<PAGE>
As filed with the Securities and Exchange Commission on April 2, 1998
Registration No. 333-_________________
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
-----------------
CHIRON CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 94-2754624
(State or other jurisdiction (IRS Employer Identification No.)
of incorporation or organization)
4560 HORTON STREET, EMERYVILLE, CA 94608
(Address of principal executive offices) (Zip Code)
-----------------
CHIRON CORPORATION 1997 EMPLOYEE STOCK PURCHASE PLAN
(Full title of the Plan)
-----------------
WILLIAM G. GREEN, ESQ.
SENIOR VICE PRESIDENT AND GENERAL COUNSEL
CHIRON CORPORATION
4560 HORTON STREET, EMERYVILLE, CA 94608
(Name and address of agent for service)
(510) 655-8730
(Telephone number, including area code, of agent for service)
-----------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF SECURITIES AMOUNT TO BE OFFERING PRICE AGGREGATE AMOUNT OF
TO BE REGISTERED REGISTERED PER SHARE OFFERING PRICE REGISTRATION FEE
---------------- ---------- --------- -------------- ----------------
<S> <C> <C> <C> <C>
Common Stock, $0.01
par value (1997
Employee Stock
Purchase Plan) 8,000,000 (1)(2) $20.78125 (3) $166,250,000 (3) $49,044
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
</TABLE>
(1) This Registration Statement shall also cover any additional shares of
Common Stock which become issuable under the Chiron Corporation 1997
Employee Stock Purchase Plan by reason of any stock dividend, stock split,
recapitalization or other similar transaction effected without the receipt
of consideration which results in an increase in the number of the
Registrant's outstanding shares of Common Stock.
(2) 579,793 shares remaining available for issuance under the Chiron
Corporation 1988 Employee Stock Purchase Plan following the last purchase
date thereunder are available for issuance under the Chiron Corporation
1997 Employee Stock Purchase Plan and have been previously registered
pursuant to Registration Statement Nos. 33-23899 and 33-68305.
(3) Calculated solely for purposes of this offering under Rule 457(h) of the
Securities Act of 1933 on the basis of the average of the high and low
selling prices per share of Common Stock of Chiron Corporation on March 30,
1998, as reported by the NASDAQ National Market System.
-----------------
This Registration Statement shall become effective immediately upon filing with
the Securities and Exchange Commission, and sales of the registered securities
will begin as soon as reasonably practicable after such effective date.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Chiron Corporation (the "Registrant") files this Registration Statement
with the Securities and Exchange Commission (the "Commission") on Form S-8 to
register 8,000,000 shares authorized for issuance under the Registrant's 1997
Employee Stock Purchase Plan.
Item 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Registrant hereby incorporates by reference into this Registration
Statement the following documents previously filed with the Commission:
a. The Registrant's Annual Report on Form 10-K for the fiscal year ended
December 28, 1997 filed with the Commission on March 30, 1998;
b. The Registrant's Current Reports on Form 8-K filed with the Commission
on January 13, 1998 and March 25, 1998;
c. The Registrant's Registration Statement (No. 0-12798) on Form 8-A
filed with the Commission on August 28, 1984 in which there is
described the terms, rights and provisions applicable to the
Registrant's outstanding Common Stock.
All reports and definitive proxy or information statements filed pursuant
to Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 (the
"1934 Act") after the date of this Registration Statement and prior to the
filing of a post-effective amendment which indicates that all securities offered
hereby have been sold or which deregisters all securities then remaining unsold
shall be deemed to be incorporated by reference into this Registration Statement
and to be a part hereof from the date of filing of such documents. Any
statement contained in a document incorporated or deemed to be 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 herein or
in any subsequently filed document which also is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Registration Statement.
Item 4. DESCRIPTION OF SECURITIES
Not applicable.
Item 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
Not applicable.
Item 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 145 of the General Corporation Law of the State of Delaware
and the Bylaws of the Registrant contain certain provisions covering
indemnification of corporate directors, officers and employees under certain
conditions and subject to certain limitations.
