EXHIBIT 10.71
AMGEN INC.
AMENDED AND RESTATED 1999 EQUITY INCENTIVE PLAN
Amgen Inc. has adopted this Amended and Restated 1999 Equity Incentive Plan
(the "Plan"), effective as of December 10, 2002. This Plan amends and restates
in its entirety the Amended and Restated 1999 Equity Incentive Plan, as
previously amended and restated on July 15, 2002 (the "Restatement Date"), which
amended and restated in its entirety the Immunex Corporation 1999 Stock Option
Plan, as amended (the "Original Plan").
ARTICLE I.
PROVISIONS APPLICABLE TO OPTIONS GRANTED
PRIOR TO RESTATEMENT DATE
The following provisions of this Article I shall govern awards granted
under the Plan prior to the Restatement Date:
SECTION 1. PURPOSE.
The purpose of Article I of the Plan is to enhance the long-term
stockholder value of Amgen Inc., a Delaware corporation (the "Company"), by
offering opportunities to selected employees, officers and directors to
participate in the Company's growth and success, and to encourage them to remain
in the service of the Company and its Related Corporations (as defined in
Article I, Section 2) and to acquire and maintain stock ownership in the
Company.
SECTION 2. DEFINITIONS.
For purposes of the Plan, the following terms shall be defined as set forth
below:
"Board" means the Board of Directors of the Company.
"Cause" means dishonesty, fraud, misconduct, unauthorized use or disclosure
of confidential information or trade secrets, or conviction or confession of a
crime punishable by law (except minor violations), in each case as determined by
the Plan Administrator, and its determination shall be conclusive and binding.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time.
"Common Stock" means the common stock, par value $.0001 per share, of the
Company.
"Disability," unless otherwise defined by the Plan Administrator, means a
mental or physical impairment of the Optionee that is expected to result in
death or that has lasted or is expected to last for a continuous period of 12
months or more and that causes the Optionee to be unable, in the opinion of the
Company and one independent physician selected by the Company, to perform his or
her duties for the Company or a Related Corporation and to be engaged in any
substantial gainful activity.
"Effective Date" means the date on which the Plan was adopted by the Board
of Directors of Immunex Corporation ("Immunex"), provided that it was approved
by Immunex's stockholders at any time within 12 months of such adoption.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Stock" has the meaning set forth in Article I, Section 11.3.
"Fair Market Value" shall be as established in good faith by the Plan
Administrator or (a) if the Common Stock is listed on the Nasdaq National
Market, the closing per share sales prices for the Common Stock as reported by
the Nasdaq National Market for a single trading day or (b) if the Common Stock
is listed on the New York Stock Exchange or the American Stock Exchange, the
closing per share sales prices for the Common Stock as such price is officially
quoted in the composite tape of transactions on such exchange for a single
trading day. If there is no such reported price for the Common Stock for the
date in question, then such price on the last preceding date for which such
price exists shall be determinative of Fair Market Value.
"Grant Date" means the date on which the Plan Administrator completes the
corporate action relating to the grant of an Option and all conditions precedent
to the grant have been satisfied, provided that conditions to the exercisability
or vesting of Options shall not defer the Grant Date.
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"Incentive Stock Option" means an Option to purchase Common Stock granted
under Article I, Section 7 with the intention that it qualify as an "incentive
stock option" as that term is defined in Section 422 of the Code.
"Nonqualified Stock Option" means an Option to purchase Common Stock
granted under Article I, Section 7 other than an Incentive Stock Option.
"Option" means the right to purchase Common Stock granted under Article I,
Section 7.
"Optionee" means (a) the person to whom an Option is granted; (b) for an
Optionee who has died, the personal representative of the Optionee's estate, the
person(s) to whom the Optionee's rights under the Option have passed by will or
by the applicable laws of descent and distribution, or the beneficiary
designated in accordance with Article I, Section 10; or (c) the person(s) to
whom an Option has been transferred in accordance with Article I, Section 10.
"Option Term" has the meaning set forth in Article I, Section 7.3.
"Parent," except as provided in Article I, Section 8.3 in connection with
Incentive Stock Options, means any entity, whether now or hereafter existing,
that directly or indirectly controls the Company.
"Plan Administrator" means the Board or any committee or committees
designated by the Board or any person to whom the Board has delegated authority
to administer the Plan under Article I, Section 3.1.
"Related Corporation" means any Parent or Subsidiary of the Company.
"Retirement" means retirement as of the individual's normal retirement date
under the Amgen Inc. Profit Sharing 401(k) Plan and Trust or other similar
successor plan applicable to salaried employees, unless otherwise defined by the
Plan Administrator from time to time for purposes of Article I of the Plan.
"Securities Act" means the Securities Act of 1933, as amended.
"Subsidiary," except as provided in Article I, Section 8.3 in connection
with Incentive Stock Options, means any entity that is directly or indirectly
controlled by the Company.
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"Termination Date" has the meaning set forth in Article I, Section 7.6.
SECTION 3. ADMINISTRATION.
3.1 Plan Administrator.
The Plan shall be administered by the Board and/or a committee or
committees (which term includes subcommittees) appointed by, and consisting of
two or more members of, the Board (a "Plan Administrator"). If and so long as
the Common Stock is registered under Section 12(b) or 12(g) of the Exchange Act,
the Board shall consider in selecting the members of any committee acting as
Plan Administrator, with respect to any persons subject or likely to become
subject to Section 16 of the Exchange Act, the provisions regarding (a) "outside
directors" as contemplated by Section 162(m) of the Code and (b) "nonemployee
directors" as contemplated by Rule 16b-3 under the Exchange Act. The Board may
delegate the responsibility for administering the Plan with respect to
designated classes of eligible persons to different committees consisting of two
or more members of the Board, subject to such limitations as the Board deems
appropriate. Committee members shall serve for such term as the Board may
determine, subject to removal by the Board at any time. To the extent consistent
with applicable law, the Board may authorize one or more senior executive
officers of the Company to grant Options to specified eligible persons, within
the limits specifically prescribed by the Board.
3.2 Administration and Interpretation by Plan Administrator.
Except for the terms and conditions explicitly set forth in the Plan, the
Plan Administrator shall have exclusive authority, in its discretion, to
determine all matters relating to Options under the Plan, including the
selection of individuals to be granted Options, the type of Options, the number
of shares of Common Stock subject to an Option, all terms, conditions,
restrictions and limitations, if any, of an Option and the terms of any
instrument that evidences the Option. The Plan Administrator shall also have
exclusive authority to interpret the Plan and may from time to time adopt, and
change, rules and regulations of general application for the Plan's
administration. The Plan Administrator's interpretation of the Plan and its
rules and regulations, and all actions taken and determinations made by the Plan
Administrator pursuant to the Plan, shall be conclusive and binding on all
parties involved or affected. The Plan
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Administrator may delegate administrative duties to such of the Company's
officers as it so determines.
SECTION 4. STOCK SUBJECT TO THE PLAN.
4.1 Shares Available for Issuance.
Subject to adjustment from time to time as provided in Article I, Section
11.1, shares of Common Stock shall be available for issuance under the Plan.
Shares issued under the Plan shall be drawn from authorized and unissued shares
or shares now held or subsequently acquired by the Company.
4.2 Reuse of Shares.
Any shares of Common Stock that have been made subject to an Option that
cease to be subject to the Option (other than by reason of exercise of the
Option to the extent it is exercised for shares) shall again be available for
issuance in connection with future grants of Options under the Plan; provided,
however, that for purposes of any individual award limit under the Plan, any
such shares shall be counted in accordance with the requirements of Section
162(m) of the Code.
SECTION 5. ELIGIBILITY.
Options may be granted under the Plan to those officers, directors and
employees of the Company and its Related Corporations as the Plan Administrator
from time to time selects.
SECTION 6. ACQUIRED COMPANY OPTIONS.
