Warrants and Stock Options. (a) Each warrant to purchase one share of Company Common Stock granted by the Company (the “Company Warrants”) that is outstanding immediately prior to the Effective Time, whether exercisable or not exercisable at such time, shall be converted into and become rights with respect to Parent Common Stock, and Parent shall assume each Company Warrant, in accordance with the terms of the Company Warrant, except that from and after the Effective Time, (i) each Company Warrant assumed by Parent may be exercised solely for shares of Parent Common Stock (or cash, if so provided under the terms of such Company Warrant), (ii) the number of shares of Parent Common Stock subject to such Company Warrant shall be equal to the number of shares of Company Common Stock subject to such Company Warrant immediately prior to the Effective Time multiplied by the Exchange Ratio, rounded up to the nearest whole share, and (iii) the per share exercise price under each such Company Warrant shall be adjusted by dividing the per share exercise price under each such Company Warrant by the Exchange Ratio and rounding up to the nearest cent. Each of Company and Parent shall adopt any and all resolutions and take any and all necessary steps to effectuate the foregoing provisions of this Section 1.8(a), including using its reasonable efforts to obtain from each holder of a Company Warrant any Consent or Contract that may be deemed necessary or advisable in order to effect the transactions contemplated by this Section 1.8(a). Anything in this Agreement to the contrary notwithstanding, Parent shall have the right, in its sole discretion, not to deliver the consideration provided in this Section 1.8(a) to a former holder of a Company Warrant who has not delivered such Consent or Contract. (b) Each option to purchase one share of Company Common Stock granted by the Company, whether granted pursuant to the Company Option Plan (individually, a “Company Plan Option”) or otherwise (collectively, including all Company Plan Options, the “Company Options”) that is outstanding immediately prior to the Effective Time, whether vested or unvested, shall be converted into and become rights with respect to Parent Common Stock, and Parent shall assume each Company Option, in accordance with the terms of the Company Option Plan and/or stock option agreement by which it is evidenced, except that from and after the Effective Time, (i) Parent and its Compensation Committee shall be substituted for Company and the compensation committee of the Board (including, if applicable, the Board) administering such Company Option Plan, (ii) each Company Option assumed by Parent may be exercised solely for shares of Parent Common Stock (or cash, if so provided under the terms of such Company Option), (iii) the number of shares of Parent Common Stock subject to such Company Options shall be equal to the number of shares of Company Common Stock subject to such Company Options immediately prior to the Effective Time multiplied by the Exchange Ratio, rounded down to the nearest whole share, and (iv) the per share exercise price under each such Company Option shall be adjusted by dividing the per share exercise price under each such Company Option by the Exchange Ratio and rounding up to the nearest cent. In addition, notwithstanding the provisions of clauses (iii) and (iv) of the first sentence of this Section 1.8(b), each Company Option which is an “incentive stock option” or a nonqualified stock option held by a US taxpayer shall be adjusted as required by Section 424 of the Code and Section 409A of the Code and the Treasury Regulations thereunder, so as not to constitute a modification, extension or renewal of the option, within the meaning of Section 424(h) of the Code and the Treasury Regulations under Section 409A of the Code, or otherwise result in negative tax treatment or penalties under Section 424 of the Code or Section 409A of the Code. Each of Company and Parent shall adopt any and all resolutions and take all necessary steps to effectuate the foregoing provisions of this Section 1.8(b). (c) The Board or a committee of non-employee Directors thereof (as such term is defined for purposes of Rule 16b-3(d) under the Exchange Act) shall adopt a resolution in advance of the Effective Time providing that the disposition by the officers and directors of Company of Company Common Stock, Company Options or other equity securities of Company pursuant to the Merger or the other transactions contemplated by this Agreement is intended to be exempt from liability pursuant to Rule 16b-3 under the Exchange Act. The Board of Directors of Parent or a committee of non-employee Directors thereof (as such term is defined for purposes of Rule 16b-3(d) under the Exchange Act) shall adopt a resolution in advance of the Effective Time providing that the receipt by the Company Insiders (as defined below) of Parent Common Stock or other equity securities of Parent pursuant to the Merger or the other transactions contemplated by this Agreement (to the extent such equity securities are listed in the Section 16 Information, as defined below) is intended to be exempt from liability pursuant to Rule 16b-3 under the Exchange Act. For purposes of this Section 1.8(c), the term “Company Insiders” means those officers and directors of Company who are currently subject to or will become subject to the reporting requirements of Section 16(a) of the Exchange Act as insiders of Parent in conjunction with the Merger, and the term “Section 16 Information” means information provided by Company that is accurate in all respects regarding Company Insiders and the number of shares of Parent Common Stock or other Parent equity securities to be acquired by each such Company Insider in connection with the Merger and other transactions contemplated by this Agreement.