II-1
<PAGE>
In addition, the Registrant has entered into supplemental indemnification
agreements with its directors which broaden the scope of indemnity beyond that
expressly provided by the Bylaws or the Delaware General Corporation Law. These
supplemental contracts are permissible under the General Corporation Law and
have been approved by the Registrant's stockholders. Accordingly, the
indemnification agreements with directors will (i) confirm the present indemnity
provided to them by the Registrant's Bylaws and give them assurance that this
indemnity will continue to be provided despite future changes in the Bylaws, and
(ii) provide that, in addition, the directors shall be indemnified to the
fullest possible extent permitted by law against all expenses (including
attorneys' fees), judgments, fines and settlement amounts, incurred or paid by
them in any action or proceeding, including any action by or in the right of the
Registrant, on account of their service as a director or officer of the
Registrant, or as a director or officer of any subsidiary of the Registrant, or
as a director, officer, or similar official of any other company or enterprise
when they are serving in such capacities at the request of the Registrant. The
indemnification agreements further provide that expenses incurred by a director
in such cases shall be paid in advance, subject to the director's obligation to
reimburse the Registrant in the event it ultimately determines that the director
is not entitled to be indemnified for such expenses under any of the provisions
of the indemnification agreement. However, no indemnity will be provided to any
director under the agreements as described in clause (ii) of the third sentence
of this paragraph on account of conduct which is finally adjudged to be
knowingly fraudulent, deliberately dishonest or to constitute willful
misconduct. In addition, no indemnification will be provided if a final court
adjudication shall determine that such indemnification is not lawful, or in
respect to any suit in which judgment is rendered against a director for an
accounting of profits made from a purchase or sale of securities of the
Registrant in violation of Section 16(b) of the 1934 Act, as amended, or of
any similar statutory provision, or on account of any remuneration paid to a
director which is finally adjudged to have been paid in violation of law. The
indemnification agreements also contain provisions designed to protect the
Registrant from unreasonable settlements or redundant legal expenditures.
The Registrant maintains liability insurance for each of its directors and
officers which provides for coverage for certain liabilities for which
indemnification by the Registrant may not be permissible under applicable law
and public policy, including liabilities under the Securities Act of 1933, as
amended.
Item 7. EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
Item 8. EXHIBITS
<TABLE>
<CAPTION>
Exhibit Number Exhibit
- -------------- -------
<C> <S>
5 Opinion of William G. Green
23.1 Consent of KPMG Peat Marwick LLP, Independent Auditors.
23.2 Consent of William G. Green is contained in Exhibit 5.
24 Power of Attorney. Reference is made to page II-4 of this
Registration Statement.
99.1 Chiron Corporation 1997 Employee Stock Purchase Plan
</TABLE>
II-2
<PAGE>
Item 9. UNDERTAKINGS
A. 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 (i) to include any prospectus required by
Section 10(a)(3) of the Securities Act of 1933 (the "1933 Act"), (ii) to reflect
in the prospectus any facts or events arising after the effective date of this
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 this Registration Statement, and (iii) to include any
material information with respect to the plan of distribution not previously
disclosed in this Registration Statement or any material change to such
information in this Registration Statement; PROVIDED, however, that
clauses (1)(i) and (1)(ii) shall not apply if the information required to be
included in a 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 1934 Act that are incorporated by reference into the registration
statement; (2) that for the purpose of determining any liability under the 1933
Act each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof; and (3) to remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold upon the
termination of the Registrant's 1997 Employee Stock Purchase Plan.
B. The undersigned Registrant hereby undertakes that, for purposes
of determining any liability under the 1933 Act, each filing of the Registrant's
annual report pursuant to Section 13(a) or Section 15(d) of the 1934 Act that is
incorporated by reference into this Registration Statement shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
C. Insofar as indemnification for liabilities arising under the 1933
Act may be permitted to directors, officers or controlling persons of the
Registrant pursuant to the indemnity provisions summarized in Item 6 above, or
otherwise, the Registrant has been informed that in the opinion of the
Commission such indemnification is against public policy as expressed in the
1933 Act 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 its 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 1933
Act and will be governed by the final adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as
amended, 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 Emeryville, State of California, on this 31st
day of March, 1998.
CHIRON CORPORATION
By: /s/ Edward E. Penhoet, Ph.D
---------------------------
Edward E. Penhoet, Ph.D
President and Chief Executive Officer
II-3
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS:
That the undersigned officers and directors of Chiron Corporation, a
Delaware corporation, do hereby constitute and appoint Edward E. Penhoet, Ph.D.
and William J. Rutter, Ph.D., and each of them, the lawful attorneys and agents,
with full power and authority to do any and all acts and things and to execute
any and all instruments which said attorneys and agents, and any one of them,
determine may be necessary or advisable or required to enable said corporation
to comply with the Securities Act of 1933, as amended, and any rules or
regulations or requirements of the Securities and Exchange Commission in
connection with this Registration Statement. Without limiting the generality of
the foregoing power and authority, the powers granted include the power and
authority to sign the names of the undersigned officers and directors in the
capacities indicated below to this Registration Statement, to any and all
amendments, both pre-effective and post-effective, and supplements to this
Registration Statement, and to any and all instruments or documents filed as
part of or in conjunction with this Registration Statement or amendments or
supplements thereof, and each of the undersigned hereby ratifies and confirms
all that said attorneys and agents, or any of them, shall do or cause to be done
by virtue hereof. This Power of Attorney may be signed in several counterparts.
