EXHIBIT 10
Baxter International Inc.
Employee Stock Purchase Plan
For United States Employees
(As Amended and Restated Effective October 1, 1999)
Baxter International Inc.
Employee Stock Purchase Plan
For United States Employees
(As Amended and Restated Effective October 1, 1999)
ARTICLE I-PURPOSE
1.01. Purpose
The Baxter International Inc. Employee Stock Purchase Plan for United States
Employees is intended to provide a method whereby employees of Baxter
International Inc. and its participating subsidiary corporations (hereinafter
referred to, unless the context otherwise requires, as the "Company") will have
an opportunity to acquire a proprietary interest in the Company through the
purchase of shares of the Common Stock of the Company ("Stock"). It is the
intention of the Company to have the Plan qualify as an "employee stock purchase
plan" under Section 423 of the Internal Revenue Code of 1986, as amended (the
"Code"). The provisions of the Plan shall be construed so as to extend and limit
participation in a manner consistent with the requirements of Code Section 423.
This document constitutes an amendment and restatement of the Baxter
International Inc. Qualified Employee Stock Purchase Plan as of the Effective
Date set forth in Section 10.05.
ARTICLE II-DEFINITIONS
2.01. Base Pay
"Base Pay" shall mean regular straight-time earnings plus commissions and
payments in lieu of regular earnings and payments in lieu of regular earnings
(such as vacation, sick pay and holiday pay). In the case of a part-time hourly
employee, such employee's base pay during an Offering shall be determined by
multiplying such employee's hourly rate of pay by the number of regularly
scheduled hours of work for such employee during such Offering.
2.02. Committee
"Committee" shall mean the individuals appointed by the Company to administer
the Plan as described in Article IX.
2.03. Eligible Employee
"Eligible Employee" means any regular employee of the Company who is paid from
the United States payroll and is scheduled to work 20 or more hours per week.
2.04. Enrollment Period
"Enrollment Period" shall mean with respect to any offering, the period
designated by the Committee prior to such Offering during which Eligible
Employees may authorize payroll deductions through a Subscription. Unless the
Committee determines otherwise, the Enrollment Period with respect to any
offering shall end on the fifteenth day of the month immediately preceding the
offering Commencement Date or, if such day is not a business day, the
immediately-preceding business day, and any Subscription received after such
date shall be deemed to be an enrollment in the next following offering.
2.05. Offering Commencement Date
"Offering Commencement Date" shall mean October 1, 1999 and, unless determined
otherwise by the Committee, the first day of each calendar quarter thereafter.
2.06. Offering
"Offering" shall mean the quarterly offering of the Company's Stock.
2.07. Offering End Date
"Offering End Date" shall mean, with respect to each Offering, the day preceding
the second annual anniversary of the Offering Commencement Date for such
offering.
2.08. Participant
"Participant" shall mean an Eligible Employee who has elected to participate in
an Offering by entering a Subscription during the Enrollment Period for such
offering.
2.09. Plan
"Plan" shall mean the Baxter International Inc. Employee Stock Purchase Plan for
United States Employees, as amended from time to time.
2.10. Purchase Date
"Purchase Date" shall mean with respect to any Offering, the last day of each
calendar month during the period beginning with the offering Commencement Date
for such offering and ending with the offering End Date; provided, however, if
any such day is not a business day, the Purchase Date shall be the next
preceding business date on which shares of Stock are traded.
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2.11. Subscription
"Subscription" shall mean an Eligible Employee's authorization for payroll
deductions made in the form and manner specified by the Committee (which may
include enrollment by submitting forms, by voice response, internet access or
other electronic means). Unless withdrawn earlier in accordance with Section
6.02, each Subscription shall be in effect for 24 months (or, if earlier, until
the maximum number of shares that may be purchased with respect to an Offering
have been purchased). No more than one Subscription may be in effect for an
Eligible Employee during any calendar quarter.
2.12. Subsidiary Corporation
"Subsidiary Corporation" shall mean any present or future corporation which
would be a "subsidiary corporation" of the Company as that term is defined in
Section 424 of the Code.
ARTICLE III-ELIGIBILITY AND PARTICIPATION
3.01. Initial Eligibility
Any individual who is an Eligible Employee on an Offering Commencement Date
shall be eligible to participate in the Offering commencing on such date,
subject to the terms and conditions of the Plan.