Notwithstanding anything in the Plan to the contrary, the Plan
Administrator may grant Options under the Plan in substitution for awards issued
under other plans, or assume under the Plan awards issued under other plans, if
the other plans are or were plans of other acquired entities ("Acquired
Entities") (or the parent of the Acquired Entity) and the new Option is
substituted, or the old option is assumed, by reason of a merger, consolidation,
acquisition of property or of stock, reorganization or liquidation (the
"Acquisition Transaction"). In the event that a written agreement pursuant to
which the Acquisition Transaction is completed is approved by the Board and said
agreement sets forth the terms and conditions of the
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substitution for or assumption of outstanding options of the Acquired Entity,
said terms and conditions shall be deemed to be the action of the Plan
Administrator without any further action by the Plan Administrator, except as
may be required for compliance with Rule 16b-3 under the Exchange Act, and the
persons holding such awards shall be deemed to be Optionees.
SECTION 7. TERMS AND CONDITIONS OF OPTIONS.
7.1 Grant of Options.
The Plan Administrator is authorized under the Plan, in its sole
discretion, to issue Options as Incentive Stock Options or as Nonqualified Stock
Options, which shall be appropriately designated.
7.2 Option Exercise Price.
The exercise price for shares purchased under an Option shall be as
determined by the Plan Administrator, but shall not be less than 100% of the
Fair Market Value of the Common Stock on the Grant Date with respect to
Incentive Stock Options and not less than 85% of the Fair Market Value of the
Common Stock on the Grant Date with respect to Nonqualified Stock Options. For
Incentive Stock Options granted to a more than 10% stockholder, the Option
exercise price shall be as specified in Article I, Section 8.2.
7.3 Term of Options.
The term of each Option (the "Option Term") shall be as established by the
Plan Administrator or, if not so established, shall be 10 years from the Grant
Date. For Incentive Stock Options, the maximum Option Term shall be as specified
in Article I, Sections 8.2 and 8.4.
7.4 Exercise of Options.
The Plan Administrator shall establish and set forth in each instrument
that evidences an Option the time at which, or the installments in which, the
Option shall vest and become exercisable, which provisions may be waived or
modified by the Plan Administrator at any time. If not so established in the
instrument evidencing the Option, the Option shall vest and
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become exercisable according to the following schedule, which may be waived or
modified by the Plan Administrator at any time:
Period of Optionee's Continuous Employment or Service Portion of Total Option
With the Company or Its Related That Is Vested and Exercisable
Corporations From the Option Grant Date ------------------------------
---------------------------------------
After one year 20%
After two years 40%
After three years 60%
After four years 80%
After five years 100%
Notwithstanding the foregoing, an Option granted under Article I of the
Plan shall become 100% vested and exercisable on the date of termination of an
Optionee's employment or service relationship with the Company or a Related
Corporation on account of the Optionee's death, provided that the Optionee has
been in the continuous employment of or service to the Company or a Related
Corporation for at least two years at the date of such Optionee's death.
The Plan Administrator may adjust the vesting schedule of an Option held by
an Optionee who works less than "full-time" as that term is defined by the Plan
Administrator.
To the extent that the right to purchase shares has accrued thereunder, an
Option may be exercised from time to time by delivery to the Company of a stock
option exercise agreement or notice, in a form and in accordance with procedures
established by the Plan Administrator, setting forth the number of shares with
respect to which the Option is being exercised, the restrictions imposed on the
shares purchased under such exercise agreement, if any, and such representations
and agreements as may be required by the Company, accompanied by payment in full
as described in Article I, Section 7.5. An Option may not be exercised as to
less than a reasonable number of shares at any one time, as determined by the
Plan Administrator.
7.5 Payment of Exercise Price.
The purchase price of Common Stock acquired pursuant to an Option shall be
paid, to the extent permitted by applicable statutes and regulations, either:
(i) in cash at the time the
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Option is exercised; or (ii) at the discretion of the Plan Administrator, either
at the time of grant or exercise of the Option (A) by delivery to the Company of
shares of Common Stock that have been held for the period required to avoid a
charge to the Company's reported earnings and valued at the fair market value on
the date of exercise, (B) according to a deferred payment or other arrangement
with the person to whom the Option is granted or to whom the Option is
transferred pursuant to Article I, Section 10, or (C) in any other form of legal
consideration that may be acceptable to the Plan Administrator in its
discretion; including but not limited to payment of the purchase price pursuant
to a program developed under Regulation T as promulgated by the Federal Reserve
Board which results in the receipt of cash (or a check) by the Company before
Common Stock is issued or the receipt of irrevocable instruction to pay the
aggregate exercise price to the Company from the sales proceeds before Common
Stock is issued.
In the case of any deferred payment arrangement, interest shall be payable
at least annually and shall be charged at not less than the minimum rate of
interest necessary to avoid the treatment as interest, under any applicable
provisions of the Code, of any amounts other than amounts stated to be interest
under the deferred payment arrangement.
7.6 Post-Termination Exercises.
The Plan Administrator shall establish and set forth in each instrument
that evidences an Option whether the Option shall continue to be exercisable,
and the terms and conditions of such exercise, if an Optionee ceases to be
employed by, or to provide services to, the Company or its Related Corporations,
which provisions may be waived or modified by the Plan Administrator at any
time. If not so established in the instrument evidencing the Option, the Option
shall be exercisable according to the following terms and conditions, which may
be waived or modified by the Plan Administrator at any time:
(a) Any portion of an Option that is not vested and exercisable on the date
of termination of the Optionee's employment or service relationship (the
"Termination Date") shall expire on such date, unless the Plan Administrator
determines otherwise.
(b) Any portion of an Option that is vested and exercisable on the
Termination Date shall expire upon the earliest to occur of:
(i) the last day of the Option Term;
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(ii) if the Optionee's Termination Date occurs for reasons other than
Cause, Disability, death or Retirement, the three-month anniversary of such
Termination Date; and
(iii) if the Optionee's Termination Date occurs by reason of
Disability, death or Retirement, the one-year anniversary of such Termination
Date.
Notwithstanding the foregoing, if the Optionee dies after the Termination
Date while the Option is otherwise exercisable, the Option shall expire upon the
earlier to occur of (y) the last day of the Option Term and (z) the first
anniversary of the date of death.
Also notwithstanding the foregoing, in case of termination of the
Optionee's employment or service relationship for Cause, the Option shall
automatically expire upon first notification to the Optionee of such
termination, unless the Plan Administrator determines otherwise. If an
Optionee's employment or service relationship with the Company is suspended
pending an investigation of whether the Optionee shall be terminated for Cause,
all the Optionee's rights under any Option likewise shall be suspended during
the period of investigation.
An Optionee's transfer of employment or service relationship between or
among the Company and its Related Corporations, or a change in status from an
employee to a consultant that is evidenced by a written agreement between an
Optionee and the Company or a Related Corporation, shall not be considered a
termination of employment or service relationship for purposes of this Article
I, Section 7. Employment or service relationship shall be deemed to continue
while the Optionee is on a bona fide leave of absence, if such leave was
approved by the Company or a Related Corporation in writing and if continued
crediting of service for purposes of this Article I, Section 7 is expressly
required by the terms of such leave or by applicable law (as determined by the
Company). The effect of a Company-approved leave of absence on the terms and
conditions of an Option shall be determined by the Plan Administrator, in its
sole discretion.
SECTION 8. INCENTIVE STOCK OPTION LIMITATIONS.
To the extent required by Section 422 of the Code, Incentive Stock Options
shall be subject to the following additional terms and conditions:
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8.1 Dollar Limitation.
To the extent the aggregate Fair Market Value (determined as of the Grant
Date) of Common Stock with respect to which Incentive Stock Options are
exercisable for the first time during any calendar year (under the Plan and all
other stock option plans of the Company) exceeds $100,000, such portion in
excess of $100,000 shall be treated as a Nonqualified Stock Option. In the event
the Optionee holds two or more such Options that become exercisable for the
first time in the same calendar year, such limitation shall be applied on the
basis of the order in which such Options are granted.
