Document:

ddr-ex103_148.htm

 

Exhibit 10.3

DDR CORP.

STOCK OPTION AWARD MEMORANDUM

 

	
1.
	
Holder:
	
[PARTICIPANT NAME] (the “Holder”)

	
 
	
 
	
 

	
2.
	
Plan:
	
[PLAN NAME] (the “Plan”)

	
 
	
 
	
 

	
3.
	
Date of Grant:
	
[GRANT DATE] (the “Date of Grant”)

	
 
	
 
	
 

	
4.
	
Number of Common Shares Subject to Option Right:
	
[# SHARES]

	
 
	
 
	
 

	
5.
	
Option Price per Common Share:
	
$[OPTION PRICE]

	
 
	
 
	
 

	
6.
	
Intended Status of Option Right:
	
 

	
 
	
 
	
 

	
o
	
If this box is checked, the Option Right (“Option”) is a non-qualified stock option and is not an Incentive Stock Option, and the Option shall be construed and exercised consistent with such description.

	
 
	
 

	
o
	
If this box is checked, or if neither this box nor the box above is checked, the Option is an Incentive Stock Option, and the Option shall be construed and exercised consistent with such description.

 

	
7.
	
Term of Option Right:
	
____ anniversary of the Date of Grant (the “Expiration Date”)

	
 
	
 
	
 

	
8.
	
Vesting Schedule:  If you are then and have been continuously employed by the Company (subject to the terms of this Stock Option Award Memorandum (the “Award Memorandum”), the attached Stock Option Terms (the “Agreement”) and the Plan), the Option shall vest as follows:

 

		
	
Vesting Date
	
No. of Option Shares Vesting

	
 
	
 

	
 
	
 

	
 
	
 

 

Additional provisions regarding the vesting of the Option, and other terms and conditions of the Option, are specified in the Agreement.  Capitalized terms not defined in this Award Memorandum shall have the meaning as defined in the Agreement, or if not defined therein, in the Plan.

 

ACCEPTANCE OF AWARD

 

I accept the Option granted to me on the Date of Grant as specified in this Award Memorandum, and I agree to be bound by the terms and conditions of the Award Memorandum, the Agreement and the Plan.

 

	
DDR CORP., an Ohio corporation
	
 
	
HOLDER

	
By:
	
 
	
 
	
 

	
 
	
Name:
	
 
	
Name:

	
 
	
Title:
	
 
	
 

 

 

STOCK OPTION TERMS

 

DDR Corp., an Ohio corporation (the “Company”), has granted to the Holder named in the Award Memorandum the Option to purchase the number of Common Shares (“Shares”) set forth in the Award Memorandum effective as of Date of Grant specified in the Award Memorandum.  The Option shall represent the right of the Holder to receive Common Shares subject to and upon these terms and conditions (the “Agreement”).  The Option has been granted pursuant to the Plan and is subject to all provisions of the Plan and the Award Memorandum, which are hereby incorporated herein by reference, and to the following provisions of this Agreement (capitalized terms not defined in this Agreement shall have the meaning as defined in the Award Memorandum, or if not defined therein, in the Plan):

 

1.Grant of Option.  The Company has granted to the Holder the option to purchase the number of Shares set forth in the Award Memorandum at the Option Price per Share set forth in the Award Memorandum and upon and subject to the other terms and conditions hereof and the Plan.

 

2.Term of the Option; Vesting.  The Option is exercisable, in whole or in part, once vested, in accordance with this Agreement and the vesting schedule set forth in the Award Memorandum.  Shares for which the Option has become exercisable shall be referred to herein as “Vested Shares,” and Shares for which the Option has not become exercisable shall be referred to herein as “Unvested Shares.”  The Option shall terminate on the Expiration Date set forth in the Award Memorandum (“Expiration Date”) and must be exercised, if at all and to the extent exercisable, before such date and shall not thereafter be exercisable, notwithstanding anything herein to the contrary.  Notwithstanding anything contained herein to the contrary, it shall be a condition to the Holder’s right to exercise the Option with respect to any Vested Shares that there shall have been filed with the Securities and Exchange Commission an effective registration statement on Form S-8 (or such other form as the Company shall deem necessary) with respect to the Shares to be received upon exercise.

 

3.Exercise.  Subject to the other terms and conditions hereof, the Option shall be exercisable from time to time by written notice to the Company (in the form required by the  Company) which shall:

 

(a)state that the Option is thereby being exercised, the number of Shares with respect to which the Option is being exercised, each person in whose name any certificates or book entry for the Shares should be registered and such person’s address;

 

(b)be signed by the person or persons entitled to exercise the Option and, if the Option is being exercised by anyone other than the Holder, be accompanied by proof satisfactory to counsel for the Company of the right of such person or persons to exercise the Option under the Plan and all applicable laws and regulations; and

 

(c)be accompanied by such representations, warranties or agreements with respect to the investment intent of such person or persons exercising the Option as the Company may reasonably request, in form and substance satisfactory to counsel for the Company.

