Incentive Stock Option Agreement - Ciphergen Biosystems Inc.
IT IS UNLAWFUL TO CONSUMMATE
A SALE OR TRANSFER OF THIS
SECURITY, OR ANY INTEREST
THEREIN, OR TO RECEIVE ANY
CONSIDERATION THEREFOR,
WITHOUT THE PRIOR WRITTEN
CONSENT OF THE COMMISSIONER
OF CORPORATIONS OF THE STATE
OF CALIFORNIA, EXCEPT AS
PERMITTED IN THE
COMMISSIONER'S RULES.
INCENTIVE STOCK OPTION
[NAME], OPTIONEE:
CIPHERGEN BIOSYSTEMS, INC. (the "Company"), pursuant to its 1993 Stock
Option Plan (the "Plan"), has this day granted to you, the optionee named above,
an option to purchase shares of the common stock of the Company ("Common
Stock"). This option is intended to qualify as an "incentive stock option"
within the meaning of Section 422 of the Internal Revenue Code of 1986, as
amended (the "Code").
The grant hereunder is in connection with and in furtherance of the
Company's compensatory benefit plan for participation of the Company's employees
(including officers), directors or consultants and is intended to comply with
the provisions of Rule 701 promulgated by the Securities and Exchange Commission
under the Securities Act of 1933, as amended (the "Act").
The details of your option are as follows:
1. The total number of shares of Common Stock subject to this option is
[SHRSSPELLEDOUT] ([NO-OF-SHARES]). Subject to the limitations contained
herein, One-sixtieth (1/60) of the total number of shares will vest on
[VESTSTART] and an additional (1/60) shall be exercisable each full month
thereafter until all of such shares are exercisable, based upon the Optionee's
continued relationship with the corporation.
This option may be exercised only with respect to those shares
which are vested except as permitted under paragraph 3 of this Agreement.
(FORM FOR CASH AND EARLY EXERCISE)
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2. (a) The exercise price of this option is __________________________
______ per share, being not less than the fair market value of the Common Stock
on the date of grant of this option.
(b) Payment of the exercise price per share is due in full upon
exercise of all or any part of each installment which has accrued to you. You
may elect, to the extent permitted by applicable statutes and regulations, to
make payment of the exercise price under one of the following alternatives:
(i) Payment of the exercise price per share in cash (including
check) at the time of exercise; or
(ii) Payment pursuant to a program developed under Regulation T
as promulgated by the Federal Reserve Board which results in the receipt of cash
(or check) by the Company prior to the issuance of Common Stock.
3. (a) Subject to the provisions of this option you may elect at any
time during your employment with the Company or an affiliate thereof, to
exercise the option as to any part or all of the shares subject to this option
at any time during the term hereof, including without limitation, a time prior
to the date of earliest exercise ("vesting") stated in paragraph 1 hereof;
PROVIDED, HOWEVER, that:
(i) a partial exercise of this option shall be deemed to cover
first vested shares and then the earliest vesting installment of unvested
shares;
(ii) any shares so purchased from installments which have not
vested as of the date of exercise shall be subject to the purchase option in
favor of the Company as described in the Early Exercise Stock Purchase Agreement
attached hereto;
(iii) you shall enter into an Early Exercise Stock Purchase
Agreement in the form attached hereto with a vesting schedule that will result
in the same vesting as if no early exercise had occurred; and
(iv) this option shall not be exercisable under this paragraph 3
to the extent such exercise would cause the aggregate fair market value of any
shares subject to incentive stock options granted you by the Company or any
affiliate (valued as of their grant date) which would become exercisable for the
first time during any calendar year to exceed $100,000.
(b) The election provided in this paragraph 3 to purchase shares
upon the exercise of this option prior to the vesting dates shall cease upon
termination of your employment with the Company or an affiliate thereof and may
not be exercised after the date thereof.
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4. The minimum number of shares with respect to which this option
may be exercised at any one time is 100, except (a) as to an installment
subject to exercise, as set forth in paragraph 1, which amounts to fewer than
100 shares, in which case, as to the exercise of that installment, the number
of such shares in such installment shall be the minimum number of shares, and
(b) with respect to the final exercise of this option this minimum shall not
apply. This option may not be exercised for any number of shares which would
require the issuance of anything other than whole shares.
5. Notwithstanding anything to the contrary contained herein, this
option may not be exercised unless the shares issuable upon exercise of this
option are then registered under the Act or, if such shares are not then so
registered, the Company has determined that such exercise and issuance would be
exempt from the registration requirements of the Act.
