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EXHIBIT 10.20
LA JOLLA PHARMACEUTICAL COMPANY
1995 EMPLOYEE STOCK PURCHASE PLAN
(AS AMENDED AND RESTATED EFFECTIVE MARCH 19, 2001)
The following constitutes the provisions of the La Jolla
Pharmaceutical Company 1995 Employee Stock Purchase Plan (as amended and
restated effective March 19, 2001) (the "PLAN").
1. PURPOSE.
The purpose of the Plan is to maintain competitive equity
compensation programs and to provide employees of La Jolla Pharmaceutical
Company (the "COMPANY") with an opportunity and incentive to acquire a
proprietary interest in the Company through the purchase of the Company's Common
Stock, thereby more closely aligning the interests of the Company's employees
and stockholders. 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 ("SECTION 423"). Accordingly, the provisions of the Plan
shall be construed to extend and limit participation consistent with the
requirements of Section 423.
2. DEFINITIONS.
Capitalized terms used in this Plan and not otherwise defined
have the meanings set forth below.
"ADMINISTRATOR" means the Committee, or the Board if the Board
asserts administrative authority over the Plan pursuant to Section 13.
"BOARD" means the Board of Directors of the Company.
"CODE" means the Internal Revenue Code of 1986, as amended.
"COMMITTEE" means a committee of members of the Board meeting the
qualifications described in Section 13 and appointed by the Board to administer
the Plan.
"COMMON STOCK" shall mean the Common Stock of the Company.
"COMPENSATION" means base salary or hourly compensation and any
cash bonus paid to a participant.
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"ELIGIBLE EMPLOYEE" means any employee of the Company whose
customary employment is for more than five months per calendar year and for more
than 20 hours per week. For purposes of the Plan, the employment relationship
shall be treated as continuing while the individual is on sick leave or other
leave of absence approved by the Company, except that when the period of leave
exceeds 90 days and the individual's right to reemployment is not guaranteed
either by statute or by contract, the employment relationship will be deemed to
have terminated on the 91st day of such leave.
"ENROLLMENT DATE" means the first day of each Offering Period.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
"EXERCISE DATE" means the last day of each Purchase Period.
"FAIR MARKET VALUE" of the Common Stock as of the time of any
determination thereof means the value of Common Stock determined as follows:
(1) If the Common Stock is listed on any established stock
exchange or trades on the Nasdaq National Market, its Fair Market Value shall be
the most recent closing sales price for such stock (or the closing bid, if no
sales were reported), as quoted on such exchange or system (or the exchange or
system with the greatest volume of trading in the Common Stock) as of the time
of such determination as reported in the Wall Street Journal or such other
source as the Administrator deems reliable; or
(2) If the Common Stock is not listed on any established
stock exchange or traded on the Nasdaq National Market its Fair Market Value
shall be the mean between the most recent closing high and low asked prices for
the Common Stock as of the time of such determination, as reported in the Wall
Street Journal or such other source as the Administrator deems reliable; or
(3) In the absence of an established market for the Common
Stock, the Fair Market Value of the Common Stock shall be determined in good
faith by the Administrator.
"OFFERING PERIOD" means (i) the period of twenty-three (23)
months commencing on August 1, 1996 and terminating on June 30, twenty-three
(23) months later; (ii) each period of twenty-four (24) months commencing on
January 1, 1997 and each January 1 thereafter for the duration of the Plan and
terminating on the December 31 twenty-four (24) months later; (iii) each period
of twenty-four (24) months commencing on July 1, 1997 and each July 1 thereafter
for the duration of the Plan and terminating on the June 30 twenty-four (24)
months later; (iv) each period of twenty-four (24) months commencing on October
1, 2000 and each October 1 thereafter for the duration of the Plan and
terminating on the September 30 twenty-four (24) months later; and (v) each
period of twenty-four (24) months commencing on April 1, 2001 and each April 1
thereafter for the duration of the Plan and terminating on the March 31
twenty-four (24) months later. The Administrator shall have the power to change
the duration of Offering Periods without stockholder approval as set forth in
Section 12 or if such change is announced at least fifteen (15) days prior to
the scheduled beginning of the first Offering Period to be affected.
