As filed with the Securities and Exchange Commission on October 27, 1998
Registration No. 333-
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
-------------------
XOMA CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 94-2756657
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
2910 Seventh Street
Berkeley, California 94710
(Address of Principal Executive Offices)
-------------------
XOMA CORPORATION 1998 EMPLOYEE STOCK PURCHASE PLAN
(Full title of the plan)
-------------------
Christopher J. Margolin, Esq.
XOMA Corporation
2910 Seventh Street
Berkeley, California 94710
(Name and address of agent for service)
(212) 644-1170
(Telephone number, including area code, of agent for service)
-------------------
Copy to:
Geoffrey E. Liebmann, Esq.
Cahill Gordon & Reindel
80 Pine Street
New York, NY 10005-1702
-------------------
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
================================================================================================================================
Title of Securities to Amount to be Proposed Maximum Proposed Maximum Amount of
be Registered Registered (1) Offering Price Per Share (2) Aggregate Offering Price (2) Registration Fee (2)
- - --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock,
par value $.0005 per 500,000 shares $2.14 $1,070,000 $298
share
================================================================================================================================
</TABLE>
(1) Subject to adjustment to prevent dilution resulting from stock splits,
stock dividends or similar transactions.
(2) Estimated solely for purposes of calculating the registration fee. Pursuant
to Rules 457(c) and 457(h) under the Securities Act of 1933, as amended,
the registration fee has been calculated based on the average of the high
and low sale prices reported for the Common Stock of XOMA Corporation on
October 20, 1998, which was $2.14 per share, as reported on the Nasdaq
National Market.
<PAGE>
PART I
INFORMATION REQUIRED
IN PROSPECTUS
ITEM 1. PLAN INFORMATION.*
ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION.*
*The information called for by Part I of Form S-8 is not being
filed with or included in this Form S-8 in accordance with Rule
428 under the Securities Act of 1933, as amended, and the Note to
Part I of Form S-8.
PART II
INFORMATION REQUIRED
IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents, previously filed by XOMA Corporation (the
"Company") with the Securities and Exchange Commission (the "Commission")
pursuant to the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), are hereby incorporated by reference:
(1) Annual Report on Form 10-K for the fiscal year ended December 31,
1997, as amended by Amendment No. 1 thereto on Form 10-K/A dated March
26, 1998 (File No. 0-14710);
(2) Quarterly Reports on Form 10-Q for the quarterly periods ended March
31, 1998 and June 30, 1998 (File No. 0-14710);
(3) Current Report on Form 8-K dated December 30, 1997 filed on January 9,
1998 (File No. 0-14710);
(4) Current Report on Form 8-K dated June 26, 1998 filed on June 29, 1998,
as amended by Amendment No. 1 thereto on Form 8-K/A dated June 26,
1998 filed on June 29, 1998 (File No. 0-14710);
(5) Current Report on Form 8-K dated July 9, 1998 filed on July 16, 1998
(File No. 0-14710); and
(6) The description of XOMA's Common Stock in the Registration Statement
on Form 8-A dated June 9, 1986 filed on June 11, 1986 under Section 12
of the Exchange Act, including any amendment or report for the purpose
of updating such description (Registration No. 33-4793).
All documents filed by the Company with the Commission pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this
Registration Statement and prior to the termination of the of-
<PAGE>
fering of the Common Stock offered hereby shall be deemed to be incorporated by
reference herein and to be a part hereof from the date any such document is
filed.
Any statements contained in a document incorporated by reference herein
shall be deemed to be modified or superseded for purposes of this Registration
Statement to the extent that a statement contained in this Registration
Statement or in any other subsequently filed document which also is incorporated
by reference herein modifies or supersedes such statement. Any statement so
modified or superseded shall not be deemed to constitute a part of this
Registration Statement except as so modified or superseded.
ITEM 4. DESCRIPTION OF SECURITIES.
The description of the Registrant's Common Stock to be offered pursuant to
this Registration Statement has been incorporated by reference into this
Registration Statement as described in Item 3 of this Part II.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Delaware General Corporation Law provides for indemnification of
directors, officers, employees and agents, subject to certain limitations (Del.