 

As conditions to the exercise of the Option and the obligation of the Company to issue Shares upon the exercise thereof, the proposed recipient of the Shares shall make any representation or warranty to comply with any applicable law or regulation or to confirm any factual matters reasonably requested by the Company or its counsel.

 

Upon exercise of the Option and the satisfaction of all conditions thereto, the Company shall arrange for the Shares to be held in book entry form or deliver a certificate or certificates for Shares to the 

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specified person or persons at the specified time upon receipt of the aggregate exercise price for such Shares by any method of payment authorized by the Plan.

 

4.Termination of Employment.  Upon termination of the Holder’s employment with the Company, the Option will be governed as follows:

 

(a)Termination by Death.  If the Holder’s employment with the Company or any Subsidiary terminates by reason of death, the Option (to the extent not vested) shall become immediately and automatically vested and exercisable in full, and the Option may thereafter be exercised by the estate of the Holder (acting through its fiduciary) for a period of one year.  The balance of the Option will be forfeited if not exercised as provided for in this subsection.  Notwithstanding the foregoing, in no event will the Option be exercisable on or after the Expiration Date.

 

(b)Termination by Reason of Disability.  If the Holder’s employment with the Company or any Subsidiary terminates by reason of a permanent and total disability as defined in Section 22(e)(3) of the Code (“Disability”), the Option (to the extent not vested) shall become immediately and automatically vested and exercisable in full, and the Option may thereafter be exercised by the Holder (or by the Holder’s duly authorized legal representative if the Holder is unable to exercise the Option as a result of the Holder’s Disability) for a period of one year; provided, however, that if the Option is an Incentive Stock Option, the Option will remain exercisable following such termination of employment no longer than permitted by Section 422 of the Code.  If the Holder dies before the Option is so exercised, any unexercised Option held by the Holder shall thereafter be exercisable by the estate of the Holder (acting through its fiduciary) for the duration of such one-year period.  The balance of the Option will be forfeited if not exercised as provided for in this subsection.  Notwithstanding the foregoing, in no event will the Option be exercisable on or after the Expiration Date.

 

(c)Termination Without Cause Other than Following a Change in Control.  If the Holder’s employment with the Company or any Subsidiary is terminated by the Company or such Subsidiary without Cause (as defined below), other than in the circumstances described in Section 4(d):

 

(i)in the case of an Option that is not an Incentive Stock Option, the Option shall continue to vest following such termination of employment to the same extent that the Option would vest had the Holder remained continuously employed by the Company through the latest vesting date set forth in the Award Memorandum (the “Final NQSO Vesting Date”), and the Option may be exercised by the Holder with respect to Vested Shares until 90 days after the Final NQSO Vesting Date.

 

(ii)in the case of an Option that is an Incentive Stock Option, the Option (to the extent not vested) shall continue to vest following such termination of employment to the same extent that the Option would vest had the Holder remained continuously employed by the Company through the date that is three months after such termination of employment, and the Option may be exercised by the Holder with respect to Vested Shares only until such date.

 

The balance of the Option will be forfeited if not exercised as provided for in this subsection.  Notwithstanding the foregoing, in no event will the Option be exercisable on or after the Expiration Date.  For purposes of this Section 4(c) and Section 4(d), “Cause” shall have the meaning as defined in the Holder’s employment, change in control or similar agreement with the Company or any Subsidiary (an “Individual Agreement”), if any, or if there is no Holder’s Individual Agreement or if it does not define Cause, the term “Cause” shall mean: (w) conviction of the Holder for committing a felony under federal law or in the law of the state in which such action occurred; (x) dishonesty in the course of fulfilling the Holder’s employment duties; (y) willful and deliberate failure on the part of the Holder to perform the Holder’s employment duties in any material respect; or (z) prior to a Change in Control, such other events 

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as shall be determined by the Committee. The Committee shall, unless otherwise provided in the Holder’s Individual Agreement, have the sole discretion to determine whether Cause exists for purposes of this Section 4(c) or Section 4(d), and its determination shall be final.

 

(d)Termination Without Cause or Termination for Good Reason After a Change in Control.  If, within two years following a Change in Control, the Holder’s employment with the Company or any Subsidiary is terminated by the Company or such Subsidiary without Cause or is terminated by the Holder for Good Reason, the Option (to the extent not vested) shall become immediately and automatically vested and exercisable, and then the Option may thereafter be exercised by the Holder (i) if the Option is not an Incentive Stock Option, at any time after the date of such termination of employment or (ii) if the Option is an Incentive Stock Option, for the period ending on the date that is three months after such termination of employment. The balance of the Option will be forfeited if not exercised as provided for in this subsection. Notwithstanding the foregoing, in no event will the Option be exercisable on or after the Expiration Date.  For purposes of this Section 4(d), “Good Reason” is used as defined in the Holder’s Individual Agreement, if any, or if there is no Holder’s Individual Agreement or if it does not define Good Reason, the term “Good Reason” shall mean: (x) a material reduction in the nature or scope of the responsibilities, authorities or duties of the Holder attached to the Holder’s position held immediately prior to the Change in Control; (y) a change of more than 50 miles in the location of the Holder’s principal office immediately prior to the Change in Control; or (z) a material reduction in the Holder’s remuneration upon or after the Change in Control; provided, that no later than 90 days following an event constituting Good Reason the Holder gives notice to the Company or its successor following the Change in Control of the occurrence of such event and such entity fails to cure the event within 30 days following the receipt of such notice.  The Committee shall, unless otherwise provided in the Holder’s Individual Agreement, have the sole discretion to determine whether Good Reason exists for purposes of this Section 4(d), and its determination shall be final.