6. The term of this option commences on the date hereof and, unless
sooner terminated as set forth below or in the Plan, terminates on
[TERMINATIONDATE] (which date shall be no more than ten (10) years from date
this option is granted). In no event may this option be exercised on or after
the date on which it terminates. This option shall terminate prior to the
expiration of its term as follows: three (3) months after the termination of
your employment with the Company or an affiliate of the Company (as defined in
the Plan) for any reason or for no reason unless
(a) such termination of employment is due to your disability, in
which event the option shall terminate on the earlier of the termination date
set forth above or six (6) months following such termination of employment; or
(b) such termination of employment is due to your death, in which
event the option shall terminate on the earlier of the termination date set
forth above or six (6) months after your death; or
(c) during any part of such three (3) month period the option is not
exercisable solely because of the condition set forth in paragraph 5 above, in
which event the option shall not terminate until the earlier of the termination
date set forth above or until it shall have been exercisable for an aggregate
period of three (3) months after the termination of employment; or
(d) exercise of the option within three (3) months after termination
of your employment with the Company or with an affiliate would result in
liability under section 16(b) of the Securities Exchange Act of 1934, in which
case the option will terminate on the earlier of (i) the termination date set
forth above, (ii) the tenth (10th) day after the last date upon which exercise
would result in such liability or (iii) six (6) months and ten (10) days after
the termination of your employment with the Company or an affiliate.
However, this option may be exercised following termination of
employment only as to that number of shares as to which it was exercisable on
the date of termination of employment under the provisions of paragraph 1 of
this option.
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7. (a) This option may be exercised, to the extent specified above, by
delivering a notice of exercise (in a form designated by the Company) together
with the exercise price to the Secretary of the Company, or to such other person
as the Company may designate, during regular business hours, together with such
additional documents as the Company may then require pursuant to subparagraph
6(f) of the Plan.
(b) By exercising this option you agree that:
(i) the Company may require you to enter an arrangement
providing for the payment by you to the Company of any tax withholding
obligation of the Company arising by reason of (1) the exercise of this option;
(2) the lapse of any substantial risk of forfeiture to which the shares are
subject at the time of exercise; or (3) the disposition of shares acquired upon
such exercise;
(ii) you will notify the Company in writing within fifteen (15)
days after the date of any disposition of any of the shares of the Common Stock
issued upon exercise of this option that occurs within two (2) years after the
date of this option grant or within one (1) year after such shares of Common
Stock are transferred upon exercise of this option; and
(iii) the Company (or a representative of the underwriters)
may, in connection with the first underwritten registration of the offering
of any securities of the Company under the Act, require that you not sell or
otherwise transfer or dispose of any shares of Common Stock or other
securities of the Company during such period (not to exceed one hundred
eighty (180) days) following the effective date (the "Effective Date") of the
registration statement of the Company filed under the Act as may be requested
by the Company or the representative of the underwriters. For purposes of
this restriction you will be deemed to own securities which (i) are owned
directly or indirectly by you, including securities held for your benefit by
nominees, custodians, brokers or pledgees; (ii) may be acquired by you within
sixty (60) days of the Effective Date; (iii) are owned directly or
indirectly, by or for your brothers or sisters (whether by whole or half
blood) spouse, ancestors and lineal descendants; or (iv) are owned, directly
or indirectly, by or for a corporation, partnership, estate or trust of which
you are a shareholder, partner or beneficiary, but only to the extent of your
proportionate interest therein as a shareholder, partner or beneficiary
thereof. You further agree that the Company may impose stop-transfer
instructions with respect to securities subject to the foregoing restrictions
until the end of such period.
8. This option is not transferable, except by will or by the laws of
descent and distribution, and is exercisable during your life only by you. By
delivering written notice to the Company, in a form satisfactory to the Company,
you may designate a third party who, in the event of your death, shall
thereafter be entitled to exercise this option.
9. This option is not an employment contract and nothing in this option
shall be deemed to create in any way whatsoever any obligation on your part to
continue in the employ of the Company, or of the Company to continue your
employment with the Company.
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10. Any notices provided for in this option or the Plan shall be given
in writing and shall be deemed effectively given upon receipt or, in the case of
notices delivered by the Company to you, five (5) days after deposit in the
United States mail, postage prepaid, addressed to you at the address specified
below or at such other address as you hereafter designate by written notice to
the Company.
11. This option is subject to all the provisions of the Plan, a copy of
which is attached hereto and its provisions are hereby made a part of this
option, including without limitation the provisions of paragraph 6 of the Plan
relating to option provisions, and is further subject to all interpretations,
amendments, rules and regulations which may from time to time be promulgated and
adopted pursuant to the Plan. In the event of any conflict between the
provisions of this option and those of the Plan, the provisions of the Plan
shall control. The Company may amend this option; PROVIDED, HOWEVER, that your
rights and obligations under this option shall not be impaired by any such
amendment unless the Company obtains your written consent.
Dated the ____________________ 2000.
Very truly yours,
CIPHERGEN BIOSYSTEMS, INC.