IN WITNESS WHEREOF, each of the undersigned has executed this Power of
Attorney as of the date indicated.
Pursuant to the requirements of the Securities Act of 1933, as
amended, this Registration Statement has been signed below by the following
persons in the capacities and on the dates indicated.
SIGNATURES TITLE DATE
---------- ----- ----
/s/ Edward E. Penhoet, Ph.D. President, Chief Executive March 31, 1998
- ------------------------------ Officer, Chief Financial
Edward E. Penhoet, Ph.D. Officer and Director
(Principal Executive and
Principal Financial Officer)
/s/ Philip K. Moody Principal Accounting Officer March 31, 1998
- ------------------------------
Philip K. Moody
/s/ William J. Rutter, Ph.D. Chairman of the Board March 31, 1998
- ------------------------------
William J. Rutter, Ph.D.
/s/ Vaughn D. Bryson Director March 31, 1998
- ------------------------------
Vaughn D. Bryson
II-4
<PAGE>
SIGNATURES TITLE DATE
---------- ----- ----
/s/ Lewis W. Coleman Director March 31, 1998
- ------------------------------
Lewis W. Coleman
/s/ Pierre E. Douaze Director March 31, 1998
- ------------------------------
Pierre E. Douaze
/s/ Donald A. Glaser, Ph.D. Director March 31, 1998
- ------------------------------
Donald A. Glaser, Ph.D.
/s/ Paul L. Herrling Director March 31, 1998
- ------------------------------
Paul L. Herrling, Ph.D.
/s/ Alex Krauer, Ph.D. Director March 31, 1998
- ------------------------------
Alex Krauer, Ph.D.
/s/ Jack W. Schuler Director March 31, 1998
- ------------------------------
Jack W. Schuler
/s/ Pieter J. Strijkert, Ph.D. Director March 31, 1998
- ------------------------------
Pieter J. Strijkert, Ph.D.
II-5
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
EXHIBITS
TO
FORM S-8
UNDER THE
SECURITIES ACT OF 1933
CHIRON CORPORATION
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT NO. EXHIBIT
- ----------- -------
<C> <S>
5 Opinion of William G. Green.
23.1 Consent of KPMG Peat Marwick LLP, Independent Auditors.
23.2 Consent of William G. Green is contained in Exhibit 5.
24 Power of Attorney. Reference is made to page II-4 of this
Registration Statement.
99.1 Chiron Corporation 1997 Employee Stock Purchase Plan.
</TABLE>
<PAGE>
EXHIBIT 5
Opinion of William G. Green
<PAGE>
[LETTERHEAD]
EXHIBIT 5
March 31, 1998
Chiron Corporation
4560 Horton Street
Emeryville, CA 94608
RE: Chiron Corporation
Registration Statement for Offering of
8,000,000 Shares of Common Stock
Ladies and Gentlemen:
In connection with your registration of 8,000,000 shares of the Common Stock of
Chiron Corporation (the "Company") on Form S-8 under the Securities Act of 1933,
as amended, I advise you that, in my opinion, when such shares have been issued
and sold pursuant to the provisions of the Company's 1997 Employee Stock
Purchase Plan and in accordance with the Registration Statement, such shares
will be duly authorized, validly issued, fully paid and non-assessable shares of
the Company's Common Stock.
I hereby consent to the filing of this opinion as an exhibit to the Registration
Statement.
Very truly yours,
/s/ William G. Green
William G. Green
Senior Vice President and General Counsel
<PAGE>
EXHIBIT 23.1
CONSENT OF KPMG PEAT MARWICK LLP, INDEPENDENT AUDITORS
<PAGE>
EXHIBIT 23.1
CONSENT OF KPMG PEAT MARWICK LLP, INDEPENDENT AUDITORS
The Board of Directors
Chiron Corporation:
We consent to the use of our reports incorporated herein by reference.
/s/ KPMG Peat Marwick LLP
San Francisco, California
March 27, 1998
<PAGE>
EXHIBIT 99.1
CHIRON CORPORATION 1997
EMPLOYEE STOCK PURCHASE PLAN
I. PURPOSE OF THE PLAN
This Employee Stock Purchase Plan is intended to promote the interests of
Chiron Corporation by providing eligible employees with the opportunity to
acquire a proprietary interest in the Corporation through participation in a
payroll-deduction based employee stock purchase plan designed to qualify under
Section 423 of the Code. The Plan shall serve as the successor to the
Corporation's existing 1988 Employee Stock Purchase Plan (the "Predecessor
Plan") and shall supersede the Predecessor Plan as of the Effective Date.
