As filed with the Securities and Exchange
Commission on ____________, 1995
Registration No. 33-56988
- -----------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------------
-----------------
POST-EFFECTIVE AMENDMENT NO. 1
TO
FORM S-8
REGISTRATION STATEMENT
Under
The Securities Act of 1933
-----------------------------
SOMATIX THERAPY CORPORATION
(Exact name of Registrant as specified in its charter)
-----------------------
DELAWARE 94-2762045
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
850 MARINA VILLAGE PARKWAY
ALAMEDA, CALIFORNIA 94501
(Address of principal executive offices) (Zip code)
----------------------
SOMATIX THERAPY CORPORATION
1992 STOCK OPTION PLAN
(Full title of the Plan)
----------------------
David W. Carter
President and Chief Executive Officer
SOMATIX THERAPY CORPORATION
850 Marina Village Parkway, Alameda, California 94501
(510) 748-3000
(Telephone number, including area code, of agent for service)
----------------------
This Post-Effective Amendment No. 1 to the Registration Statement
shall hereafter become effective in accordance with the provisions
of Section 8(c) of the Securities Act of 1933.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 8. Exhibits
--------
Exhibit Number Exhibit
- ------------- -------
5 Opinion and consent of Brobeck, Phleger &
Harrison.*
23.1 Consent of Independent Auditors - Ernst & Young.*
23.2 Consent of Brobeck, Phleger & Harrison is
contained in Exhibit 5.*
24 Power of Attorney. Reference is made to page
II-4 of this Registration Statement.*
99.1 Somatix Therapy Corporation 1992 Stock Option
Plan.
99.2 Form Notice of Grant with Stock Option Agreement
(incorporated by reference to Exhibit 28.2 of
Registration Statement No. 33-56988).
___________________
* Previously filed with Registration Statement No. 33-87632
on December 19, 1994.
II-1.
<PAGE>
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 Post-Effective
Amendment No. 1 to the Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City
of Alameda, State of California, on ______________, 1995.
SOMATIX THERAPY CORPORATION
By: DAVID W. CARTER
----------------------
David W. Carter
President, Chief Executive
Officer and Chairman of the
Board of Directors
Pursuant to the requirements of the Securities Act
of 1933, as amended, this Post-Effective Amendment No. 1 to the
Registration Statement has been signed below by the following
persons in the capacities and on the dates indicated.
<TABLE>
<S> <C> <C>
Signatures Title Date
- ---------- ----- ----
DAVID W. CARTER President, Chief Executive Officer and December 12, 1995
- ---------------------------- and Chairman of the Board of Directors
David W. Carter (Principal Executive Officer)
MARK N. K. BAGNALL Vice President, Finance, Chief Financial December 12, 1995
- ---------------------------- Officer and Secretary (Principal Financial
Mark N. K. Bagnall and Accounting Officer)
*HARRY F. HIXSON, JR., PH.D. Director December 12, 1995
- ----------------------------
Harry F. Hixson, Jr., Ph.D.
*KAREN DAVIS, PH.D. Director December 12, 1995
- ----------------------------
Karen Davis, Ph.D.
*MICHAEL R. EISENSON Director December 12, 1995
- ----------------------------
Michael R. Eisenson
II-2.
<PAGE>
*FRED H. GAGE, PH.D Director December 12, 1995
- ---------------------------
Fred H. Gage, Ph.D.
*RICHARD C. MULLIGAN, PH.D. Director December 12, 1995
- ---------------------------
Richard C. Mulligan, Ph.D.
Director December 12, 1995
- ---------------------------
John T. Potts, Jr., M.D.
- --------------------------- Director December 12, 1995
Thomas E. Shenk, Ph.D.
Director December 12, 1995
- ---------------------------
Samuel D. Waksal, Ph.D.
Director December 12, 1995
- ---------------------------
Leon E. Rosenberg, M.D.
*By MARK N.K. BAGNALL
----------------------
Mark N.K. Bagnall
Attorney-in-Fact
</TABLE>
II-3.
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
EXHIBITS
TO
FORM S-8
UNDER
SECURITIES ACT OF 1933
SOMATIX THERAPY CORPORATION
<PAGE>
EXHIBIT INDEX
-------------
Exhibit
Number Exhibit
- ------- -------
5 Opinion and consent of Brobeck, Phleger &
Harrison.*
23.1 Consent of Independent Auditors - Ernst &
Young.*
23.2 Consent of Brobeck, Phleger & Harrison is
contained in Exhibit 5.*
24 Power of Attorney. Reference is made to
page II-4 of this Registration Statement.*
99.1 Somatix Therapy Corporation 1992 Stock
Option Plan.
99.2 Form Notice of Grant with Stock Option
Agreement (incorporated by reference to
Exhibit 28.2 of Registration Statement
No. 33-56988).
__________
* Previously filed with Registration Statement
No. 33-87632 on December 19, 1994.
<PAGE>
EXHIBIT 99.1
Somatix Therapy Corporation 1992 Stock Option Plan
SOMATIX THERAPY CORPORATION
1992 STOCK OPTION PLAN
(AS AMENDED THROUGH MARCH 15, 1995)
ARTICLE ONE
GENERAL PROVISIONS
I. PURPOSES OF THE PLAN
A. This 1992 Stock Option Plan (the "Plan") was
implemented, as of September 15, 1992 (the "Effective Date"), to
promote the interests of Somatix Therapy Corporation, a Delaware
corporation (the "Corporation"), by providing eligible individuals
with the opportunity to acquire a proprietary interest, or
otherwise increase their proprietary interest, in the Corporation
as an incentive for them to remain in the service of the
Corporation (or its parent or subsidiary corporations).
B. This Plan shall serve as the successor to the
Somatix Therapy Corporation 1983 Stock Option Plan (the "1983
Plan"), and no further option grants shall be made under the 1983
Plan from and after the Effective Date. All options outstanding
under the 1983 Plan on such Effective Date are hereby incorporated
into this Plan and shall accordingly be treated as outstanding
options under this Plan. However, each outstanding option so
incorporated shall continue to be governed solely by the express
terms and conditions of the instrument evidencing such grant, and
no provision of this Plan shall be deemed to affect or otherwise
modify the rights or obligations of the holders of such
incorporated options with respect to their acquisition of shares of
the Corporation's common stock thereunder or their exercise of any
outstanding stock appreciation rights thereunder.
C. For purposes of the Plan, the following provisions
shall be applicable in determining the parent and subsidiary
corporations of the Corporation:
Any corporation (other than the Corporation)
in an unbroken chain of corporations ending with the
Corporation shall be considered to be a PARENT
corporation of the Corporation, provided each such
corporation in the unbroken chain (other than the
Corporation) owns, at the time of the determination,
stock possessing fifty percent (50%) or more of the
total combined voting power of all classes of stock in
one of the other corporations in such chain.
Each corporation (other than the Corporation)
in an unbroken chain of corporations beginning with the
Corporation shall be considered to be a SUBSIDIARY of
the Corporation, provided each such corporation (other
<PAGE>
than the last corporation) in the unbroken chain owns,
at the time of the determination, stock possessing fifty
percent (50%) or more of the total combined voting power
of all classes of stock in one of the other corporations
in such chain.
II. STRUCTURE OF THE PLAN
A. The Plan shall be divided into two separate
components: the Discretionary Option Grant Program specified in
Article Two and the Automatic Option Grant Program specified in
Article Three. Under the Discretionary Option Grant Program,
eligible individuals may be granted options to purchase shares of
the Corporation's common stock. Under the Automatic Option Grant
Program, each eligible member of the Corporation's Board of
Directors (the "Board") will automatically receive a special option
grant to purchase shares of the Corporation's common stock.
B. The provisions of Articles One and Four of the Plan
shall apply to the Discretionary Option Grant Program and the
Automatic Option Grant Program and shall accordingly govern the
interests of all individuals in the Plan.