 

(e)Termination for Cause.  If the Holder’s employment with the Company or any Subsidiary terminates for Cause, any Unvested Shares will be forfeited and terminate immediately upon termination and any unexercised Vested Shares shall be forfeited and terminate 30 days after the date employment terminates. The balance of the Option will be forfeited if not exercised as provided for in this subsection. Notwithstanding the foregoing, in no event will the Option be exercisable after the Expiration Date.

 

(f)Other Termination.  Unless otherwise determined by the Committee, if the Holder’s employment with the Company or any Subsidiary terminates other than in the circumstances described in subsections (a), (b), (c), (d) or (e) of this Section 4, any Vested Shares at the time of termination must be exercised by the Holder within three months after the date the Holder’s employment terminates.  The balance of the Option will be forfeited if not exercised as provided for in this subsection.  Notwithstanding the foregoing, in no event will the Option be exercisable on or after the Expiration Date.  Except as otherwise provided in Section 4(c), and unless otherwise determined by the Committee, any Unvested Shares under the Option shall be forfeited upon termination.

 

(g)Leave of Absence.  If the Holder is granted a leave of absence by the Company or any Subsidiary, his or her employment will not be considered terminated, and he or she will continue to be deemed an employee of the Company or Subsidiary during such leave of absence or any extension thereof granted by the Company or Subsidiary for purposes of the Plan; provided, that in the case of an Option that is an Incentive Stock Option, but subject to the Plan, a leave of absence of more than three months will be viewed as a termination of employment unless continued employment is guaranteed by contract or statute.

 

5.Transferability.  Except as provided in the sentence that immediately follows, the Option and the Holder’s rights therein are not transferable by the Holder other than by will or the laws of descent 

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and distribution or pursuant to a qualified domestic relations order (as defined in the Internal Revenue Code or the Employee Retirement Income Security Act of 1974, as amended).  Notwithstanding the foregoing, if the Option is not an Incentive Stock Option, the Holder also may transfer the Option, during his or her lifetime (a) to one or more members of such Holder’s family, (b) to one or more trusts for the benefit of one or more of such Holder’s family, (c) to a partnership or partnerships of members of such Holder’s family, or (d) to a charitable organization as defined in Section 501(c)(3) of the Code, provided that no consideration is paid for the transfer and that the transfer would not result in the loss of any exemption under Rule 16b-3 of the Securities Exchange Act of 1934, as amended, with respect to any Option.  The transferee of any Option will be subject to all restrictions, terms and conditions applicable to the Option prior to its transfer. 

 

6.Taxes.  The Holder hereby agrees to pay to the Company, in accordance with the terms of the Plan, any federal, state or local taxes of any kind required by law to be withheld and remitted by the Company with respect to an exercise of the Option.  The Holder may satisfy such tax obligation, in whole or in part, by (a) electing to have the Company withhold a portion of the Shares otherwise to be delivered upon exercise of (or the lapse of restrictions relating to) the Option with a fair market value equal to the amount of such taxes, or (b) delivering to the Company Common Shares other than Shares issuable upon exercise of (or the lapse of restrictions relating to) the Option with a fair market value equal to the amount of such taxes.  The election, if any, must be made on or before the date that the amount of tax to be withheld is determined.  If the Holder does not make such payment to the Company, the Company shall have the right to withhold from any payment of any kind otherwise due to the Holder from the Company, any federal, state or local taxes of any kind required by law to be withheld with respect to an exercise of the Option or the Shares which are the subject of such Option, so long as such withholding does not result in any adverse tax consequences under Section 409A of the Code.

7.Subject to the Plan.  This Agreement is made and the Option evidenced hereby is granted under and pursuant to, and they are expressly made subject to all of the terms and conditions of, the Plan, notwithstanding anything herein to the contrary.  The Option and the terms and conditions of the grant evidenced by this Agreement are subject to mandatory adjustment under Section 12 of the Plan. The Holder hereby acknowledges receipt of a copy of the Plan and that the Holder has read and understands the terms and conditions of the Plan.  In the event of a conflict between the terms of this Agreement, the Award Memorandum and the Plan, the terms of the Plan shall govern.  In the event of a conflict between the terms of this Agreement and the Award Memorandum, the terms of this Agreement shall govern.