"OPTION" means the option granted to each participant pursuant to
Section 4 upon enrollment in an Offering Period.
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"PERIODIC EXERCISE LIMIT" has the meaning set forth in Section
4(a).
"PLAN ACCOUNT" means an account maintained by the Company for
each participant in the Plan, to which are credited the payroll deductions made
for such participant pursuant to Section 5 and from which are debited amounts
paid for the purchase of shares upon exercise of such participant's Option
pursuant to Section 6.
"PURCHASE PRICE" as of any Exercise Date means an amount equal to
85% of the Fair Market Value of a share of Common Stock as of the close of
business on the Exercise Date or the opening of business on the Enrollment Date
for the Offering Period in which such Exercise Date occurs, whichever is lower.
"PURCHASE PERIOD" means (i) the period of five (5) months
commencing on August 1, 1996 and ending on December 31, 1996; (ii) with respect
to the Offering Periods beginning on January and July 1, 1997, January and July
1, 1998, and January 1, 1999, each period of six (6) months within any such
Offering Period, commencing January 1, 1997 and each July 1 and January 1
thereafter, and ending on the December 31 or June 30 following such commencement
date; (iii) with respect to the Offering Period beginning on July 1, 1999, the
period of six (6) months commencing July 1, 1999 and ending on December 31,
1999, the period of six (6) months commencing on January 1, 2000 and ending on
June 30, 2000, the period of six (6) months commencing on July 1, 2000 and
ending on December 31, 2000, the period of three (3) months commencing on
January 1, 2001 and ending on March 31, 2001, and the period of three (3) months
commencing on April 1, 2001 and ending on June 30, 2001, (iv) with respect to
the Offering Period beginning on January 1, 2000, the period of six (6) months
commencing on January 1, 2000 and ending on June 30, 2000, the period of six (6)
months commencing on July 1, 2000 and ending on December 31, 2000, and each
period of three (3) months commencing on January 1, 2001 and each April 1, July
1, and October 1 thereafter, and ending on the March 31, June 30, September 30
and December 31 following such commencement date; (v) with respect to the
Offering Period beginning on July 1, 2000, the period of six (6) months
commencing on July 1, 2000 and ending on December 31, 2000, and each period of
three (3) months commencing on January 1, 2001 and each April 1, July 1, and
October 1 thereafter, and ending on the March 31, June 30, September 30 and
December 31 following such commencement date; and (vi) for any Offering Period
commencing on or after October 1, 2000, each period of three (3) months within
the Offering Period commencing on October 1, 2000 and each January 1, April 1,
July 1, and October 1 thereafter, and ending on the December 31, March 31, June
30, and September 30 following such commencement date.
"RESERVES" means the number of shares of Common Stock covered by
each Option that has not yet been exercised and the number of shares of Common
Stock that have been authorized for issuance under the Plan, but not yet placed
under any Option.
"RULE 16b-3" means Rule 16b-3 under the Exchange Act and any
successor provision.
"SUBSIDIARY" has the meaning as set forth under Section 424(f) of
the Code.
"TRADING DAY" means a day on which national stock exchanges and
the National Association of Securities Dealers Automated Quotation System are
open for trading.
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3. OFFERING PERIODS AND PARTICIPATION.
The Plan shall be implemented through a series of consecutive and
overlapping Offering Periods. An Eligible Employee may enroll in an Offering
Period by delivering a subscription agreement in the form of Exhibit A hereto to
the Company's payroll office at least five (5) business days prior to the
Enrollment Date for that Offering Period. Eligible Employees shall participate
in only one Offering Period at a time, and a subscription agreement in effect
for a Plan participant for a particular Offering Period shall continue in effect
for subsequent Offering Periods if the participant remains an Eligible Employee
and has not withdrawn pursuant to Section 8.