III. ADMINISTRATION OF THE PLAN
A. The Plan shall be administered by a committee
("Committee") of two (2) or more non-employee Board members
appointed by the Board. No Board member shall be eligible to serve
on the Committee if such individual has, within the twelve
(12)-month period immediately preceding the date he or she is to be
appointed to the Committee, received an option grant or stock
issuance under this Plan or any other stock plan of the Corporation
(or any parent or subsidiary corporation), other than pursuant to
the Automatic Option Grant Program. Members of the Committee shall
serve for such period of time as the Board may determine and shall
be subject to removal by the Board at any time.
B. The Committee as Plan Administrator shall have full
power and authority (subject to the express provisions of the Plan)
to establish such rules and regulations as it may deem appropriate
for the proper administration of the Discretionary Option Grant
Program and to make such determinations and interpretations
concerning such program and any outstanding option thereunder as it
may deem necessary or advisable. The decisions of the Plan
Administrator shall be final and binding on all parties with an
interest in any outstanding option under the Discretionary Option
Grant Program.
C. Administration of the Automatic Option Grant Program
shall be self-executing in accordance with the express terms and
conditions of Article Three.
2.
<PAGE>
IV. ELIGIBILITY FOR OPTION GRANTS
A. The persons eligible to participate in the
Discretionary Option Grant Program under Article Two of the Plan
shall be limited to the following:
(i) officers and other key employees of the
Corporation (or its parent or subsidiary corporations) who render
services which contribute to the management, growth and financial
success of the Corporation (or its parent or subsidiary
corporations);
(ii) non-employee members of the Board;
(iii) non-employee members of the board of directors
of any parent or subsidiary corporation; and
(iv) those consultants or other independent advisors
who provide valuable services to the Corporation (or its parent or
subsidiary corporations).
B. Members of the Committee while serving as the Plan
Administrator shall not be eligible to receive any stock options,
stock appreciation rights, direct stock issuances or other stock
awards under this Plan or any other stock plan of the Corporation
or its parent or subsidiary corporations, other than pursuant to
the Automatic Option Grant Program under Article Three.
C. The Plan Administrator shall have full authority to
determine which eligible individuals are to receive discretionary
option grants under Article Two, the number of shares to be covered
by each such grant, whether the granted option is to be an
incentive stock option ("Incentive Option") which satisfies the
requirements of Section 422 of the Internal Revenue Code or a
non-statutory option not intended to meet such requirements, the
time or times at which each such option is to become exercisable,
and the maximum term for which the option is to remain outstanding.
V. STOCK SUBJECT TO THE PLAN
A. Shares of the Corporation's common stock, par value
$0.01 per share ("Common Stock") shall be available for issuance
under the Plan and shall be drawn from either the Corporation's
authorized but unissued shares of Common Stock or from reacquired
shares of Common Stock, including shares repurchased by the
Corporation on the open market. The aggregate number of shares
available for issuance under the Plan
3.
<PAGE>
from and after the Effective Date shall not exceed 3,200,000 1/
shares of Common Stock, subject to adjustment from time to time in
accordance with the provisions of this Section V. Such authorized
share reserve is comprised of (i) the aggregate number of shares
which remained available for issuance under the 1983 Plan as of the
Effective Date of this Plan, including (a) the shares subject to
the outstanding options incorporated into this Plan from the 1983
Plan and any other shares which would have been available for
future option grant under the 1983 Plan plus (b) the increase of
300,000 shares of Common Stock to the 1983 Plan authorized by the
Board in June 1992 and approved by the stockholders at the 1992
Annual Meeting, (ii) the increase of 400,000 shares of Common Stock
to this Plan authorized by the Board in September 1992 and approved
by the stockholders at the 1992 Annual Meeting and (iii) the
additional increase of 1,000,000 shares of Common Stock to this
Plan authorized by the Board in September 1994 and approved by the
stockholders at the 1994 Annual Meeting. To the extent one or more
outstanding options under the 1983 Plan which have been
incorporated into this Plan are subsequently exercised, the number
of shares issued with respect to each such option shall reduce, on
a share-for-share basis, the number of shares available for
issuance under this Plan.
B. In no event may any individual participating in the
Plan be granted stock options or separately exercisable stock
appreciation rights after August 31, 1994 for more than twenty-five
percent (25%) of the total number of shares of Common Stock
available for issuance under the Plan from and after that date,
including any and all share increases subsequently approved by the
stockholders. For purposes of this limitation, no stock options or
stock appreciation rights granted prior to September 1, 1994 shall
be taken into account.
C. Should one or more outstanding options under this
Plan (including any outstanding options under the 1983 Plan
incorporated into this Plan) expire or terminate for any reason
prior to exercise in full (including any option cancelled in
accordance with the cancellation-regrant provisions of Section IV
of Article Two of the Plan), the shares subject to the portion of
the option not so exercised shall be available for subsequent
option grant under the Plan. Shares subject to any option or
portion thereof surrendered or cancelled in accordance with
Section V of Article Two and Section III of Article Three and
shares repurchased by the Corporation pursuant to its repurchase
rights under the Plan shall not be available for subsequent option
grant under the Plan. Should the exercise price of an outstanding
option under the Plan (including any option incorporated from the
1983 Plan) be paid with shares of Common Stock or should shares of
Common Stock otherwise issuable under the Plan be withheld by the
Corporation in satisfaction of the withholding taxes incurred in
connection with the exercise of an outstanding option under the
Plan, then the number of shares available for issuance under the
Plan shall be reduced by the gross
_________________________
1/ Not more than 2,987,562 shares may be issued under the Plan
from and after August 31, 1994, subject to periodic adjustment under
Section V of Article One.
4.
<PAGE>
number of shares for which the option is exercised, and not by the
net number of shares of Common Stock issued to the option holder.
D. In the event any change is made to the Common Stock
issuable under the Plan 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 receipt of consideration, then appropriate
adjustments shall be made to (i) the maximum number and/or class of
securities issuable under the Plan, (ii) the maximum number and/or
class of securities for which any one individual participating in
the Plan may be granted stock options or separately exercisable
stock appreciation rights in the aggregate after August 31, 1994,
(iii) the number and/or class of securities and price per share in
effect under each outstanding option under the Plan (including each
outstanding option incorporated into this Plan from the 1983 Plan),
and (iv) the number and/or class of securities for option grants
are subsequently to be made to each newly elected non-employee
Board member under the Automatic Option Grant Program. The purpose
of such adjustments to the outstanding options shall be to preclude
the enlargement or dilution of rights and benefits under such
options. The adjustments determined by the Plan Administrator
shall be final, binding and conclusive.
5.
<PAGE>
ARTICLE TWO
OPTION GRANTS
I. TERMS AND CONDITIONS OF OPTIONS
Options granted pursuant to this Article Two shall be
authorized by action of the Plan Administrator and may, at the Plan
Administrator's discretion, be either Incentive Options or non-
statutory options. Individuals who are not Employees may only be
granted non-statutory options. Each option granted shall be
evidenced by one or more instruments in the form approved by the
Plan Administrator. Each such instrument shall, however, comply
with the terms and conditions specified below, and each instrument
evidencing an Incentive Option shall, in addition, be subject to
the applicable provisions of Section II of this Article Two.
A. Option Price.
1. The option price per share shall be fixed
by the Plan Administrator. In no event, however, shall the option
price per share be less than eighty-five percent (85%) of the fair
market value per share of Common Stock on the date of the option
grant.
2. The option price shall become immediately
due upon exercise of the option and, subject to the provisions of
Section VI of this Article Two and the instrument evidencing the
grant, shall be payable in one of the following alternative forms:
- cash or check made payable to the
Corporation's order;
- shares of Common Stock held by the
optionee for the requisite period necessary to avoid a
charge to the Corporation's earnings for financial
reporting purposes and valued at fair market value on
the Exercise Date (as such term is defined below); or
- to the extent the option is exercised for
fully vested shares, through a broker-dealer sale and
remittance procedure pursuant to which the optionee
shall provide irrevocable written instructions (I) to
a designated brokerage firm to effect the immediate sale
of the purchased shares and remit to the Corporation,
out of the sale proceeds available on the settlement
date, sufficient funds to cover the aggregate option
price payable for the purchased shares plus all
applicable Federal and State income and employment taxes
required to be withheld by the Corporation in connection
with such purchase and (II) to the Corporation to
deliver the certificates for
6.
