02(b) of the Merger Agreement has become payable (a "Triggering Event") and such exercise is prior to the occurrence of an Exercise Termination Event (as hereinafter defined). Notwithstanding anything to the contrary contained herein, this Agreement shall automatically terminate upon the termination of the Merger Agreement by Issuer pursuant to Section 8.01(b) thereof. (b) Each of the following shall be an "Exercise Termination Event": (i) the Effective Time (as defined in the Merger Agreement); or (ii) termination of the Merger Agreement in accordance with the provisions thereof if such termination occurs prior to the occurrence of a Triggering Event and at the time of such termination the conditions prerequisite to a Triggering Event occurring in the future are incapable of being fulfilled; or (iii) the passage of thirteen (13) months (or such longer period as provided in Section 10) after termination of the Merger Agreement; or (iv) the receipt by Grantee of the Termination Fee. (c) Issuer shall notify Grantee promptly in writing of the occurrence of any Triggering Event (other than a Triggering Event by reason of a termination of the Merger Agreement pursuant to Section 8.01(e)), it being understood that the giving of such notice by Issuer shall not be a condition to the right of the Holder to exercise the Option. (d) In the event the Holder is entitled to and wishes to exercise the Option (or any portion thereof), it shall send to Issuer a written notice (the date of which being herein referred to as the "Notice Date") specifying (i) the total number of shares it will purchase pursuant to such exercise and (ii) a place and date not earlier than three business days nor later than 60 business days from the Notice Date for the closing of such purchase (the "Closing Date"); provided, that if the closing of such purchase cannot be consummated by reason of any applicable judgment, injunction, decree, order, law or regulation, the period of time that would otherwise run pursuant to this sentence shall run instead from the date on which such restriction on consummation has expired or been terminated; and provided, further, that if prior notification to or approval of any regulatory or antitrust agency is required in connection with such purchase, the Holder shall promptly file the required notice or application for approval, shall promptly notify Issuer of such filing, and shall expeditiously process the same and the period of time that otherwise would run pursuant to this sentence shall run instead from the date on which any required notification periods have expired or been terminated or such approvals have been obtained and any requisite waiting period or periods shall have passed. Any exercise of the Option shall be deemed to occur on the Notice Date relating thereto. (e) At the closing referred to in subsection (d) of this Section 2, the Holder shall (i) pay to Issuer the aggregate purchase price for the shares of Common Stock purchased pursuant to the exercise of the Option in immediately available funds by wire transfer to a bank account designated by Issuer, provided that failure or refusal of Issuer to designate such a bank account shall not preclude the Holder from exercising the Option by delivery of a certified check or bank draft and (ii) present and surrender this Agreement to Issuer. (f) At such closing, simultaneously with the delivery of immediately available funds as provided in subsection (e) of this Section 2, Issuer shall deliver to the Holder a certificate or certificates representing the number of shares of Common Stock purchased by the Holder and, if the Option should be exercised in part only, a new Option evidencing the rights of the Holder thereof to purchase the balance of the shares purchasable hereunder. (g) Certificates for Common Stock delivered at a closing hereunder may be endorsed with a restrictive legend that shall read substantially as follows: "The transfer of the shares represented by this certificate is subject to certain provisions of an agreement between the registered holder hereof and Issuer and to resale restrictions arising under applicable securities laws (including the Securities Act of 1933, as amended). A copy of such agreement is on file at the principal office of Issuer and will be provided to the holder hereof without charge upon receipt by Issuer of a written request therefor." It is understood and agreed that: (i) the reference to the resale restrictions arising under applicable securities laws, including the Securities Act of 1933, as amended (the "Securities Act"), in the above legend shall be removed by delivery of substitute certificate(s) without such reference if the Holder shall have delivered to Issuer a copy of a letter from the staff of the Securities and Exchange Commission, or an opinion of counsel, in form and substance reasonably satisfactory to Issuer, to the effect that such legend is not required for purposes of the Securities Act or other applicable securities laws; (ii) the reference to the provisions of this Agreement in the above legend shall be removed by delivery of substitute certificate(s) without such reference if the shares have been sold or transferred in compliance with the provisions of this Agreement and under circumstances that do not require the retention of such reference in the opinion of counsel to the Holder, in form and substance reasonably satisfactory to Issuer; and (iii) the legend shall be removed in its entirety if the conditions in the preceding clauses (i) and (ii) are both satisfied. In addition, such certificates shall bear any other legend as may be required by law. The Holder understands and agrees that the Option is being issued to the Holder pursuant to the registration and prospectus exceptions in paragraph 35(1) and clause 72(1)(b0 of the Securities Act (Ontario) (the "Ontario Act") and that the resale of the Option or Common Stock issued upon exercise of the Option is restricted by the provisions of the Ontario Act and other applicable Canadian securities legislation. (h) Upon the giving by the Holder to Issuer of the written notice of exercise of the Option provided for under subsection (f) of this Section 2 and the tender of the applicable purchase price in immediately available funds, the Holder shall be deemed to be the holder of record of the shares of Common Stock issuable upon such exercise, notwithstanding that the stock transfer books of Issuer shall then be closed or that certificates representing such shares of Common Stock shall not then be actually delivered to the Holder. Issuer shall pay all expenses, and any and all United States federal, state and local taxes and other charges that may be payable in connection with the preparation, issue and delivery of stock certificates under this Section 2 in the name of the Holder or its assignee, transferee or designee.
