As Filed with the Securities and Exchange Commission on November 26, 1996
Registration No._______
=========================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
AGOURON PHARMACEUTICALS, INC.
(Exact name of registrant as specified in its charter)
California 33-0061928
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification Number)
10350 North Torrey Pines Road
La Jolla, California 92037
(Address of Principal Executive Offices)
AGOURON PHARMACEUTICALS, INC., 1996 STOCK OPTION PLAN
(Full title of plan)
PETER JOHNSON
Agouron Pharmaceuticals, Inc.
10350 North Torrey Pines Road
La Jolla, California 92037
(619) 622-3000
(Telephone number, including area code, of agent for service)
Calculation of Registration Fee
============================================================================
Title of Amount to Proposed Proposed Amount of
securities be Maximum Maximum Registration
to be registered(1) offering Aggregate Fee
registered price per Offering
unit (2) Price (2)
- ---------------------------------------------------------------------------
Common 2,000,000 $49.375 $98,750,000 $29,924.25
Stock No Shares
par Value
Options to 2,000,000 N/A N/A N/A
Purchase
Common
Stock
(1) In addition, this Registration Statement also covers any additional
shares of Common Stock which become issuable under the Agouron
Pharmaceuticals, Inc. 1996 Stock Option 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) Calculated in accordance with Rule 457(h) under the Securities
Act of 1933.
=========================================================================
[PAGE]
Part II
Information Required in the Registration Statement
Item 3. Incorporation of Documents by Reference.
The following documents filed by AGOURON PHARMACEUTICALS, INC. (the
"Company" or "Registrant") with the Securities and Exchange Commission are
incorporated by reference in this Registration Statement:
(1) The Company's Annual Report on Form 10-K for the fiscal year
ended June 30, 1996.
(2) The Company's Quarterly Report on Form 10-Q for the quarter
ended September 30, 1996.
(3) The description of the Company's Common Stock contained in the
Company's Form 8-A Registration Statement filed April 17, 1987, including any
amendment or report filed for the purpose of updating such description,
together with the Company's Form 8-A Registration Statement filed on November
7, 1996, in which there is described the terms, rights and provisions
applicable to the Company's outstanding Common Stock under the Rights
Agreement dated as of November 7, 1996, between the Company and Chase Mellon
Shareholder Services, L.L.C., including any amendment or report filed for the
purpose of updating such description.
In addition, all documents subsequently filed by the Company pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934,
prior to the filing of a post-effective amendment which indicates that all
securities offered have been sold or which deregisters all securities then
remaining unsold, shall be deemed to be incorporated by reference in this
Registration Statement and to be a part hereof from the date of filing of
such documents.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Gary E. Friedman, Esq., who has provided the opinion to the Registrant
on the validity of the securities being registered which is attached as
Exhibit 5 to this Registration Statement, is Vice President, General Counsel
and Secretary of the Registrant.
Item 6. Indemnification of Directors and Officers.
Section 317 of the California General Corporation Law generally provides
indemnification to officers and directors of the Company against expenses,
judgments, fines and amounts paid in settlement under certain conditions and
subject to certain limitations.
Article VII of the articles of incorporation of the Company provides
that liability of the directors of the Company for monetary damages shall be
eliminated to the fullest extent permissible under California law. Further,
Article VIII of the articles of incorporation authorizes the Company to
provide indemnification of agents (as defined
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[PAGE]
in Section 317) for breach of duty to the Company and its shareholders
through bylaw provisions or through agreements with such agents, or both, in
excess of the indemnification otherwise permitted by Section 317, subject to
the limits on such excess indemnification set forth in Section 317.
Section 3.15 of the bylaws of the Company authorizes the Company to
indemnify any person who was or is a party, or is threatened to be made a
party, to any proceeding (other than actions by or in the right of the
Company to procure a judgment in its favor) by reason of the fact that such
person is or was an agent of the Company, against expenses, judgments, fines,
settlements and other amounts actually and reasonably incurred in connection
with such proceeding if such person acted in good faith and in a manner such
person reasonably believed to be in the best interests of the Company.
Section 3.15 also authorizes the Company to indemnify any person who was or
is a party, or is threatened to be made a party, to any threatened, pending
or completed action by or in the right of the Company to procure a judgment
in its favor by reason of the fact that such person is or was an agent of the
Company, against expenses actually and reasonably incurred by such person in
connection with the defense or settlement of such action if such person acted
in good faith.