 

8.Relation to Other Benefits.  Any economic or other benefit to the Holder under this Agreement, the Award Memorandum or the Plan shall not be taken into account in determining any benefits to which the Holder may be entitled under any profit-sharing, retirement or other benefit or compensation plan maintained by the Company or any of its Subsidiaries and shall not affect the amount of any life insurance coverage available to any beneficiary under any life insurance plan covering employees of the Company or any of its Subsidiaries.

 

9.Restrictive Covenants.  In the event the Holder breaches any of the restrictive covenants set forth in the Holder’s Individual Agreement (if any) while such restrictive covenants are in effect, the Holder will forfeit any right to the Option, to the extent the Option has not been exercised, as of the date of such breach.

 

10.Intent.  It is acknowledged that the United States Treasury Department may amend or modify from time to time its regulations governing Incentive Stock Options. Accordingly, if the Option is an Incentive Stock Option, it is understood and agreed by the Holder that the Company may amend or modify the Plan and this Agreement in any respect deemed by the Company to be necessary, appropriate 

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or desirable to comply with such regulations, as amended or modified from time to time or to meet the requirements for an Incentive Stock Option. 

 

11.Securities Law Compliance.

 

(a)Notwithstanding any provision of this Agreement or the Award Memorandum to the contrary, the Option shall not be exercisable unless, at the time the Holder attempts to exercise the Option, in the opinion of counsel for the Company, all applicable securities laws, rules and regulations have been complied with.  The Holder agrees that the Company may impose such restrictions on the Shares as are deemed advisable by the Company, including, without limitation, restrictions relating to listing or trading requirements.  The Holder further agrees that certificates representing the Shares, if any, may bear such legends and statements as the Company shall deem appropriate or advisable to assure, among other things, compliance with applicable securities laws, rules and regulations.

 

(b)The Holder agrees that any Shares which the Holder may acquire by virtue of the Option may not be transferred, sold, assigned, pledged, hypothecated or otherwise disposed of by the Holder unless (i) a registration statement or post-effective amendment to a registration statement under the Securities Act of 1933, as amended, with respect to such Shares has become effective so as to permit the sale or other disposition of such Shares by the Holder, or (ii) there is presented to the Company an opinion of counsel satisfactory to the Company to the effect that the sale or other proposed disposition of such Shares by the Holder may lawfully be made otherwise than pursuant to an effective registration statement or post-effective amendment to a registration statement relating to such Shares under the Securities Act of 1933, as amended.

 

12.Rights of the Holder.  The Option is a voluntary, discretionary bonus being made on a one-time basis and it does not constitute a commitment to make any future awards.  The Option and any payments made hereunder will not be considered salary or other compensation for purposes of any severance pay or similar allowance, except as otherwise required by law.  The granting of the Option shall in and of itself not confer any right on the Holder to continue in the employ of the Company and shall not interfere in any way with the right of the Company to terminate the Holder’s employment at any time, subject to the terms of any Individual Agreement between the Company and the Holder.  The Holder shall have no dividend, voting or other rights of a stockholder with respect to the Shares which are subject to the Option prior to the purchase of such Shares upon exercise of the Option and the execution and delivery of all other documents and instruments deemed necessary or desirable by the Company.

 

13.Amendment.  Any amendment to the Plan shall be deemed to be an amendment to this Agreement to the extent that the amendment is applicable hereto; provided, however, that no amendment shall adversely affect the Holder’s rights with respect to the Option without the Holder’s consent and the Holder’s consent shall not be required to an amendment that is deemed necessary by the Company to ensure compliance with Section 10D of the Exchange Act.

 

14.Severability.  If any provision of this Agreement or the Award Memorandum or the application of any provision hereof or thereof to any person or circumstances is held invalid or unenforceable, the remainder of this Agreement and the Award Memorandum and the application of such provision in any other person or circumstances shall not be affected, and the provisions so held to be invalid or unenforceable shall be reformed to the extent (and only to the extent) necessary to make it enforceable and valid.

 

15.Electronic Delivery.  The Company may, in its sole discretion, deliver any documents related to the Option and the Holder’s participation in the Plan, or future awards that may be granted under the Plan, by electronic means or request the Holder’s consent to participate in the Plan by electronic 

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means.  The Holder hereby consents to receive such documents by electronic delivery and, if requested, agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company. 

 

16.Successors and Assigns.  Without limiting Section 5 hereof, the provisions of this Agreement shall inure to the benefit of, and be binding upon, the successors, administrators, heirs, legal representatives and assigns of the Holder, and the successors and assigns of the Company.

 

17.Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of Ohio, except to the extent otherwise governed by Federal law.

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Exhibit 4.9

XOMA CORPORATION

Warrant to Purchase Shares of Common Stock

 

 

NEITHER THIS SECURITY NOR THE SECURITIES ISSUABLE UPON EXERCISE OR CONVERSION OF THIS SECURITY HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED EXCEPT IN ACCORDANCE WITH APPLICABLE LAW.