By:
-------------------------------
William E. Rich,
President and Chief Executive
Officer
ATTACHMENTS:
1993 Stock option Plan
Form of Early Exercise Stock Purchase Agreement
Notice of Exercise
Section 83(b) Election
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The undersigned:
(a) Acknowledges receipt of the foregoing option and the attachments
referenced therein and understands that all rights and liabilities with respect
to this option are set forth in the option and the Plan; and
(b) Acknowledges that as of the date of grant of this option, it
sets forth the entire understanding between the undersigned optionee and the
Company and its affiliates regarding the acquisition of stock in the Company and
supersedes all prior oral and written agreements on that subject with the
exception of (i) the options previously granted and delivered to the undersigned
under stock option plans of the Company, and (ii) the following agreements only:
NONE _______________
(Initial)
OTHER _______________________________________
________________________________________
________________________________________
(c) Acknowledges receipt of a copy of Section 260.141.11 of Title 10 of
the California Code of Regulations.
_________________________________________
[NAME], OPTIONEE
Address: ________________________________
________________________________
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EARLY EXERCISE STOCK PURCHASE AGREEMENT
THIS AGREEMENT is made by and between CIPHERGEN BIOSYSTEMS, INC., a
California corporation (the "Corporation"), and _____________________________
("Purchaser").
WITNESSETH:
WHEREAS, Purchaser holds a _________________ stock option to
purchase shares of common stock of the Corporation pursuant to the
Corporation's 1993 Stock Option Plan (the "Plan") which Purchaser desires to
exercise; and
WHEREAS, Purchaser wishes to take advantage of the early exercise
provision of his option and therefore to enter into this Agreement;
NOW, THEREFORE, IT IS AGREED between the parties as follows:
1. Purchaser hereby agrees to purchase from the Corporation, and the
Corporation hereby agrees to sell to Purchaser, an aggregate of ________
shares of the common stock (the "Stock") of the Corporation, for an exercise
price of __________ per share (total exercise price: __________), payable in
cash.
The closing hereunder shall occur at the offices of the Corporation on
the date of this Agreement or at such other time and place as the parties may
mutually agree upon in writing.
At the closing, Purchaser shall deliver three (3) stock assignments in
the form of Exhibit B duly endorsed (with date and number of shares left blank),
joint escrow instructions (the "Joint Escrow Instructions") in the form of
Exhibit C, duly executed by Purchaser, and the total exercise price in cash.
(CASH)
1.
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At the closing or as soon thereafter as practicable, the Corporation
shall deliver to the Escrow Agent (as defined in paragraph 8 below) share
certificates for all of the Stock that is to be subject to the Purchase Option
(as defined in paragraph 2 below), and shall deliver share certificates to
Purchaser for all of the Stock, if any, that is not to be subject to the
Purchase Option.
2. In accordance with the provisions of section 408(b) of the
California General Corporation Law, the Stock to be purchased by Purchaser
pursuant to this Agreement shall be subject to the following option ("Purchase
Option"):
(a) In the event that Purchaser shall cease to be an employee of the
Corporation for any reason (including his death), or no reason, with or without
cause, the Purchase Option may be exercised. The Corporation shall have the
right at any time within ninety (90) days after such cessation of employment to
purchase from Purchaser or his personal representative, as the case may be, at
the price per share paid by Purchaser pursuant to this Agreement ("Option
Price"), up to but not exceeding the number of shares of the Stock shown on
Exhibit A hereto which is incorporated herein by this reference. Notwithstanding
the foregoing, however, if the expiration of the aforesaid ninety (90) day
period will occur prior to the date that is twenty-seven (27) months following
the date of this Agreement, the Corporation shall be entitled to extend the
period during which it shall be entitled to exercise such option to such date
that is twenty-seven (27) months following the date of this Agreement.
(b) In addition, and without limiting the foregoing Purchase Option,
if at any time during the term of the Purchase Option, there occurs: (a) a
dissolution or liquidation of the Corporation; (b) a merger or consolidation
involving the Corporation in which the Corporation is not the surviving
corporation; (c) a reverse merger in which the Corporation is the surviving
corporation but the shares of the Corporation's common stock outstanding
immediately preceding the merger are converted by virtue of the merger into
other property, whether in the form of other securities, cash or otherwise; or
(d) any other capital reorganization in which more than fifty percent (50%) of
the shares of the Corporation entitled to vote are exchanged, then: (i) if there
will be no successor to the Corporation, the Corporation shall have the right to
exercise its Purchase Option as to all or any portion of the Stock then subject
to the Purchase Option set forth above to the same extent as if Purchaser's
employment by the Corporation had ceased on the date preceding the date of
consummation of said event or transaction, or (ii) the Purchase Option may be
assigned to any successor of the Corporation, and the Purchase Option shall
apply if Purchaser shall cease for any reason to be an employee of such
successor on the same basis as set forth above. In that case, references herein
to the "Corporation" shall be deemed to refer to such successor.
(c) The Corporation shall be entitled to pay for any shares
purchased pursuant to its Purchase Option at the Corporation's option in cash,
by offset against any indebtedness owing to the Corporation and given in payment
for the Stock by Purchaser, or a combination of both.