<PAGE>
the purchased shares directly to such brokerage firm
in order to complete the sale transaction.
For purposes of this subparagraph 2, the Exercise
Date shall be the date on which written notice of the option
exercise is delivered to the Corporation. Except to the extent the
sale and remittance procedure is used in connection with the
exercise of the option, payment of the option price for the
purchased shares must accompany such notice.
3. The fair market value per share of Common Stock
on any relevant date under the Plan shall be determined in
accordance with the following provisions:
- If the Common Stock is not at the time
listed or admitted to trading on any national securities
exchange but is traded on the Nasdaq National Market,
the Fair Market Value shall be the closing selling price
per share of Common Stock on the date in question, as
such price is reported by the National Association of
Securities Dealers on the Nasdaq National Market or any
successor system. If there is no closing selling price
for the Common Stock on the date in question, then the
closing selling price on the last preceding date for
which such quotation exists on the Nasdaq National
Market shall be determinative of Fair Market Value.
- If the Common Stock is at the time listed
or admitted to trading on any national securities
exchange, then the Fair Market Value shall be the
closing selling price per share of Common Stock on the
date in question on the securities exchange determined
by the Plan Administrator to be the primary market for
the Common Stock, as such price is officially quoted in
the composite tape of transactions on such exchange. If
there is no reported sale of Common Stock on such
exchange on the date in question, then the Fair Market
Value shall be the closing selling price on the exchange
on the last preceding date for which such quotation
exists.
B. Term and Exercise of Options.
Each option granted under this Article Two shall be
exercisable at such time or times, during such period, and for such
number of shares as shall be determined by the Plan Administrator
and set forth in the instrument evidencing the option grant. No
such option, however, shall have a maximum term in excess of ten
(10) years from the grant date. During the lifetime of the
optionee, the option, together with any stock appreciation right
pertaining to such option, shall be exercisable only by the
optionee and shall not be assignable or transferable by the
optionee except for a transfer of the option by will or by the laws
of descent and distribution following the optionee's death.
7.
<PAGE>
C. Termination of Service.
1. Except to the extent otherwise provided
pursuant to Section VII of this Article Two, the following
provisions shall govern the exercise period applicable to any
options held by the optionee at the time of cessation of Service or
death:
- Should the optionee cease to remain in
Service for any reason other than death or permanent
disability, then the period for which each outstanding
option held by such optionee is to remain exercisable
shall be limited to the three (3)-month period following
the date of such cessation of Service.
- In the event such Service terminates by
reason of permanent disability (as defined in Section
22(e)(3) of the Internal Revenue Code), then the period
for which each outstanding option held by the optionee
is to remain exercisable shall be limited to the twelve
(12)-month period following the date of such cessation
of Service.
- Should the optionee die while in Service
or during the three (3)-month period following his or
her cessation of Service, then the period for which each
of his or her outstanding options is to remain
exercisable shall be limited to the twelve (12)-month
period following the date of the optionee's cessation of
service. During such limited period, the option may be
exercised by the personal representative of the
optionee's estate or by the person or persons to whom
the option is transferred pursuant to the optionee's
will or in accordance with the laws of descent and
distribution.
- Under no circumstances, however, shall any
option be exercisable after the specified expiration
date of the option term.
- During the applicable post-Service
exercise period, the option may not be exercised in
the aggregate for more than the number of shares (if
any) for which that option is exercisable at the time
of the optionee's cessation of Service. Upon the
expiration of the limited post-Service exercise period
or (if earlier) upon the specified expiration date of
the option term, each such option shall terminate and
cease to remain outstanding with respect to any shares
for which the option was exercisable at the time of the
optionee's cessation of Service but for which that
option has not otherwise been exercised. However, each
outstanding option held by the optionee shall terminate
and cease to remain outstanding, immediately upon such
optionee's cessation of Service, with respect to any
shares for which the option is not otherwise at that
time exercisable or in which the optionee is not
otherwise vested.
8.
<PAGE>
2. The Plan Administrator shall have complete
discretion, exercisable either at the time the option is granted or
at any time while the option remains outstanding, to permit one or
more options held by the optionee under this Article Two to be
exercised, during the limited period of exercisability provided
under subparagraph 1 above, not only with respect to the number of
shares for which each such option is exercisable at the time of the
optionee's cessation of Service but also with respect to one or
more subsequent installments of purchasable shares for which the
option would otherwise have become exercisable had such cessation
of Service not occurred.
3. For purposes of the foregoing provisions of
this Section I.C (and for all other purposes under the Plan):
- The optionee shall be deemed to remain in
the SERVICE of the Corporation for so long as such
individual renders services on a periodic basis to the
Corporation (or any parent or subsidiary corporation) in
the capacity of an Employee, a non-employee member of
the Board or an independent consultant or advisor.
- The optionee shall be considered to be an
EMPLOYEE for so long as such individual remains in the
employ of the Corporation or one or more of its parent
or subsidiary corporations, subject to the control and
direction of the employer entity as to the work to be
performed and the manner and method of performance.
D. Stockholder Rights.
An optionee shall have no stockholder rights with
respect to any shares covered by the option until such individual
shall have exercised the option and paid the option price for the
purchased shares.
II. INCENTIVE OPTIONS
The terms and conditions specified below shall be
applicable to all Incentive Options granted under this Article Two.
Incentive Options may only be granted to individuals who are
Employees. Options which are specifically designated as "non-
statutory" options when issued under the Plan shall not be subject
to such terms and conditions.
A. Option Price. The option price per share of the
Common Stock subject to an Incentive Option shall in no event be
less than one hundred percent (100%) of the fair market value of
such Common Stock on the grant date.
B. Dollar Limitation. The aggregate fair market value
(determined as of the respective date or dates of grant) of the
Common Stock for which one or more options granted to any Employee
under this Plan (or any other option plan of the Corporation or
9.
<PAGE>
its parent or subsidiary corporations) may for the first time
become exercisable as incentive stock options under the Federal tax
laws during any one calendar year shall not exceed the sum of One
Hundred Thousand Dollars ($100,000). To the extent the Employee
holds two or more such options which become exercisable for the
first time in the same calendar year, the foregoing limitation on
the exercisability of such options as incentive stock options under
the Federal tax laws shall be applied on the basis of the order in
which such options are granted. Should the number of shares of
Common Stock for which any Incentive Option first becomes
exercisable in any calendar year exceed the applicable One Hundred
Thousand Dollar ($100,000) limitation, then the option may
nevertheless be exercised in that calendar year for the excess
number of shares as a non-statutory option under the Federal tax
laws.
C. 10% Stockholder. If any individual to whom an
Incentive Option is granted is the owner of stock (as determined
under Section 424(d) of the Internal Revenue Code) possessing 10%
or more of the total combined voting power of all classes of stock
of the Corporation or any one of its parent or subsidiary
corporations ("10% Stockholder"), then the option price per share
shall not be less than one hundred and ten percent (110%) of the
fair market value per share of Common Stock on the grant date, and
the option term shall not exceed five (5) years measured from the
grant date.
Except as modified by the preceding provisions of this
Section II, the provisions of the Plan shall apply to all Incentive
Options granted hereunder.
III. CORPORATE TRANSACTIONS/CHANGES IN CONTROL
A. In the event of any of the following stockholder-
approved transactions (a "Corporate Transaction"):
(i) a merger or consolidation in which
the Corporation is not the surviving entity, except
for a transaction the principal purpose of which is to
change the State of the Corporation's incorporation,
(ii) the sale, transfer or other
disposition of all or substantially all of the assets
of the Corporation in liquidation or dissolution of the
Corporation, or
(iii) any reverse merger in which the
Corporation is the surviving entity but in which
securities possessing more than fifty percent (50%)
of the total combined voting power of the Corporation's
outstanding securities are transferred to holders
different from those who held such securities
immediately prior to such merger,
the exercisability of each option at the time
outstanding under this Article Two shall automatically accelerate
so that each such option shall, immediately prior
10.