Code, Title 8 Sec. 145). Article VII of the Company's Bylaws provides that
expenses incurred by an officer or director of the Company in defending a civil
or criminal action, suit or proceeding shall be paid by the Company in advance
of a final disposition of the action, suit or proceeding upon receipt by the
Company of an undertaking by the officer or director that he or she will repay
such expenses if it is ultimately determined that he or she is not entitled to
indemnification under the Delaware General Corporation Law.
As permitted by Section 102 of the Delaware General Corporation Law, the
Company's Certificate of Incorporation contains provisions eliminating a
director's personal liability for monetary damages to the Company and its
stockholders arising from a breach of a director's fiduciary duty except for
liability under Section 174 of the Delaware General Corporation Law or liability
for any breach of the director's duty of loyalty to the Company or its
stockholders, for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law or for any transaction by
which the director derived an improper personal benefit. The Company has also
entered into indemnification agreements with its directors and officers
providing for indemnification and advancements of expenses to the fullest extent
permitted under Delaware law.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
See Exhibit Index.
ITEM 9. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
-2-
<PAGE>
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement;
Provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if the
registration statement is on Form S-3 or Form S-8, and the information required
to be included in the post-effective amendment by those paragraphs is contained
in periodic reports filed by the registrant pursuant to Section 13 or Section
15(d) of the Securities Exchange Act of 1934 that are incorporated by reference
in the registration statement.
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered herein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities Act
of 1933 and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act of 1933 and will be governed by the final adjudication of such issue.
-3-
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Berkeley, State of California, on October 27, 1998.
XOMA CORPORATION
By: /s/ John L. Castello
---------------------------------------
Name: John L. Castello
Title: Chairman of the Board, President
and Chief Executive Officer
-4-
<PAGE>
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints John L. Castello and Christopher J.
Margolin, and each of them, as his true and lawful attorneys-in-fact and agents,
with full power of substitution and resubstitution, for him and in his name,
place and stead, in any and all capacities, to sign any and all amendments
(including post-effective amendments) and supplements to this registration
statement, and to file the same, with the Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
connection therewith, as fully to all intents and purposes as he might or could
do in person, hereby ratifying and confirming all that said attorneys-in-fact
and agents, or any of them, or their or his substitute or substitutes, may
lawfully do or cause to be done by virtue hereof. This Power of Attorney may be
signed in several counterparts.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
- - --------- ----- ----
<S> <C> <C>
/s/ John L. Castello Chairman of the Board, President and Chief October 27, 1998
- - ---------------------------- Executive Officer (Principal Executive Officer)
John L. Castello
/s/ Patrick J. Scannon Chief Scientific and Medical Officer October 27, 1998
- - ----------------------------
Patrick J. Scannon
/s/ Peter B. Davis Vice President, Finance and Chief Financial October 27, 1998
- - ---------------------------- Officer (Principal Financial and Accounting
Peter B. Davis Officer)
/s/ James G. Andress Director October 27, 1998
- - ----------------------------
James G. Andress
/s/ William K. Bowes, Jr. Director October 27, 1998
- - ----------------------------
William K. Bowes, Jr.
/s/ Arthur Kornberg Director October 27, 1998
- - ----------------------------
Arthur Kornberg
/s/ Steven C. Mendell Director October 27, 1998
- - ----------------------------
Steven C. Mendell
/s/ W. Denman Van Ness Director October 27, 1998
- - ----------------------------
W. Denman Van Ness
</TABLE>
-5-
<PAGE>
EXHIBIT INDEX
Exhibit
Number Exhibit
5.1 Opinion of Cahill Gordon & Reindel.
10.1 1998 Employee Stock Purchase Plan.
10.2 Amendment No. 1 to 1998 Employee Stock Purchase Plan.
23.1 Consent of Arthur Andersen LLP.
23.2 Consent of Cahill Gordon & Reindel (included in Exhibit 5.1).
24.1 Power of Attorney (included on signature page to Registration
Statement).