(d) As used herein, employment with the Corporation shall include
employment with an affiliate of the Corporation.
2.
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(e) This Agreement is not an employment contract and nothing in this
Agreement shall be deemed to create in any way whatsoever any obligation on the
part of the Purchaser to continue in the employ of the Corporation, or of the
Corporation to continue Purchaser in the employ of the Corporation.
(f) In the event that the Stock's Fair Market Value (as defined in
the Plan) is equal to or exceeds the Option Price on the date that the Purchaser
ceases to be employed, the Company shall exercise its purchase option to the
extent permitted by law.
3. The Purchase Option may be exercised by giving written notice of
exercise delivered or mailed as provided in paragraph 14. Upon providing such
notice and payment or tender of the purchase price, the Corporation shall become
the legal and beneficial owner of the Stock being purchased and all rights and
interests therein or related thereto.
4. If from time to time during the term of the Purchase Option there is
any stock dividend or liquidating dividend or distribution of cash and/or
property, stock split or other change in the character or amount of any of the
outstanding securities of the Corporation, then, in such event, any and all new,
substituted or additional securities or other property to which Purchaser is
entitled by reason of his ownership of Stock will be immediately subject to the
Purchase Option and be included in the word "Stock" for all purposes of the
Purchase Option with the same force and effect as the shares of Stock then
subject to the Purchase Option. While the total Option Price shall remain the
same after each such event, the Option Price per share of Stock upon exercise of
the Purchase Option shall be appropriately adjusted.
5. All certificates representing any shares of Stock of the Corporation
subject to the provisions of this Agreement shall have endorsed thereon legends
in substantially the following form:
(i) "THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
AN OPTION SET FORTH IN AN AGREEMENT BETWEEN THE CORPORATION AND THE REGISTERED
HOLDER, OR HIS PREDECESSOR IN INTEREST, A COPY OF WHICH IS ON FILE AT THE
PRINCIPAL OFFICE OF THIS CORPORATION. ANY TRANSFER OR ATTEMPTED TRANSFER OF ANY
SHARES SUBJECT TO SUCH OPTION IS VOID WITHOUT THE PRIOR EXPRESS WRITTEN CONSENT
OF THE ISSUER OF THESE SHARES."
(ii) "THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR
HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE
SECURITIES UNDER SAID ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE
CORPORATION THAT SUCH REGISTRATION IS NOT REQUIRED."
(iii) Any legend required to be placed thereon by the California
Commissioner of Corporations.
6. Purchaser acknowledges that he is aware that the Stock to be issued
to him by the Corporation pursuant to this Agreement has not been registered
under the Securities Act of 1933, as amended (the "Act"), on the basis that no
distribution or public offering of the Stock is to be
3.
<PAGE>
effected, and in this connection acknowledges that the Corporation is relying on
the following representations: Purchaser warrants and represents to the
Corporation that he is acquiring the Stock for investment and not with a view to
or for sale in connection with any distribution of the Stock or with any present
intention of distributing or selling the Stock and he does not presently have
reason to anticipate any change in circumstances or any particular occasion or
event which would cause him to sell the Stock. Purchaser recognizes that the
Stock must be held indefinitely unless it is subsequently registered under the
Act or an exemption from such registration is available and, further, recognizes
that the Corporation is under no obligation to register the Stock or to comply
with any exemption from such registration.
7. Purchaser is aware that the Stock may not be sold pursuant to Rule
144 adopted under the Act unless certain conditions are met and until Purchaser
has held the Stock for at least two (2) years. Among the conditions for use of
Rule 144 is the availability of specified current public information about the
Corporation. Purchaser recognizes that the Corporation presently has no plans to
make such information available to the public.
Whether or not the Purchase Option is exercised or has lapsed,
Purchaser further agrees not to make any disposition of any of the Stock in any
event unless and until:
(a) There is then in effect a registration statement under the Act
covering such proposed disposition and such disposition is made in accordance
with such registration statement; or
(b) (i) Purchaser shall have notified the Corporation of the
proposed disposition and shall have furnished the Corporation with a detailed
statement of the circumstances surrounding the proposed disposition, and (ii)
Purchaser shall have given the Corporation an opinion of counsel, which opinion
and counsel shall be satisfactory to the Corporation, to the effect that such
disposition will not require registration of the Stock under the Act.
8. As security for his faithful performance of the terms of this
Agreement and to insure the availability for delivery of Purchaser's Stock upon
exercise of the Purchase Option herein provided for, Purchaser agrees, at the
closing hereunder (or as soon thereafter as practicable) to deliver (or have the
Corporation deliver on the Purchaser's behalf) to and deposit with the Secretary
of the Corporation, as escrow agent in this transaction (the "Escrow Agent"),
three (3) stock assignments duly endorsed (with date and number of shares left
blank) in the form attached hereto as Exhibit B, together with a certificate or
certificates evidencing all of the Stock subject to the Purchase Option; said
documents are to be held by the Escrow Agent and delivered by said Escrow Agent
pursuant to the Joint Escrow Instructions of the Corporation and Purchaser set
forth in Exhibit C attached hereto and incorporated herein by this reference,
which instructions shall also be delivered to the Escrow Agent at the closing
hereunder (or as soon thereafter as practicable).