<PAGE>
to the specified effective date for the Corporate Transaction,
become fully exercisable with respect to the total number of shares
of Common Stock at the time subject to such option and may be
exercised for all or any portion of such shares as fully-vested
shares. However, an outstanding option under this Article Two
shall NOT so accelerate if and to the extent: (i) such option is,
in connection with the Corporate Transaction, either to be assumed
by the successor corporation or parent thereof or be replaced with
a comparable option to purchase shares of the capital stock of the
successor corporation or parent thereof, (ii) such option is to be
replaced with a cash incentive program of the successor corporation
based on the option spread at the time of the Corporate
Transaction, or (iii) the acceleration of such option is subject to
other limitations imposed by the Plan Administrator at the time of
grant. The determination of comparability under clause (i) or
(ii) above shall be made by the Plan Administrator, and its
determination shall be final, binding and conclusive.
B. Immediately following the consummation of the
Corporate Transaction, all outstanding options under this Article
Two shall terminate and cease to be outstanding, except to the
extent assumed by the successor corporation or its parent company.
C. Each outstanding option under this Article Two which
is assumed in connection with the Corporate Transaction or is
otherwise to continue in effect shall be appropriately adjusted,
immediately after such Corporate Transaction, to apply and pertain
to the number and class of securities which would have been
issuable, in consummation of such Corporate Transaction, to an
actual holder of the same number of shares of Common Stock as are
subject to such option immediately prior to such Corporate
Transaction. Appropriate adjustments shall also be made to the
option price payable per share, provided the aggregate option price
payable for such securities shall remain the same. In addition,
the class and number of securities available for issuance under the
Plan on both an aggregate and per individual basis following the
consummation of the Corporate Transaction shall be appropriately
adjusted.
D. The grant of options under this Article Two shall in
no way affect the right of the Corporation to adjust, reclassify,
reorganize or otherwise change its capital or business structure or
to merge, consolidate, dissolve, liquidate or sell or transfer all
or any part of its business or assets.
E. The Plan Administrator shall have the discretionary
authority, exercisable either at the time the option is granted or
at any time while the option remains outstanding, to provide for
the automatic acceleration and vesting of one or more outstanding
options under this Article Two upon the occurrence of a Change in
Control. The Plan Administrator shall also have full power and
authority to condition any such option acceleration and vesting
upon the subsequent termination of the optionee's Service within a
specified period following the Change in Control.
F. For all purposes under the Plan, a Change in Control
shall be deemed to occur in the event:
11.
<PAGE>
(i) any person or related group of persons
(other than the Corporation or a person that directly or
indirectly controls, is controlled by, or is under common
control with, the Corporation) directly or indirectly
acquires beneficial ownership (within the meaning of
Rule 13d-3 of the Securities Exchange Act of 1934 ("1934
Act")) of securities possessing more than fifty percent
(50%) of the total combined voting power of the
Corporation's outstanding securities pursuant to a
tender or exchange offer made directly to the
Corporation's stockholders which the Board does not
recommend such stockholders to accept; or
(ii) there is a change in the composition
of the Board over a period of twenty-four (24)
consecutive months or less such that a majority of the
Board members (rounded up to the next whole number)
cease, by reason of one or more proxy contests for the
election of Board members, to be comprised of individuals
who either (A) have been Board members continuously since
the beginning of such period or (B) have been elected or
nominated for election as Board members during such
period by at least a majority of the Board members
described in clause (A) who were still in office at the
time such election or nomination was approved by the
Board.
G. Any options accelerated in connection with the
Change in Control shall remain fully exercisable until the
expiration or sooner termination of the option term.
H. The portion of any Incentive Option accelerated
under this Section III in connection with a Corporate Transaction
or Change in Control shall remain exercisable as an incentive stock
option under the Federal tax laws only to the extent the dollar
limitation of Section II of Article Two is not exceeded. To the
extent such dollar limitation is exceeded, the accelerated portion
of such option shall be exercisable as a non-statutory option under
the Federal tax laws.
IV. CANCELLATION AND REGRANT OF OPTIONS
The Plan Administrator shall have the authority to
effect, at any time and from time to time, with the consent of the
affected optionees, the cancellation of any or all outstanding
options under this Article Two and to grant in substitution new
options under the Plan covering the same or different numbers of
shares of Common Stock but having an option price per share not
less than eighty-five percent (85%) of the fair market value of the
Common Stock on the new grant date (or one hundred percent (100%)
of such fair market value in the case of an Incentive Option).
V. STOCK APPRECIATION RIGHTS
A. Provided and only if the Plan Administrator
determines in its discretion to implement the stock appreciation
right provisions of this Section V, one or more
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optionees may be granted the right, exercisable upon such terms and
conditions as the Plan Administrator may establish, to surrender all
or part of an unexercised option under this Article Two in exchange
for a distribution from the Corporation in an amount equal to the
excess of (i) the fair market value (on the option surrender date) of
the number of shares in which the optionee is at the time vested under
the surrendered option (or surrendered portion thereof) over (ii)
the aggregate option price payable for such vested shares.
B. No surrender of an option shall be effective
hereunder unless it is approved by the Plan Administrator. If the
surrender is so approved, then the distribution to which the
optionee shall accordingly become entitled under this Section V may
be made in shares of Common Stock valued at fair market value on
the option surrender date, in cash, or partly in shares and partly
in cash, as the Plan Administrator shall in its sole discretion
deem appropriate.
C. If the surrender of an option is rejected by the
Plan Administrator, then the optionee shall retain whatever rights
the optionee had under the surrendered option (or surrendered
portion thereof) on the option surrender date and may exercise such
rights at any time prior to the later of (i) five (5) business days
after the receipt of the rejection notice or (ii) the last day on
which the option is otherwise exercisable in accordance with the
terms of the instrument evidencing such option, but in no event may
such rights be exercised more than ten (10) years after the date of
the option grant.
D. One or more officers of the Corporation subject to
the short-swing profit restrictions of the Federal securities laws
may, in the Plan Administrator's sole discretion, be granted
limited stock appreciation rights in tandem with their outstanding
options under this Article Two. Upon the occurrence of a Hostile
Take-Over, each outstanding option with such a limited stock
appreciation right in effect for at least six (6) months shall
automatically be cancelled and the optionee shall in return be
entitled to a cash distribution from the Corporation in an amount
equal to the excess of (i) the Take-Over Price of the shares of
Common Stock at the time subject to the cancelled option (whether
or not the option is otherwise at the time exercisable for such
shares) over (ii) the aggregate exercise price payable for such
shares. The cash distribution payable upon such cancellation shall
be made within five (5) days following the consummation of the
Hostile Take-Over. Neither the approval of the Plan Administrator
nor the consent of the Board shall be required in connection with
such option cancellation and cash distribution.
E. For purposes of Section V.D, the following
definitions shall be in effect:
A Hostile Take-Over shall be deemed to occur in the
event (i) any person or related group of persons (other than the
Corporation or a person that directly or indirectly controls, is
controlled by, or is under common control with, the Corporation)
directly or indirectly acquires beneficial ownership (within the
meaning of Rule 13d-3 of the 1934 Act) of securities possessing
more than fifty percent (50%) of the total combined voting power of
the Corporation's outstanding securities pursuant to a tender or
exchange
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offer made directly to the Corporation's stockholders which the Board
does not recommend such stockholders to accept and (ii) more than fifty
percent (50%) of the securities so acquired in such tender or exchange
offer are accepted from holders other than officers and directors of
the Corporation participating in the Plan.
The Take-Over Price per share shall be deemed to be
equal to the greater of (a) the fair market value per share on the
date of the option cancellation, as determined pursuant to the
valuation provisions of Section I.A.3 of this Article Two, or (b)
the highest reported price per share of Common Stock paid in
effecting such Hostile Take-Over. However, if the cancelled option
is an Incentive Option, the Take-Over Price shall not exceed the
clause (a) price per share.
F. The shares of Common Stock subject to any option
surrendered or cancelled for an appreciation distribution pursuant
to this Section V shall NOT be available for subsequent option
grant under the Plan.