8.2 More Than 10% Stockholders.
If an individual owns more than 10% of the total voting power of all
classes of the Company's stock, then the exercise price per share of an
Incentive Stock Option shall not be less than 110% of the Fair Market Value of
the Common Stock on the Grant Date and the Option Term shall not exceed five
years. The determination of more than 10% ownership shall be made in accordance
with Section 422 of the Code.
8.3 Eligible Employees.
Individuals who are not employees of the Company or one of its parent
corporations or subsidiary corporations may not be granted Incentive Stock
Options. For purposes of this Article I, Section 8.3, "parent corporation" and
"subsidiary corporation" shall have the meanings attributed to those terms for
purposes of Section 422 of the Code.
8.4 Term.
Except as provided in Article I, Section 8.2, the Option Term shall not
exceed 10 years.
8.5 Exercisability.
An Option designated as an Incentive Stock Option shall cease to qualify
for favorable tax treatment as an Incentive Stock Option to the extent it is
exercised (if permitted by the terms of the Option) (a) more than three months
after the Termination Date for reasons other than death or Disability, (b) more
than one year after the Termination Date by reason of Disability,
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or (c) after the Optionee has been on leave of absence for more than 90 days,
unless the Optionee's reemployment rights are guaranteed by statute or contract.
For purposes of this Article I, Section 8.5, Disability shall mean
"disability" as that term is defined for purposes of Section 422 of the Code.
8.6 Taxation of Incentive Stock Options.
In order to obtain certain tax benefits afforded to Incentive Stock Options
under Section 422 of the Code, the Optionee must hold the shares issued upon the
exercise of an Incentive Stock Option for two years after the Grant Date and one
year from the date of exercise. An Optionee may be subject to the alternative
minimum tax at the time of exercise of an Incentive Stock Option. The Optionee
shall give the Company prompt notice of any disposition of shares acquired by
the exercise of an Incentive Stock Option prior to the expiration of such
holding periods.
SECTION 9. WITHHOLDING.
The Company may require the Optionee to pay to the Company the amount of
any withholding taxes that the Company is required to withhold with respect to
the grant, vesting or exercise of any Option. Subject to the Plan and applicable
law, the Plan Administrator may, in its sole discretion, permit the Optionee to
satisfy withholding obligations, in whole or in part, by paying cash, by
electing to have the Company withhold shares of Common Stock or by transferring
shares of Common Stock to the Company, in such amounts as are equivalent to the
Fair Market Value of the withholding obligation. The Company shall have the
right to withhold from any Option or any shares of Common Stock issuable
pursuant to an Option or from any cash amounts otherwise due or to become due
from the Company to the Optionee an amount equal to such taxes. The Company may
also deduct from any Option any other amounts due from the Optionee to the
Company or a Related Corporation.
SECTION 10. ASSIGNABILITY.
Options granted under Article I of the Plan and any interest therein may
not be assigned, pledged or transferred by the Optionee and may not be made
subject to attachment or similar proceedings otherwise than by will or by the
applicable laws of descent and distribution, and,
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during the Optionee's lifetime, such Options may be exercised only by the
Optionee. Notwithstanding the foregoing, and to the extent permitted by Section
422 of the Code, the Plan Administrator, in its sole discretion, may permit such
assignment, transfer and exercisability and may permit an Optionee to designate
a beneficiary who may exercise the Option or receive compensation under the
Option after the Optionee's death; provided, however, that any Option so
assigned or transferred shall be subject to all the same terms and conditions
contained in the instrument evidencing the Option.
SECTION 11. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION.
11.1 Adjustment of Shares.
The aggregate number and class of shares for which Options may be granted
under the Plan, the number and class of shares covered by each outstanding
Option and the exercise price per share thereof (but not the total price), shall
all be proportionately adjusted for any increase or decrease in the number of
issued shares of Common Stock resulting from a split-up or consolidation of
shares or any like capital adjustment, or the payment of any stock dividend (not
including the stock dividend approved by the Board of Directors of Immunex on
February 23, 1999).
11.2 Cash, Stock or Other Property for Stock.
Except as provided in Article I, Section 11.3, upon a merger (other than a
merger of the Company in which the holders of Common Stock immediately prior to
the merger have the same proportionate ownership of Common Stock in the
surviving corporation immediately after the merger), consolidation, acquisition
of property or stock, separation, reorganization (other than a mere
reincorporation or the creation of a holding company) or liquidation of the
Company, as a result of which the stockholders of the Company receive cash,
stock or other property in exchange for or in connection with their shares of
Common Stock, any Option granted hereunder shall terminate, but the Optionee
shall have the right immediately prior to any such merger, consolidation,
acquisition of property or stock, liquidation or reorganization to exercise such
Option in whole or in part whether or not the vesting requirements set forth in
the Option agreement have been satisfied.
11.3 Conversion of Options on Stock for Stock Exchange.
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If the stockholders of the Company receive capital stock of another
corporation ("Exchange Stock") in exchange for their shares of Common Stock in
any transaction involving a merger (other than a merger of the Company in which
the holders of Common Stock immediately prior to the merger have the same
proportionate ownership of Common Stock in the surviving corporation immediately
after the merger), consolidation, acquisition of property or stock, liquidation
or reorganization (other than a mere reincorporation or the creation of a
holding company), the Company and the corporation issuing the Exchange Stock, in
their sole discretion, may determine that all Options granted hereunder shall be
converted into options to purchase shares of Exchange Stock instead of
terminating in accordance with the provisions of Article I, Section 11.2. The
amount and price of converted options shall be determined by adjusting the
amount and price of the Options granted hereunder in the same proportion as used
for determining the number of shares of Exchange Stock the holders of the Common
Stock receive in such merger, consolidation, acquisition of property or stock,
liquidation or reorganization. Unless accelerated by the Board, the vesting
schedule set forth in the Option agreement shall continue to apply to the
options granted for the Exchange Stock. The aggregate number and kind of shares
for which options may be granted under this Plan shall be proportionately
adjusted in the event of such merger, consolidation, acquisition of property or
stock, liquidation or reorganization.
11.4 Fractional Shares.
In the event of any adjustment in the number of shares covered by any
Option, any fractional shares resulting from such adjustment shall be
disregarded and each such Option shall cover only the number of full shares
resulting from such adjustment.
11.5 Determination of Board to Be Final.
All Article I, Section 11 adjustments shall be made by the Plan
Administrator, and its determination as to what adjustments shall be made, and
the extent thereof, shall be final, binding and conclusive. Unless an Optionee
agrees otherwise, any change or adjustment to an Incentive Stock Option shall be
made in such a manner so as not to constitute a "modification" as defined in
Section 424(h) of the Code and so as not to cause his or her Incentive Stock
Option issued hereunder to fail to continue to qualify as an "incentive stock
option" as defined in Section 422(b) of the Code.
11.6 Limitations.
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The grant of Options shall in no way affect the Company's right to adjust,
reclassify, reorganize or otherwise change its capital or business structure or
to merge, consolidate, dissolve, liquidate or sell or transfer all or any part
of its business or assets.
SECTION 12. AMENDMENT AND TERMINATION OF PLAN.
12.1 Amendment of Plan.
The Plan may be amended only by the Board in such respects as it shall deem
advisable; provided, however, that to the extent required for compliance with
Section 422 of the Code or any applicable law or regulation, stockholder
approval shall be required for any amendment that would (a) increase the total
number of shares available for issuance under the Plan, (b) modify the class of
persons eligible to receive Options, or (c) otherwise require stockholder
approval under any applicable law or regulation. Any amendment made to the Plan
that would constitute a "modification" to Incentive Stock Options outstanding on
the date of such amendment shall not, without the consent of the Optionee, be
applicable to such outstanding Incentive Stock Options but shall have
prospective effect only.
12.2 Termination of Plan.
The Board may suspend or terminate the Plan at any time. The Plan shall
have no fixed expiration date; provided, however, that no Incentive Stock
Options may be granted more than 10 years after the later of (a) the Plan's
adoption by the Board of Directors of Immunex and (b) the adoption by the Board
of Directors of Immunex of any amendment to the Plan that constitutes the
adoption of a new plan for purposes of Section 422 of the Code.