-6-
[LETTERHEAD OF CAHILL GORDON & REINDEL]
October 27, 1998
(212) 701-3000
XOMA Corporation
2910 Seventh Street
Berkeley, California 94710
Re: XOMA Corporation
Registration Statement on Form S-8
Ladies and Gentlemen:
We have acted as special counsel to XOMA Corporation, a Delaware
corporation (the "Company"), in connection with its Registration Statement on
Form S-8 (the "Registration Statement") filed with the Securities and Exchange
Commission under the Securities Act of 1933, as amended, with respect to up to
500,000 shares of Common Stock, par value $0.0005 per share (the "Common
Stock"), of the Company which are issuable under the Company's 1998 Employee
Stock Purchase Plan, as amended (the "Plan").
We advise you that, in our opinion, upon the issuance of shares of Common
Stock in accordance with the terms of the Plan and receipt by the Company of the
consideration for such shares in accordance with the terms of the Plan, the
shares of Common Stock so issued will be validly issued, fully paid and
non-assessable.
We hereby consent to the filing of this opinion with the Securities and
Exchange Commission as an exhibit to the Registration Statement.
Very truly yours,
CAHILL GORDON & REINDEL
Exhibit 10.1
XOMA CORPORATION
1998 EMPLOYEE STOCK PURCHASE PLAN
1. Purpose. The purpose of this XOMA Corporation 1998 Employee Stock
Purchase Plan (the "Plan") is to provide employees of XOMA Corporation, a
Delaware corporation (the "Company") with an opportunity to purchase common
stock of the Company ("Common Stock") through accumulated payroll deductions. 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, accordingly, shall be
construed so as to extend and limit participation in a manner consistent with
the requirements of that section of the Code. Rights to purchase stock under the
Plan are referred to in the Code and in this Plan as "options".
2. Definitions.
(a) "Committee" shall mean the Compensation Committee of the Board of
Directors or such other committee selected by the Board of Directors to
administer the Plan.
(b) "Compensation" shall mean total cash compensation received by the
Employee from the Company, including regular pay, overtime pay, and bonuses, and
shall also include any pretax Employee cash or deferred contributions to a plan
maintained by the Company which qualifies under Section 401(k) of the Code and
any pretax Employee contributions to a plan maintained by the Company which
qualifies under Section 125 of the Code.
(c) "Employee" shall mean any individual who is an employee of the Company
for purposes of tax withholding under the Code whose customary employment with
the Company is at least twenty (20) hours per week and more than five (5) months
in any calendar year. For purposes of the Plan, the employment relationship
shall be treated as continuing intact while the individual is on sick leave or
other leave of absence approved by the Company.
(d) "Enrollment Date" shall mean the first day of each Offering Period.
(e) "Exercise Date" shall mean the last day of each Offering Period.
(f) "Fair Market Value" shall mean, as of any date, the value of Common
Stock determined as follows:
(1) If the Common Stock is listed on any established stock
exchange or a national market system, including without limitation the
Nasdaq National Market, its Fair Market Value shall be the closing
selling price for the Common Stock, as quoted on such exchange (or the
exchange with the greatest volume of trading in Common Stock) or
system on the date of such determination, as reported in The Wall
Street Journal or such other source as the Committee deems reliable;
or
(2) If the Common Stock is quoted on the Nasdaq Stock Market (but
not on the Nasdaq National Market), its Fair Market Value shall be the
closing selling price for the Common Stock on the date of such
determination, as reported in The Wall Street Journal or such other
source as the Committee deems reliable; or
<PAGE>
(3) In the absence of an established market for the Common Stock,
the Fair Market Value thereof shall be determined in good faith by the
Committee.
(g) "Offering Periods" shall mean concurrent twenty-four (24) month periods
(or another period as determined by the Committee), commencing once every
calendar quarter beginning on January 1, April 1, July 1 and September 1 of each
year (or at other times determined by the Committee), and ending on the day
prior to the end of such twenty-four (24) month period.
(h) "Purchase Price" shall mean with respect to each Offering Period either
(i) an amount equal to 85% of the Fair Market Value of a share of Common Stock
on the Enrollment Date or the Exercise Date for that Offering Period, whichever
is lower, or (ii) such higher price as may be set by the Committee at the
beginning of that Offering Period.
3. Eligibility.
(a) Any person who is an Employee on a given Enrollment Date shall be
eligible to participate in the Plan.