VI. LOANS OR INSTALLMENT PAYMENTS
The Plan Administrator may assist any optionee (including
any officer) in the exercise of one or more outstanding options
under this Article Two, including the satisfaction of any Federal
and State income and employment tax obligations arising therefrom,
by (a) authorizing the extension of a loan to such optionee from
the Corporation or (b) permitting the optionee to pay the option
price for the purchased Common Stock in installments over a period
of years. The terms of any loan or installment method of payment
(including the interest rate and terms of repayment) will be
established by the Plan Administrator in its sole discretion.
Loans and installment payments may be granted with or without
security or collateral, but the maximum credit available to the
optionee shall not exceed the sum of (i) the aggregate option price
(less par value) of the purchased shares plus (ii) any federal and
state income and employment tax liability incurred by the optionee
in connection with the exercise of the option.
VII. EXTENSION OF EXERCISE PERIOD
The Plan Administrator shall have full power and
authority to extend the period of time for which any option granted
under this Article Two is to remain exercisable following the
optionee's cessation of Service or death from the limited period in
effect under Section I.C.1 of this Article Two to such greater
period of time as the Plan Administrator shall deem appropriate;
provided, however, that in no event shall such option be
exercisable after the specified expiration date of the option term.
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ARTICLE THREE
AUTOMATIC OPTION GRANT PROGRAM
I. ELIGIBILITY
A. Eligible Optionees. The individuals eligible to
receive automatic option grants pursuant to the provisions of this
Article Three shall be limited to (i) those individuals who are
first elected or appointed as non-employee Board members on or
after the June 9, 1994 effective date of this Automatic Option
Grant Program, whether through appointment by the Board or election
by the Corporation's stockholders, and (ii) those individuals
serving as non-employee Board members on the June 9, 1994
effective date, provided in each instance that such individuals
have not otherwise been in the prior employ of the Corporation (or
any parent or subsidiary corporation). Each individual so eligible
to receive an automatic option grant is hereby designated an
"Eligible Director."
B. Limitation. Except for the option grants to be made
pursuant to the provisions of this Automatic Option Grant Program,
the non-employee Board members who serve on the Committee acting as
Plan Administrator shall not, during the period of such Committee
service, be eligible to receive any additional option grants under
this Plan or option grants or stock issuances under any other stock
plan of the Corporation (or its parent or subsidiaries).
II. TERMS AND CONDITIONS OF AUTOMATIC OPTION GRANTS
A. Grant Dates. Option grants will be made under this
Article Three as follows:
(i) Each Eligible Director serving as an
Eligible Director on June 9, 1994 shall automatically be
granted on such date a non-statutory stock option to
purchase twenty-five thousand (25,000) shares of Common
Stock upon the terms and conditions of this Article
Three, provided such individual has not previously been
granted an option by the Corporation to purchase shares
of Common Stock, whether under this Plan or otherwise,
in connection with services as either a non-employee
Board member or an independent consultant.
(ii) Each Eligible Director who first
becomes a non-employee Board member at any time after
June 9, 1994, whether through election at an Annual
Stockholders Meeting or through appointment by the
Board, shall automatically be granted, at the time of
such initial election or appointment, a non-statutory
stock option to purchase twenty-five thousand (25,000)
shares of Common Stock, provided such individual has not
previously
15.
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been granted an option by the Corporation to purchase
shares of Common Stock, whether under this Plan or
otherwise, in connection with services as either a
non-employee Board member or an independent consultant.
B. Exercise Price. The exercise price per share shall
be equal to one hundred percent (100%) of the Fair Market Value per
share of Common Stock on the automatic grant date.
C. Payment. The exercise price shall become
immediately due upon exercise of the option and shall be payable in
one of the alternative forms specified in Section I.A.2 of Article
Two.
D. Option Term. Each automatic grant under this
Article Three shall have a maximum term of ten (10) years measured
from the automatic grant date.
E. Exercisability/Vesting. Each automatic grant shall
be immediately exercisable for any or all of the option shares;
provided, however, that no such grant shall become exercisable in
whole or in part unless and until the stockholders approve this
Automatic Option Grant Program at the 1994 Annual Meeting. Any
shares purchased under the option shall be subject to repurchase by
the Corporation, at the exercise price paid per share, upon the
optionee's cessation of Board service prior to vesting in those
shares. The optionee shall vest in the shares purchased or
purchasable under the automatic grant, and the Corporation's
repurchase right shall accordingly terminate, in a series of
sixteen (16) successive equal quarterly installments upon the
optionee's completion of each full calendar quarter of continued
service as a Board member over the forty-eight (48)-month period
measured from the first day of the first calendar quarter following
the automatic grant date. The option shares shall also be subject
to accelerated as provided in Section III of this Article Three.
In no event, however, shall any additional option shares vest after
the optionee's cessation of Board service.
F. Non-Transferability. The following provision shall
apply to each Eligible Director other than Mr. Eisenson (or any
successor Eligible Director contractually committed to transfer his
or her automatic option grant to Aeneas Venture Corporation as
investment manager of the Harvard University Endowment Fund):
- During the lifetime of each such Eligible
Director, the option shall be exercisable only by the
Eligible Director and shall not be assignable or
transferable by the Eligible Director except by will or
the laws of descent and distribution following his or
her death.
The following provision shall be applicable only to Mr.
Eisenson and any successor Eligible Director contractually
committed to transfer his or her automatic option grant to Aeneas
Venture Corporation:
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- The automatic option grant made to Mr.
Eisenson (and any similar automatic grants made to
successor Eligible Directors contractually committed to
transfer their grants to Aeneas Venture Corporation as
investment manager of the Harvard University Endowment
Fund) shall be transferable and assignable solely to
Aeneas Venture Corporation. In the event of such
assignment to Aeneas Venture Corporation, Aeneas Venture
Corporation shall have the sole and exclusive right to
exercise the option in accordance with the provisions of
this Article Three, as and when such option becomes
exercisable.
G. Effect of Termination of Board Membership.
1. Should the Eligible Director cease to serve as
a Board member for any reason (other than death or permanent
disability) while holding an automatic option grant under this
Article Three, then that individual shall have a three (3)-month
period following the date of such cessation of Board service in
which to exercise such option for any or all of the shares of
Common Stock in which he or she is vested at the time of such
cessation of Board service. However, the option shall immediately
terminate and cease to remain outstanding, at the time of the
optionee's cessation of Board service for any reason (including
death or permanent disability), for any and all shares of Common
Stock in which the optionee is not otherwise at that time vested
under such option.
2. Should the Eligible Director die while serving
as a Board member or during the three (3)-month period following
his or her cessation of Board service, then the option may
subsequently be exercised, for any or all of the shares of Common
Stock in which the optionee is vested at the time of such cessation
of Board service, by the personal representative of his or her
estate or by the person or persons to whom the option is
transferred pursuant to the Eligible Director's will or in
accordance with the laws of descent and distribution. Any such
exercise of the option must, however, occur within twelve (12)
months after the date of the Eligible Director's death.
3. Should the Eligible Director become permanently
disabled (as defined in Section 22(e)(3) of the Internal Revenue
Code) while serving as a Board member, then that individual shall
have a twelve (12)-month period following the date of such
cessation of Board service in which to exercise his or her
outstanding automatic grant for any or all of the shares of Common
Stock in which he or she is vested at the time of such cessation of
Board service.
4. In no event shall any automatic grant under this
Article Three remain exercisable after the expiration date of the
ten (10)-year option term. Upon the expiration of the applicable
post-service exercise period under subparagraphs 1 through 3 above
or (if earlier) upon the expiration of the ten (10)-year option
term, the automatic grant shall terminate and cease to be
outstanding for any option shares in which the optionee was vested
at the time of his or her cessation of Board service but for which
such option was not subsequently exercised.
H. Stockholder Rights. The holder of an automatic
option grant under this Article Three shall have no stockholder
rights with respect to any shares covered by such option until such
individual shall have exercised the option and paid the exercise
price for the purchased shares.
I. Remaining Terms. The remaining terms and conditions
of each automatic option grant shall be as set forth in the
prototype Director Automatic Grant Agreement attached as Exhibit A
to the Plan.