12.3 Consent of Optionee.
The amendment or termination of the Plan or the amendment of an outstanding
Option shall not, without the Optionee's consent, impair or diminish any rights
or obligations under any Option theretofore granted to the Optionee under the
Plan. Except as otherwise provided in the Plan, no outstanding Option shall be
terminated without the consent of the Optionee. Any change or adjustment to an
outstanding Incentive Stock Option shall not, without the consent of the
Optionee, be made in a manner so as to constitute a "modification" that would
cause such Incentive Stock Option to fail to continue to qualify as an Incentive
Stock Option.
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SECTION 13. GENERAL.
13.1 Evidence of Options.
Options granted under the Plan shall be evidenced by a written instrument
that shall contain such terms, conditions, limitations and restrictions as the
Plan Administrator shall deem advisable and that are not inconsistent with the
Plan.
13.2 No Individual Rights.
Nothing in the Plan or any Option granted under the Plan shall be deemed to
constitute an employment contract or confer or be deemed to confer on any
Optionee any right to continue in the employ of, or to continue any other
relationship with, the Company or any Related Corporation or limit in any way
the right of the Company or any Related Corporation of the Company to terminate
an Optionee's employment or other relationship at any time, with or without
Cause.
13.3 Registration.
Notwithstanding any other provision of the Plan, the Company shall have no
obligation to issue or deliver any shares of Common Stock under the Plan or make
any other distribution of benefits under the Plan unless such issuance, delivery
or distribution would comply with all applicable laws (including, without
limitation, the requirements of the Securities Act), and the applicable
requirements of any securities exchange or similar entity.
The Company shall be under no obligation to any Optionee to register for
offering or resale or to qualify for exemption under the Securities Act, or to
register or qualify under state securities laws, any shares of Common Stock,
security or interest in a security paid or issued under, or created by, the
Plan, or to continue in effect any such registrations or qualifications if made.
The Company may issue certificates for shares with such legends and subject to
such restrictions on transfer and stop-transfer instructions as counsel for the
Company deems necessary or desirable for compliance by the Company with federal
and state securities laws.
To the extent that the Plan or any instrument evidencing an Option provides
for issuance of stock certificates to reflect the issuance of shares of Common
Stock, the issuance may be
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effected on a noncertificated basis, to the extent not prohibited by applicable
law or the applicable rules of any stock exchange.
13.4 No Rights as a Stockholder.
No Option shall entitle the Optionee to any cash dividend, voting or other
right of a stockholder unless and until the date of issuance under the Plan of
the shares that are the subject of such Option.
13.5 Compliance With Laws and Regulations.
Notwithstanding anything in the Plan to the contrary, the Plan
Administrator, in its sole discretion, may bifurcate the Plan so as to restrict,
limit or condition the use of any provision of the Plan to Optionees who are
officers or directors subject to Section 16 of the Exchange Act without so
restricting, limiting or conditioning the Plan with respect to other Optionees.
Additionally, in interpreting and applying the provisions of the Plan, any
Option granted as an Incentive Stock Option pursuant to the Plan shall, to the
extent permitted by law, be construed as an "incentive stock option" within the
meaning of Section 422 of the Code.
13.6 Optionees in Foreign Countries.
The Plan Administrator shall have the authority to adopt such
modifications, procedures and subplans as may be necessary or desirable to
comply with provisions of the laws of foreign countries in which the Company or
its Related Corporations may operate to assure the viability of the benefits
from Options granted to Optionees employed in such countries and to meet the
objectives of the Plan.
13.7 No Trust or Fund.
The Plan is intended to constitute an "unfunded" plan. Nothing contained
herein shall require the Company to segregate any monies or other property, or
shares of Common Stock, or to create any trusts, or to make any special deposits
for any immediate or deferred amounts payable to any Optionee, and no Optionee
shall have any rights that are greater than those of a general unsecured
creditor of the Company.
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13.8 Severability.
If any provision of the Plan or any Option is determined to be invalid,
illegal or unenforceable in any jurisdiction, or as to any person, or would
disqualify the Plan or any Option under any law deemed applicable by the Plan
Administrator, such provision shall be construed or deemed amended to conform to
applicable laws, or, if it cannot be so construed or deemed amended without, in
the Plan Administrator's determination, materially altering the intent of the
Plan or the Option, such provision shall be stricken as to such jurisdiction,
person or Option, and the remainder of the Plan and any such Option shall remain
in full force and effect.
13.9 Choice of Law.
The Plan and all determinations made and actions taken pursuant hereto, to
the extent not otherwise governed by the laws of the United States, shall be
governed by the laws of the State of Washington without giving effect to
principles of conflicts of laws.
SECTION 14. EFFECTIVE DATE.
The Effective Date of the Original Plan was the date on which it was
adopted by the Board of Directors of Immunex, provided that it was approved by
Immunex's stockholders at any time within 12 months of such adoption.
SECTION 15. ADDENDUM TO ARTICLE I OF THE PLAN.
Notwithstanding anything in Article I of the Plan or any program adopted
under the Original Plan to the contrary, effective as of the Effective Time (as
defined in the Amended and Restated Agreement and Plan of Merger by and between
the Company, AMS Acquisition Inc. and Immunex dated as of December 16, 2001, as
amended by that certain First Amendment to Amended and Restated Agreement and
Plan of Merger dated as of July 15, 2002 (as amended, the "Merger Agreement")),
the following provisions shall constitute an addendum (the "Addendum") to
Article I of the Plan:
15.1. At the Effective Time, each option granted pursuant Article I of the
Plan shall be treated in accordance with the applicable terms of the Merger
Agreement.
17
15.2. In the event that an optionee's employment with Immunex or the
Company is terminated by the optionee for Good Reason or by Immunex or the
Company without Cause during the fifteen (15) months following the Effective
Time, each option held by such optionee for Common Stock that was granted
pursuant to the Merger Agreement with respect to (a) a Cancelled Company Option
(as defined in the Merger Agreement) or (b) an option for common stock of
Immunex that was granted after December 16, 2001, shall immediately vest in full
and shall remain exercisable until the earlier of (x) the first anniversary of
the optionee's termination of employment or (y) the end of the term of such
option.
15.3. In the event that an optionee who is a nonemployee director of
Immunex immediately prior to the Effective Time ceases to be a director of
Immunex or the Company for any reason immediately prior to, at, or during the
fifteen (15) months following the Effective Time, each option held by such
optionee for Common Stock shall immediately vest in full and shall remain
exercisable until the earlier of (x) the first anniversary of the date such
optionee ceases to be a director of Immunex or the Company or (y) the end of the
term of such option.
15.4. For purposes of this Addendum only, "Good Reason" shall mean the
occurrence on or after the Effective Time and without the optionee's consent of,
(a) a reduction in the optionee's annual base salary or wages, other than as
part of a general reduction applicable to substantially all employees of Immunex
or the Company employed in the United States or (ii) the relocation of the
optionee's principal place of employment to a location more than fifty (50)
miles from the optionee's principal place of employment prior to the Effective
Time.
15.5. For purposes of this Addendum only, "Cause" shall mean (a) the
willful and continued failure by the optionee to substantially perform the
optionee's duties with Immunex or the Company (other than such failure resulting
form the optionee's incapacity due to physical or mental illness) or (b) the
willful engaging by the optionee in conduct which is demonstrably and materially
injurious to Immunex or the Company, monetarily or otherwise. For purposes of
this definition, no act, or failure to act, on the optionee's part shall be
deemed willful unless done, or omitted to be done, by the optionee not in good
faith or without reasonable belief that the optionee's act, or failure to act,
was in the best interest of Immunex or the Company.
18
ARTICLE II.
PROVISIONS APPLICABLE TO OPTIONS GRANTED
ON OR AFTER RESTATEMENT DATE
The following provisions of this Article II shall govern awards granted
under the Plan on or after the Restatement Date:
SECTION 1. PURPOSE.