Capitalized terms herein shall have the meanings assigned to such terms in
the attached Appendix.
II. ADMINISTRATION OF THE PLAN
The Plan Administrator shall have full authority to interpret and construe
any provision of the Plan and to adopt such rules and regulations for
administering the Plan as it may deem necessary in order to comply with the
requirements of Code Section 423. Decisions of the Plan Administrator shall be
final and binding on all parties having an interest in the Plan.
III. STOCK SUBJECT TO PLAN
A. The stock purchasable under the Plan shall be shares of authorized but
unissued or reacquired Common Stock, including shares of Common Stock purchased
on the open market. The maximum number of shares of Common Stock which may be
issued over the term of the Plan is: (i) the number of shares that remain
available for issuance under the Predecessor Plan following the last purchase
date thereunder (not to exceed 600,000 shares) plus (ii) an additional increase
of 8,000,000 shares.
B. Should any change be made to the Common Stock by reason of any stock
split, stock dividend, recapitalization, combination of shares, exchange of
shares or other change affecting the outstanding Common Stock as a class without
the Corporation's receipt of consideration, appropriate adjustments shall be
made to (i) the maximum number and class of securities issuable under the Plan,
(ii) the maximum number and class of securities purchasable per Participant and
(iii) the number and class of securities and the price per share in effect under
each outstanding purchase right in order to prevent the dilution or enlargement
of benefits thereunder.
IV. OFFERING PERIODS
A. Common Stock shall be offered for purchase under the Plan through a
series of successive offering periods until (i) all shares of Common Stock
available under the Plan have been purchased or (ii), if earlier, the Plan is
terminated.
1
<PAGE>
B. The Plan Administrator shall determine the start date and the length
(not to exceed twenty-seven (27) months) of each offering period.
C. Each offering period shall be comprised of a series of one or more
successive Purchase Intervals. The length of the Purchase Intervals shall be
determined by the Plan Administrator.
D. Unless and until the Plan Administrator determines otherwise, each
offering period shall be twenty-seven (27) months long and consist of nine (9)
quarterly Purchase Intervals.
V. ELIGIBILITY
A. Each individual who is an Eligible Employee on the start date of any
offering period under the Plan may enter that offering period on such start date
or, unless the Plan Administrator determines otherwise for any offering period,
on the first day of any Purchase Interval within that offering period, provided
he or she remains an Eligible Employee on that date.
B. Each individual who first becomes an Eligible Employee after the start
date of an offering period may enter that offering period on the first day of
the next Purchase Interval within that offering period or, unless the Plan
Administrator determines otherwise for an offering period, on the first day of
any subsequent Purchase Interval within that offering period, provided he or she
remains an Eligible Employee on that date.
C. The date an individual enters an offering period shall be designated
his or her Entry Date for purposes of that offering period.
D. To participate in the Plan for a particular offering period, the
Eligible Employee must complete the enrollment forms prescribed by the Plan
Administrator and file such forms with the Plan Administrator (or its designate)
fifteen (15) days (or such other interval as the Plan Administrator shall
specify) before his or her scheduled Entry Date.
VI. PAYROLL DEDUCTIONS
A. Unless the Plan Administrator specifies otherwise for any offering
period, the minimum and maximum percentage of Cash Earnings which each
Participant may contribute to the Plan through payroll deductions during an
offering period shall be three percent (3%) and fifteen percent (15%),
respectively. The Plan Administrator may specify a different minimum and
maximum for any offering period; provided, however, that the minimum percentage
shall not be less than one percent (1%) and the maximum percentage shall not
exceed fifteen percent (15%). Each Participant may then authorize a level of
payroll deduction to be in effect for such offering period in any multiple
(within the minimum and maximum) of one percent (1%) of the Cash Earnings paid
to him or her during each Purchase Interval within that offering period, up to
the maximum percentage established by the Plan Administrator for such offering
period. The deduction rate authorized by the Participant shall continue in
effect throughout the offering period, except to the extent such rate is changed
in accordance with the following guidelines:
2
<PAGE>
(i) The Participant may, at any time during the offering period
and subject to such advance notice requirements as the Plan Administrator
shall specify, reduce his or her rate of payroll deduction by filing the
appropriate form with the Plan Administrator. The Participant may not,
however, effect more than one (1) such reduction per Purchase Interval.