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Warrants and Stock Options. (a) Each warrant to purchase one share of Company Common Stock granted by the Company (the “Company Warrants”) that is outstanding immediately prior to the Effective Time, whether exercisable or not exercisable at such time, shall be converted into and become rights with respect to Parent SciVac Common StockShares, and Parent SciVac shall assume each Company Warrant, in accordance with the terms of the Company Warrant, except that from and after the Effective Time, (i) each Company Warrant assumed by Parent SciVac may be exercised solely for shares of Parent SciVac Common Stock Shares (or cash, if so provided under the terms of such Company Warrant), (ii) the number of shares of Parent SciVac Common Stock Shares subject to such Company Warrant shall be equal to the number of shares of Company Common Stock subject to such Company Warrant immediately prior to the Effective Time multiplied by the Exchange Ratio, rounded up down to the nearest whole share, and (iii) the per share exercise price under each such Company Warrant shall be adjusted by dividing the per share exercise price under each such Company Warrant by the Exchange Ratio and rounding up to the nearest cent. Each of Company and Parent SciVac shall adopt any and all resolutions and take any and all necessary steps to effectuate the foregoing provisions of this Section 1.8(a), including using its reasonable efforts to obtain from each holder ) and reserve for issuance a sufficient number of a SciVac Common Shares for delivery upon exercise of Company Warrant any Consent or Contract that may be deemed necessary or advisable Warrants assumed by it in order to effect the transactions contemplated by accordance with this Section 1.8(a). Anything in this Agreement to the contrary notwithstanding, Parent shall have the right, in its sole discretion, not to deliver the consideration provided in this Section 1.8(a) to a former holder of a Company Warrant who has not delivered such Consent or Contract.
(b) Each At the Effective Time, each option to purchase one share shares of Company Common Stock granted by the Company, whether granted pursuant to the a Company Option Plan (individually, a “Company Plan Option”) or otherwise (collectively, including all such options granted under any Company Plan OptionsOption Plan, the “Company Options”) that is outstanding immediately prior to the Effective Time, whether vested or unvested, shall be converted into disposed of to and become rights cancelled by SciVac, and the former holders of Company Options shall receive as the sole consideration therefor substantially identical options with respect to Parent SciVac Common StockShares (“SciVac Options”). All terms and conditions of each SciVac Option, including the term to expiry, conditions to and manner of exercising, will be the same as the Company Option for which it was exchanged (subject to applicable Law), and Parent shall assume each Company Option, in accordance with be governed by the terms of the applicable Company Option Plan and/or stock option agreement, and any certificate or option agreement by which it is evidencedpreviously evidencing the Company Option shall thereafter be and be deemed to be evidence of the SciVac Option, except that from and after the Effective Time, (i) Parent SciVac and its Compensation Committee compensation committee shall be substituted for the Company and the compensation committee of the Company Board (including, if applicable, the Company Board) administering such Company Option Plan, (ii) each Company the SciVac Option assumed by Parent may be exercised solely for shares of Parent SciVac Common Stock Shares (or cash, if so provided under the terms of such Company Option), (iii) the number of shares of Parent SciVac Common Stock Shares subject to such Company Options a particular SciVac Option shall be equal to the number of shares of Company Common Stock subject to such the applicable Company Options Option immediately prior to the Effective Time multiplied by the Exchange Ratio, rounded down to the nearest whole share, subject to automatic downward adjustment in accordance with Section 1.8(e), and (iv) the per share exercise price under each such Company the SciVac Option shall be adjusted by dividing converting the per share exercise price under each such the Company Option to Canadian dollars using the noon spot rate quoted by the Bank of Canada (the “Noon Spot Rate”) for the day that includes the Effective Time (or, if no Noon Spot Rate is quoted for that day, the Noon Spot Rate for the closest preceding day for which a Noon Spot Rate is quoted), and dividing the result of that conversion by the Exchange Ratio and rounding up to the nearest cent, subject to automatic upward adjustment in accordance with paragraph Section 1.8(e). In addition, notwithstanding the provisions of clauses (iii) and (iv) of the first second sentence of this Section 1.8(b), each Company Option which that is an “incentive stock option” or a nonqualified stock option held by a US U.S. taxpayer shall be adjusted as required by Section 424 of the Code and Section 409A of the Code and the Treasury Regulations thereunder, so as not to constitute a modification, extension or renewal of the option, within the meaning of Section 424(h) of the Code and the Treasury Regulations under Section 409A of the Code, or otherwise result in negative tax Tax treatment or penalties under Section 424 of the Code or Section 409A of the Code. Each of the Company and Parent SciVac shall adopt any and all resolutions and take all necessary steps to effectuate the foregoing provisions of this Section 1.8(b).