(b) Any provisions of the Plan to the contrary notwithstanding, no Employee
shall be granted an option under the Plan (i) if, immediately after the grant,
such Employee would own stock (together with stock owned by any other person or
entity that would be attributed to such Employee pursuant to Section 424(d) of
the Code) of the Company (including, for this purpose, all shares of stock
subject to any outstanding options to purchase such stock, whether or not
currently exercisable and irrespective of whether such options are subject to
the favorable tax treatment of Section 421(a) of the Code) 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 parent (within the meaning of Section 424(e)
of the Code) or subsidiary (within the meaning of Section 424(f) of the Code),
or (ii) which permits his or her rights to purchase stock under all Offering
Periods and all employee stock purchase plans (within the meaning of Section 423
of the Code) of the Company and its parents and subsidiaries to accrue at a rate
which exceeds Twenty-Five Thousand Dollars ($25,000) worth of stock (determined
at the Fair Market Value of the stock at the time such option is granted) for
each calendar year in which such option is outstanding at any time. The
limitation described in clause (ii) of the preceding sentence shall be applied
in a manner consistent with Section 423(b)(8) of the Code.
4. Offering Periods. The Plan shall be implemented by concurrent Offering
Periods with a new Offering Period commencing on the first day of each calendar
quarter, or on such other date as the Committee shall determine, with such
Offering Periods extending for twenty-four (24) months, or such other length as
the Committee shall determine. The Committee shall have the power to change the
duration of Offering Periods (including the commencement dates thereof) with
respect to future offerings without stockholder approval if such change is
announced at least fifteen (15) days prior to the scheduled beginning of the
first Offering Period to be affected thereafter.
5. Participation.
(a) An eligible Employee may become a participant in the Plan by completing
a subscription agreement authorizing payroll deductions in a form prepared by
the Company and filing it with the Company's Human Resources Department at least
fifteen (15) business days prior to the applicable Enrollment Date for a
particular Offering Period, unless a later time for filing the subscription
agreement is set by the Committee for all eligible Employees with respect to a
given Offering Period.
<PAGE>
(b) Payroll deductions for a participant shall commence on the first
payroll date following the Enrollment Date and shall end on the last payroll
date in the Offering Period to which such authorization is applicable, unless
sooner terminated by the participant as provided in Section 10 hereof.
6. Payroll Deductions.
(a) At the time a participant files his or her subscription agreement, he
or she shall elect to have payroll deductions made on each payday during the
Offering Period in an amount not exceeding twenty percent (20%), in whole
multiples of one percent (1%), of the Compensation which he or she receives on
each payday during the Offering Period. The aggregate amount of payroll
deductions for all concurrent Offering Periods shall not exceed twenty percent
(20%).
(b) All payroll deductions made for a participant shall be credited to his
or her account under the Plan and will be withheld in whole percentages only. A
participant may not make any additional payments into such account.
(c) Once an Offering Period has commenced, a participant may decrease, but
not increase, the rate of his or her payroll deductions for that Offering Period
once per calendar quarter by filing a new subscription agreement at least
fifteen (15) business days prior to the beginning of the calendar quarter, which
decrease shall become effective at the beginning of the next calendar quarter;
provided, however, that a participant may discontinue his or her participation
in the Plan, as provided in Section 10 hereof, at any time during the Offering
Period prior to the Exercise Date. During an Offering Period, a participant may
elect to have new or additional payroll deductions made with respect to the next
beginning Offering Period, by completing or filing with the Company an
additional subscription agreement, at least fifteen (15) business days prior to
the beginning of the next Offering Period, authorizing a payroll deduction rate
with respect to the new Offering Period. A participant's subscription agreement
with respect to an expiring Offering Period shall remain in effect for the
Offering Period which begins after the end of the currently expiring Offering
Period, unless terminated as provided in Section 10 hereof.
(d) Notwithstanding the foregoing, a participant's payroll deductions for
each Offering Period may be decreased to 0% at any time, to the extent necessary
to comply with Section 423(b)(8) of the Code and Section 3(b) hereof.