3.02. Leave of Absence
For purposes of participation in the Plan, a Participant on a leave of absence
shall be deemed to be an employee for a period of up to 90 days or, if longer,
during the period the Participant's right to reemployment is guaranteed by
statute or contract. If the leave of absence is paid, deductions authorized
under any Subscription in effect at the time the leave began will continue. If
the leave of absence is unpaid, no deductions or contributions will be permitted
during the leave. If such a Participant returns to active status within 90 days
or the guaranteed reemployment period, as applicable, payroll deductions under
the Subscription in effect at the time the leave began will automatically begin
again upon the Participant's return to active status. If the Participant does
not return to active status within 90 days or the guaranteed reemployment
period, as applicable, the Participant shall be treated as having terminated
employment for all purposes of the Plan. If such individual later returns to
active employment as an Eligible Employee, such individual will be treated as a
new employee and will be eligible to participate in Offerings commencing after
his or her reemployment date by filing a Subscription during the applicable
Enrollment Period for such Offering.
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3.03. Restrictions on Participation
Notwithstanding any provisions of the Plan to the contrary, no Eligible Employee
shall be granted an option to participate in the Plan:
(a) if, immediately after the grant, such employee would own stock, and/or
hold outstanding options to purchase stock, possessing 5% or more of
the total combined voting power or value of all classes of stock of
the Company (for purposes of this paragraph, the rules of Section
424(d) of the Code shall apply in determining stock ownership of any
employee); or
(b) which permits the employee's rights to purchase stock under all
employee stock purchase plans of the Company to accrue at a rate which
exceeds $25,000 in fair market value of the stock (determined at the
time such option is granted) for each calendar year in which such
option is outstanding.
3.04. Commencement of Participation
An Eligible Employee may become a Participant in any Offering by entering a
Subscription during the Enrollment Period for such Offering. Payroll deductions
for such Offering shall commence on the applicable Offering Commencement Date
and shall end on the applicable Offering End Date unless withdrawn by the
Participant or sooner terminated in accordance with Article VII. only one
Subscription may be in effect with respect to any Participant at any one time.
3.05. Participation After Rehire
Except an provided in Section 7.03, an Eligible Employee's Subscription will
automatically terminate on his or her termination of employment with the
Company. If the Eligible Employee terminates employment with a Subscription in
effect with respect to an Offering and is rehired prior to the Offering End Date
for that Offering, the Subscription will not be reinstated and the Eligible
Employee will not be allowed to again make payroll deductions under such
Offering. The Eligible Employee may elect to participate in Offerings commencing
after his or her reemployment date by entering a Subscription during the
applicable Enrollment Period for such Offering.
3.06. International Employees/International Transfers
Eligible Employees who transfer to the United States and are placed on a U. S.
payroll may not participate in Offerings which had an Offering Commencement Date
prior to such transfer, regardless of whether such Eligible Employee was
participating in an offering under a stock purchase plan for international
employees prior to the transfer. Such Eligible Employee may participate in
Offerings commencing after such transfer, by entering a Subscription during the
applicable Enrollment Period for such Offering.
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A Participant who transfers outside of the United States and is no longer paid
on a U.S. payroll will be treated as a terminated Participant under this Plan.
For purposes of the Plan, Puerto Rico is not considered U.S. payroll.
ARTICLE IV-OFFERINGS
4.01. Quarterly Offerings
The Plan will be implemented by Offerings beginning on October 1, 1999 and,
unless determined otherwise by the Committee, on the first day of each calendar
quarter thereafter. Eligible Employees may not have in effect more than one
Subscription at a time.
Participants may subscribe to any offering by entering a Subscription during the
Enrollment Period for such Offering in such manner as the Committee may
prescribe (which may include enrollment by submitting forms, by voice response,
internet access or other electronic means).
A Subscription that is in effect on an Offering End Date will automatically be
deemed to be a Subscription for the offering that commences immediately
following such Offering End Date, provided that the Participant is still an
Eligible Employee and has not withdrawn the Subscription. If a Participant
purchases the maximum number of shares that may be purchased with respect to an
offering prior to the Offering End Date, the Participant's Subscription will
automatically be deemed to be a Subscription for the offering that commences
immediately following the date such maximum number of shares are purchased, is
still and has not provided that the Participant an Eligible Employee withdrawn
the Subscription. Under the foregoing automatic enrollment provisions, payroll
deductions will continue at the level in effect immediately prior to the new
Offering Commencement Date, unless changed in advance by the Participant in
accordance with Section 5.03.