(a) The purpose of Article II of the Plan is to provide a means by
which employees or directors of and consultants to Amgen Inc., a Delaware
corporation (the "Company"), and its Affiliates, as defined in Article II,
paragraph 1(b), directly, or indirectly through Trusts, may be given an
opportunity to benefit from increases in value of the stock of the Company
through the granting of (i) incentive stock options, (ii) nonqualified stock
options, (iii) stock bonuses, and (iv) rights to purchase restricted stock, all
as defined below.
(b) The word "Affiliate" as used in Article II of the Plan means any
parent corporation or subsidiary corporation of the Company, as those terms are
defined in Sections 424(e) and (f), respectively, of the Internal Revenue Code
of 1986, as amended (the "Code").
(c) The Company, by means of Article II of the Plan, seeks to retain
the services of persons now employed by or serving as directors or consultants
to the Company, to secure and retain the services of persons capable of filling
such positions, and to provide incentives for such persons to exert maximum
efforts for the success of the Company.
(d) The Company intends that the rights issued under Article II of the
Plan ("Stock Awards") shall, in the discretion of the Board of Directors of the
Company (the "Board") or any committee to which responsibility for
administration of the Plan has been delegated pursuant to Article II, paragraph
2(c), be either (i) stock options granted pursuant to Article II, Sections 5 or
6 hereof, including incentive stock options as that term is used in Section 422
of the Code ("Incentive Stock Options"), or options which do not qualify as
Incentive Stock Options ("Nonqualified Stock Options") (together hereinafter
referred to as "Options"), or (ii) stock bonuses or rights to purchase
restricted stock granted pursuant to Article II, Section 7 hereof.
(e) The word "Trust" as used in Article II of the Plan shall mean a
trust created for
19
the benefit of the employee, director or consultant, his or her spouse, or
members of their immediate family. The word optionee shall mean the person to
whom the option is granted or the employee, director or consultant for whose
benefit the option is granted to a Trust, as the context shall require.
SECTION 2. ADMINISTRATION.
(a) The Plan shall be administered by the Board unless and until the
Board delegates administration to a committee, as provided in Article II,
paragraph 2(c).
(b) The Board shall have the power, subject to, and within the
limitations of, the express provisions of the Plan:
(1) To determine from time to time which of the persons
eligible under the Plan shall be granted Stock Awards; when and how Stock Awards
shall be granted; whether a Stock Award will be an Incentive Stock Option, a
Nonqualified Stock Option, a stock bonus, a right to purchase restricted stock,
or a combination of the foregoing; the provisions of each Stock Award granted
(which need not be identical), including the time or times when a person shall
be permitted to purchase or receive stock pursuant to a Stock Award; and the
number of shares with respect to which Stock Awards shall be granted to each
such person.
(2) To construe and interpret the Plan and Stock Awards granted
under it, and to establish, amend and revoke rules and regulations for its
administration. The Board, in the exercise of this power, may correct any
defect, omission or inconsistency in the Plan or in any Stock Award, in a manner
and to the extent it shall deem necessary or expedient to make the Plan fully
effective.
(3) To amend the Plan as provided in Article II, Section 14.
(4) Generally, to exercise such powers and to perform such acts
as the Board deems necessary or expedient to promote the best interests of the
Company.
(c) The Board may delegate administration of the Plan to a committee
composed of not fewer than two (2) members of the Board (the "Committee"). One
or more of these members may be non-employee directors and outside directors, if
required and as defined by the provisions of Article II, paragraphs 2(e) and
2(f). If administration is delegated to a
20
Committee, the Committee shall have, in connection with the administration of
the Plan, the powers theretofore possessed by the Board (except amendment of any
program adopted pursuant to Article II, Section 6 or any Non-Discretionary
Director Awards granted thereunder shall only be by action taken by the Board or
a committee of one or more members of the Board to which such authority has been
specifically delegated by the Board), subject, however, to such resolutions, not
inconsistent with the provisions of Article II of the Plan, as may be adopted
from time to time by the Board. Notwithstanding anything else in this Article
II, paragraph 2(c) to the contrary, at any time the Board or the Committee may
delegate to a committee of one or more members of the Board the authority to
grant or amend options to all employees, directors or consultants or any portion
or class thereof.
(d) Notwithstanding anything else in the Plan to the contrary, at any
time the Board or the Committee may authorize by duly adopted resolution one or
more Officers (as defined below) (each a "Delegated Officer") to take the
actions described in Article II, paragraph 2(b)(1) of the Plan with respect to
Options only, subject to, and within the limitations of, the express provisions
of Article II of the Plan; provided, however, that a Delegated Officer shall not
have the power to (1) grant any Options to himself, any non-employee director,
consultant, Trust, other Delegated Officer or Officer, (2) determine the time or
times when a person shall be permitted to purchase stock pursuant to the
exercise of an Option (i.e., vesting), (3) determine the exercise price of an
Option, or (4) grant any Option to a parent corporation of the Company, as
defined in Section 424(e) of the Code. The resolution authorizing a Delegated
Officer to act as such shall specify the total number of shares of Common Stock
that a Delegated Officer may grant with respect to Options. The exercise price
(including any formula by which such price or prices may be determined) and the
time or times when a person shall be permitted to purchase stock pursuant to the
exercise of an Option shall, however, be set by the Board or the Committee and
not by a Delegated Officer to the extent required by Delaware General
Corporation Law Section 157 or any other applicable law. The term "Officer"
shall include any natural person who is elected as a corporate officer of the
Company by the Board.
(e) The term "non-employee director" shall mean a member of the Board
who (i) is not currently an officer of the Company or a parent or subsidiary of
the Company (as defined in Rule 16a-1(f) promulgated by the Securities and
Exchange Commission under Section 16 of the Securities Exchange Act of 1934, as
amended (the "Exchange Act")) or an employee of the Company or a parent or
subsidiary of the Company; (ii) does not receive compensation from the Company
or a parent or subsidiary of the Company for services rendered in any capacity
other
21
than as a member of the Board (including a consultant) in an amount required to
be disclosed to the Company's stockholders under Rule 404 of Regulation S-K
promulgated by the Securities and Exchange Commission ("Rule 404"); (iii) does
not possess an interest in any other transaction required to be disclosed under
Rule 404; or (iv) is not engaged in a business relationship required to be
disclosed under Rule 404, as all of these provisions are interpreted by the
Securities and Exchange Commission under Rule 16b-3 promulgated under the
Exchange Act.
(f) The term "outside director," as used in Article II of this Plan,
shall mean an administrator of the Plan, whether a member of the Board or of any
Committee to which responsibility for administration of the Plan has been
delegated pursuant to Article II, paragraph 2(c), who is considered to be an
"outside director" in accordance with the rules, regulations or interpretations
of Section 162(m) of the Code.
(g) Any requirement that an administrator of the Plan be a
"non-employee director" or "outside director" shall not apply if the Board or
the Committee expressly declares that such requirement shall not apply.
SECTION 3. SHARES SUBJECT TO THE PLAN.
(a) Subject to the provisions of Article II, Section 11 relating to
adjustments upon changes in stock, the stock that may be issued pursuant to
Stock Awards granted under the Plan shall not exceed in the aggregate 19,273,852
shares of the Company's $.0001 par value common stock (the "Common Stock"). If
any Stock Award granted under the Plan shall for any reason expire or otherwise
terminate without having been exercised in full, the Common Stock not purchased
under such Stock Award shall again become available for the Plan. Shares
repurchased by the Company pursuant to any repurchase rights reserved by the
Company pursuant to the Plan shall not be available for subsequent issuance
under the Plan.
(b) The Common Stock subject to the Plan may be unissued shares or
reacquired shares, bought on the market or otherwise.