(ii) The Participant may, no later than ten (10) days (or such
other period as the Plan Administrator shall specify) before the start of a
Purchase Interval within the offering period, increase the rate of his or
her payroll deduction by filing the appropriate form with the Plan
Administrator. The new rate (which may not exceed the maximum percentage)
shall become effective on the start date of the first Purchase Interval
following the filing of such form.
B. Payroll deductions shall begin on the first pay day following the
Participant's Entry Date into the offering period and shall (unless sooner
terminated by the Participant) continue through the pay day ending with or
immediately before the last day of that offering period. The amount deducted
shall be credited to the Participant's book account under the Plan, but no
interest shall be paid on the balance from time to time outstanding in such
account. The amounts collected from the Participant shall not be held in any
segregated account or trust fund and may be commingled with the general assets
of the Corporation and used for general corporate purposes.
C. Payroll deductions shall automatically cease upon the termination of
the Participant's purchase right.
VII. PURCHASE RIGHTS
A. GRANT OF PURCHASE RIGHT. A Participant shall be granted a separate
purchase right for each offering period in which he or she participates. The
purchase right shall be granted on the first day of the offering period (or the
first day that he or she is eligible to participate, in the case of a
Participant who was not an Eligible Employee on the first day of the offering
period) and shall provide the Participant with the right to purchase shares of
Common Stock, in a series of successive installments over the remainder of such
offering period, upon the terms set forth herein. The Participant shall, if the
Plan Administrator so requires, execute a stock purchase agreement embodying
such terms and such other provisions (not inconsistent with the Plan) as the
Plan Administrator may deem advisable.
Under no circumstances shall purchase rights be granted under the Plan to
any Eligible Employee if such individual would, immediately after the grant, own
(within the meaning of Code Section 424(d)) or hold outstanding options or other
rights to purchase, stock possessing five percent (5%) or more of the total
combined voting power or value of all classes of stock of the Corporation or any
Corporate Affiliate.
B. EXERCISE OF THE PURCHASE RIGHT. Each purchase right not previously
terminated will be automatically exercised in installments on each successive
Purchase Date within the offering period. The purchase shall be effected by
applying the Participant's payroll deductions for the Purchase Interval ending
on such Purchase Date to the purchase of whole shares of Common Stock at the
3
<PAGE>
purchase price in effect for the Participant for that Purchase Date.
C. PURCHASE PRICE. The purchase price per share at which Common Stock
will be purchased on the Participant's behalf on each Purchase Date shall be
determined, by dollar amount or by formula, before the beginning of the offering
period. However, the purchase price may not be less than (and, until the Plan
Administrator determines otherwise, will be) eighty-five percent (85%) of the
lower of (i) the Fair Market Value per share of Common Stock on the first day of
the offering period (or the first day that the Participant became eligible to
participate, in the case of a Participant who was not an Eligible Employee on
the first day of the offering period) or (ii) the Fair Market Value per share of
Common Stock on each such Purchase Date.
D. NUMBER OF PURCHASABLE SHARES. The number of shares of Common Stock
purchasable by a Participant on each Purchase Date during an offering period
shall be the number of whole shares obtained by dividing the amount collected
from the Participant through payroll deductions during the Purchase Interval
ending with that Purchase Date by the purchase price in effect for the
Participant for that Purchase Date. However, the maximum number of shares of
Common Stock purchasable per Participant during any one offering period shall be
twenty-four thousand (24,000) shares (or such other number as the Plan
Administrator shall specify), subject to periodic adjustments in the event of
certain changes in the Corporation's capitalization, prorated, based on the
number of months in the offering period to the extent an offering period is
shorter than twenty-seven (27) months.
E. EXCESS PAYROLL DEDUCTIONS. Any payroll deductions not applied to the
purchase of shares of Common Stock on any Purchase Date because they are not
sufficient to purchase a whole share of Common Stock shall be held for the
purchase of Common Stock on the next Purchase Date. However, any payroll
deductions not applied to the purchase of Common Stock by reason of the
limitation on the maximum number of shares purchasable by the Participant on the
Purchase Date shall be promptly refunded.
F. TERMINATION OF PURCHASE RIGHT.
(i) A Participant may, not later than ten (10) days (or such other
period as the Plan Administrator shall specify) before the next scheduled
Purchase Date in the offering period, terminate his or her outstanding
purchase right by filing the appropriate form with the Plan Administrator
(or its designate), and no further payroll deductions shall be collected
from the Participant with respect to the terminated purchase right. Any
payroll deductions collected during the Purchase Interval in which such
termination occurs shall be immediately refunded as soon as practicable or,
if the Plan Administrator permits for an offering period and the
Participant so elects, held for the purchase of shares on the next Purchase
Date.