III. CORPORATE TRANSACTION
A. In the event of any Corporate Transaction (as
defined in Section III of Article Two), the shares of Common Stock
at the time subject to each outstanding option under this Article
Three but not otherwise vested shall automatically vest in full and
the Corporation's repurchase right with respect to those shares
shall terminate, so that each such option shall, immediately prior
to the specified effective date for the Corporate Transaction,
become fully exercisable for all of the shares of Common Stock at
the time subject to that option and may be exercised for all or any
portion of such shares as fully vested shares of Common Stock.
Immediately following the consummation of the Corporate
Transaction, all option grants under this Article Three shall
terminate and cease to remain outstanding, except to the extent one
or more such grants are assumed by the successor entity or its
parent corporation.
B. The automatic option grants outstanding under this
Article Three shall in no way affect the right of the Corporation
to adjust, reclassify, reorganize or otherwise change its capital
or business structure or to merge, consolidate, dissolve, liquidate
or sell or transfer all or any part of its business or assets.
IV. AMENDMENT OF THE AUTOMATIC GRANT PROVISIONS
The provisions of this Automatic Option Grant Program,
including any automatic option grants outstanding under this
Article Three, may not be amended at intervals more frequently than
once every six (6) months, other than to the extent necessary to
comply with applicable Federal income tax laws and regulations.
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ARTICLE FOUR
MISCELLANEOUS
I. AMENDMENT OF THE PLAN
The Board shall have complete and exclusive power and
authority to amend or modify the Plan in any or all respects
whatsoever subject to Section IV of Article Three. However, (i) no
such amendment or modification shall adversely affect rights and
obligations with respect to stock options or stock appreciation
rights the time outstanding under the Plan, unless the option
holders consent to such amendment, and (ii) any amendment made to
the Automatic Option Grant Program (or any stock options
outstanding thereunder) shall be in compliance with the applicable
limitations of Section IV of Article Three. In addition, the Board
shall not, without the approval of the Corporation's stockholders,
(i) increase the maximum number of shares issuable under the Plan,
the number of shares for which options may be granted to newly
elected non-employee Board members under Article Three or the
maximum number of shares for which any one individual participating
in the Plan may be granted stock options or separately-exercisable
stock appreciation rights under the Plan after August 31, 1994,
except for permissible adjustments under Section V.C of Article
One, (ii) materially modify the eligibility requirements for the
grant of options under the Plan or (iii) otherwise materially
increase the benefits accruing to participants under the Plan.
II. TAX WITHHOLDING
A. The Corporation's obligation to deliver shares or
cash upon the exercise of stock options or stock appreciation
rights granted under the Plan shall be subject to the satisfaction
of all applicable Federal, State and local income and employment
tax withholding requirements.
B. The Plan Administrator may, in its discretion and
upon such terms and conditions as it may deem appropriate
(including the applicable safe-harbor provisions of Rule 16b-3 of
the 1934 Act) provide any or all holders of outstanding option
grants under Article Two of the Plan with the election to have the
Corporation withhold, from the shares of Common Stock otherwise
issuable upon the exercise of such options, one or more of such
shares with an aggregate fair market value equal to the designated
percentage (any multiple of 5% specified by the optionee) of the
Federal and State income and employment taxes ("Taxes") incurred in
connection with the acquisition of such shares. In lieu of such
direct withholding, one or more optionees may also be granted the
right to deliver shares of Common Stock to the Corporation in
satisfaction of such Taxes. The withheld or delivered shares shall
be valued at Fair Market Value on the applicable determination date
for such
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Taxes or such other date required by the applicable safe-harbor
provisions of SEC Rule 16b-3.
III. EFFECTIVE DATE AND TERM OF PLAN
A. This Plan first became effective on the Effective
Date and serves as the successor to the Corporation's 1983 Plan.
No further option grants shall be made under the 1983 Plan from and
after the Effective Date.
B. On June 9, 1994, the Board adopted a restatement of
the Plan to add the Automatic Option Grant Program, and on
September 29, 1994, the Board adopted a second restatement of the
Plan to (i) increase the number of shares issuable under the Plan
by an additional 1,000,000 shares, (ii) limit the maximum number of
shares for which any one individual participating in the Plan may
be granted stock options and separately exercisable stock
appreciation rights after August 31, 1994 to twenty-five percent
(25%) of the total number of shares of Common Stock available for
issuance under the Plan from and after that date and (iii) extend
the term of the Plan to August 31, 2004. Both 1994 restatements
were approved by the Corporation's stockholders at the 1994 Annual
Stockholders Meeting. The provisions of each of the 1994
restatements shall apply only to options granted under the Plan
from and after the effective date of that particular restatement.
Subject to the foregoing limitations, options may be granted under
this Plan at any time from and after the Effective Date of the Plan
and before the date fixed herein for termination of the Plan.
C. On March 15, 1995, the Board amended the Plan to
extend the eligibility provisions of the Discretionary Option Grant
Program so that all non-employee Board members will be eligible to
receive one or more grants under the Discretionary Option Grant
Program during their period of Board service, other than during
their period of service on the Committee acting as the Plan
Administrator. Such amendment is subject to stockholder approval
at the 1995 Annual Meeting, and no option granted on the basis of
such amendment shall become exercisable in whole or in part unless
and until such stockholder approval is obtained. Should such
stockholder approval not be obtained, then any option grants made
on the basis of the March 15, 1995 amendment shall terminate and
cease to be outstanding without ever becoming exercisable for any
of the option shares, and non-employee Board members shall remain
ineligible to participate in the Discretionary Option Grant
Program. However, non-employee Board members would continue to be
eligible for automatic option grants made pursuant to the
provisions of Article Three.
D. Each option issued and outstanding under the 1983
Plan immediately prior to the Effective Date of this Plan shall be
incorporated into this Plan and treated as an outstanding option
under this Plan, but each such option shall continue to be governed
solely by the terms and conditions of the instrument evidencing
such grant, and nothing in this Plan shall be deemed to affect or
otherwise modify the rights or obligations of the
20.
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holders of such options with respect to their acquisition of shares
of Common Stock thereunder or their exercise of outstanding stock
appreciation rights thereunder.
E. The Plan shall terminate upon the earlier of
(i) August 31, 2004 or (ii) the date on which all shares available
for issuance under the Plan have been issued pursuant to the
exercise of options granted under the Plan. If the date of
termination is determined under clause (i) above, then no options
outstanding on such date shall be affected by the termination of
the Plan, and such securities shall thereafter continue to have
force and effect in accordance with the provisions of the
instruments evidencing such options.
F. Options may be granted under this Plan to purchase
shares of Common Stock in excess of the number of shares then
available for issuance under the Plan, provided each option granted
is not to become exercisable, in whole or in part, at any time
prior to stockholder approval of an amendment authorizing a
sufficient increase in the number of shares issuable under the
Plan.
IV. USE OF PROCEEDS
Any cash proceeds received by the Corporation from the
sale of shares pursuant to options granted under the Plan shall be
used for general corporate purposes.
V. REGULATORY APPROVALS
A. The implementation of the Plan, the granting of any
option hereunder, and the issuance of stock upon the exercise or
surrender of any such option shall be subject to the procurement by
the Corporation of all approvals and permits required by regulatory
authorities having jurisdiction over the Plan, the options granted
under it and the stock issued pursuant to it.
B. No shares of Common Stock or other assets shall be
issued or delivered under the Plan unless and until there shall
have been compliance with all applicable requirements of Federal
and state securities laws, including the filing and effectiveness
of a Form S-8 registration statement for the shares of Common Stock
issuable under the Plan, and all applicable listing requirements of
any securities exchange on which stock of the same class is then
listed.
VI. NO EMPLOYMENT/SERVICE RIGHTS
Neither the action of the Corporation in establishing or
restating the Plan, nor any action taken by the Plan Administrator
hereunder, nor any provision of the restated Plan shall be
construed so as to grant any individual the right to remain in the
employ or service of the Corporation (or any parent or subsidiary
corporation) for any period of specific duration, and the Corporation
(or any parent or subsidiary corporation retaining the
21.
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services of such individual) may terminate such individual's
employment or service at any time and for any reason, with or
without cause.