4. OPTIONS.
(a) Grants. On the Enrollment Date for each Offering Period, each
Eligible Employee participating in such Offering Period shall be granted an
Option to purchase (i) on each Exercise Date for any six-month Purchase Period
in such Offering Period (at the applicable Purchase Price) up to that number of
shares of Common Stock determined by dividing $12,500 by the Fair Market Value
of a share of Common Stock as of the opening of business on the Enrollment Date,
and (ii) on each Exercise Date for any three-month Purchase Period in such
Offering Period (at the applicable Purchase Price) up to that number of shares
of Common Stock determined by dividing $6,250 by the Fair Market Value of a
share of Common Stock as of the opening of business on the Enrollment Date (such
number of shares being the "PERIODIC EXERCISE LIMIT"). The Option shall expire
immediately after the last Exercise Date of the Offering Period.
(b) Grant Limitations. Any provisions of the Plan to the contrary
notwithstanding, no participant shall be granted an Option under the Plan:
(i) if, immediately after the grant, such participant (or
any other person whose stock would be attributed to such
participant pursuant to Section 424(d) of the Code) would own
stock and/or hold outstanding options to purchase stock
possessing five percent (5%) or more of the total combined voting
power or value of all classes of stock of the Company or of any
Subsidiary; or
(ii) which permits such participant's rights to purchase
stock under all employee stock purchase plans of the Company and
its Subsidiaries to accrue at a rate that exceeds Twenty-Five
Thousand Dollars ($25,000) worth of stock (determined at the Fair
Market Value of the shares at the time such Option is granted) in
any calendar year.
(c) No Rights in Respect of Underlying Stock. The participant
will have no interest or voting right in shares covered by an Option until such
Option has been exercised.
5. PAYROLL DEDUCTIONS.
(a) Participant Designations. The subscription agreement
applicable to an Offering Period shall designate payroll deductions to be made
on each payday during the Offering Period as a whole number percentage not
exceeding ten percent (10%) of such Eligible Employee's Compensation for the pay
period preceding such payday, provided that
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the aggregate of such payroll deductions during the Offering Period shall not
exceed ten percent (10%) of the participant's Compensation during said Offering
Period.
(b) Plan Account Balances. The Company shall make payroll
deductions as specified in each participant's subscription agreement on each
payday during the Offering Period and credit such payroll deductions to such
participant's Plan Account. A participant may not make any additional payments
into such Plan Account. No interest will accrue on any payroll deductions. All
payroll deductions received or held by the Company under the Plan may be used by
the Company for any corporate purpose, and the Company shall not be obligated to
segregate such payroll deductions.
(c) Participant Changes. A participant may discontinue his or her
participation in the Plan as provided in Section 8, or may increase or decrease
(subject to such limits as the Administrator may impose) the rate of his or her
payroll deductions during any Purchase Period by filing with the Company a new
subscription agreement authorizing such a change in the payroll deduction rate.
The change in rate shall be effective with the first full payroll period
following five (5) business days after the Company's receipt of the new
subscription agreement, unless the Company elects to process a given change in
participation more quickly.
(d) Decreases. Notwithstanding the foregoing, to the extent
necessary to comply with Section 423(b)(8) of the Code and Section 4(b) herein,
a participant's payroll deductions may be decreased to 0% at such time during
any Purchase Period that is scheduled to end during a calendar year (the
"CURRENT PURCHASE PERIOD") when the aggregate of all payroll deductions
previously used to purchase stock under the Plan in a prior Purchase Period
which ended during that calendar year plus all payroll deductions accumulated
with respect to the Current Purchase Period equal $21,250. Payroll deductions
shall recommence at the rate provided in such participant's subscription
agreement at the beginning of the first Purchase Period that is scheduled to end
in the following calendar year, unless terminated by the participant as provided
in Section 8.