(e) At the time of the Exercise Date, in whole or in part, or at the time
some or all of the Company's Common Stock issued under the Plan is disposed of,
the participant must make adequate provisions for the Company's federal, state,
or other tax withholding obligations, if any, which 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.
7. Grant of Option. On the Enrollment Date of each Offering Period, each
eligible Employee participating in such Offering Period shall be granted an
option to purchase on the Exercise Date of such Offering Period (at the
applicable Purchase Price) up to a number of shares of the Company's Common
Stock determined by dividing such Employee's payroll deductions accumulated with
respect to that Offering Period prior to such Exercise Date and retained in the
participant's account as of the Exercise Date by the applicable Purchase Price;
provided, however, that in no event shall an Employee be permitted to purchase
during each Offering Period and with respect to such Offering Period more than
50,000 shares of Common Stock; and provided, further, that such purchase shall
be subject to the limitations set forth in Section 3(b) and 12 hereof. Exercise
of the option with respect to that Offering Period shall occur as provided in
Section 8 hereof, unless the participant has
<PAGE>
withdrawn pursuant to Section 10 hereof, and the option with respect to that
Offering Period shall expire on the last day of the Offering Period.
8. Exercise of Option. Unless a participant has withdrawn from the Plan as
provided in Section 10 hereof, his or her option for the purchase of shares of
Common Stock will be exercised automatically on the Exercise Date, and, subject
to the limitations set forth in Sections 3(b), 7 and 12 hereof, the maximum
number of full shares subject to the option shall be purchased for such
participant at the applicable Purchase Price with the accumulated payroll
deductions in his or her account with respect to that Offering Period. Unless
otherwise approved by the Committee, no fractional shares will be purchased.
Unless acquisition of fractional shares has been so approved, any payroll
deductions accumulated in a participant's account which are not sufficient to
purchase a full share of Common Stock shall be retained in the participant's
account for the next expiring Offering Period, subject to earlier withdrawal by
the participant as provided in Section 10 hereof. Any other monies left over in
a participant's account after the Exercise Date shall be returned to the
participant. During a participant's lifetime, a participant's option to purchase
shares hereunder is exercisable only by the participant.
9. Issuance; Delivery; Restriction. The shares of Common Stock purchased
for a participant on the last day of an Offering Period shall be deemed to have
been issued by the Company for all purposes as of the Exercise Date. Prior to
such date, none of the rights and privileges of a stockholder of the Company
shall exist with respect to such Common Stock. The registrar for the Company
shall be instructed to make entries on its books and records evidencing that
shares of Common Stock issued hereunder have been duly issued as of each
pertinent Exercise Date; provided, however, that an employee may in the
alternative elect in writing to receive a stock certificate representing the
amount of such shares so acquired. Notwithstanding the foregoing, delivery of
certificates representing shares of Common Stock or transfer to or for the
account of any participant under the Plan may be conditioned upon the agreement
of such participant to allow federal income tax withholdings as may be required
to be made by the Company.
10. Withdrawal; Termination of Employment.
(a) A participant may withdraw all but not less than all the payroll
deductions credited to his or her account and not yet used to exercise his or
her option under the Plan with respect to one or more Offering Periods at any
time prior to the last day of such Offering Period by giving written notice to
the Company in a form prepared by the Company. All of the participant's payroll
deductions credited to his or her account with respect to such Offering
Period(s) will be paid to such participant promptly after receipt of written
notice of withdrawal and such participant's option for the relevant Offering
Period(s) will be automatically terminated, and no further payroll deductions
for the purchase of shares will be made during the Offering Period(s) with
respect to such Offering Period(s). If a participant withdraws from the Plan
with respect to one or more Offering Periods, he or she may continue in the Plan
with respect to other Offering Periods that have already begun and he or she may
also resume participation for subsequent Offering Periods by delivering to the
Company a new subscription agreement at least fifteen (15) business days prior
to the Enrollment Date for such subsequent Offering Period.
(b) Upon a participant's ceasing to be an Employee, for any reason, he or
she will be deemed to have elected to withdraw from the Plan and the payroll
deductions credited to such participant's account during the current Offering
Periods but not yet used to exercise the option will be returned to such
participant or, in the case of his or her death, to the person or persons
entitled thereto under Section 14 hereof, and such participant's option will be
automatically terminated.