THIS SECURITY IS HELD BY A PERSON WHO MAY BE DEEMED TO BE AN AFFILIATE OF THE ISSUER FOR PURPOSES OF RULE 144 PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.

XOMA CORPORATION

WARRANT TO PURCHASE COMMON STOCK

		
	
 
	
Original Issue Date: February 26, 2016

VOID AFTER February 26, 2021

THIS CERTIFIES THAT, for value received, Torreya Partners LLC, or permitted registered assigns (the “Holder”), is entitled to subscribe for and purchase at the Exercise Price (defined below) from XOMA Corporation, a Delaware corporation (the “Company”), up to 165,000 shares of the common stock of the Company, par value $.0075 per share (the “Common Stock”).  This warrant (the “Warrant”) is issued pursuant to that certain Engagement Letter between the Company and Holder (the “Engagement Letter”).  

1.DEFINITIONS.  Capitalized terms used herein but not otherwise defined herein shall have their respective meanings as set forth in the Engagement Letter.  As used herein, the following terms shall have the following respective meanings:

1.1“Business Day” means a day, other than a Saturday or Sunday, on which banks in New York City are open for the general transaction of business.

1.2“Eligible Market” means any of the New York Stock Exchange, the American Stock Exchange, The NASDAQ Global Market, The NASDAQ Global Select Market or The NASDAQ Capital Market.

1.3“Exercise Period” shall mean that period beginning on the Original Issue Date set forth above and continuing until the expiration of the five-year period thereafter, subject to earlier termination in accordance with Section 6 hereof.

1

 

 

 

 

1.4“Exercise Price” shall mean $0.7699 per share, subject to adjustment pursuant to Section 4 below. 

1.5“Exercise Shares” shall mean the shares of Common Stock issuable upon exercise of this Warrant.

1.6“NASDAQ Rules” means the rules and regulations of The NASDAQ Stock Market LLC (“NASDAQ”) and any published or written interpretations thereof by NASDAQ or its staff.

1.7“Trading Day” shall mean (a) a day on which the Common Stock is listed or quoted and traded on its primary Trading Market (other than the OTC Bulletin Board), or (b) if the Common Stock is not then listed or quoted and traded on any Eligible Market, then a day on which the Common Stock is traded in the over‐the‐counter market, as reported by the OTC Bulletin Board, or (c) if the Common Stock is not quoted on any Trading Market, a day on which the Common Stock is quoted in the over‐the‐counter market as reported in the “pink sheets” by Pink Sheets LLC (or any similar organization or agency succeeding to its functions of reporting prices); provided, that in the event that the Common Stock is not listed or quoted as set forth in clauses (a), (b) and (c) of this Section 1.7, then Trading Day shall mean a Business Day.

1.8“Trading Market” shall mean the OTC Bulletin Board or any Eligible Market, or any national securities exchange, market or trading or quotation facility on which the Common Stock is then listed or quoted.  

2.EXERCISE OF WARRANT.  The rights represented by this Warrant may be exercised in whole or in part at any time during the Exercise Period, by delivery of the following to the Company at its address set forth on the signature page hereto (or at such other address as it may designate by notice in writing to the Holder):

(A)An executed Notice of Exercise in the form attached hereto;

(B)Payment of the Exercise Price either (i) in cash or by check or (ii) pursuant to Section 2.1 below; and

(C)This Warrant. 

Execution and delivery of the Notice of Exercise shall have the same effect as cancellation of the original Warrant and issuance of a new Warrant evidencing the right to purchase the remaining number of Exercise Shares, if any. This Warrant shall be deemed to have been exercised on the date the Exercise Price is received by the Company (such date, the “Exercise Date”).

Upon the valid exercise of this Warrant, the Company shall promptly (but in no event later than three Trading Days after the Exercise Date) issue or cause to be issued and cause to be delivered to or upon the written order of the Holder and in such name or names as the Holder may designate (provided that, if the Holder directs the Company to deliver a certificate for the Exercise Shares in a name other than that of the Holder or an Affiliate of the Holder and such Exercise Shares are not then eligible for sale without restriction under Rule 144, the Holder shall deliver to the Company on the Exercise Date (i) an opinion of counsel reasonably satisfactory to the 

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Company to the effect that the issuance of such Exercise Shares in such other name or names may be made pursuant to an available exemption from the registration requirements of the Securities Act and all applicable state securities or blue sky laws or (ii) a certificate, in form and substance reasonably satisfactory to the Company, that such Exercise Shares have been sold pusuant to an effective registration statement or pursuant to Rule 144), a certificate for the Exercise Shares issuable upon such exercise. If the Exercise Shares are to be issued free of all restrictive legends, the Company shall, upon the written request of the Holder, use its commercially reasonable efforts to transmit certificates for such Exercise Shares to the Holder by crediting the account of the transferee’s Holder’s prime broker with DTC through its Deposit Withdrawal Agent Commission (DWAC) system, or any successor system thereto, if, at the time of delivery of such Exercise Shares, the Company is generally able to so deliver Common Stock electronically.  Any delivery not effected by electronic transmission shall be effected by delivery of physical certificates.