(c) The Board As soon as practicable after the Effective Time, SciVac shall deliver to the participants in each Company Option Plan an appropriate notice setting forth such participant’s rights pursuant thereto and the grants subject to such Company Option Plan shall continue in effect on the same terms and conditions (subject to the adjustments required by Section 1.8(b) after giving effect to the Merger), and SciVac shall comply with the terms of each Company Option Plan to ensure, to the extent required by, and subject to the provisions of, such Company Option Plan, that Company Options that qualified as incentive stock options prior to the Effective Time continue to qualify as incentive stock options after the Effective Time and Company Options that qualified for exemption from application of Section 409A of the Code prior to the Effective Time continue to remain so exempt. At or prior to the Effective Time, SciVac shall take all corporate action necessary to reserve for issuance a committee sufficient number of non-employee Directors thereof SciVac Common Shares for delivery upon exercise of Company Options assumed by it in accordance with this Section 1.8.
(d) As soon as practicable after the Effective Time, SciVac shall file a registration statement on Form S-8 (or any successor or other appropriate form), with respect to the SciVac Common Shares subject to such options and shall use its reasonable efforts to maintain the effectiveness of such registration statements (and maintain the current status of the prospectus or prospectuses contained therein) for so long as such term options remain outstanding.
(e) The number of SciVac Common Shares issuable on exercise of each SciVac Option as determined pursuant to Section 1.8(b), or the per share exercise price under the SciVac Option as determined pursuant to Section 1.8(b), in respect of each SciVac Option that is defined issued at the Effective Time in exchange for a Company Option pursuant to paragraph Section 1.8(b) to a person who at the Effective Time is a resident of Canada (each a “Canadian Company Optionholder”) for the purposes of Rule 16b-3(d) under the Exchange Tax Act) , shall adopt a resolution in advance be automatically adjusted with effect as of the Effective Time providing such that
(i) the amount by which the total value as computed in accordance with the Tax Act (“Total Value”), determined immediately after the Effective Time, of the SciVac Common Shares that are subject to the disposition SciVac Option exceeds the total amount as computed in accordance with the Tax Act (“Total Amount”) payable to acquire those SciVac Common Shares, does not exceed
(ii) the amount by which the officers and directors Total Value, determined immediately before the Effective Time, of the shares of Company Common Stock that were subject to the Company Option exceeds the Total Amount that was payable to acquire those shares of Company Common Stock, The compensation committee of the Company shall, no later than 48 hours before the day that includes the Effective Time, declare whether the automatic adjustment shall be made by decreasing the number of SciVac Shares issuable under the SciVac Option or by increasing the per share exercise price under the SciVac Option (but not both), and the automatic adjustment shall be made either by reducing the number of SciVac Shares or increasing the per share exercise price (but not both) in accordance with such declaration. The compensation committee shall determine the amount of each such adjustment and shall notify each Canadian Company Optionholder promptly in writing of its determination but, for greater certainty, no such determination or notification shall be or be deemed to be conclusive evidence of the correct amount of the adjustment after Closing, it being the intention of the Company and SciVac that the automatic adjustment to the terms of each SciVac Option issued to a Canadian Company Optionholder in exchange for SciVac Options or other equity securities of Company pursuant to the Merger or the other transactions contemplated by this Agreement Section 1.8(b) that is intended to be exempt from liability made pursuant to Rule 16b-3 under the Exchange Act. The Board of Directors of Parent or a committee of non-employee Directors thereof (as such term is defined for purposes of Rule 16b-3(d) under the Exchange Act) shall adopt a resolution in advance of the Effective Time providing that the receipt by the Company Insiders (as defined below) of Parent Common Stock or other equity securities of Parent pursuant to the Merger or the other transactions contemplated by this Agreement (to the extent such equity securities are listed in the Section 16 Information, as defined below) is intended to be exempt from liability pursuant to Rule 16b-3 under the Exchange Act. For purposes of this Section 1.8(c), 1.8(e) comply with the term “Company Insiders” means those officers and directors of Company who are currently subject to or will become subject to the reporting requirements of Section 16(asubsection 7(1.4) of the Exchange Act as insiders of Parent in conjunction with the Merger, and the term “Section 16 Information” means information provided by Company that is accurate in all respects regarding Company Insiders and the number of shares of Parent Common Stock or other Parent equity securities to be acquired by each such Company Insider in connection with the Merger and other transactions contemplated by this AgreementTax Act.
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