VII. MISCELLANEOUS PROVISIONS
A. The right to acquire Common Stock or other assets
under the Plan may not be assigned, encumbered or otherwise
transferred by any optionee.
B. The provisions of the Plan shall be governed by the
laws of the State of California, as such laws are applied to
contracts entered into and performed in such State.
C. The provisions of the Plan shall inure to the
benefit of, and be binding upon, the Corporation and its successors
or assigns, whether by Corporate Transaction or otherwise, and the
optionees, the legal representatives of their respective estates,
their respective heirs or legatees and their permitted assignees.
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EXHIBIT A
NON-EMPLOYEE DIRECTOR STOCK OPTION AGREEMENT
<PAGE>
SOMATIX THERAPY CORPORATION
1992 STOCK OPTION PLAN
NON-EMPLOYEE DIRECTOR STOCK OPTION AGREEMENT
RECITALS
A. The Corporation has, with the approval of the
stockholders obtained at the 1994 Annual Meeting, implemented an
automatic option grant program under the 1992 Stock Option Plan
(the "Plan"), pursuant to which certain non-employee members of the
Corporation's Board of Directors (the "Board") will automatically
receive option grants designed to encourage them to continue in
the service of the Corporation.
B. Optionee is a non-employee member of the Board, and
this Agreement is executed pursuant to, and is intended to carry
out the purposes of, the Plan in connection with the automatic
grant on this day of a stock option to purchase shares of the
Corporation's common stock ("Common Stock") under Article Three
of the Plan.
C. The granted option is intended to be a non-statutory
option which does not meet the requirements of Section 422 of the
Internal Revenue Code.
NOW, THEREFORE, it is hereby agreed as follows:
1. GRANT OF OPTION. Subject to and upon the terms and
conditions set forth in this Agreement, the Corporation hereby
grants to Optionee, as of the automatic grant date (the "Grant
Date") specified in the accompanying Notice of Grant of
Non-Employee Director Stock Option (the "Grant Notice"), a stock
option to purchase up to twenty-five thousand (25,000) shares of
Common Stock (the "Option Shares"). The Option Shares shall be
purchasable from time to time during the option term at the
exercise price per share (the "Exercise Price") specified in
the Grant Notice.
2. OPTION TERM. This option shall have a maximum
term of ten (10) years measured from the Grant Date and shall
accordingly expire at the close of business on the expiration
date specified in the Grant Notice ("Expiration Date"), unless
sooner terminated in accordance with Paragraph 5 or 7.
3. LIMITED TRANSFERABILITY. This option shall be
neither transferable nor assignable by Optionee, other than by
will or by the laws of descent and distribution following
Optionee's death, and may be exercised, during Optionee's
lifetime, only by Optionee.
<PAGE>
4. EXERCISABILITY. This option shall not be
exercisable in whole or in part until the LATER of (i) the
Grant Date or (ii) the date the plan amendment authorizing the
automatic option grant program for non-employee Board members
under the Plan is approved by the Corporation's stockholders at
the 1994 Annual Meeting. Upon the later of such dates, this option
shall become immediately exercisable for any or all of the Option
Shares, whether or not the Option Shares are vested in accordance
with the Vesting Schedule set forth in the Grant Notice, and shall
remain so exercisable until the expiration or sooner termination
of the option term. In no event, however, shall any additional
Option Shares vest following Optionee's cessation of service as a
Board member.
5. CESSATION OF BOARD MEMBERSHIP. Should Optionee's
service as a Board member cease while this option remains
outstanding, then the option term specified in Paragraph 2 shall
terminate (and this option shall cease to remain outstanding)
prior to the Expiration Date in accordance with the following
provisions:
(i) Upon Optionee's cessation of Board service for
any reason, this option shall immediately terminate and cease to be
outstanding with respect to any and all Option Shares in which
Optionee is not otherwise at that time vested in accordance with
the normal Vesting Schedule set forth in the Grant Notice or the
special vesting acceleration provisions of Paragraph 7.
(ii) Should Optionee cease Board service (for any reason
other than death or permanent disability) while this option
remains outstanding, then the period for exercising this option
shall be reduced to a three (3)-month period commencing with the
date of such cessation of Board service, but in no event shall
this option be exercisable at any time after the Expiration Date.
During such limited period of exercisability, this option may not
be exercised for more than the number of Option Shares (if any)
in which Optionee is vested on the date of Optionee's cessation
of service as a Board member. Upon the expiration of such three
(3)-month period or (if earlier) upon the Expiration Date, this
option shall terminate and cease to remain outstanding for those
shares.
(iii) Should Optionee die while serving as a Board
member or during the three (3)-month period following Optionee's
cessation of Board service, then the personal representative of
Optionee's estate or the person or persons to whom this option
is transferred pursuant to Optionee's will or in accordance
with the laws of descent and distribution shall have the right
to exercise this option for any or all of the Option Shares
in which the Optionee is vested at the time of Optionee's
cessation of Board service, less any Option
2.
<PAGE>
Shares subsequently purchased by Optionee prior to death. Such
right shall lapse, and this option shall terminate and cease to
remain outstanding, upon the earlier of (A) the expiration of
the twelve (12)-month period measured from the date of Optionee's
death or (B) the Expiration Date.
(iv) Should Optionee become permanently disabled while
serving as a Board member, then Optionee shall have a twelve
(12)-month period commencing with the date of such cessation of
Board service in which to exercise this option for any or all
Option Shares in which Optionee is vested at the time of such
cessation of Board service. Upon the expiration of such twelve
(12)-month period or (if earlier) upon the Expiration Date,
this option shall terminate and cease to remain outstanding for
those vested Option Shares.
(v) Optionee shall be deemed to be PERMANENTLY DISABLED
if Optionee is unable to engage in any substantial gainful
activity by reason of any medically determinable physical or mental
impairment expected to result in death or to be of continuous
duration of twelve (12) months or more.
6. ADJUSTMENT IN OPTION SHARES.
A. In the event any change is made to the Common Stock
issuable under the Plan 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,
then appropriate adjustments shall be made to (i) the total number
and/or class of securities subject to this option and (ii) the
Exercise Price payable per share in order to reflect such change
and thereby preclude the dilution or enlargement of Optionee's
rights and benefits hereunder.
B. Upon the assumption of this option in connection
with any Corporate Transaction under Paragraph 7, this option
shall be appropriately adjusted to apply and pertain to the number
and class of securities which would have been issued to Optionee
in the consummation of such Corporate Transaction had the option
been exercised immediately prior to such Corporate Transaction.
Appropriate adjustments shall also be made to the Exercise Price
payable per share, provided the aggregate Exercise Price payable
hereunder shall remain the same.
7. SPECIAL ACCELERATION OF OPTION.
A. In the event of any of the following stockholder-
approved transactions (a "Corporate Transaction"):
3.
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(i) a merger or consolidation in which the Corporation
is not the surviving entity, except for a transaction the
principal purpose of which is to change the state of the
Corporation's incorporation, or
(ii) the sale, transfer or other disposition of all or
substantially all of the assets of the Corporation in liquidation
or dissolution of the Corporation; or
(iii) any reverse merger in which the Corporation is
the surviving entity but in which securities possessing more than
fifty percent (50%) of the total combined voting power of the
Corporation's outstanding securities are transferred to holders
different from those who held such securities immediately prior
to such merger,
all Option Shares at the time subject to this option
but not otherwise vested shall automatically vest and the
Corporation's repurchase right shall terminate so that this option
shall, immediately prior to the specified effective date for the
Corporate Transaction, become fully exercisable for all of the
Option Shares at the time subject to this option and may be
exercised for all or any portion of such shares as fully vested
shares of Common Stock.
B. This option, to the extent not previously exercised,
shall terminate immediately following the consummation of the
Corporate Transaction, except to the extent assumed by the
successor corporation or its parent company.
C. This Agreement shall not in any way affect the
right of the Corporation to adjust, reclassify, reorganize or
otherwise make changes in its capital or business structure or
to merge, consolidate, dissolve, liquidate or sell or transfer
all or any part of its business or assets.