9. Purchaser shall not sell or transfer any of the Stock subject to the
Purchase Option or any interest therein so long as such Stock is subject to the
Purchase Option.
10. The Corporation shall not be required (i) to transfer on its books
any shares of Stock of the Corporation which shall have been sold or transferred
in violation of any of the provisions set
4.
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forth in this Agreement or (ii) to treat as owner of such shares or to accord
the right to vote as such owner or to pay dividends to any transferee to whom
such shares shall have been so transferred.
11. Subject to the provisions of paragraphs 9 and 10 above, Purchaser
(but not any unapproved transferee) shall, during the term of this Agreement,
exercise all rights and privileges of a stockholder of the Corporation with
respect to the Stock.
12. Purchaser acknowledges receipt of a copy of Section 260.141.11 of
Title 10 of the California Administrative Code, attached hereto as Exhibit D.
13. The parties agree to execute such further instruments and to take
such further action as reasonably may be necessary to carry out the intent of
this Agreement.
14. Any notice required or permitted hereunder shall be given in
writing and shall be deemed effectively given upon personal delivery or upon
deposit in any United States Post Office Box, by registered or certified mail
with postage and fees prepaid, addressed to the other party hereto as his
address hereinafter shown below his signature or at such other address as such
party may designate by ten (10) days' advance written notice to the other party
hereto.
5.
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15. This Agreement shall bind and inure to the benefit of the
successors and assigns of the Corporation and, subject to the restrictions on
transfer herein set forth, inure to the benefit of and be binding upon
Purchaser, his heirs, executors, administrators, successors, and assigns.
Without limiting the generality of the foregoing, the Purchase Option of the
Corporation hereunder shall be assignable by the Corporation at any time or from
time to time, in whole or in part. Should the right of repurchase be assigned by
the Corporation, the assignee shall pay to the Corporation cash equal to the
excess, if any, of the Stock's Fair Market Value (as defined in the Plan) over
the Option Price.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the ___________________________.
CIPHERGEN BIOSYSTEMS, INC.
By:______________________________________
William E. Rich,
President and Chief Executive Officer
Address:
490 San Antonio Road
Palo Alto, CA 94306
PURCHASER
________________________________________
Signature Of Optionee
________________________________________
Printed Name
Address:
________________________________________
________________________________________
ATTACHMENTS:
Exhibit A Vesting Schedule
Exhibit B Assignment Separate from Certificate
Exhibit C Joint Escrow Instructions
Exhibit D Cal. Admin. Code, Title 10, Section 260.141.11
6.
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EXHIBIT A
VESTING SCHEDULE
NUMBER OF SHARES
SUBJECT TO
IF CESSATION OF EMPLOYMENT OCCURS: PURCHASE OPTION:
Before _________________ ,19__ ____________________shares
After___________________ ,19__
but before__________________,19__ ____________________shares
After___________________ ,19__
but before__________________,19__ ____________________shares
After___________________ ,19__
but before__________________,19__ ____________________shares
After___________________ ,19__
but before__________________,19__ ____________________shares
After___________________ ,19__
but before__________________,19__ ____________________shares
After___________________ ,19__
but before__________________,19__ ____________________shares
After___________________ ,19__
but before__________________,19__ ____________________shares
After___________________ ,19__
but before__________________,19__ ____________________shares
After___________________ ,19__
but before__________________,19__ ____________________shares
After___________________ ,19__
but before__________________,19__ ____________________shares
<PAGE>
EXHIBIT B
ASSIGNMENT SEPARATE FROM CERTIFICATE
FOR VALUE RECEIVED and pursuant to that certain Early Exercise Stock
Purchase Agreement dated as of _________________, _________________ hereby
sells, assigns and transfers unto CIPHERGEN BIOSYSTEMS, INC.
__________________________ (_______________________) shares of common stock of
Ciphergen Biosystems, Inc., a California corporation, standing in the
undersigned's name on the books of said corporation represented by Certificate
No. __________________ herewith, and does hereby irrevocably constitute and
appoint Wilson Sonsini Goodrich & Rosati attorney to transfer the said stock on
the books of the said corporation with full power of substitution in the
premises. This Assignment may be used only in accordance with and subject to the
terms and conditions of the Agreement, in connection with the repurchase of
shares of Common Stock issued to the undersigned pursuant to the Agreement, and
only to the extent that such shares remain subject to the Company's Purchase
Option under the Agreement.