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Exercise Closing. (a) Grantee and/or any other person that shall become a holder of all or part of the Option in accordance with the terms of this Agreement (each such person being referred to herein as the "Holder") may exercise the Option, in whole or part, if, but only if, the Termination Fee provided for in Section 8.02(b) of the Merger Agreement has become payable (a "Triggering Event") and such exercise is prior to the occurrence of an Exercise Termination Event (as hereinafter defined). Notwithstanding anything to the contrary contained herein, this Agreement shall automatically terminate upon the termination of the Merger Agreement by Issuer pursuant to Section 8.01(b) thereof.
(b) Each of the following shall be an "Exercise Termination Event":
(i) the Effective Time (as defined in the Merger Agreement); or
(ii) termination of the Merger Agreement in accordance with the provisions thereof if such termination occurs prior to the occurrence of a Triggering Event and at the time of such termination the conditions prerequisite to a Triggering Event occurring in the future are incapable of being fulfilled; or
(iii) the passage of thirteen (13) months (or such longer period as provided in Section 10) after termination of the Merger Offer Agreement; or
(ivii) the receipt completion of the acquisition of all of the issued and outstanding Common Shares of Issuer by Grantee or a direct or indirect wholly-owned subsidiary of Grantee; or
(iii) the payment of any combination of the Termination FeeOption Repurchase Price or the Option Share Repurchase Price (as defined in Section 7(a) hereof) or the Substitute Option Repurchase Price or the Substitute Share Repurchase Price (as defined in Section 9(a) hereof) aggregating U.S. $4,700,000.
(c) Issuer shall notify Grantee promptly in writing of the occurrence of any Triggering Event (other than a Triggering Event by reason of a termination of the Merger Agreement pursuant to Section 8.01(e)), it being understood that the giving of such notice by Issuer shall not be a condition to the right of the Holder to exercise the Option.
(d) In the event the Holder is entitled to and wishes to exercise the Option (or any portion thereof), it shall send to Issuer a written notice (the date of which being herein referred to as the "Notice Date") specifying (i) the total number of shares it will purchase pursuant to such exercise and (ii) a place and date not earlier than three business days nor later than 60 business days from the Notice Date for the closing of such purchase (the "Closing Date"); provided, that if the closing of such purchase cannot be consummated by reason of any applicable judgment, injunction, decree, order, law or regulation, the period of time that would otherwise run pursuant to this sentence shall run instead from the date on which such restriction on consummation has expired or been terminated; and provided, further, that if prior notification to or approval of any regulatory or antitrust agency is required in connection with such purchase, the Holder shall promptly file the required notice or application for approval, shall promptly notify Issuer of such filing, and shall expeditiously process the same and the period of time that otherwise would run pursuant to this sentence shall run instead from the date on which any required notification periods have expired or been terminated or such approvals have been obtained and any requisite waiting period or periods shall have passed. Issuer agrees to use its best efforts to obtain any and all regulatory or other approvals necessary in connection with the granting or exercise of the Option. Any exercise of the Option Option, in whole or in part, shall be deemed to occur on the Notice Date relating theretoto that portion of the exercise of the Option.
(ed) At the closing referred to in subsection (dc) of this Section 2, the Holder shall (i) pay to Issuer the aggregate purchase price for the shares of Common Stock Shares purchased pursuant to the an exercise of the Option in immediately available funds by wire transfer to a bank account designated by Issuer, provided that failure or refusal of Issuer to designate such a bank account shall not preclude the Holder from exercising the Option by delivery of a certified check or bank draft and (ii) present and surrender this Agreement to Issuer, against delivery, in the case of any exercise of the Option in part only, of the new Agreement referred to in subsection (e) of this Section 2.
(fe) At such closing, simultaneously with the delivery of immediately available funds as provided in subsection (ed) of this Section 2, Issuer shall deliver to the Holder a certificate or certificates representing the number of shares of Common Stock Shares purchased by the Holder and, if the Option should be exercised in part only, a new Option Agreement evidencing the rights of the Holder thereof to purchase the balance of the shares purchasable hereunder, which new Agreement shall be on the same terms and conditions as are set forth herein except with respect to the number of Common Shares issuable pursuant thereto, which shall be reduced accordingly in respect of any prior exercises of the Option.