<PAGE>
(c) A participant's withdrawal from an Offering Period will not have any
effect upon his or her eligibility to participate in any similar plan which may
hereafter be adopted by the Company or in subsequent and all other Offering
Periods.
11. Interest. No interest or other increment shall accrue or be payable
with respect to any of the payroll deductions of a participant in the Plan.
12. Stock.
(a) The maximum number of shares of Common Stock which 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 18 hereof.
Such shares of Common Stock may be authorized but unissued shares, treasury
shares or shares purchased in the open market.
(b) If on a given Exercise Date the number of shares of Common Stock with
respect to which options are to be exercised exceeds the number of shares then
available under the Plan, the Committee 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, and the balance of the
payroll deductions accumulated in the participant's account (other than amounts
representing fractional shares, which are retained for the next Offering Period,
as described in Section 8 above) shall be returned to him as promptly as
possible.
(c) No participant will have an interest or voting right in shares of
Common Stock covered by his or her option until such option has been exercised.
(d) Shares of Common Stock to be delivered to a participant under the Plan
will be registered in the name of the participant or in the name of the
participant and his or her spouse.
13. Administration. The Plan shall be administered by the Committee. The
Committee shall have full and exclusive discretionary authority to construe,
interpret and apply the terms of the Plan, to determine eligibility and to
adjudicate all disputed claims filed under the Plan. Every finding, decision and
determination made by the Committee shall, to the full extent permitted by law,
be final and binding upon all parties. Members of the Committee shall not be
permitted to participate in the Plan.
14. Designation of Beneficiary.
(a) A participant may file a written designation of a beneficiary who is to
receive any shares of Common Stock and cash, if any, from the participant's
account under the Plan in the event of such participant's death subsequent to an
Exercise Date on which the option is exercised but prior to delivery to such
participant of such shares or cash. In addition, a participant may file a
written designation of a beneficiary who is to receive any cash from the
participant's account under the Plan in the event of such participant's death
prior to exercise of the option. If a participant is married and the designated
beneficiary is not the spouse, spousal consent shall be required for such
designation to be effective.
(b) Such designation of beneficiary may be changed by the 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 of
Common Stock 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
<PAGE>
shares 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.
15. Transferability. Neither payroll deductions credited to a participant's
account nor any rights with regard to the exercise of an option or to receive
shares of Common Stock under the Plan may be assigned, transferred, pledged or
otherwise disposed of in any way (other than by will, the laws of descent and
distribution or as provided in Section 14 hereof) by the participant. Any such
attempt at assignment, transfer, pledge or other disposition shall be without
effect, except that the Company may treat such act as an election to withdraw
funds from an Offering Period in accordance with Section 10 hereof.
16. Use of Funds. 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.
17. Reports. Individual accounts will be maintained for each participant in
the Plan. Statements of account will be given to participating Employees at
least annually, within such time as the Committee may reasonably determine,
which statements will set forth the amounts of payroll deductions, the Purchase
Price, the number of shares purchased and the remaining cash balance, if any.
18. Adjustments Upon Changes in Capitalization.
(a) Changes in Capitalization. The "Reserves" (as defined below), the
maximum number of shares of Common Stock an Employee is permitted to purchase in
any Offering Period under Section 7, and the price per share of Common Stock
covered by each option under the Plan which has not yet been exercised shall be
proportionately adjusted for any increase or decrease in the number of issued
shares of Common Stock resulting from a stock split, reverse stock split, stock
dividend, combination or reclassification of the Common Stock, 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
Committee, 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.
"Reserves" means the number of shares of Common Stock covered by each option
under the Plan which have not yet been exercised and the number of shares of
Common Stock which have been authorized for issuance under the Plan but not yet
placed under option.
(b) Dissolution or Liquidation. In an event of the proposed dissolution or
liquidation of the Company, the Offering Period will terminate immediately prior
to the consummation of such proposed action, unless otherwise provided by the
Committee.