8. MANNER OF EXERCISING OPTION.
A. In order to exercise this option with respect to
all or any part of the Option Shares for which this option is at
the time exercisable, Optionee (or in the case of exercise after
Optionee's death, Optionee's executor, administrator, heir or
legatee, as the case may be) must take the following actions:
(i) To the extent the option is exercised for vested
Option Shares, the Secretary of the Corporation shall be provided
with written notice of the option exercise (the "Exercise Notice"),
in substantially the form of Exhibit I attached hereto, in which
there is specified the number of vested Option Shares which are
to be purchased under the exercised option. To the extent the
option is exercised for
4.
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one or more unvested Option Shares, Optionee (or other person
exercising the option) shall deliver to the Secretary of the
Corporation a stock issuance agreement (in form and substance
satisfactory to the Corporation) which grants the Corporation the
right to repurchase, at the Exercise Price, any and all unvested
Option Shares held by Optionee at the time of his or her cessation
of Board service and which precludes the sale, transfer or other
disposition of any purchased Option Shares while subject to such
repurchase right (the "Issuance Agreement").
(ii) The aggregate Exercise Price for the purchased
shares shall be paid in one or more of the following alternative
forms:
(a) cash or check made payable to the Corporation's
order;
(b) shares of Common Stock held by Optionee for the
requisite period necessary to avoid a charge to the Corporation's
earnings for financial reporting purposes and valued at Fair
Market Value on the Exercise Date (as such terms are defined
below); or
(c) to the extent the option is exercised for vested
Option Shares, through a broker-dealer sale and remittance
procedure pursuant to which the Optionee shall provide irrevocable
written instructions (I) to a Corporation-designated brokerage
firm to effect the immediate sale of the purchased shares and remit
to the Corporation, out of the sale proceeds available on the
settlement date, sufficient funds to cover the aggregate option
price payable for the purchased shares plus all applicable Federal
and State income and employment taxes required to be withheld by
the Corporation in connection with such purchase and (II) to the
Corporation to deliver the certificates for the purchased shares
directly to such brokerage firm in order to complete the sale
transaction.
(iii) Appropriate documentation evidencing the right to
exercise this option shall be furnished the Corporation if the
person or persons exercising the option is other than Optionee.
B. For purposes of this Agreement, the Exercise Date
shall be the date on which the Exercise Notice is delivered to the
Secretary of the Corporation, together with the appropriate
Issuance Agreement for any unvested shares acquired under the
option. Except to the extent the sale and remittance procedure
specified above is utilized in connection with the exercise of the
option for vested shares, payment of the Exercise Price for the
purchased shares must accompany such notice.
C. The Fair Market Value per share of Common Stock
on any relevant date under this Agreement shall be determined in
accordance with the following provisions:
5.
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- If the Common Stock is not at the time listed
or admitted to trading on any national securities exchange but is
traded on the Nasdaq National Market, the Fair Market Value shall
be the closing selling price per share of Common Stock on the date
in question, as such price is reported by the National Association
of Securities Dealers on the Nasdaq National Market or any
successor system. If there is no closing selling price for the
Common Stock on the date in question, then the closing selling
price on the last preceding date for which such quotation exists
on the Nasdaq National Market shall be determinative of Fair
Market Value.
- If the Common Stock is at the time listed or
admitted to trading on any national securities exchange, then the
Fair Market Value shall be the closing selling price per share of
Common Stock on the date in question on the securities exchange
determined by the Plan Administrator to be the primary market for
the Common Stock, as such price is officially quoted in the
composite tape of transactions on such exchange. If there is no
reported sale of Common Stock on such exchange on the date in
question, then the Fair Market Value shall be the closing selling
price on the exchange on the last preceding date for which such
quotation exists.
D. As soon as practical after the Exercise Date, the
Corporation shall issue to or on behalf of Optionee (or any other
person or persons exercising this option) a certificate or
certificates representing the Option Shares purchased and paid for
in accordance herewith. To the extent any such Option Shares are
unvested, the certificates for those Option Shares shall be
endorsed with an appropriate legend evidencing the Corporation's
repurchase rights and may be held in escrow with the Corporation
until such shares vest.
E. In no event may this option be exercised for any
fractional shares.
9. STOCKHOLDER RIGHTS. The holder of this option
shall not have any of the rights of a stockholder with respect to
the Option Shares until such individual shall have exercised this
option and paid the Exercise Price for the purchased shares.
10. NO IMPAIRMENT OF RIGHTS. Nothing in this Agreement
shall be construed or interpreted so as to affect adversely or
otherwise impair the right of the Corporation or the stockholders
to remove Optionee from the Board at any time in accordance with
the provisions of applicable law.
6.
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11. COMPLIANCE WITH LAWS AND REGULATIONS. The exercise
of this option and the issuance of the Option Shares upon such
exercise shall be subject to compliance by the Corporation and
Optionee with all applicable requirements of law relating thereto
and with all applicable regulations of any securities exchange on
which shares of the Common Stock may be listed for trading at the
time of such exercise and issuance.
12. SUCCESSORS AND ASSIGNS. Except to the extent
otherwise provided in Paragraph 3 or 7, the provisions of this
Agreement shall inure to the benefit of, and be binding upon,
the successors, administrators, heirs, legal representatives and
assigns of Optionee and the successors and assigns of the
Corporation.
13. LIABILITY OF CORPORATION.
A. If the Option Shares covered by this Agreement
exceed, as of the Grant Date, the number of shares of Common Stock
which may without stockholder approval be issued under the Plan,
then this option shall be void with respect to such excess shares
unless stockholder approval of an amendment sufficiently increasing
the number of shares of Common Stock issuable under the Plan is
obtained in accordance with the provisions of Article Four, Section
III of the Plan.
B. The inability of the Corporation to obtain approval
from any regulatory body having authority deemed by the Corporation
to be necessary to the lawful issuance and sale of any Common Stock
pursuant to this option shall relieve the Corporation of any
liability with respect to the non-issuance or sale of the Common
Stock as to which such approval shall not have been obtained.
However, the Corporation shall use its best efforts to obtain all
such approvals.
14. NOTICES. Any notice required to be given or
delivered to the Corporation under the terms of this Agreement
shall be in writing and addressed to the Corporation in care of
the Corporate Secretary at the Corporate Offices at 1301 Marina
Village Parkway, Alameda, California 94501. Any notice required
to be given or delivered to Optionee shall be in writing and
addressed to Optionee at the address indicated below Optionee's
signature line on the Grant Notice. All notices shall be deemed
to have been given or delivered upon personal delivery or upon
deposit in the U.S. mail, postage prepaid and properly addressed
to the party to be notified.
15. CONSTRUCTION/GOVERNING LAW. This Agreement and
the option evidenced hereby are made and granted pursuant to the
Plan and are in all respects limited by and subject to the
express terms and provisions of the Plan. The interpretation,
performance and enforcement of this Agreement shall be governed
by the laws of the State of California without resort to that
state's conflict-of-laws rules.
7.
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EXHIBIT I
NOTICE OF EXERCISE OF STOCK OPTION
I hereby notify Somatix Therapy Corporation (the
"Corporation") that I elect to purchase ____ shares of the
Corporation's Common Stock (the "Purchased Shares") pursuant to
that certain option (the "Option") granted to me on
______________________, 199__ to purchase up to twenty-five
thousand (25,000) shares of such Common Stock at an option price
of $________ per share (the "Exercise Price").
Concurrently with the delivery of this Exercise Notice
to the Secretary of the Corporation, I shall pay to the Corporation
the Exercise Price for the Purchased Shares in accordance with the
provisions of my agreement with the Corporation evidencing the
Option and shall deliver whatever additional documents may be
required by such agreement as a condition for exercise.
Alternatively, I may utilize the special broker/dealer sale and
remittance procedure specified in my agreement to effect payment
of the Exercise Price for any Purchased Shares in which I am
vested at the time of exercise.
_____________________ ________________________________
Date Optionee
Address: ________________________________
________________________________
Print name in exact manner
it is to appear on the
stock certificate: _________________________________
_________________________________
Address to which certificate
is to be sent, if different
from address above: ________________________________
________________________________
Social Security Number: ________________________________
8.
