[ex10-23logo.jpg]
(Bioanalytical Systems, Inc)
2701 Kent Avenue
West Lafayette, IN 47906 USA
TEL: (765) 463-4527 - FAX: (765) 497-1102
www.basinc.com
 
August 18, 2010
 
Albert F. Hidalgo, Jr.
1336 Central Avenue
Indianapolis, IN 46202
 
Dear Alberto:
 
The Compensation Committee of the Board of Directors of Bioanalytical Systems,
Inc. (the "Company") has approved the grant of non-qualified stock options to
you as an inducement to your employment with the Company. This letter will serve
as notice of the grant, effective as of the date of this letter (the "Date of
Grant") of an option to purchase (the "Option") 30,000 shares of the Common
Shares of the Company (the "Option Shares") on the terms and conditions set
forth herein, and upon your execution and delivery to the Company of the copy of
this letter included herein will constitute our agreement as to those terms.
This Option has not been granted under the terms of the Company's employee stock
option plans, and is not a "qualified" stock option as defined by the Internal
Revenue Service. You are urged to consult with your tax advisors concerning the
tax effect of the grant and exercise of this Option.
 
1.           OPTION PRICE. The purchase price of the Option Shares is $1.00 per
share (the "Option Price").
 
2.           MEDIUM AND TIME OF PAYMENT. You must pay the Option Price with
respect to the Option Shares being purchased at the time you exercise the
Option. The Option Price may be paid either (a) in cash; (b) by certified check
or by bank cashier's check; (c) if you can do so without violating Section 16(b)
of the Securities Exchange Act of 1934, through the tender to the Company of
outstanding Common Shares, which shall be valued, for purposes of determining
the extent to which the purchase price has been paid, at the fair market value
of the Common Shares on the date of exercise of the Option; (d) by surrendering
a sufficient portion of the vested Option based on the difference between the
exercise price of the Option and the fair market value at the time of exercise
of the Shares subject to the Option, or (e) by any combination of (a), (b), (c)
and (d).

 
 

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3.           TERM AND EXERCISABILITY OF OPTIONS. The Option is effective
immediately upon your acceptance of this letter. Unless the Option is terminated
or vesting of the Option or any portion thereof is accelerated (in each case as
provided in this letter), the Option shall vest and become exercisable in whole
or in part from time to time subject to the limitation that no Option may be
exercised with respect to fewer than twenty-five (25) shares then subject to
Option hereunder, in which event any exercise must be as to all such shares and
subject to the further limitation that the Options represented by the Agreement
shall first become exercisable in four equal installments and pursuant to the
following sentence. The Option may be exercised as to the shares covered by the
first installment from and after the second anniversary of the grant of the
Option, with second, third and fourth installments becoming exercisable on the
three succeeding anniversary dates. Unless sooner terminated under the terms of
this Agreement, the Option shall expire as to all shares subject to purchase
hereunder on the 10th anniversary date of this Agreement if not exercised on or
before such date. The Option shall also vest and become exercisable as to all
unvested Option Shares upon the occurrence of a "Change in Control" as defined
in your Employment Agreement with the Company dated August 12, 2010, as the same
may be amended from time to time. The Option will be considered to have been
effectively exercised only upon delivery to the Company, with a copy to the
Chair of the Compensation Committee of the Board of Directors of the Company, of
the Option Price and a "Notice of Exercise" in the form attached hereto, and the
satisfaction of all other conditions described in this letter. The Option shall
expire as to all unexercised Option Shares at the close of business on the tenth
anniversary of the date of this letter (or on the next business day if that date
is a Saturday, Sunday or holiday).
 
4.           CESSATION OF SERVICE WITH THE COMPANY. In the event you cease to
serve as an employee of the Company or any of its subsidiaries, this Option
shall terminate immediately upon termination of employment as to any unexercised
Option Shares; provided, however, that if termination of employment is due to
retirement with the consent of the Company, the expiration of the term of your
employment with the Company set forth in your employment agreement, or is due to
a permanent and total disability, you shall have the right to exercise the
Option with respect to the Common Shares for which it could have been exercised
on the effective date of termination of employment at any time within three (3)
months after the termination date. In the event of your death while serving as
an employee of the Company or any of its subsidiaries, your personal
representative shall have the right to exercise this Option with respect to the
Common Shares for which it could have been exercised on the date of your death
at any time within six (6) months of your death. Whether termination is a
retirement with the consent of the Company or due to permanent and total
disability, and whether an authorized leave of absence on military or government
service shall be deemed to constitute termination of employment for the purposes
of this Option, shall be determined by the Board of Directors in its sole
discretion, which determination shall be final and conclusive.
 
5.           RECAPITALIZATION. The number of Option Shares and the Option Price
each shall be proportionally adjusted for any increase or decrease in the number
of issued Common Shares resulting from a subdivision or consolidation of shares
of the Company, the payment of a share dividend, a share split or other increase
or decrease in the outstanding Common Shares effected without receipt of
consideration by the Company (including an increase or decrease effected as a
part of the Recapitalization of the Company, as defined herein). In the event
that there shall be a recapitalization or reorganization of the Company or a
reclassification of its outstanding shares (each a "Recapitalization") as a
result of which other shares (the "New Shares") are issued in exchange for
Common Shares, then there shall be substituted for the Option Shares then
issuable hereunder that number of New Shares into which those Option Shares have
been converted had they been outstanding at the effective date of the
Recapitalization.