(e) Tax Obligations. At the time of each exercise of a
participant's Option, and at the time any Common Stock issued under the Plan to
a participant is disposed of, the participant must adequately provide for the
Company's federal, state, or other tax withholding obligations, if any, that
arise upon the exercise of the Option or the disposition of the Common Stock. At
any time, the Company may, but will not be obligated to, withhold from the
participant's compensation the amount necessary for the Company to meet
applicable withholding obligations, including any withholding required to make
available to the Company any tax deductions or benefit attributable to sale or
early disposition of Common Stock by the participant.
(f) Statements of Account. The Company shall maintain each
participant's Plan Account and shall give each Plan participant a statement of
account at least annually. Such statements will set forth the amounts of payroll
deductions, the Purchase Price, the number of shares purchased and the remaining
cash balance, if any, for the period covered.
6. EXERCISE OF OPTIONS.
(a) Automatic Exercise on Exercise Dates. Unless a participant
withdraws as provided in Section 8, his or her Option for the purchase of shares
will be exercised automatically on each Exercise Date within the Offering Period
in which such
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participant is enrolled for the maximum number of shares of Common Stock,
including fractional shares, as can then be purchased at the applicable Purchase
Price with the payroll deductions accumulated in such participant's Plan Account
and not yet applied to the purchase of shares under the Plan, subject to the
Periodic Exercise Limit. During a participant's lifetime, a participant's
Options to purchase shares hereunder are exercisable only by the participant.
(b) Delivery of Shares. As promptly as practicable after each
Exercise Date on which a purchase of shares occurs, the Company shall arrange
the delivery to each participant, as appropriate, of a certificate or book entry
transfer representing the shares purchased upon exercise of his or her Option,
provided that the Company may in its discretion hold fractional shares for the
accounts of the participants pending aggregation to whole shares.
(c) Compliance with Law. Shares shall not be issued with respect
to an Option unless the exercise of such Option and the issuance and delivery of
such shares pursuant thereto comply with all applicable provisions of law,
domestic or foreign, including, without limitation, the Securities Act of 1933,
as amended, the Exchange Act, the rules and regulations promulgated thereunder,
and the requirements of any stock exchange upon which the shares may then be
listed, and shall be further subject to the approval of counsel for the Company
with respect to such compliance. As a condition to the exercise of an Option,
the Company may require the participant for whom an Option is exercised to
represent and warrant at the time of any such exercise that the shares are being
purchased only for investment and without any present intention to sell or
distribute such shares if, in the opinion of counsel for the Company, such a
representation is required by any of the aforementioned applicable provisions of
law. Shares issued upon purchase under the Plan may be subject to such transfer
restrictions and stop-transfer instructions as the Administrator deems
appropriate.
(d) Excess Plan Account Balances. If, due to application of the
Periodic Exercise Limit, there remains in a participant's Plan Account
immediately following exercise of such participant's Option on an Exercise Date
any cash accumulated during the Purchase Period immediately preceding such
Exercise Date and not applied to the purchase of shares under the Plan, such
cash shall promptly be returned to the participant.
7. AUTOMATIC TRANSFER TO LOW PRICE OFFERING PERIOD.
If the Fair Market Value of the Common Stock as of the close of
business on any Exercise Date is lower than the Fair Market Value of the Common
Stock as of the opening of business on the Enrollment Date for the Offering
Period in which such Exercise Date occurs, then all participants in such
Offering Period shall be automatically withdrawn from such Offering Period
immediately after the exercise of their Options on such Exercise Date and
automatically re-enrolled in the immediately following Offering Period as of the
first day thereof.
8. WITHDRAWAL; TERMINATION OF EMPLOYMENT.
(a) Voluntary Withdrawal. A participant may withdraw from an
Offering Period by giving written notice to the Company's payroll office at
least five (5) business days prior to the next Exercise Date. Such withdrawal
shall be effective beginning five business days after receipt by the Company's
payroll office of notice thereof. On or promptly following the effective date of
any withdrawal, all (but not less than all) of the withdrawing
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participant's payroll deductions credited to his or her Plan Account and not yet
applied to the purchase of shares under the Plan will be paid to such
participant, and on the effective date of such withdrawal such participant's
Option for the Offering Period will be automatically terminated, and no further
payroll deductions for the purchase of shares will be made during the Offering
Period. If a participant withdraws from an Offering Period, payroll deductions
will not resume at the beginning of any succeeding Offering Period unless the
participant delivers to the Company a new subscription agreement with respect
thereto.