(ii) The termination of such purchase right shall be irrevocable
and the Participant may not subsequently rejoin the Purchase Interval in
which the purchase right was terminated or, unless the Plan Administrator
determines otherwise for an offering period, the next Purchase Interval, if
any, within that offering period. In order to resume participation in the
current or any subsequent offering period, such individual must re-enroll
4
<PAGE>
in the Plan (by making a timely filing of any prescribed enrollment forms).
(iii) Should the Participant cease to remain an Eligible Employee
for any reason while his or her purchase right remains outstanding, then
that purchase right shall immediately terminate, and the Participant's
payroll deductions for the Purchase Interval in which the purchase right
terminates shall be refunded as soon as practicable. However, unless the
Plan Administrator determines otherwise for an offering period, should the
Participant die or become permanently disabled while in Eligible Employee
status, the Participant or the person or persons to whom the rights of the
deceased Participant under the Plan are transferred by will or by the laws
of descent and distribution shall have the election, exercisable up until
ten (10) days (or such other period as the Plan Administrator shall
specify) before the next purchase date following the date that the
Participant dies or becomes permanently disabled, to (i) withdraw all the
funds in the Participant's payroll account at the time of his/her cessation
of Eligible Employee status or (ii) have such funds held for the purchase
of shares on such next Purchase Date. If such an election is offered to a
Participant, but no election is made by the Participant, then such funds
shall automatically be held for the purchase of shares on the next Purchase
Date. In no event, however, shall any further payroll deductions be added
to the Participant's account following his/her cessation of Employee
status. For purposes of the Plan, a Participant shall be deemed to be
permanently disabled if he/she is unable, by reason of any medically
determinable physical or mental impairment expected to result in death or
to be of continuous duration of at least twelve (12) months, to engage in
any substantial gainful employment.
(iv) Should the Participant cease to remain in active service by
reason of an approved unpaid leave of absence, then, unless the Participant
elects to terminate his or her Purchase Right, the funds collected from
the Participant during the Purchase Interval in which active service ceases
shall be held for the purchase of shares on his or her behalf on the next
scheduled Purchase Date. No further payroll deductions will be collected
on the Participant's behalf during such leave. Upon the Participant's
return to active service, his or her payroll deductions under the Plan will
automatically resume at the rate in effect at the time the leave began,
unless the Participant withdraws from the Plan prior to his or her return.
G. CORPORATE TRANSACTION. Each outstanding purchase right shall
automatically be exercised, immediately before the effective date of any
Corporate Transaction, by applying the payroll deductions of each Participant
for the Purchase Interval in which such Corporate Transaction occurs to the
purchase of whole shares of Common Stock at a purchase price per share
determined as if such date were a regular Purchase Date. However, the
applicable limitation on the number of shares of Common Stock purchasable per
Participant shall continue to apply to any such purchase.
The Corporation shall use its best efforts to provide at least ten
(10)-days prior written notice of the occurrence of any Corporate Transaction,
and Participants shall, following the receipt of such notice, have the right to
terminate their outstanding purchase rights before the effective date of the
Corporate Transaction.
5
<PAGE>
H. PRORATION OF PURCHASE RIGHTS. The Plan Administrator may limit the
total number of shares that may be purchased in an offering period. Should the
total number of shares of Common Stock to be purchased pursuant to outstanding
purchase rights on any particular date exceed the number of shares remaining
available for issuance under the Plan or such offering period, the Plan
Administrator shall make a pro-rata allocation of the available shares on a
uniform and nondiscriminatory basis, and the payroll deductions of each
Participant, to the extent in excess of the aggregate purchase price payable for
the Common Stock pro-rated to such individual, shall be refunded.
I. ASSIGNABILITY. The purchase right shall be exercisable only by the
Participant and shall not be assignable or transferable by the Participant other
than, to the extent permitted herein, by will or by the laws of descent and
distribution, and during the Participant's lifetime the purchase rights shall be
exercisable only by the Participant.
J. STOCKHOLDER RIGHTS. A Participant shall have no stockholder rights
with respect to the shares subject to his or her outstanding purchase right
until the shares are purchased on the Participant's behalf in accordance with
the provisions of the Plan and the Participant has become a holder of record of
the purchased shares.