4.02. Number Of Shares Which May Be Purchased
Subject to the limitations of Section 3.03, on each Offering Commencement Date,
a Participant in that Offering shall be deemed to have been granted an option to
purchase the number of shares of Stock of the Company determined as follows: (i)
the percentage of participation elected by the Participant in his or her
Subscription, which percentage may not exceed 12%, multiplied by (ii) the
Participant's aggregate Base Pay during the 24-month offering period, divided by
(iii) 85% of the market value of a share of Stock on the applicable Offering
Commencement Date. In determining the maximum number of shares under this
Section 4.02, the maximum number shall be rounded down to the nearest number of
whole shares of Stock. The market value of the Stock shall be determined as
provided in Subsection 4.03(a). A Participant's Base Pay during the period of
the offering shall be determined using the Participant's regular rate of salary
as in effect on the Offering Commencement Date or, in the case of an hourly paid
employee, Base Pay shall be determined based on the employee's hourly rate and
number of regularly-scheduled hours of work as of such date.
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4.03. Purchase Price
The purchase price per share of Stock under each Offering shall be the lower of:
(a) 85% of the closing price of the Stock on the Offering Commencement
Date or the nearest preceding business day on which trading occurred
on the New York Stock Exchange; or
(b) 85% of the closing price of the Stock on the Purchase Date or the
nearest prior business day on which trading occurred on the New York
Stock Exchange. If the Common Stock of the Company is not admitted to
trading on any of the aforesaid dates for which closing prices of the
stock are to be determined, then reference shall be made to the next
preceding date on which Common Stock was so admitted.
Except as provided in Section 7.03, such purchase price may only be paid with
accumulated payroll deductions in accordance with Article V.
ARTICLE V-PAYROLL DEDUCTIONS
5.01. Amount of Deduction
An Eligible Employee's Subscription shall authorize payroll deductions at a
rate, in whole percentages, of no less than 1% and no more than 12% of Base Pay
on each payday that the Subscription is in effect.
5.02. Participant's Account
All payroll deductions made with respect to a Participant shall be credited to
his or her recordkeeping account under the Plan. Except as provided for in
Section 7.03, a Participant may not make any separate cash payment into such
account. No interest will accrue or be paid on any amount withheld from a
Participant's pay under the Plan or credited to the Participant's account.
Except as otherwise provided in this Section 5.02, all amounts in a
Participant's account will be used to purchase Stock and no cash refunds shall
be made from such account. Any amounts remaining in a Participant's account
with respect to an offering after the purchase of the maximum number of shares
of Stock that may be purchased under such offering (whether such maximum is
pursuant to the participant's Subscription election or because of the
limitations of Section 3.03) shall be returned to the Participant without
interest and will not be used to purchase shares with respect to any other
offering under the Plan.
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5.03. Changes in Payroll Deductions
During an Offering period, a Participant may change his or her level of payroll
deduction with respect to such Offering within the limits described in Section
5.01 in accordance with procedures established by the Committee (including,
without limitation, rules relating to the frequency of such changes); provided,
however, if the Participant reduces his or her payroll deductions to zero, it
shall be deemed to be a withdrawal of the Subscription and the Participant may
not thereafter participate in such Offering but must wait until the next
quarterly offering to resubscribe to the Plan. Any such discontinuance or change
in level shall be effective as soon as administratively practicable.
ARTICLE VI-EXERCISE OF OPTION
6.01. Automatic Exercise
A Participant's option for the purchase of Stock with respect to any Offering
will be automatically exercised on each Purchase Date for the Offering. The
option will be exercised by using the accumulated payroll deductions in the
Participant's account as of each such Purchase Date to purchase the number of
full and fractional shares of Stock that may be purchased at the purchase price
on such date, determined in accordance with Section 4.03 (but not in excess of
the number of shares for which options have been granted to the Participant
pursuant to Section 4.02).
6.02. Withdrawal From offering
A Participant may not withdraw the accumulated payroll deductions in his or her
account during an Offering period. If the Participant withdraws his or her
Subscription with respect to any Offering, the accumulated payroll deductions in
the Participant's account at the time the Subscription is withdrawn will be used
to purchase shares of Stock at the next Purchase Date for the Offering to which
the Subscription related, in accordance with Section 6.01.