(b) Termination of Employment. Promptly after a participant's
ceasing to be an Eligible Employee for any reason the payroll deductions
credited to such participant's Plan Account and not yet applied to the purchase
of shares under the Plan will be returned to such participant or, in the case of
his or her death, to the person or persons entitled thereto under Section 10,
and such participant's Option will be automatically terminated, provided that,
if the Company does not learn of such death more than five (5) business days
prior to an Exercise Date, payroll deductions credited to such participant's
Plan account may be applied to the purchase of shares under the Plan on such
Exercise Date.
9. TRANSFERABILITY.
Neither payroll deductions credited to a participant's Plan
Account nor any rights with regard to the exercise of an Option or to receive
shares under the Plan nor any Option itself may be assigned, transferred,
pledged or otherwise disposed of by the participant in any way other than by
will, the laws of descent and distribution or as provided in Section 10 hereof.
Any such attempt at assignment, transfer, pledge or other disposition shall be
without effect, except that the Administrator may treat such act as an election
to withdraw from an Offering Period in accordance with Section 8.
10. DESIGNATION OF BENEFICIARY.
A participant may file a written designation of a beneficiary who
is to receive any cash from the participant's Plan Account in the event of such
participant's death and any shares purchased for the participant upon exercise
of his or her Option but not yet issued. If a participant is married and the
designated beneficiary is not the spouse, spousal consent may be required for
such designation to be effective. A designation of beneficiary may be changed by
a participant at any time by written notice. In the event of the death of a
participant and in the absence of a beneficiary validly designated under the
Plan who is living at the time of such participant's death, the Company shall
deliver such shares and/or cash to the executor or administrator of the estate
of the participant, or if no such executor or administrator has been appointed
(to the knowledge of the Company), the Company, in its discretion, may deliver
such shares and/or cash to the spouse or to any one or more dependents or
relatives of the participant, or if no spouse, dependent or relative is known to
the Company, then to such other person as the Company may designate.
11. STOCK.
The maximum number of shares of the Company's Common Stock that
shall be made available for sale under the Plan shall be 500,000 shares, subject
to adjustment upon changes in capitalization of the Company as provided in
Section 12. If on a given Enrollment Date or Exercise Date the number of shares
with respect to which Options are to be granted or exercised exceeds the number
of shares then available under the Plan, the Administrator shall make a pro rata
allocation of the shares remaining available for purchase in as uniform a manner
as shall be practicable and as it shall determine to be equitable.
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Shares of Common Stock subject to unexercised Options that expire, terminate or
are cancelled will again become available for the grant of further Options under
the Plan.
12. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION, DISSOLUTION, MERGER OR ASSET
SALE.
(a) Changes in Capitalization. Subject to any required action by
the stockholders of the Company, the Reserves as well as the Purchase Price,
Periodic Exercise Limit, and other characteristics of the Options, shall be
appropriately and proportionately adjusted for any increase or decrease or
exchange in the issued shares of Common Stock resulting from a stock split,
reverse stock split, stock dividend, combination or reclassification of the
Common Stock, exchange or any other increase or decrease in the number of shares
of Common Stock effected without receipt of consideration by the Company;
provided, however, that conversion of any convertible securities of the Company
shall not be deemed to have been "effected without receipt of consideration."
Such adjustment shall be made by the Administrator, whose determination in that
respect shall be final, binding and conclusive. Except as expressly provided
herein, no issuance by the Company of shares of stock of any class, or
securities convertible into shares of stock of any class, shall affect, and no
adjustment by reason thereof shall be made with respect to, the number or price
of shares of Common Stock subject to an Option. The Administrator may, if it so
determines in the exercise of its sole discretion, provide for adjusting the
Reserves, as well as the Purchase Price, Periodic Exercise Limit, and other
characteristics of the Options, in the event the Company effects one or more
reorganizations, recapitalizations, rights offerings or other increases or
reductions of shares of its outstanding Common Stock.