Dated: ____________________________
Signature _____________________
<PAGE>
EXHIBIT C
JOINT ESCROW INSTRUCTIONS
Michael J. O'Donnell, Secretary
Ciphergen Biosystems, Inc.
c/o Wilson Sonsini Goodrich & Rosati
650 Page Mill Road
Palo Alto, CA 94304-1050
Dear Mr. O'Donnell:
As Escrow Agent for both CIPHERGEN BIOSYSTEMS, INC., a California
corporation ("Corporation"), and the undersigned purchaser of stock of the
Corporation ("Purchaser"), you are hereby authorized and directed to hold the
documents delivered to you pursuant to the terms of that certain Early Exercise
Stock Purchase Agreement ("Agreement"), dated _____________________, to which a
copy of these Joint Escrow Instructions is attached as Exhibit C, in accordance
with the following instructions:
1. In the event the Corporation or an assignee shall elect to exercise
the Purchase Option set forth in the Agreement, the Corporation or its assignee
will give to Purchaser and you a written notice specifying the number of shares
of stock to be purchased, the purchase price, and the time for a closing
hereunder at the principal office of the Corporation. Purchaser and the
Corporation hereby irrevocably authorize and direct you to close the transaction
contemplated by such notice in accordance with the terms of said notice.
2. At the closing you are directed (a) to date any stock assignments
necessary for the transfer in question, (b) to fill in the number of shares
being transferred, and (c) to deliver same, together with the certificate
evidencing the shares of stock to be transferred, to the Corporation against the
simultaneous delivery to you of the purchase price (which may include suitable
acknowledgment of cancellation of indebtedness) of the number of shares of stock
being purchased pursuant to the exercise of the Purchase Option.
3. Purchaser irrevocably authorizes the Corporation to deposit with you
any certificates evidencing shares of stock to be held by you hereunder and any
additions and substitutions to said shares as specified in the Agreement.
Purchaser does hereby irrevocably constitute and appoint you as his
attorney-in-fact and agent for the term of this escrow to execute with respect
to such securities and other property all documents of assignment and/or
transfer and all stock certificates necessary or appropriate to make all
securities negotiable and complete any transaction herein contemplated.
4. This escrow shall terminate upon expiration or exercise in full of
the Purchase Option, whichever occurs first.
1.
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5. If at the time of termination of this escrow you should have in your
possession any documents, securities, or other property belonging to Purchaser,
you shall deliver all of same to Purchaser and shall be discharged of all
further obligations hereunder; PROVIDED, HOWEVER, that if at the time of
termination of this escrow you are advised by the Corporation that the property
subject to this escrow is the subject of a pledge or other security agreement,
you shall deliver all such property to the pledgeholder or other person
designated by the Corporation.
6. Except at otherwise provided in these Joint Escrow Instructions,
your duties hereunder may be altered, amended, modified or revoked only by a
writing signed by all of the parties hereto.
7. You shall be obligated only for the performance of such duties as
are specifically set forth herein and may rely and shall be protected in relying
or refraining from acting on any instrument reasonably believed by you to be
genuine and to have been signed or presented by the proper party or parties or
their assignees. You shall not be personally liable for any act you may do or
omit to do hereunder as Escrow Agent or as attorney-in-fact for Purchaser while
acting in good faith and any act done or omitted by you pursuant to the advice
of your own attorneys shall be conclusive evidence of such good faith.
8. You are hereby expressly authorized to disregard any and all
warnings given by any of the parties hereto or by any other person or
corporation, excepting only orders or process of courts of law, and are hereby
expressly authorized to comply with and obey orders, judgments or decrees of any
court. In case you obey or comply with any such order, judgment or decree of any
court, you shall not be liable to any of the parties hereto or to any other
person, firm or corporation by reason of such compliance, notwithstanding any
such order, judgment or decree being subsequently reversed, modified, annulled,
set aside, vacated or found to have been entered without jurisdiction.
9. You shall not be liable in any respect on account of the identity,
authority or rights of the parties executing or delivering or purporting to
execute or deliver the Agreement or any documents or papers deposited or called
for hereunder.
10. You shall not be liable for the outlawing of any rights under any
statute of limitations with respect to these Joint Escrow Instructions or any
documents deposited with you.
11. You shall be entitled to employ such legal counsel (including
without limitation the firm of Wilson Sonsini Goodrich & Rosati) and other
experts as you may deem necessary properly to advise you in connection with your
obligations hereunder, may rely upon the advice of such counsel, and may pay
such counsel reasonable compensation therefor.
12. Your responsibilities as Escrow Agent hereunder shall terminate if
you shall cease to be Secretary of the Corporation or if you shall resign by
written notice to each party. In the event of any such termination, the
Corporation may appoint any officer or assistant officer of the Corporation as
successor Escrow Agent and Purchaser hereby confirms the appointment of such
successor or successors as his attorney-in-fact and agent to the full extent of
your appointment.
2.