VIII. ACCRUAL LIMITATIONS
A. No Participant shall be entitled to accrue rights to acquire Common
Stock pursuant to any purchase right outstanding under this Plan if and to the
extent such accrual, when aggregated with (i) rights to purchase Common Stock
accrued under any other purchase right granted under this Plan and (ii) similar
rights accrued under other employee stock purchase plans (within the meaning of
Code Section 423) of the Corporation or any Corporate Affiliate, would otherwise
permit such Participant to purchase more than Twenty-Five Thousand Dollars
($25,000) worth of stock of the Corporation or any Corporate Affiliate
(determined on the basis of the Fair Market Value per share on the date or dates
such rights are granted) for each calendar year such rights are at any time
outstanding.
B. For purposes of applying such accrual limitations to the purchase
rights granted under the Plan, the following provisions shall be in effect:
(i) The right to acquire Common Stock under each outstanding
purchase right shall accrue in a series of installments on each successive
Purchase Date during the offering period on which such right remains
outstanding.
(ii) No right to acquire Common Stock under any outstanding
purchase right shall accrue to the extent the Participant has already
accrued in the same calendar year the right to acquire Common Stock under
one (1) or more other purchase rights at a rate equal to Twenty-Five
Thousand Dollars ($25,000) worth of Common Stock (determined on the basis
of the Fair Market Value per share on the date or dates of grant) for each
calendar year such rights were at any time outstanding.
C. If by reason of such accrual limitations, any purchase right of a
Participant does not
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accrue for a particular Purchase Interval, then the payroll deductions which the
Participant made during that Purchase Interval with respect to such purchase
right shall be promptly refunded.
D. In the event there is any conflict between the provisions of this
Article and one or more provisions of the Plan or any instrument issued
thereunder, the provisions of this Article shall be controlling.
IX. EFFECTIVE DATE AND TERM OF THE PLAN
A. The Plan was adopted by the Board on February 28, 1997 and shall
become effective at the Effective Time, provided that no purchase rights granted
under the Plan shall be exercised, and no shares of Common Stock shall be issued
hereunder, until (i) the Plan has been approved by the stockholders of the
Corporation and (ii) the Corporation has complied with all applicable
requirements of the 1933 Act (including the registration of the shares of Common
Stock issuable under the Plan on a Form S-8 registration statement filed with
the Securities and Exchange Commission), all applicable listing requirements of
any stock exchange (or the Nasdaq National Market, if applicable) on which the
Common Stock is listed for trading and all other applicable requirements
established by law or regulation. In the event such stockholder approval is not
obtained, or such compliance is not effected, within twelve (12) months after
the date on which the Plan is adopted by the Board, the Plan shall terminate and
have no further force or effect, and all sums collected from Participants during
the initial offering period hereunder shall be refunded.
B. Unless sooner terminated by the Board, the Plan shall terminate upon
the earliest of (i) February 28, 2007, (ii) the date on which all shares
available under the Plan have been issued or (iii) the date on which all
purchase rights are exercised in connection with a Corporate Transaction. No
further purchase rights shall be granted or exercised, and no further payroll
deductions shall be collected, under the Plan following such termination.
X. AMENDMENT OF THE PLAN
The Board may alter, amend, suspend or discontinue the Plan at any time to
become effective immediately following the close of any Purchase Interval.
However, the Board may not, without the approval of the Corporation's
stockholders, increase the number of shares of Common Stock issuable under the
Plan, except for permissible adjustments in the event of certain changes in the
Corporation's capitalization. The Plan Administrator may amend or modify
outstanding purchase rights, provided however, that no such action shall
adversely affect purchase rights at the time outstanding under the Plan unless
the holder consents thereto. The Corporation may institute additional equity
compensation programs for some or all of the employees of the Corporation and/or
its affiliates, which programs shall not be considered an amendment to this
Plan.
XI. GENERAL PROVISIONS
A. All costs and expenses incurred in the administration of the Plan
shall be paid by the Corporation.
B. Nothing in the Plan shall confer upon the Participant any right to
continue in the
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employ of the Corporation or any Corporate Affiliate for any period of specific
duration or interfere with or otherwise restrict in any way the rights of the
Corporation (or any Corporate Affiliate employing such person) or of the
Participant, which rights are hereby expressly reserved by each, to terminate
such person's employment at any time for any reason, with or without cause.
C. The provisions of the Plan shall be governed by the laws of the State
of California without resort to that State's conflict-of-laws rules.