(b) Dissolution or Liquidation. In the event of the proposed
dissolution or liquidation of the Company, all pending Offering Periods will
terminate immediately prior to the consummation of such proposed action, unless
otherwise provided by the Administrator, and all Plan Account balances will be
paid to participants as appropriate consistent with applicable law.
(c) Merger or Asset Sale. In the event of a proposed sale of all
or substantially all of the assets of the Company, or the merger or other
combination (the "Transaction") of the Company with or into another entity, each
Option under the Plan shall be assumed or an equivalent option shall be
substituted by such successor entity or a parent or subsidiary of such successor
entity, unless the Administrator determines, in the exercise of its sole
discretion and in lieu of such assumption or substitution, to shorten the
Offering Periods then in progress by setting a new Exercise Date (the "NEW
EXERCISE DATE"). If the Administrator shortens the Offering Periods then in
progress in lieu of assumption or substitution, the Administrator shall notify
each participant in writing, at least ten (10) days prior to the New Exercise
Date, that the Exercise Date for such participant's Option has been changed to
the New Exercise Date and that such participant's Option will be exercised
automatically on the New Exercise Date, unless prior to such date the
participant has withdrawn from the Offering Period as provided in Section 8
(provided that, in such case, the participant's withdrawal shall be effective if
notice thereof is delivered to the Company's payroll office at least two (2)
business days prior to the New Exercise Date). For purposes of this Section, an
Option granted under the Plan shall be deemed to be assumed if, following the
Transaction the Option confers the right to purchase at the Purchase Price
(provided that for such purposes the Fair Market Value of the Common Stock on
the New Exercise Date shall be the value per share of the consideration paid in
the Transaction), for each share of stock subject to the Option immediately
prior to the Transaction, the consideration (whether stock, cash or other
securities or property) received in the Transaction by holders of
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Common Stock for each share of Common Stock held on the effective date of the
transaction (and if such holders were offered a choice of consideration, the
type of consideration chosen by the holders of a majority of the outstanding
shares of Common Stock); provided, however, that if such consideration received
in the Transaction was not solely common equity of the successor entity or its
parent (as defined in Section 424(e) of the Code), the Administrator may, with
the consent of the successor entity and the participant, provide for the
consideration to be received upon exercise of the Option to be solely common
equity of the successor entity or its parent equal in fair market value to the
per share consideration received by holders of Common Stock in the Transaction.
13. ADMINISTRATION.
The Plan shall be administered by the Committee, which shall have
the authority to construe, interpret and apply the terms of the Plan and any
agreements defining the rights and obligations of the Company and participants
under the Plan, to prescribe, amend, and rescind rules and regulations relating
to the Plan, to determine eligibility and to adjudicate all disputed claims
filed under the Plan, and to make all other determinations necessary or
advisable for the administration of the Plan. The Administrator may, in its
discretion, delegate ministerial responsibilities under the Plan to the Company.
Every finding, decision and determination made by the Committee shall, to the
full extent permitted by law, be final and binding upon all parties. Any action
of the Committee shall be taken pursuant to a majority vote or by the unanimous
written consent of its members. The Committee shall consist of three or more
members of the Board, each of whom shall be disinterested within the meaning of
Rule 16b-3, provided, however, that the number of members of the Committee may
be reduced or increased from time to time by the Board to the number required or
allowed by Rule 16b-3. The Board may from time to time in its discretion
exercise any responsibilities or authority allocated to the Committee under the
Plan. No member of the Committee or any designee thereof will be liable for any
action or determination made in good faith with respect to the Plan or any
transaction arising under the Plan.