The Person in whose name any certificate or certificates for Exercise Shares are to be issued upon exercise of this Warrant shall be deemed to have become the holder of record of such shares on the date on which this Warrant was surrendered and payment of the Exercise Price was made, irrespective of the date of delivery of such certificate or certificates, except that, if the date of such surrender and payment is a date when the stock transfer books of the Company are closed, such Person shall be deemed to have become the holder of such shares at the close of business on the next succeeding date on which the stock transfer books are open.

Subject to the provisions of Section 2.4 and the final sentence of this paragraph and to the extent permitted by law, the Company’s obligations to issue and deliver Exercise Shares in accordance with the terms hereof are absolute and unconditional, irrespective of any action or inaction by the Holder to enforce the same, any waiver or consent with respect to any provision hereof, the recovery of any judgment against any Person or any action to enforce the same, or any setoff, counterclaim, recoupment, limitation or termination, or any breach or alleged breach by the Holder or any other Person of any obligation to the Company or any violation or alleged violation of law by the Holder or any other Person, and irrespective of any other circumstance which might otherwise limit such obligation of the Company to the Holder in connection with the issuance of Exercise Shares. The Holder shall, subject to the following proviso, have the right to pursue any remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely deliver Exercise Shares upon exercise of this Warrant as required pursuant to the terms hereof; provided, however, that notwithstanding anything to the contrary in this Warrant or in the Engagement Letter, if the Company is for any reason unable to deliver Exercise Shares upon exercise of this Warrant as required pursuant to the terms hereof, the Company shall have no obligation to pay to the Holder any cash or other consideration or otherwise “net cash settle” this Warrant.

2.1NET EXERCISE.  If during the Exercise Period the fair market value of one share of the Common Stock is greater than the Exercise Price (at the date of calculation as set forth below), in lieu of exercising this Warrant by payment of cash or by check, the Holder may, at its election, effect a “net exercise” of this Warrant, in which event, if so effected, the Holder shall receive Exercise Shares equal to the value (as determined below) of this Warrant (or the portion thereof being canceled) by surrender of this Warrant at the principal office of the Company 

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together with the properly endorsed Notice of Exercise in which event the Company shall issue to the Holder a number of shares of Common Stock computed using the following formula:   

			
	
X
	
=
	
Y*(A-B)

	
 
	
 
	
A

Where  X = the number of Exercise Shares to be issued to the Holder

	
 
	
Y = 
	
the number of Exercise Shares with respect to which this Warrant is being exercised

	
 
	
A = 
	
the Fair Market Value (as defined below) of one share of Common Stock (at the date of such calculation)

	
 
	
B =
	
Exercise Price (as adjusted to the date of such calculation)

For purposes of this Warrant, the “Fair Market Value” of one share of Common Stock shall mean (i) the average of the closing sales prices for the shares of Common Stock on The NASDAQ Global Market or other Eligible Market where the Common Stock is listed or traded as reported by Bloomberg Financial Markets (or a comparable reporting service of national reputation selected by the Company and reasonably acceptable to the Holder if Bloomberg Financial Markets is not then reporting sales prices of such security) (collectively, “Bloomberg”) for the ten (10) consecutive Trading Days immediately prior to the Exercise Date, or (ii) if an Eligible Market is not the principal Trading Market for the shares of Common Stock, the average of the reported sales prices reported by Bloomberg on the principal Trading Market for the Common Stock during the same period, or, if there is no sales price for such period, the last sales price reported by Bloomberg for such period, or (iii) if neither of the foregoing applies, the last sales price of such security in the over-the-counter market as reported in the “pink sheets” by Pink Sheets LLC (or any similar organization or agency succeeding to its functions of reporting prices) for such security as reported by Bloomberg, or if no sales price is so reported for such security, the last bid price of such security as reported by Bloomberg or (iv) if fair market value cannot be calculated as of such date on any of the foregoing bases, the fair market value shall be as determined by the Board of Directors of the Company in the exercise of its good faith judgment.

2.2ISSUANCE OF NEW WARRANTS.  Upon any partial exercise of this Warrant, the Company, at its expense, will forthwith and, in any event within five (5) Business Days, issue and deliver to the Holder a new warrant or warrants of like tenor, registered in the name of the Holder, exercisable, in the aggregate, for the balance of the number of shares of Common Stock remaining available for purchase under this Warrant.

2.3PAYMENT OF TAXES AND EXPENSES.  The Company shall pay any recording, filing, stamp or similar tax which may be payable in respect of any transfer involved in the issuance of, and the preparation and delivery of certificates (if applicable) representing, (i) any Exercise Shares purchased upon exercise of this Warrant and/or (ii) new or replacement warrants in the Holder’s name or the name of any transferee of all or any portion of this Warrant; provided, however, that the Company shall not be required to pay any tax which may be payable in respect of any transfer involved in the issuance, delivery or registration of any certificates for Exercise Shares or Warrants in a name other than that of the Holder.  The Holder shall be responsible for 

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all other tax liability that may arise as a result of holding or transferring this Warrant or receiving Exercise Shares upon exercise hereof.   