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Schedule A
Corporations Participating in
Employee Stock Purchase Plan
As of the Effective Time
Chiron Corporation
Chiron Diagnostics Corporation
Chiron Beta Corporation
Chiron Investment Corporation
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APPENDIX
The following definitions shall be in effect under the Plan:
A. BOARD means the Corporation's Board of Directors.
B. CASH EARNINGS means (i) the regular basic cash earnings paid to a
Participant by one or more Participating Corporations plus (ii) any amount which
the Participant would have received in cash but for an election under a
cafeteria plan (within the meaning of Code Section 125) or a qualified salary
deferral arrangement (within the meaning of Code Section 401(k)). However, Cash
Earnings shall not include (I) overtime payments, bonuses, commissions,
profit-sharing distributions and other incentive-type payments other than
commissions and bonuses that constitute an integral, recurring part of a
Participant's compensation, as determined by the Plan Administrator, or (II) any
contributions (other than Code Section 401(k) or Code Section 125 contributions)
made on the Participant's behalf by the Corporation or any Corporate Affiliate
under any employee pension or welfare benefit plan now or hereafter established.
C. CODE shall mean the Internal Revenue Code of 1986, as amended.
D. COMMON STOCK shall mean the Corporation's common stock.
E. CORPORATE AFFILIATE shall mean any parent or subsidiary corporation of
the Corporation (as determined in accordance with Code Section 424), whether now
existing or subsequently established.
F. CORPORATE TRANSACTION shall mean either of the following
stockholder-approved transactions to which the Corporation is a party:
(i) a merger or consolidation in which securities possessing more
than fifty percent (50%) of the total combined voting power of the
Corporation's outstanding securities are transferred to a person or persons
different from the persons holding those securities immediately prior to
such transaction, or
(ii) the sale, transfer or other disposition of all or
substantially all of the assets of the Corporation in complete liquidation
or dissolution of the Corporation.
G. CORPORATION shall mean Chiron Corporation, a Delaware corporation, and
any corporate successor to all or substantially all of the assets or voting
stock of Chiron Corporation, which shall by appropriate action adopt the Plan.
H. EFFECTIVE DATE shall mean such date after the 1997 Annual Stockholders
Meeting as the Plan Administrator shall select for the first day of the first
offering period under the Plan, provided the Plan is approved by the
stockholders at that meeting. Any Corporate Affiliate which becomes a
Participating Corporation after such Effective Date shall designate a subsequent
Effective Date with respect to its employee-Participants.
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I. ELIGIBLE EMPLOYEE shall mean any person who is employed by a
Participating Corporation on a basis under which he or she is regularly expected
to render twenty (20) hours of service or more per week for more than five (5)
months per calendar year for earnings considered wages under Code
Section 3401(a).
J. ENTRY DATE shall mean the date an Eligible Employee first commences
participation in the offering period in effect under the Plan.
K. FAIR MARKET VALUE per share of Common Stock on any relevant date shall
be determined in accordance with the following provisions:
(i) If the Common Stock is at the time listed on any Stock
Exchange, then the Fair Market Value shall be the average of the high and
low selling prices per share of Common Stock on the date in question on the
Stock Exchange determined by the Plan Administrator to be the primary
market for the Common Stock, as such prices are officially quoted in the
composite tape of transactions on such exchange. If there are no high or
low selling prices for the Common Stock on the date in question, then the
Fair Market Value shall be the average of the high and low selling prices
on the last preceding date for which such quotations exist.
(ii) If the Common Stock is at the time traded on the Nasdaq
National Market, then the Fair Market Value shall be the average of the
high and low selling prices per share of Common Stock on the date in
question, as such prices are reported by the National Association of
Securities Dealers on the Nasdaq National Market or any successor system.
If there are no high or low selling prices for the Common Stock on the date
in question, then the Fair Market Value shall be the average of the high
and low selling prices on the last preceding date for which such quotations
exist.
L. 1933 ACT shall mean the Securities Act of 1933, as amended.
M. PARTICIPANT shall mean any Eligible Employee of a Participating
Corporation who is actively participating in the Plan.
N. PARTICIPATING CORPORATION shall mean the Corporation and such Corporate
Affiliates as may be authorized from time to time by the Board to extend the
benefits of the Plan to their Eligible Employees. The Participating
Corporations in the Plan as of the Effective Time are listed in attached
Schedule A.
O. PLAN shall mean the Corporation's Employee Stock Purchase Plan, as set
forth in this document.
P. PLAN ADMINISTRATOR shall mean the Board or, if the Board so determines,
a committee of Board members appointed by the Board or the delegate of either.
Q. PREDECESSOR PLAN shall mean the Corporation's 1988 Employee Stock
Purchase Plan.
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R. PURCHASE DATE shall mean the last business day of each Purchase
Interval.
S. PURCHASE INTERVAL shall mean each successive period within the offering
period at the end of which there shall be purchased shares of Common Stock on
behalf of each Participant.
T. STOCK EXCHANGE shall mean either the American Stock Exchange or the New
York Stock Exchange.
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