6.03. Delivery of Stock
Stock purchases under the Plan will be held in an account in the Participant's
name in uncertificated form unless certification is requested by the
Participant.
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ARTICLE VII-WITHDRAWAL
7.01. Effect on Subsequent Participation
A Participant's election to withdraw from any Offering will not have any effect
upon the Participant's eligibility to participate in any succeeding Offering or
in any similar plan which may hereafter be adopted by the Company.
7.02. Termination of Employment
Subject to Section 7.03 and the following provisions of this Section 7.02, upon
termination of the Participant's employment for any reason, any Subscription
then in effect will be deemed to have been withdrawn and any payroll deductions
credited to the Participant's account will be used to purchase Stock on the next
Purchase Date for the Offering with respect to which such deductions relate.
Notwithstanding the foregoing, if the Participant has not purchased the maximum
shares of Stock under the Subscription in effect on the Particpant's termination
of employment, payroll deductions (at the rate in effect on the termination
date) shall continue to be made from Base Pay earned prior to termination of
employment, if any, that is paid to the Participant after such termination of
employment and before the earlier of (i) the three-month anniversary of such
termination of employment, or (ii) the Offering End Date of such Offering. Any
such payroll deduction shall be used to purchase Stock on the next Purchase Date
for the Offering after the deduction is made.
7.03. Termination of Employment Due to Death, Disability or Retirement
If the Participant's employment terminates because of death, disability (within
the meaning of the Baxter Long Term Disability Plan) or retirement after
attaining age 55, the Participant (or beneficiary in the case of death) shall
have the right to elect, in such form as the Committee may require, prior to the
earlier of (i) the three month anniversary of such termination date (the twelve
month anniversary in the case of death), or (ii) the Offering End Date, to buy
out the remaining shares in his or her Subscription.
ARTICLE VIII-STOCK
8.01. Maximum Shares
The maximum number of shares which may be issued under the Plan, subject to
adjustment upon changes in capitalization of the Company as provided in Section
10.04, shall be 40,000,000 shares. If the total number of shares for which
options are exercised on any Purchase Date in accordance with Article IV exceeds
the maximum number of shares for the applicable Offering, the Company shall make
a pro rata allocation of the shares available for delivery and distribution in
as nearly a uniform manner as shall be practicable and as it shall determine
to be equitable,
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and the balance of payroll deductions credited to the account of each
Participant under the Plan shall be returned to him as promptly as possible.
8.02. Participant's Interest in Option Stock
The Participant will have no interest in Stock covered by an option under the
Plan until such option has been exercised.
8.03. Registration of Stock
Stock to be delivered to a Participant under the Plan will be registered in the
name of the Participant, or, if the Participant so directs in accordance with
procedures established by the Committee, in the names of the Participant and one
such other person as may be designated by the Participant, as joint tenants with
rights of survivorship, to the extent permitted by applicable law. If the
Participant was a participant in the Plan prior to the Effective Date and
directed that shares purchased under the Plan be registered in joint tenancy,
Stock delivered under the Plan after the Effective Date will automatically be
registered in joint tenancy unless such direction is changed by the Participant
in accordance with procedures established by the Committee.
8.04. Dividends
Dividends on Stock purchased under the Plan that is held in a Participant's
account shall be credited to the Participant's account and reinvested in Stock.
Unless the Participant has requested otherwise, dividend reinvestment will occur
regardless of whether the Participant is currently participating in an Offering.
At the Participant's request, dividends will be paid directly to the Participant
in cash. If the Participant was a participant in the Plan prior to the Effective
Date and elected that dividends be paid in cash, such election will remain in
effect after the Effective Date unless changed by the Participant in accordance
with procedures established by the Committee.
ARTICLE IX-ADMINISTRATION
9.01. Appointment of Committee
The Board of Directors shall appoint a Committee to administer the Plan. No
member of the Committee who is not an Eligible Employee shall be eligible to
purchase Stock under the Plan.
9.02. Authority of Committee
Subject to the express provisions of the Plan, the Committee shall have plenary
authority in its discretion to interpret and construe any and all provisions of
the Plan, to adopt rules and regulations for administering the Plan, and to make
all other determinations deemed necessary or advisable for administering the
Plan. The Committee's determination on the foregoing matters
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shall be conclusive. The Committee shall also have the authority to determine
whether the employees of divisions or subsidiaries of the Company organized or
acquired after the Effective Date shall be eligible for participation in the
Plan.