 
 

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6.           MERGER, DISSOLUTION. If the Company shall enter into any agreement
of merger or consolidation (whether or not it shall be the surviving entity
thereunder), the Company shall have the right to terminate this Option as of any
date specified in a written notice given to you not less than 30 days prior to
the termination date. If the merger or consolidation described in that notice is
not consummated within 180 days following the termination date of this Option
specified in the notice, this Option thereafter shall be deemed to have been
continuously in effect since the date hereof. In the event of the sale of all or
substantially all of the assets of the Company and the distribution of the
proceeds thereof to shareholders in liquidation of the company, the Company
shall give you 30 days prior written notice specifying record date for the
purpose of determining the shareholders entitled to participate in that
distribution and this Option shall expire as to all Option Shares that remain
unexercised as of the date of that distribution.
 
7.           NONASSIGNABILITY. This Option is not assignable or transferable
except by will or under the laws of descent and distribution. During your
lifetime, this Option shall be exercisable only by you (or if you become
incapacitated, by your legal guardian or attorney-in-fact).
 
8.           ISSUANCE OF SHARES AND COMPLIANCE WITH SECURITIES LAWS. The Company
may postpone the issuance and delivery of certificates representing Common
Shares until (a) the admission of such shares to listing on any exchange on
which shares of the Company of the same class are then listed and (b) the
completion of any requirements for registration or other qualification of the
shares under any state or Federal law, rule or regulation or the rules and
regulations of any exchange upon which the Common shares are traded as the
Company shall determine to be necessary or advisable. The Company shall use
reasonable commercial efforts to complete any required registration or other
qualification. You have no right to require the Company to register the Common
Shares acquired upon the exercise of this Option under federal or state
securities laws. As a condition to the effective exercise of this Option you may
be required to make such representations and furnish such information as may, in
the opinion of counsel for the Company, be appropriate to permit the Company to
determine whether registration or qualification of those shares is required in
connection with that transaction.
 
9.           RIGHTS AS A SHAREHOLDER. You shall have no rights as a shareholder
with respect to Common Shares subject to this Option until the date of issuance
of a certificate to you. A certificate will not be issued until you have
exercised the Option, fully paid for the Common Shares acquired thereby and
satisfied all other details described in this letter. No adjustment will be made
for dividends or other rights for which the record date is prior to the date a
certificate is issued.
 
10.         NO OBLIGATION TO EXERCISE OPTION. The grant of this Option imposes
no obligation upon you to exercise the Option.
 
11.         NO OBLIGATION TO CONTINUE EMPLOYMENT. The grant of this Option to
you does not constitute any contract of employment between you and the Company,
and does not impose any obligation of the Company to continue your employment.

 
 

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12.         WITHHOLDINGS. As a condition to the effective exercise of this
Option, the Company shall have the right to require you to remit to the Company
amounts sufficient to satisfy any applicable withholding requirements set forth
in the Internal Revenue Code of 1986, as amended, or under state or local law
relating to the Option. The Company shall have the right, to the extent
permitted by law, to deduct from any payment of any kind otherwise due to you
any federal, state or local taxes of any kind required by law to be withheld
with respect to the exercise of the Option.
 
13.         POWER AND AUTHORITY. The Board of Directors shall have the full
power and authority to take all actions and make all determinations required or
provided for under the terms of this Option; to interpret and construe the
provisions of this letter, which interpretation or construction shall be final,
conclusive and binding on the Company and you; and to take any and all other
actions and make any and all other determinations not consistent with the
specific terms and provisions of this letter which the Board of Directors deems
necessary or appropriate.
 
Please acknowledge your receipt of this letter and your agreement to the terms
set forth herein by signing and returning the copy enclosed for that purpose.

 
Very truly yours,
     
BIOANALYTICAL SYSTEMS, INC.
        By:     
 
Michael R. Cox, Vice President- Finance
and Chief Financial Officer
       
Accepted and agreed to:
           
Alberto F. Hidalgo, Jr.
       
Date: 
 

 
 
 

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EXHIBIT A
 
BIOANALYTICAL SYSTEMS, INC.
 
NOTICE OF EXERCISE
 
Date:
 
Mr. Michael R. Cox
Chief Financial Officer
BIOANALYTICAL SYSTEMS, INC.
2701 Kent Avenue
West Lafayette, Indiana 47906
 
Dear Mr. Cox:
 
Pursuant to the agreement dated August 18, 2010 granting me an option ("Option")
with respect to the purchase of Common Shares of Bioanalytical Systems, Inc.,
please accept this letter as notice of exercise of the Option with respect to
__________________________ Common Shares. I am tendering full payment to the
Company for the Common Shares and all applicable withholdings in one or more of
the following forms:
 
1.           Cash in the amount of $ __________
 
2.           Certified or bank cashier's check in the amount of $ __________
 
3.           Tender to the Company of _____ outstanding Common Shares
 
4.           _________________________ Common Shares that are subject to the
Option
 
Unless I have delivered herewith sufficient funds to pay in full all required
withholdings under applicable law, I authorize the Company to withhold from the
Common Shares otherwise issuable to me as a result of this exercise of the
Option to pay in full all such required withholdings.
 

     
Signature
         
Printed Name
                 
Address

 
 

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