14. AMENDMENT OR TERMINATION.
(a) Administrator's Discretion. The Administrator may, at any
time and for any reason, terminate or amend the Plan. Except as provided in
Section 12, no such termination can affect Options previously granted, provided
that an Offering Period may be terminated by the Administrator on any Exercise
Date if the Administrator determines that such termination is in the best
interests of the Company and its stockholders. Except as provided herein, no
amendment may make any change in any Option theretofore granted that adversely
affects the rights of any participant. To the extent necessary to comply with
and qualify under Rule 16b-3 or under Section 423 (or any successor rule or
provision or any other applicable law or regulation), the Administrator shall
obtain stockholder approval of amendments to the Plan in such a manner and to
such a degree as required.
(b) Administrative Modifications. Without stockholder consent
(except as specifically required by applicable law or regulation) and without
regard to whether any participant rights may be considered to have been
"adversely affected," the Administrator shall be entitled to amend the Plan to
the extent necessary to comply with and qualify under Rule 16b-3 and Section
423, change the Purchase Periods and/or Offering Periods, limit the frequency
and/or number of changes in payroll deductions during Purchase Periods and/or
Offering Periods, establish the exchange ratio applicable to amounts withheld in
a currency other than U.S. dollars, permit payroll withholding in excess of the
amount designated by a
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participant to adjust for delays or mistakes in the Company's processing of
properly completed withholding elections, establish reasonable waiting and
adjustment periods and/or accounting and crediting procedures to ensure that
amounts applied toward the purchase of Common Stock for each participant
properly correspond with amounts withheld from the participant's Compensation,
and establish such other limitations or procedures as the Administrator
determines in its sole discretion to be advisable and which are consistent with
the Plan.
15. TERM OF PLAN.
The Plan shall become effective upon the first Enrollment Date
after its approval by the stockholders of the Company and shall continue in
effect for a term of twenty (20) years unless sooner terminated pursuant to
Section 14.
16. MISCELLANEOUS.
(a) Notices. All notices or other communications by a participant
to the Company under or in connection with the Plan shall be deemed to have been
duly given when received in the form specified by the Company at the location,
or by the person, designated by the Company for the receipt thereof.
(b) Subsidiaries. The Administrator may from time to time in its
discretion permit persons who are employees of any Subsidiary whose customary
employment is for more than five months per calendar year and for more than 20
hours per week to participate in the Plan on the same terms as Eligible
Employees hereunder.
(c) Stockholder Approval. The Plan shall be subject to approval
by the stockholders of the Company within twelve months before or after the date
the Board adopts the Plan. If such stockholder approval is not obtained, the
Plan and all rights to the Common Stock purchased under the Plan shall be null
and void and shall have no effect.
(d) Additional Restrictions of Rule 16b-3. The terms and
conditions of Options granted hereunder to, and the purchase of shares by,
persons subject to Section 16 of the Exchange Act shall comply with the
applicable provisions of Rule 16b-3. This Plan shall be deemed to contain, and
such Options shall contain, and the shares issued upon exercise thereof shall be
subject to, such additional conditions and restrictions as may be required by
Rule 16b-3 to qualify for the maximum exemption from Section 16 of the Exchange
Act with respect to Plan transactions.
(e) No Employment Rights. The Plan does not, directly or
indirectly, create any right for the benefit of an 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.
(f) Applicable Law. The laws of the State of California shall
govern all matters relating to the Plan, except to the extent (if any)
superseded by the laws of the United States.
(g) Headings. Headings used herein are for convenience of
reference only and do not affect the meaning or interpretation of the Plan.
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EXHIBIT A
LA JOLLA PHARMACEUTICAL COMPANY
1995 EMPLOYEE STOCK PURCHASE PLAN
SUBSCRIPTION AGREEMENT
_____ Original Application Enrollment Date: ___________
_____ Change in Payroll Deduction Rate
_____ Change of Beneficiary(ies)
1. I, ________________________, hereby elect to participate in the La Jolla
Pharmaceutical Company 1995 Employee Stock Purchase Plan (the "Plan")
and subscribe to purchase shares of the Company's Common Stock in
accordance with this Subscription Agreement and the Plan.