<PAGE>
13. If you reasonably require other or further instruments in
connection with these Joint Escrow Instructions or obligations in respect
hereto, the necessary parties hereto shall join in furnishing such instruments.
14. It is understood and agreed that should any dispute arise with
respect to the delivery and/or ownership or right of possession of the
securities, you may (but are not obligated to) retain in your possession without
liability to anyone all or any part of said securities until such dispute shall
have been settled either by mutual written agreement of the parties concerned or
by a final order, decree or judgment of a court of competent jurisdiction after
the time for appeal has expired and no appeal has been perfected, but you shall
be under no duty whatsoever to institute or defend any such proceedings.
15. Any notice required or permitted hereunder shall be given in
writing and shall be deemed effectively given upon personal delivery or upon
deposit in any United States Post Box, by registered or certified mail with
postage and fees prepaid, addressed to each of the other parties hereunto
entitled at the following addresses, or at such other addresses as a party may
designate by ten days' written notice to each of the other parties hereto:
CORPORATION: CIPHERGEN BIOSYSTEMS, INC.
490 San Antonio Road
Palo Alto, CA 94306
PURCHASER:
______________________________________
______________________________________
SECRETARY: MICHAEL J. O'DONNELL
Ciphergen Biosystems, Inc.
c/o Wilson Sonsini Goodrich & Rosati
650 Page Mill Road
Palo Alto, CA 94304-1050
16. By signing these Joint Escrow Instructions you become a party
hereto only for the purpose of said Joint Escrow Instructions; you do not become
a party to the Agreement.
3.
<PAGE>
17. This instrument shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and permitted assigns. It is
understood and agreed that references to "you" or "your" herein refer to the
original Escrow Agent and to any and all successor Escrow Agents. It is
understood and agreed that the Corporation may at any time or from time to time
assign its rights under the Agreement and these Joint Escrow Instructions in
whole or in part.
Very truly yours,
CIPHERGEN BIOSYSTEMS, INC.
By: _____________________________________
William E. Rich,
President and Chief Executive Officer
PURCHASER:
_________________________________________
ESCROW AGENT:
_____________________________________
Michael J. O'Donnell, Secretary
4.
<PAGE>
EXHIBIT D
STATE OF CALIFORNIA - CALIFORNIA ADMINISTRATIVE CODE
TITLE 10. INVESTMENT - CHAPTER 3. COMMISSIONER OF CORPORATIONS
260.141.11: RESTRICTION ON TRANSFER. (a) The issuer of any security
upon which a restriction on transfer has been imposed pursuant to Sections
260.102.6, 260.141.10 or 260.534 shall cause a copy of this section to be
delivered to each issuee or transferee of such security at the time the
certificate evidencing the security is delivered to the issuee or transferee.
(b) It is unlawful for the holder of any such security to consummate a
sale or transfer of such security, or any interest therein, without the prior
written consent of the Commissioner (until this condition is removed pursuant to
Section 260.141.12 of these rules), except:
(1) to the issuer;
(2) pursuant to the order or process of any court;
(3) to any person described in Subdivision (i) of Section
25102 of the Code or Section 260.105.14 of these rules;
(4) to the transferor's ancestors, descendants or spouse, or
any custodian or trustee for the account of the transferror or the
transferor's ancestors, descendants, or spouse; or to a transferee by a
trustee or custodian for the account of the transferee or the
transferee's ancestors, descendants or spouse;
(5) to holders of securities of the same class of the same
issuer;
(6) by way of gift or donation inter vivos or on death;
(7) by or through a broker-dealer licensed under the Code
(either acting as such or as a finder) to a resident of a foreign
state, territory or country who is neither domiciled in this state to
the knowledge of the broker-dealer, nor actually present in this state
if the sale of such securities is not in violation of any securities
law of the foreign state, territory or country concerned;
(8) to a broker-dealer licensed under the Code in a principal
transaction, or as an underwriter or member of an underwriting
syndicate or selling group;
(9) if the interest sold or transferred is a pledge or other
lien given by the purchase to the seller upon a sale of the security
for which the Commissioner's written consent is obtained or under this
rule not required;
(10) by way of a sale qualified under Sections 25111, 25112,
25113 or 25121 of the Code, of the securities to be transferred,
provided that no order under Section 25140 or subdivision (a) of
Section 25143 is in effect with respect to such qualification;
(11) by a corporation to a wholly owned subsidiary of such
corporation, or by a wholly owned subsidiary of a corporation to such
corporation;
(12) by way of an exchange qualified under Section 25111,
25112 or 25113 of the Code, provided that no order under Section 25140
or subdivision (a) of Section 25143 is in effect with respect to such
qualification;
(13) between residents of foreign states, territories or
countries who are neither domiciled nor actually present in this state;
1.