(gf) Certificates for Common Stock Shares delivered at a closing hereunder may be endorsed with a restrictive legend that shall read substantially as follows: "The transfer of the shares represented by this certificate is subject to certain provisions of an agreement between the registered holder hereof and Issuer and to resale restrictions arising under applicable securities laws (including the United States Securities Act of 1933, as amended). A copy of such agreement is on file at the principal office of Issuer and will be provided to the holder hereof without charge upon receipt by Issuer of a written request therefor." It is understood and agreed that: (i) the reference to the resale restrictions arising under applicable securities laws, including the Securities Act of 1933, as amended (the "Securities Act"), in that the above legend shall be removed by delivery of substitute certificate(s) without such reference if the Holder shall have delivered to Issuer a copy of a letter from the staff of the United States Securities and Exchange Commission, Commission or an a written opinion of counselcounsel of nationally recognized standing addressed to Issuer, in form and substance reasonably satisfactory to Issuer, to the effect that such legend is not required for purposes of the Unites States Securities Act of 1933, as amended (the "1933 Act") or other applicable securities laws; (ii) the reference to the provisions of this Agreement in the above legend shall be removed by delivery of substitute certificate(s) without such reference if the shares have been sold or transferred in compliance with the provisions of this Agreement and under circumstances that do not require the retention of such reference in the opinion of counsel to the Holder, in form and substance reasonably satisfactory to Issuer; and (iii) the legend shall be removed in its entirety if the conditions in the preceding clauses (i) and (ii) are both satisfied. In addition, such certificates shall bear any other legend as may be required by law. The Holder understands and agrees that the Option is being issued to the Holder pursuant to the registration and prospectus exceptions in paragraph 35(1) and clause 72(1)(b0 of the Securities Act (Ontario) (the "Ontario Act") and that the resale of the Option or Common Stock issued upon exercise of the Option is restricted by the provisions of the Ontario Act and other applicable Canadian securities legislation.
(hg) Upon the giving by the Holder to Issuer of the written notice of exercise of the Option provided for under subsection (fc) of this Section 2 and the tender of the applicable purchase price in immediately available funds, the Holder shall be deemed to be the holder of record of the shares of Common Stock Shares issuable upon such exercise, notwithstanding that the stock share transfer books of Issuer shall then be closed or that certificates representing such shares of Common Stock Shares shall not then be actually delivered to the Holder. Issuer shall pay all expenses, and any and all United States federal, state and local taxes and other charges that may be payable in connection with the preparation, issue and delivery of stock share certificates under this Section 2 in the name of the Holder or its assignee, transferee or designee.
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Exercise Closing. (a) Grantee and/or or any other person that shall become a holder of all or part of the Option in accordance with the terms of this Agreement (each such person being referred to herein as the "HolderHOLDER") may exercise the Option, in whole or partonly, if, but only if, the Termination Fee Amount provided for in Section 8.02(b) 8.3 of the Merger Agreement has become payable (a "Triggering EventTRIGGERING EVENT") and notice of such exercise is received prior to the occurrence of an Exercise Termination Event (as hereinafter defined). Notwithstanding anything ; PROVIDED, HOWEVER, that a Triggering Event will be deemed to occur if all of the conditions prerequisite to the contrary contained herein, this Agreement shall automatically terminate upon payment of the termination Termination Amount pursuant to Section 8.3(a) of the Merger Agreement by Issuer pursuant to have been satisfied except for the consummation of the transaction described in such Section 8.01(b) thereof8.3(a). For purposes of clarification, the date of a Triggering Event shall not be the date on which the Termination Amount is paid, but the date on which the Termination Amount becomes payable.
(b) Each of the following shall be an "Exercise Termination EventEXERCISE TERMINATION EVENT":
(i) the Effective Time (as defined in the Merger Agreement); or
(ii) termination of the Merger Agreement in accordance with the provisions thereof if such termination occurs prior to the occurrence of a Triggering Event and at the time of such termination the conditions prerequisite to a Triggering Event occurring in the future are incapable of being fulfilled; or
(iii) the passage of thirteen (13) months (or such longer period as provided in Section 10) 30 days after termination the date of the Merger AgreementTriggering Event; or
(iv) November 9, 1999, if all governmental and regulatory approvals for Grantee to exercise its rights under this Section 2 shall not then have been obtained or if an injunction or similar legal prohibition on exercise shall then be in effect; or
(v) the receipt by Grantee of the Termination FeeAmount.
(c) Issuer shall notify Grantee promptly in writing of the occurrence of any Triggering Event (other than a Triggering Event by reason of a termination of the Merger Agreement pursuant to Section 8.01(e))Event, it being understood that the giving of such notice by Issuer shall not be a condition to the right of the Holder to exercise the Option.