(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 of the Company
with or into another corporation, all options under the Plan shall be assumed or
an equivalent option shall be substituted by such successor corporation or a
parent or subsidiary of such successor corporation, unless the Committee
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 new Exercise Dates ("New Exercise Dates"). If the Committee shortens the
Offering Period then in progress in lieu of assumption or substitution in the
event of a merger or sale of assets, the Committee shall notify each participant
in writing, at least fifteen (15) business days prior to the New Exercise Dates,
that the Exercise Dates for his or her option has been changed to the New
Exercise Dates and that his or her options will be exercised automatically on
the New
<PAGE>
Exercise Dates, unless prior to such dates he or she has withdrawn from the
Offering Periods as provided in Section 10 hereof. For purposes of this
paragraph, options granted under the Plan shall be deemed to be assumed if,
following the sale of assets or merger, the options confer the right to
purchase, for each share of stock subject to the option immediately prior to the
sale of assets or merger, the consideration (whether stock, cash or other
securities or property) received in the sale of assets or merger by holders of
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 sale of assets or merger was not solely common stock of the successor
corporation or its parent (as defined in Section 424(e) of the Code), the
Committee may, with the consent of the successor corporation and the
participant, provide for the consideration to be received upon exercise of the
options to be solely common stock of the successor corporation or its parent
equal in fair market value to the per share consideration received by holders of
Common Stock in the sale of assets or merger.
19. Amendment or Termination.
(a) The Board of Directors may at any time and for any reason terminate or
amend the Plan. Except as provided in Section 18 hereof, no such termination may
adversely affect options previously granted; provided, however, that Offering
Periods may be terminated by the Board of Directors on any Exercise Date if the
Board of Directors determines that the termination of the Plan is in the best
interests of the Company and its stockholders. Except as provided in Section 18
hereof, no amendment may make any change in any option theretofore granted which
adversely affects the rights of any participant. To the extent necessary to
comply with Section 423 of the Code (or any successor rule or provision or any
other applicable law or regulation), the Company shall obtain stockholder
approval in such a manner and to such a degree as required.
(b) Without stockholder consent and without regard to whether any
participant rights may be considered to have been adversely affected, the
Committee shall be entitled to change the Offering Periods, limit the frequency
or number of changes in the amount withheld during the Offering Periods, permit
payroll withholding in excess of the amount designated by a participant in order
to adjust for delays or mistakes in the Company's processing of properly
completed withholding elections, establish reasonable waiting and adjustment
periods 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 Committee finds, in its sole discretion,
advisable and consistent with the Plan.
20. 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.
21. Conditions Upon Issuance of Shares. 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 shall comply with all applicable
provisions of law, domestic or foreign, including, without limitation, the
Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as
amended, 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 person exercising such option 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.
<PAGE>
22. Term of Plan. The Plan shall become effective on May 20, 1998 (the
"Effective Date"), subject to its approval by the stockholders of the Company
within twelve (12) months after its adoption by the Board of Directors. It shall
continue in effect until terminated under Section 19 hereof.
Exhibit 10.2
AMENDMENT NO. 1
TO THE XOMA CORPORATION
1998 EMPLOYEE STOCK PURCHASE PLAN
The XOMA Corporation 1998 Employee Stock Purchase Plan (the "Plan") is
hereby amended, effective as of May 20, 1998, as follows:
1. Section 6(a) of the Plan is amended to read as follows: "(a) At the
time a participant files his or her subscription agreement, he or she shall
elect to have payroll deductions made on each payday during the Offering
Period in an amount not exceeding twenty percent (20%) (or such lesser
percentage, applied uniformly to all participants, as an executive officer
of the Company shall set), in whole multiples of one percent (1%), of the
Compensation which he or she receives on each payday during the Offering
Period. The aggregate amount of payroll deductions for all concurrent
Offering Periods shall not exceed twenty percent (20%) (or such lesser
percentage, applied uniformly to all participants, as an executive officer
of the Company shall set)."
Exhibit 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation
by reference in this Registration Statement on Form S-8 of our report dated
February 3, 1998 included in the Company's Form 10-K for the year ended
December 31, 1997, and to all references to our Firm included in this
Registration Statement.
ARTHUR ANDERSEN LLP
San Francisco, California
October 23, 1998