3.COVENANTS OF THE COMPANY.

3.1COVENANTS AS TO EXERCISE SHARES.  The Company covenants and agrees that all Exercise Shares that may be issued upon the exercise of the rights represented by this Warrant will, upon issuance, be validly issued and outstanding, fully paid and nonassessable, and free from all taxes, liens and charges with respect to the issuance thereof.  The Company further covenants and agrees that the Company will at all times during the Exercise Period, have authorized and reserved, free from preemptive rights, a sufficient number of shares of Common Stock to provide for the exercise of the rights represented by this Warrant.  If at any time during the Exercise Period the number of authorized but unissued shares of Common Stock shall not be sufficient to permit exercise of this Warrant, the Company will use its commercially reasonable efforts to take such corporate action in compliance with applicable law as may, in the opinion of its counsel, be necessary to increase its authorized but unissued shares of Common Stock to such number of shares as shall be sufficient for such purposes.

3.2NOTICES OF RECORD DATE AND CERTAIN OTHER EVENTS.  In the event of any taking by the Company of a record of the holders of any class of securities for the purpose of determining the holders thereof who are entitled to receive any dividend or other distribution, the Company shall mail to the Holder, at least fifteen (15) days prior to the date on which any such record is to be taken for the purpose of such dividend or distribution, a notice specifying such date.  In the event of any voluntary dissolution, liquidation or winding up of the Company, the Company shall mail to the Holder, at least fifteen (15) days prior to the date of the occurrence of any such event, a notice specifying such date.  In the event the Company authorizes or approves, enters into any agreement contemplating, or solicits stockholder approval for any Fundamental Transaction (as defined in Section 6 herein), the Company shall mail to the Holder, at least fifteen (15) days prior to the date of the consummation of such event, a notice specifying such date. Notwithstanding the foregoing, the failure to deliver such notice or any defect therein shall not affect the validity of the corporate action required to be described in such notice.

4.ADJUSTMENT OF EXERCISE PRICE AND SHARES. The Exercise Price and number of Exercise Shares issuable upon exercise of this Warrant are subject to adjustment from time to time as set forth in this Section 4.

4.1If the Company, at any time while this Warrant is outstanding, (i) pays a stock dividend on its Common Stock or otherwise makes a distribution on any class of capital stock that is payable in shares of Common Stock, (ii) subdivides outstanding shares of Common Stock into a larger number of shares, or (iii) combines outstanding shares of Common Stock into a smaller number of shares, then in each such case the number of Exercise Shares issuable upon exercise of this Warrant shall be proportionately adjusted to reflect the distribution, subdivision or combination and the Exercise Price shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock outstanding immediately before such event and of which the denominator shall be the number of shares of Common Stock outstanding immediately after such event.  Any adjustment made pursuant to clause (i) of this Section 4.1 shall become effective immediately after the record date for the determination of stockholders entitled to receive 

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such dividend or distribution, and any adjustment pursuant to clauses (ii) or (iii) of this Section 4.1 shall become effective immediately after the effective date of such subdivision or combination. 

4.2If the Company, at any time while this Warrant is outstanding, distributes to holders of Common Stock (i) evidences of its indebtedness, (ii) any security (other than a distribution of Common Stock covered by Section 4.1), (iii) rights or warrants to subscribe for or purchase any security, or (iv) any other asset (in each case, “Distributed Property”), then in each such case the Holder shall be entitled upon exercise of this Warrant for the purchase of any or all of the Exercise Shares, to receive the amount of Distributed Property which would have been payable to the Holder had such Holder been the holder of such Exercise Shares on the record date for the determination of stockholders entitled to such Distributed Property.  The Company will at all times set aside in escrow and keep available for distribution to such holder upon exercise of this Warrant a portion of the Distributed Property to satisfy the distribution to which such Holder is entitled pursuant to the preceding sentence.

4.3Upon the occurrence of each adjustment pursuant to this Section 4, the Company at its expense will, at the written request of the Holder, promptly compute such adjustment in accordance with the terms of this Warrant and prepare a certificate setting forth such adjustment, including a statement of the adjusted Exercise Price and adjusted number or type of Exercise Shares or other securities issuable upon exercise of this Warrant (as applicable), describing the transactions giving rise to such adjustments and showing in detail the facts upon which such adjustment is based.  Upon written request, the Company will promptly deliver a copy of each such certificate to the Holder and to the Company’s transfer agent.

5.FRACTIONAL SHARES.  No fractional shares shall be issued upon the exercise of this Warrant as a consequence of any adjustment pursuant hereto.  All Exercise Shares (including fractions) issuable upon exercise of this Warrant may be aggregated for purposes of determining whether the exercise would result in the issuance of any fractional share.  If, after aggregation, the exercise would result in the issuance of a fractional share, the number of Exercise Shares to be issued will be rounded down to the nearest whole share.