(c) An Incentive Stock Option may be granted to an eligible person
under the Plan only if the aggregate fair market value (determined at the time
the Incentive Stock Option is granted) of the Common Stock with respect to which
incentive stock options (as defined by the Code) are exercisable for the first
time by such optionee during any calendar year under all such
22
plans of the Company and its Affiliates does not exceed one hundred thousand
dollars ($100,000). If it is determined that an entire Option or any portion
thereof does not qualify for treatment as an Incentive Stock Option by reason of
exceeding such maximum, such Option or the applicable portion shall be
considered a Nonqualified Stock Option.
SECTION 4. ELIGIBILITY.
(a) Incentive Stock Options may be granted only to employees
(including officers) of the Company or its Affiliates. A director of the Company
shall not be eligible to receive Incentive Stock Options unless such director is
also an employee of the Company or any Affiliate. Stock Awards other than
Incentive Stock Options may be granted to employees (including officers) or
directors of or consultants to the Company or any Affiliate or to Trusts of any
such employee, director or consultant.
(b) A director shall in no event be eligible for the benefits of the
Plan (other than Non-Discretionary Director Awards, as defined in Article II,
Section 6) unless and until such director is expressly declared eligible to
participate in the Plan by action of the Board or the Committee, and only if, at
any time discretion is exercised by the Board or the Committee in the selection
of a director as a person to whom Stock Awards may be granted, or in the
determination of the number of shares which may be covered by Stock Awards
granted to a director, the Plan complies with the requirements of Rule 16b-3
promulgated under the Exchange Act, as from time to time in effect. The Board
shall otherwise comply with the requirements of Rule 16b-3 promulgated under the
Exchange Act, as from time to time in effect. Notwithstanding the foregoing, the
restrictions set forth in this Article II, paragraph 4(b) shall not apply if the
Board or Committee expressly declares that such restrictions shall not apply.
(c) No person shall be eligible for the grant of an Incentive Stock
Option under the Plan if, at the time of grant, such person owns (or is deemed
to own pursuant to Section 424(d) of the Code) stock possessing more than ten
percent (10%) of the total combined voting power of all classes of stock of the
Company or of any of its Affiliates unless the exercise price of such Incentive
Stock Option is at least one hundred and ten percent (110%) of the fair market
value of the Common Stock at the date of grant and the Incentive Stock Option is
not exercisable after the expiration of five (5) years from the date of grant.
(d) Stock Awards shall be limited to a maximum of 649,455 shares of
Common
23
Stock per person per calendar year.
SECTION 5. TERMS OF DISCRETIONARY STOCK OPTIONS.
An option granted pursuant to this Article II, Section 5 (a "Discretionary
Stock Option") shall be in such form and shall contain such terms and conditions
as the Board or the Committee shall deem appropriate. The provisions of separate
Options need not be identical, but each Option shall include (through
incorporation of provisions hereof by reference in the Option or otherwise) the
substance of each of the following provisions:
(a) No Option shall be exercisable after the expiration of ten (10) years
from the date it was granted.
(b) The exercise price of each Incentive Stock Option and each
Nonqualified Stock Option shall be not less than one hundred percent (100%) of
the fair market value of the Common Stock subject to the Option on the date the
Option is granted.
(c) The purchase price of Common Stock acquired pursuant to an Option
shall be paid, to the extent permitted by applicable statutes and regulations,
either: (i) in cash at the time the Option is exercised; or (ii) at the
discretion of the Board or the Committee, either at the time of grant or
exercise of the Option (A) by delivery to the Company of shares of Common Stock
that have been held for the period required to avoid a charge to the Company's
reported earnings and valued at the fair market value on the date of exercise,
(B) according to a deferred payment or other arrangement with the person to whom
the Option is granted or to whom the Option is transferred pursuant to Article
II, paragraph 5(d), or (C) in any other form of legal consideration that may be
acceptable to the Board or the Committee in their discretion; including but not
limited to payment of the purchase price pursuant to a program developed under
Regulation T as promulgated by the Federal Reserve Board which results in the
receipt of cash (or a check) by the Company before Common Stock is issued or the
receipt of irrevocable instruction to pay the aggregate exercise price to the
Company from the sales proceeds before Common Stock is issued.
In the case of any deferred payment arrangement, interest shall be payable
at least annually and shall be charged at not less than the minimum rate of
interest necessary to avoid the treatment as interest, under any applicable
provisions of the Code, of any amounts other than amounts stated to be interest
under the deferred payment arrangement.
24
(d) An Option granted to a natural person shall be exercisable during the
lifetime of such person only by such person, provided that such person during
such person's lifetime may designate a Trust to be such person's beneficiary
with respect to any Incentive Stock Options and with respect to any Nonqualified
Stock Options, and such beneficiary shall, after the death of the person to whom
the Option was granted, have all the rights that such person has while living,
including the right to exercise the Option. In the absence of such designation,
after the death of the person to whom the Option is granted, the Option shall be
exercisable by the person or persons to whom the optionee's rights under such
Option pass by will or by the laws of descent and distribution.
(e) The total number of shares of Common Stock subject to an Option may,
but need not, be allotted in periodic installments (which may, but need not, be
equal). From time to time during each of such installment periods, the Option
may become exercisable ("vest") with respect to some or all of the shares
allotted to that period, and may be exercised with respect to some or all of the
shares allotted to such period and/or any prior period as to which the Option
was not fully exercised. During the remainder of the term of the Option (if its
term extends beyond the end of the installment periods), the Option may be
exercised from time to time with respect to any shares then remaining subject to
the Option. The provisions of this Article II, paragraph 5(e) are subject to any
Option provisions governing the minimum number of shares as to which an Option
may be exercised.
(f) The Company may require any optionee, or any person to whom an Option
is transferred under Article II, paragraph 5(d), as a condition of exercising
any such Option: (i) to give written assurances satisfactory to the Company as
to such person's knowledge and experience in financial and business matters
and/or to employ a purchaser representative who has such knowledge and
experience in financial and business matters, and that such person is capable of
evaluating, alone or together with the purchaser representative, the merits and
risks of exercising the Option; and (ii) to give written assurances satisfactory
to the Company stating that such person is acquiring the Common Stock subject to
the Option for such person's own account and not with any present intention of
selling or otherwise distributing the Common Stock. These requirements, and any
assurances given pursuant to such requirements, shall be inoperative if: (x) the
issuance of the shares upon the exercise of the Option has been registered under
a then currently effective registration statement under the Securities Act of
1933, as amended (the "Securities Act"); or (y) as to any particular
requirement, a determination is made by counsel for the Company that such
requirement need not be met in the circumstances under
25
the then applicable securities law.
(g) An Option shall terminate three (3) months after termination of the
optionee's employment or relationship as a consultant or director with the
Company or an Affiliate, unless: (i) such termination is due to the optionee's
permanent and total disability, within the meaning of Section 422(c)(6) of the
Code and with such permanent and total disability being certified by the Social
Security Administration prior to such termination, in which case the Option may,
but need not, provide that it may be exercised at any time within one (1) year
following such termination of employment or relationship as a consultant or
director; (ii) the optionee dies while in the employ of or while serving as a
consultant or director to the Company or an Affiliate, or within not more than
three (3) months after termination of such employment or relationship as a
consultant or director, in which case the Option may, but need not, provide that
it may be exercised at any time within eighteen (18) months following the death
of the optionee by the person or persons to whom the optionee's rights under
such Option pass by will or by the laws of descent and distribution; or (iii)
the Option by its term specifies either (A) that it shall terminate sooner than
three (3) months after termination of the optionee's employment or relationship
as a consultant or director with the Company or an Affiliate; or (B) that it may
be exercised more than three (3) months after termination of the optionee's
employment or relationship as a consultant or director with the Company or an
Affiliate. This Article II, paragraph 5(g) shall not be construed to extend the
term of any Option or to permit anyone to exercise the Option after expiration
of its term, nor shall it be construed to increase the number of shares as to
which any Option is exercisable from the amount exercisable on the date of
termination of the optionee's employment or relationship as a consultant or
director.