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(14) to the State Controller pursuant to the Unclaimed
Property Law or to the administrator of the unclaimed property law of
another state; or
(15) by the State Controller pursuant to the Unclaimed
Property Law or by the administrator of the unclaimed property law of
another state if, in either such case, such person (i) discloses to
potential purchasers at the sale that transfer of the securities is
restricted under this rule, (ii) delivers to each purchaser a copy of
this rule, and (iii) advises the Commissioner of the name of each
purchaser;
(16) by a trustee to a successor trustee when such transfer
does not involve a change in the beneficial ownership of the
securities;
(17) by way of an offer and sale of outstanding securities in
an issuer transaction that is subject to the qualification requirement
of Section 25110 of the Code but exempt from that qualification
requirement by subdivision (f) of Section 25102;
provided that any such transfer is on the condition that any certificate
evidencing the security issued to such transferee shall contain the legend
required by this section.
(c) The certificates representing all such securities subject to such a
restriction on transfer, whether upon initial issuance or upon any transfer
thereof, shall bear on their face a legend, prominently stamped or printed
thereon in capital letters of not less than 1O-point size, reading as follows:
"IT IS UNLAWFUL TO CONSUMMATE A SALE OR TRANSFER OF THIS SECURITY, OR
ANY INTEREST THEREIN, OR TO RECEIVE ANY CONSIDERATION THEREFOR, WITHOUT
THE PRIOR WRITTEN CONSENT OF THE COMMISSIONER OF CORPORATIONS OF THE
STATE OF CALIFORNIA, EXCEPT AS PERMITTED IN THE COMMISSIONER'S RULES."
2.
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NOTICE OF EXERCISE
Ciphergen Biosystems, Inc.
490 San Antonio Road
Palo Alto, CA 94306 Date of Exercise:
-------------
Ladies and Gentlemen:
This constitutes notice under my stock option that I elect to purchase
the number of shares for the price set forth below.
<TABLE>
<CAPTION>
Type of option (check one): Incentive / / Nonstatutory / /
<S> <C> <C>
Stock option dated: __________________
Number of shares as
to which option is
exercised: __________________
Certificates to be
issued in name of: __________________
Total exercise price: $_________________
Cash payment delivered
herewith: $_________________
</TABLE>
By this exercise, I agree (i) to provide such additional documents as
you may require pursuant to the terms of the 1993 Stock Option Plan, (ii) to
provide for the payment by me to you (in the manner designated by you) of your
withholding obligation, if any, relating to the exercise of this option, and
(iii) if this exercise relates to an incentive stock option, to notify you in
writing within fifteen (15) days after the date of any disposition of any shares
of Common Stock issued upon exercise of this option that occurs within two (2)
years after the date of grant of this option or within one (1) year after such
shares of Common Stock are issued upon exercise of this option.
1.
<PAGE>
I hereby make the following certifications and representations with
respect to the number of shares of Common Stock of the Company listed above (the
"Shares"), which are being acquired by me for my own account upon exercise of
the Option as set forth above:
I acknowledge that the Shares have not been registered under the
Securities Act of 1933, as amended (the "Act"), and are deemed to constitute
"restricted securities" under Rule 701 and "control securities" under Rule 144
promulgated under the Act. I warrant and represent to the Company that I have no
present intention of distributing or selling said Shares, except as permitted
under the Act and any applicable state securities laws.
I further acknowledge that I will not be able to resell the Shares for
at least ninety days after the stock of the Company becomes publicly traded
(i.e., subject to the reporting requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934) under Rule 701 and that more restrictive
conditions apply to affiliates of the Company under Rule 144.
I further acknowledge that all certificates representing any of the
Shares subject to the provisions of the Option shall have endorsed thereon
appropriate legends reflecting the foregoing limitations, as well as any legends
reflecting restrictions pursuant to the Company's Articles of Incorporation,
Bylaws and/or applicable securities laws.
I further agree that, if required by the Company (or a representative
of the underwriters) in connection with the first underwritten registration of
the offering of any securities of the Company under the Act, I will not sell or
otherwise transfer or dispose of any shares of Common Stock or other securities
of the Company during such period (not to exceed one hundred eighty (180) days)
following the effective date of the registration statement of the Company filed
under the Act (the "Effective Date") as may be requested by the Company or the
representative of the underwriters. For purposes of this restriction I will be
deemed to own securities that (i) are owned directly or indirectly by me,
including securities held for my benefit by nominees, custodians, brokers or
pledges; (ii) may be acquired by me within sixty (60) days of the Effective
Date; (iii) are owned directly or indirectly, by or for my brothers or sisters
(whether by whole or half blood), spouse, ancestors and lineal descendants; or
(iv) are owned, directly or indirectly, by or for a corporation, partnership,
estate or trust of which I am a shareholder, partner or beneficiary, but only to
the extent of my proportionate interest therein as a shareholder, partner or
beneficiary thereof. I further agree that the Company may impose stop-transfer
instructions with respect to securities subject to the foregoing restrictions
until the end of such period.
Very truly yours,
_____________________________________
2.