6.FUNDAMENTAL TRANSACTIONS. If any capital reorganization, reclassification of the capital stock of the Company, consolidation or merger of the Company with another entity in which the Company is not the survivor or the stockholders of the Company immediately prior to such transaction own less than 50% of the voting power of the surviving entity immediately after such transaction, or sale, transfer or other disposition of all or substantially all of the Company’s assets to another entity shall be effected (any such transaction being hereinafter referred to as a “Fundamental Transaction”), then the Company shall use its commercially reasonable efforts to ensure that the Holder shall have the right thereafter to receive, upon exercise of this Warrant, the same amount and kind of securities, cash or property as it would have been entitled to receive upon the occurrence of such Fundamental Transaction if it had been, immediately prior to such Fundamental Transaction, the holder of the number of Exercise Shares then issuable upon exercise in full of this Warrant. If any successor to the Company, surviving entity or the corporation purchasing or otherwise acquiring such assets or other appropriate corporation or entity does not agree to assume this Warrant in connection with a Fundamental Transaction, then the Holder may exercise this Warrant at any time prior to the consummation of such Fundamental Transaction (and such exercise may be made contingent upon the 

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consummation of such Fundamental Transaction), and any portion of this Warrant that has not been exercised prior to the consummation of such Fundamental Transaction shall terminate and expire, and shall no longer be outstanding. The provisions of this Section 6 shall apply similarly and equally to successive Fundamental Transactions and shall be applied without regard to any limitations on the exercise of this Warrant. 

7.NO STOCKHOLDER RIGHTS.  Other than as provided in Section 3.2 or otherwise herein, this Warrant in and of itself shall not entitle the Holder to any voting rights or other rights as a stockholder of the Company.

8.TRANSFER OF WARRANT.  This Warrant and all rights hereunder shall not be transferred. Any purported transfer of all or any portion of this Warrant in violation of the provisions of this Warrant shall be null and void.

9.LOST, STOLEN, MUTILATED OR DESTROYED WARRANT.  If this Warrant is lost, stolen, mutilated or destroyed, the Company may, on such terms as to indemnity or otherwise as it may reasonably impose (which shall, in the case of a mutilated Warrant, include the surrender thereof), issue a new Warrant of like denomination and tenor as this Warrant so lost, stolen, mutilated or destroyed. Any such new Warrant shall constitute an original contractual obligation of the Company, whether or not the allegedly lost, stolen, mutilated or destroyed Warrant shall be at any time enforceable by anyone.

10.NOTICES.  Any notice, request or other document required or permitted to be given or delivered hereunder shall be delivered in accordance with the notice provisions of the Engagement Letter.

11.ACCEPTANCE.  Receipt of this Warrant by the Holder shall constitute acceptance of and agreement to all of the terms and conditions contained herein.

12.GOVERNING LAW.  All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be governed by and construed and enforced in accordance with the internal laws of the State of California, without regard to the principles of conflicts of law thereof. Each of the Company and the Holder hereby irrevocably waives personal service of process and consents to process being served in any Proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under the Engagement Letter and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law.

13.AMENDMENT OR WAIVER.  Any term of this Warrant may be amended or waived (either generally or in a particular instance and either retroactively or prospectively) with the written consent of the Company and the Holder. No waiver of any default with respect to any provision, condition or requirement of this Warrant shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

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IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its duly authorized officer as of February 26, 2016 

 

	
	
XOMA CORPORATION

	
By: /s/ Tom Burns

	
Name: Tom Burns

Title:   Chief Financial Officer, Vice President, Finance

 

	
	
ADDRESS:

	
XOMA Corporation

	
2910 Seventh Street

	
Berkeley, CA 94710

 

 

 

 

NOTICE OF EXERCISE

TO:XOMA Corporation

(1)[_]The undersigned hereby elects to purchase [______] shares of the common stock, par value $.001 (the “Common Stock”), of COMAPNY, INC. (the “Company”) pursuant to the terms of the attached Warrant, and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.

[_]The undersigned hereby elects to purchase [______] shares of Common Stock of the Company pursuant to the terms of the net exercise provisions set forth in Section 2.1 of the attached Warrant, and shall tender payment of all applicable transfer taxes, if any.

(2)Please issue the certificate for shares of Common Stock in the name of:

--------------------------------------------------------------------------------

Print or type name

--------------------------------------------------------------------------------

Social Security or other Identifying Number

--------------------------------------------------------------------------------

Street Address

--------------------------------------------------------------------------------

City State Zip Code

(3)If such number of shares shall not be all the shares purchasable upon the exercise of the Warrants evidenced by this Warrant, a new warrant certificate for the balance of such Warrants remaining unexercised shall be registered in the name of and delivered to:

Please insert social security or other identifying number:  ----------------------

---------------------------------------------------------------------------------

(Please print name and address)

---------------------------------------------------------------------------------

Dated:

 

		
	
(Date)
	

(Signature)

	
 
	

(Print name)

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00257-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00257-of-00352.parquet"}]]