(h) The Option may, but need not, include a provision whereby the optionee
may elect at any time during the term of the optionee's employment or
relationship as a consultant or director with the Company or any Affiliate to
exercise the Option as to any part or all of the shares subject to the Option
prior to the stated vesting dates of the Option. Any shares so purchased from
any unvested installment or Option may be subject to a repurchase right in favor
of the Company or to any other restriction the Board or the Committee determines
to be appropriate.
(i) To the extent provided by the terms of an Option, each optionee may
satisfy any federal, state or local tax withholding obligation relating to the
exercise of such Option by any of the following means or by a combination of
such means: (i) tendering a cash payment; (ii) authorizing the Company to
withhold from the shares of the Common Stock otherwise issuable
26
to the optionee as a result of the exercise of the Option a number of shares
having a fair market value less than or equal to the amount of the Company's
required minimum statutory withholding; or (iii) delivering to the Company owned
and unencumbered shares of the Common Stock having a fair market value less than
or equal to the amount of the Company's required minimum statutory withholding.
SECTION 6. NON-DISCRETIONARY DIRECTOR AWARDS.
The Board may from time to time adopt award programs under the Plan
providing for the grant of formula or non-discretionary Stock Awards to
directors of the Company who are not employees of the Company or any Affiliate
("Non-Discretionary Director Awards"). The terms and conditions of any such
program shall be established by the Board in its sole discretion, subject to the
terms and conditions of the Plan.
SECTION 7. TERMS OF STOCK BONUSES AND PURCHASES OF RESTRICTED STOCK.
Each stock bonus or restricted stock purchase agreement shall be in such
form and shall contain such terms and conditions as the Board or the Committee
shall deem appropriate. The terms and conditions of stock bonus or restricted
stock purchase agreements may change from time to time, and the terms and
conditions of separate agreements need not be identical, but each stock bonus or
restricted stock purchase agreement shall include (through incorporation of
provisions hereof by reference in the agreement or otherwise) the substance of
each of the following provisions as appropriate:
(a) The purchase price under each stock purchase agreement shall be such
amount as the Board or Committee shall determine and designate in such
agreement. Notwithstanding the foregoing, the Board or the Committee may
determine that eligible participants in the Plan may be awarded stock pursuant
to a stock bonus agreement in consideration for past services actually rendered
to the Company or for its benefit.
(b) No rights under a stock bonus or restricted stock purchase agreement
shall be assignable by any participant under the Plan, either voluntarily or by
operation of law, except where such assignment is required by law or expressly
authorized by the terms of the applicable stock bonus or restricted stock
purchase agreement.
27
(c) The purchase price of stock acquired pursuant to a stock purchase
agreement shall be paid either: (i) in cash at the time of purchase; (ii) at the
discretion of the Board or the Committee, according to a deferred payment or
other arrangement with the person to whom the Common Stock is sold; or (iii) in
any other form of legal consideration that may be acceptable to the Board or the
Committee in their discretion; including but not limited to payment of the
purchase price pursuant to a program developed under Regulation T as promulgated
by the Federal Reserve Board which results in the receipt of cash (or a check)
by the Company before Common Stock is issued or the receipt of irrevocable
instruction to pay the aggregate exercise price of the Company from the sales
proceeds before Common Stock is issued. Notwithstanding the foregoing, the Board
or the Committee to which administration of the Plan has been delegated may
award Common Stock pursuant to a stock bonus agreement in consideration for past
services actually rendered to the Company or for its benefit.
(d) Shares of Common Stock sold or awarded under the Plan may, but need
not, be subject to a repurchase option in favor of the Company in accordance
with a vesting schedule to be determined by the Board or the Committee.
(e) In the event a person ceases to be an employee of or ceases to serve
as a director or consultant to the Company or an Affiliate, the Company may
repurchase or otherwise reacquire any or all of the shares of Common Stock held
by that person which have not vested as of the date of termination under the
terms of the stock bonus or restricted stock purchase agreement between the
Company and such person.
(f) To the extent provided by the terms of a stock bonus or restricted
stock purchase agreement, a participant may satisfy any federal, state or local
tax withholding obligation relating to the lapsing of a repurchase option in
favor of the Company or vesting of a stock bonus or a restricted stock award by
any of the following means or by a combination of such means: (i) tendering a
cash payment; (ii) authorizing the Company to withhold from the shares of the
Common Stock otherwise deliverable to a participant as a result of the lapsing
of a repurchase option in favor of the Company or the vesting of a stock bonus
or a restricted stock award a number of shares having a fair market value less
than or equal to the amount of the Company's required minimum statutory
withholding; or (iii) delivering to the Company owned and unencumbered shares of
the Common Stock having a fair market value less than or equal to the amount of
the Company's required minimum statutory withholding.
SECTION 8. COVENANTS OF THE COMPANY.
28
(a) During the terms of the Stock Awards granted under the Plan, the
Company shall keep available at all times the number of shares of Common Stock
required to satisfy such Stock Awards up to the number of shares of Common Stock
authorized under the Plan.
(b) The Company shall seek to obtain from each regulatory commission or
agency having jurisdiction over the Plan such authority as may be required to
issue and sell shares of Common Stock under the Stock Awards granted under the
Plan; provided, however, that this undertaking shall not require the Company to
register under the Securities Act either the Plan, any Stock Award granted under
the Plan or any Common Stock issued or issuable pursuant to any such Stock
Award. If, after reasonable efforts, the Company is unable to obtain from any
such regulatory commission or agency the authority that counsel for the Company
deems necessary for the lawful issuance and sale of Common Stock under the Plan,
the Company shall be relieved from any liability for failure to issue and sell
Common Stock upon exercise of such Stock Awards unless and until such authority
is obtained.
SECTION 9. USE OF PROCEEDS FROM COMMON STOCK.
Proceeds from the sale of Common Stock pursuant to Stock Awards granted
under the Plan shall constitute general funds of the Company.
SECTION 10. MISCELLANEOUS.
(a) The Board or Committee shall have the power to accelerate the time
during which a Stock Award may be exercised or the time during which a Stock
Award or any part thereof will vest, notwithstanding the provisions in the Stock
Award stating the time during which it may be exercised or the time during which
it will vest. Each Discretionary Stock Option providing for vesting pursuant to
Article II, paragraph 5(e) shall also provide that if the employee's employment
or a director's or consultant's affiliation with the Company or an Affiliate of
the Company is terminated by reason of death or disability (within the meaning
of Title II or XVI of the Social Security Act or comparable statute applicable
to an Affiliate and with such permanent and total disability certified by (i)
the Social Security Administration, (ii) the comparable governmental authority
applicable to an Affiliate, (iii) such other body having the relevant
decision-making power applicable to an Affiliate or (iv) an independent medical
advisor appointed by the Company, as applicable, prior to such termination),
then the vesting schedule of Discretionary Stock Options granted to such
employee, director or consultant or to
29
the Trusts of such employee, director or consultant shall be accelerated by
twelve months for each full year the employee has been employed by or the
director or consultant has been affiliated with the Company and/or an Affiliate
of the Company.
(b) Neither an optionee nor any person to whom an Option is transferred
under the provisions of the Plan shall be deemed to be the holder of, or to have
any of the rights of a holder with respect to, any shares subject to such Option
unless and until such person has satisfied all requirements for exercise of the
Option pursuant to its terms.
(c) Nothing in the Plan or any instrument executed or Stock Award granted
pursuant thereto shall confer upon any eligible employee, consultant, director,
optionee or holder of Stock Awards under the Plan any right to continue in the
employ of the Company or any Affiliate or to continue acting as a consultant or
director or shall affect the right of the Company or any Affiliate to terminate
the employment or consulting relationship or directorship of any eligible
employee, consultant, director, optionee or holder of Stock Awards under the
Plan with or without cause. In the event that a holder of Stock Awards under the
Plan is permitted or otherwise entitled to take a leave of absence, the Company
shall have the unilateral right to (i) determine whether such leave of absence
will be treated as a termination of employment or relationship as consultant or
director for purposes hereof, and (ii) suspend or otherwise delay the time or
times at which exercisability or vesting would otherwise occur with respect to
any outstanding Stock Awards under the Plan.