2. I hereby authorize payroll deductions from each paycheck in the amount
of ____% (not to exceed 10%) of my Compensation (as defined in the Plan)
on each payday during the Offering Period in accordance with the Plan.
(Please note that no fractional percentages are permitted.)
3. I understand that said payroll deductions shall be accumulated for the
purchase of shares of Common Stock at the applicable Purchase Price
determined in accordance with the Plan. I understand that if I do not
withdraw from an Offering Period, any accumulated payroll deductions
will be used to automatically exercise my Option on each Exercise Date
within the Offering Period.
4. I have received a copy of the complete Plan. I understand that my
participation in the Plan is in all respects subject to the terms of the
Plan, that capitalized terms used herein have the same meanings as
ascribed thereto in the Plan, and that in case of any inconsistency
between this Subscription Agreement and the Plan, the Plan shall govern.
I understand that the grant of the Option by the Company under this
Subscription Agreement is subject to stockholder approval of the Plan.
5. Shares purchased for me under the Plan should be issued in the name(s)
of (employee and/or spouse only):__________________________
_______________________________________________________.
6. I understand that if I dispose of any shares received by me pursuant to
the Plan within two years after the Enrollment Date (the first day of
the Offering Period during which I purchased such shares) or within one
year after the Exercise Date (the date I purchased such shares), I will
be treated for federal income tax purposes as having received ordinary
income at the time of such disposition in an amount equal to the excess
of the fair market value of the shares at the time such shares were
delivered to me over the price which I paid for the shares, regardless
of whether I disposed of the shares at a price less than their fair
market value at the Exercise Date. The remainder of the gain or loss, if
any, recognized on such disposition will be treated as capital gain or
loss. I hereby agree to notify the Company in writing within 30 days
after the date of any disposition of my shares, and I will make adequate
provision for Federal, State or other tax withholding obligations, if
any, which arise upon the disposition of the Common Stock. The Company
may, but will not be obligated to, withhold from my Compensation or
other amounts payable to me the amount necessary to meet any
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applicable withholding obligation including any withholding necessary to
make available to the Company any tax deductions or benefits
attributable to sale or early disposition of Common Stock by me. If I
dispose of such shares at any time after the expiration of the one-year
and two-year holding periods described above, I understand that I will
be treated for federal income tax purposes as having received income
only at the time of such disposition, and that such income will be taxed
as ordinary income only to the extent of an amount equal to the lesser
of (a) the excess of the fair market value of the shares at the time of
such disposition over the purchase price which I paid for the shares, or
(b) 15% of the fair market value of the shares on the first day of the
Offering Period. The remainder of the gain or loss, if any, recognized
on such disposition will be taxed as capital gain or loss. I understand
that this tax summary is only a summary for general information purposes
and is subject to change and I agree to consult with my own tax advisors
for definitive advice regarding the tax consequences to me of
participation in the Plan and sale of shares purchased thereunder.
7. I agree to be bound by the terms of the Plan. The effectiveness of this
Subscription Agreement is dependent upon my eligibility to participate
in the Plan.
8. In the event of my death, I hereby designate the following as my
beneficiary(ies) to receive (in proportion to the percentages listed
below) all payments and shares due me under the Plan (use additional
sheets to add beneficiaries):
NAME: (Please print) __________________________________________________
(First) (Middle) (Last)
______________________________ ___________________________________
Relationship
Percentage: __________ ___________________________________
(Address)
NAME: (Please print) __________________________________________________
(First) (Middle) (Last)
______________________________ ___________________________________
Relationship
Percentage: __________ ___________________________________
(Address)
Employee's Social
Security Number: ___________________________________
Employee's Address: ___________________________________
___________________________________
___________________________________
I UNDERSTAND THAT THIS SUBSCRIPTION AGREEMENT SHALL REMAIN IN EFFECT THROUGHOUT
SUCCESSIVE OFFERING PERIODS UNLESS TERMINATED BY ME.
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Dated: ___________________ ___________________________________
Signature of Employee
___________________________________
Spouse's Signature (If beneficiary
other than spouse)
3