9.03. Rules Governing the Administration of the Committee
The Board of Directors may from time to time appoint members of the Committee in
substitution for or in addition to members previously appointed and may fill
vacancies, however caused, in the Committee. The Committee may select one of its
members as its Chairman and shall hold its meetings at such times and places as
it shall deem advisable and may hold telephonic meetings. A majority of its
members shall constitute a quorum. All determinations of the Committee shall be
made by a majority of its members. The Committee may correct any defect or
omission or reconcile any inconsistency in the Plan, in the manner and to the
extent it shall deem desirable. Any decision or determination reduced to writing
and signed by a majority of the members of the Committee shall be as fully
effective as if it had been made by a majority vote at a meeting duly called and
held. The Committee may appoint a secretary and shall make such rules and
regulations for the conduct of its business as it shall deem advisable.
9.04. Statements
Each Participant shall receive a statement of his account showing the number of
shares of Stock held and the amount of cash credited to such account. Such
statements will be provided as soon as administratively feasible following the
end of each calendar quarter.
ARTICLE X-MISCELLANEOUS
10.01. Transferability
Neither payroll deductions credited to a Participantys account nor any rights
with regard to the exercise of an option or to receive Stock under the Plan may
be assigned, transferred, pledged, or otherwise disposed of in any way by the
Participant other than by will or the laws of descent and distribution. Any such
attempted assignment, transfer, pledge or other disposition shall be without
effect. During a Participant's lifetime, options held by such Participant shall
be exercisable only by that Participant.
10.02. Use of Funds
All payroll deductions received or held by the company under this Plan may be
used by the Company for any corporate purpose and the Company shall not be
obligated to segregate such payroll deductions.
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10.03. Adjustment Upon Changes in Capitalization
In the event of a stock split, stock dividend, recapitalization,
reclassification or combination of shares, merger, sale of assets or similar
event, the Committee shall adjust equitably (a) the number and class of shares
or other securities that are reserved for sale under the Plan, (b) the number
and class of shares or other securities that are subject to outstanding options,
and (c) the appropriate market value and other price determinations applicable
to options. The Committee shall make all determinations under this Section
10.04, and all such determinations shall be conclusive and binding.
10.04. Amendment and Termination
The Board of Directors shall have complete power and authority to terminate or
amend the Plan; provided, however, that the Board of Directors shall not,
without the approval of the stockholders of the Corporation (i) increase the
maximum number of shares which may be issued under any offering (except pursuant
to Section 10.03); (ii) amend the requirements as to the class of employees
eligible to purchase stock under the Plan or permit the members of the Committee
to purchase stock under the Plan.
Upon termination, any cash remaining in Participant accounts will be applied to
the purchase of Stock. For purposes of valuing the Stock, the closing price of
the Stock on the New York Stock Exchange on the most recent preceding trading
day will determine the purchase price. At the discretion of the Board of
Directors, Participants will be permitted to exercise their options for any
unpurchased shares by either requiring direct payment from the Participants,
cashless exercise or any other arrangement deemed appropriate by the Board of
Directors.
10.05. Effective Date
This amendment and restatement of the Plan shall be effective as of October 1,
1999.
10.06. No Employment Rights
The Plan does not, directly or indirectly, create any right for the benefit of
any employee or class of employees to purchase any shares under the Plan, or
create in any employee or class of employees any right with respect to
continuation of employment by the Company, and it shall not be deemed to
interfere in any way with the Company's right to terminate, or otherwise modify,
an employee's employment at any time.
10.07. Effect of Plan
The provisions of the Plan shall, in accordance with its terms, be binding upon,
and inure to the benefit of, all successors of each employee participating in
the Plan, including, without limitation, such employee's estate and the
executors, administrators or trustees thereof, heirs and legatees, and any
receiver, trustee in bankruptcy or representative of creditors of such employee.
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10.08. Governing Law
The law of the State of Illinois will govern all matters relating to this Plan
except to the extent it is superseded by the laws of the United States.
IN WITNESS WHEREOF, the company has caused this instrument to be executed on the
________ day of _____________, 1999.
BAXTER INTERNATIONAL INC.
By:
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Its: Senior Vice President of Human Resources
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