SECTION 11. ADJUSTMENTS UPON CHANGES IN COMMON STOCK.
If any change is made in the Common Stock subject to the Plan, or subject
to any Stock Award granted under the Plan (through merger, consolidation,
reorganization, recapitalization, stock dividend, dividend in property other
than cash, stock split, liquidating dividend, combination of shares, exchange of
shares, change in corporate structure or other transaction not involving the
receipt of consideration by the Company), the Plan and outstanding Stock Awards
will be appropriately adjusted in the class(es) and maximum number of shares
subject to the Plan, the maximum number of shares which may be granted to a
participant in a calendar year, the class(es) and number of shares and price per
share of stock subject to outstanding Stock Awards, and the number of shares of
Common Stock to be granted as Non-Discretionary Director Awards, if any. Such
adjustment shall be made by the Board or the Committee, the determination of
which shall be final, binding and conclusive. (The conversion of any convertible
securities of the Company shall not be treated as a "transaction not involving
the
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receipt of consideration".)
SECTION 12. CHANGE OF CONTROL.
(a) Notwithstanding anything to the contrary in this Plan, in the event of
a Change in Control (as hereinafter defined), then, to the extent permitted by
applicable law: (i) the time during which Stock Awards become vested shall
automatically be accelerated so that the unvested portions of all Stock Awards
shall be vested prior to the Change in Control and (ii) the time during which
the Options may be exercised shall automatically be accelerated to prior to the
Change in Control. Upon and following the acceleration of the vesting and
exercise periods, at the election of the holder of the Stock Award, the Stock
Award may be: (x) exercised (with respect to Options) or, if the surviving or
acquiring corporation agrees to assume the Stock Awards or substitute similar
stock awards, (y) assumed; or (z) replaced with substitute stock awards. Options
not exercised, substituted or assumed prior to or upon the Change in Control
shall be terminated.
(b) For purposes of Article II of the Plan, a "Change of Control" shall be
deemed to have occurred at any of the following times:
(i) upon the acquisition (other than from the Company) by any person,
entity or "group," within the meaning of Section 13(d)(3) or 14(d)(2) of the
Exchange Act (excluding, for this purpose, the Company or its affiliates, or any
employee benefit plan of the Company or its affiliates which acquires beneficial
ownership of voting securities of the Company), of beneficial ownership (within
the meaning of Rule 13d-3 promulgated under the Exchange Act) of fifty percent
(50%) or more of either the then outstanding shares of Common Stock or the
combined voting power of the Company's then outstanding voting securities
entitled to vote generally in the election of directors; or
(ii) at the time individuals who, as of July 15, 2002, constitute the
Board (the "Incumbent Board") cease for any reason to constitute at least a
majority of the Board, provided that any person becoming a director subsequent
to July 15, 2002, whose election, or nomination for election by the Company's
stockholders, was approved by a vote of at least a majority of the directors
then comprising the Incumbent Board (other than an election or nomination of an
individual whose initial assumption of office is in connection with an actual or
threatened election contest relating to the election of the Directors of the
Company, as such terms are used in Rule 14a-11 of Regulation 14A promulgated
under the Exchange Act) shall be, for purposes
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of Article II of the Plan, considered as though such person were a member of the
Incumbent Board; or
(iii) immediately prior to the consummation by the Company of a
reorganization, merger, consolidation, (in each case, with respect to which
persons who were the stockholders of the Company immediately prior to such
reorganization, merger or consolidation do not, immediately thereafter, own more
than fifty percent (50%) of the combined voting power entitled to vote generally
in the election of directors of the reorganized, merged or consolidated
company's then outstanding voting securities) or a liquidation or dissolution of
the Company or of the sale of all or substantially all of the assets of the
Company; or
(iv) the occurrence of any other event which the Incumbent Board in
its sole discretion determines constitutes a Change of Control.
SECTION 13. QUALIFIED DOMESTIC RELATIONS ORDERS
(a) Anything in the Plan to the contrary notwithstanding, rights under
Stock Awards may be assigned to an Alternate Payee to the extent that a QDRO so
provides. (The terms "Alternate Payee" and "QDRO" are defined in Article II,
paragraph 13(c) below.) The assignment of a Stock Award to an Alternate Payee
pursuant to a QDRO shall not be treated as having caused a new grant. The
transfer of an Incentive Stock Option to an Alternate Payee may, however, cause
it to fail to qualify as an Incentive Stock Option. If a Stock Award is assigned
to an Alternate Payee, the Alternate Payee generally has the same rights as the
grantee under the terms of the Plan; provided however, that (i) the Stock Award
shall be subject to the same vesting terms and exercise period as if the Stock
Award were still held by the grantee and (ii) an Alternate Payee may not
transfer a Stock Award.
(b) In the event of the Plan administrator's receipt of a domestic
relations order or other notice of adverse claim by an Alternate Payee of a
grantee of a Stock Award, transfer of the proceeds of the exercise of such Stock
Award, whether in the form of cash, stock or other property, may be suspended.
Such proceeds shall thereafter be transferred pursuant to the terms of a QDRO or
other agreement between the grantee and Alternate Payee. A grantee's ability to
exercise a Stock Award may be barred if the Plan administrator receives a court
order directing the Plan administrator not to permit exercise.
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(c) The word "QDRO" as used in Article II of the Plan shall mean a court
order (i) that creates or recognizes the right of the spouse, former spouse or
child (an "Alternate Payee") of an individual who is granted a Stock Award to an
interest in such Stock Award relating to marital property rights or support
obligations and (ii) that the administrator of the Plan determines would be a
"qualified domestic relations order," as that term is defined in section 414(p)
of the Code and section 206(d) of the Employee Retirement Income Security Act
("ERISA"), but for the fact that the Plan is not a plan described in section
3(3) of ERISA.
SECTION 14. AMENDMENT OF THE PLAN.
(a) The Board at any time, and from time to time, may amend the Plan.
However, except as provided in Article II, Section 11 relating to adjustments
upon changes in the Common Stock, no amendment shall be effective unless
approved by the stockholders of the Company within twelve (12) months before or
after the adoption of the amendment, where the amendment will:
(i) increase the number of shares reserved for Stock Awards under
the Plan;
(ii) modify the requirements as to eligibility for participation in
the Plan (to the extent such modification requires stockholder approval in order
for the Plan to satisfy the requirements of Section 422(b) of the Code); or
(iii) modify the Plan in any other way if such modification requires
stockholder approval in order for the Plan to satisfy the requirements of
Section 422(b) of the Code.
(b) The Board may in its sole discretion submit any other amendment to the
Plan for stockholder approval, including, but not limited to, amendments to the
Plan intended to satisfy the requirements of Section 162(m) of the Code and the
regulations promulgated thereunder regarding the exclusion of performance-based
compensation from the limit on corporate deductibility of compensation to
certain executive officers.
(c) It is expressly contemplated that the Board may amend the Plan in any
respect the Board deems necessary or advisable to provide optionees with the
maximum benefits provided or to be provided under the provisions of the Code and
the regulations promulgated thereunder relating to employee Incentive Stock
Options and/or to bring the Plan and/or
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Options granted under it into compliance therewith.
(d) Rights and obligations under any Stock Award granted before amendment
of the Plan shall not be impaired by any amendment of the Plan, unless: (i) the
Company requests the consent of the person to whom the Stock Award was granted;
and (ii) such person consents in writing.
SECTION 15. TERMINATION OR SUSPENSION OF THE PLAN.
(a) The Board may suspend or terminate the Plan at any time. No Stock
Awards may be granted under the Plan while the Plan is suspended or after it is
terminated. No Incentive Stock Options may be granted under the Plan after
February 22, 2009.
(b) Rights and obligations under any Stock Awards granted while the Plan
is in effect shall not be impaired by suspension or termination of the Plan,
except with the consent of the person to whom the Stock Award was granted.
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