(d) In the event the Holder is entitled to and wishes to exercise the Option (or any portion thereof)Option, it shall send to Issuer a written notice (the date of which being herein referred to as the "Notice DateNOTICE DATE") specifying (i) the total number of shares it will purchase pursuant to such exercise and (ii) a place and date not earlier than three two business days nor later than 60 twenty business days from the Notice Date for the closing of such purchase of the applicable Option Amount of Shares (the "Closing DateCLOSING DATE"); provided, that if the closing of such purchase cannot Closing Date may be consummated extended by reason of any applicable judgment, injunction, decree, order, law or regulation, the period of time that would otherwise run pursuant to this sentence shall run instead from the date on which such restriction on consummation has expired or been terminated; and provided, further, that if prior notification to or approval of any regulatory or antitrust agency is required in connection with such purchase, the Holder shall promptly file until November 9, 1999 to the required notice or application for approval, shall promptly notify Issuer extent provided in clauses (i) and (ii) of such filing, and shall expeditiously process the same and the period of time that otherwise would run pursuant to this sentence shall run instead from the date on which any required notification periods have expired or been terminated or such approvals have been obtained and any requisite waiting period or periods shall have passed. Any exercise of the Option shall be deemed to occur on the Notice Date relating theretoSection 7.
(e) At the closing referred to in subsection (d) of this Section 2, the Holder shall (i) pay to Issuer the aggregate purchase price for the shares of Common Stock purchased pursuant to the exercise of the Option in immediately available funds by wire transfer to a bank account designated by Issuer, provided PROVIDED that failure or refusal of Issuer to designate such a bank account shall not preclude the Holder from exercising the Option by delivery of a certified check or bank draft and (ii) present and surrender this Agreement to Issuer.
(f) At such closing, simultaneously with the delivery of immediately available funds as provided in subsection (e) of this Section 2, Issuer shall deliver to the Holder a certificate or certificates representing the number of shares of Common Stock purchased by the Holder and, if the Option should be exercised in part only, a new Option evidencing the rights of the Holder thereof to purchase the balance of the shares purchasable hereunderHolder.
(g) Certificates for Common Stock delivered at a closing hereunder may be endorsed with a restrictive legend that shall read substantially as follows: "The transfer of the shares represented by this certificate is subject to certain provisions of an agreement between have not been registered under the registered holder hereof and Issuer and to resale restrictions arising under applicable securities laws (including the Securities Act of 1933, as amended). A copy of such agreement is on file at the principal office of Issuer and will be provided to the holder hereof without charge upon receipt by Issuer of a written request therefor." It is understood and agreed that: (i) the reference to the resale restrictions arising under applicable securities laws, including the U.S. Securities Act of 1933, as amended (the "Securities Act"), or any state securities law, and such securities may not be offered, sold, transferred, pledged, hypothecated or otherwise disposed of except pursuant to an effective registration statement or pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities laws." It is understood and agreed that the above legend shall be removed by delivery of substitute certificate(s) without such reference if the Holder shall have delivered to Issuer a copy of a letter from the staff of the Securities and Exchange Commission, or an opinion of counsel, in form and substance reasonably satisfactory to Issuer, to the effect that such legend is not required for purposes of the Securities Act or other applicable securities laws; (ii) the reference to the provisions of this Agreement in the above legend shall be removed by delivery of substitute certificate(s) without such reference if the shares have been sold or transferred in compliance with the provisions of this Agreement and under circumstances that do not require the retention of such reference in the opinion of counsel to the Holder, in form and substance reasonably satisfactory to Issuer; and (iii) the legend shall be removed in its entirety if the conditions in the preceding clauses (i) and (ii) are both satisfied. In addition, such certificates shall bear any other legend as may be required by law. The Holder understands and agrees that the Option is being issued to the Holder pursuant to the registration and prospectus exceptions in paragraph 35(1) and clause 72(1)(b0 of the Securities Act (Ontario) (the "Ontario Act") and that the resale of the Option or Common Stock issued upon exercise of the Option is restricted by the provisions of the Ontario Act and other applicable Canadian securities legislation.
(h) Upon the giving by the Holder to Issuer of the written notice of exercise of the Option provided for under subsection (f) of this Section 2 and the tender of the applicable purchase price in immediately available funds, the Holder shall be deemed to be the holder of record of the shares of Common Stock issuable upon such exercise, notwithstanding that the stock transfer books of Issuer shall then be closed or that certificates representing such shares of Common Stock shall not then be actually delivered to the Holder. Issuer Holder shall pay all expenses, and any and all United States federal, state and local taxes and other charges that may be payable in connection with the preparation, issue and delivery of stock certificates under this Section 2 in the name of the Holder or its assignee, transferee or designee.
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Sources: Stock Option Agreement (World Color Press Inc /De/)