Any indemnification under Section 3.15 is to be made by the Company only
if authorized in the specific case upon determination that indemnification of
the agent is proper in the circumstances because the agent has met the
applicable standard of conduct required by Paragraphs 3.15.2 or 3.15.3 of the
bylaws.
Pursuant to authorization provided under the articles of incorporation
and the bylaws, the Company has entered into indemnification agreements with
each of its present directors. The Company has also entered into similar
agreements with certain of the Company's officers who are not directors.
Generally, the indemnification agreements attempt to provide the maximum
protection permitted by California law as it may be amended from time to
time. Moreover, the indemnification agreements provide for certain
additional indemnification. Under such additional indemnification
provisions, however, an individual will not receive indemnification for
judgments, settlements or expenses if he or she is found liable to the
Company (except to the extent the court determines he or she is fairly and
reasonably entitled to indemnity for expenses) for settlements not approved
by the Company or for settlements and expenses if the settlement is not
approved by the court. The indemnification agreements provide for the
Company to advance to the individual any and all reasonable expenses
(including legal fees and expenses) incurred in investigating or defending
any such action, suit or proceeding. In order to receive an advance of
expenses, the individual must submit to the Company copies of invoices
presented to him or her for such expenses. Also, the individual must repay
such advances upon a final judicial decision that he or she is not entitled
to indemnification.
Section 3.15 of the bylaws also provides that, in the event of a
determination by the Board of Directors of the Company to purchase insurance
for certain of its agents, the Company shall purchase and maintain insurance
on behalf of any such agent against liability asserted against or incurred by
the agent in such capacity or arising out of the agent's status, whether or
not the Company would have the power to indemnify the agent against such
liability under the provisions of Section 3.15.
The Company has in effect directors and officers liability insurance
policies which insure directors and officers of the Company. Although the
Company intends to renew the policies on or before their expiration date,
there can be no assurance that the policies will be renewed on terms
acceptable to the Company. Under the policies, the directors
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[PAGE]
and officers of the Company are insured against loss arising from claims made
against them due to wrongful acts while acting in their individual and
collective capacities as directors and officers, subject to certain
exclusions. In addition, the policies insure the Company against losses for
which its directors and officers are entitled to indemnification, subject to
certain retentions payable by the Company. The policies are "claims made"
policies and provide coverage only for losses arising out of claims first
made against the Company and reported to the insurer during the policy
period.
Item 7. Exemption from Registration Claimed.
Not Applicable.
Item 8. Exhibits.
4.1 Restated Articles of Incorporation dated October 20, 1990,
incorporated by reference to the Company's Form 10-Q for the
Quarter ended December 31, 1992.
4.2 Rights Agreement dated as of November 7, 1996, between the Company
and Chase Mellon Shareholder Services, L.L.C., which includes the
Certificate of Designation, Preferences and Rights of Series B
Participating Preferred Stock as Exhibit A, the Form of Rights
Certificate as Exhibit B and the Form of Summary of Rights as
Exhibit C, incorporated by reference to Exhibit 4.4 of the Company's
current report on Form 8-K dated November 7, 1996.
5 Opinion of Gary E. Friedman, Esq.
23.1 Consent of Price Waterhouse LLP.
23.2 Consent of Gary E. Friedman, Esq. (included in his opinion filed as
Exhibit 5).
24 Power of Attorney (contained on signature page of this Registration
Statement).
99.1 The Agouron Pharmaceuticals, Inc. 1996 Stock Option Plan.
99.2 Form of Notice of Grant.
99.3 Agouron Pharmaceuticals, Inc. 1996 Incentive Stock Option Agreement.
99.4 Agouron Pharmaceuticals, Inc. 1996 Non-Statutory Stock Option
Agreement - Employee/Officer/Director.
99.5 Agouron Pharmaceuticals, Inc. 1996 Non-Statutory Stock Option
Agreement - Consultant.
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:
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[PAGE]
(i) to include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) to reflect in the prospectus any facts or events
arising after the effective date of this Registration
Statement (or the most recent post-effective amendment
hereof) which, individually or in the aggregate,
represent a fundamental change in the
information set forth in this Registration Statement;
(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 paragraphs (a)(l)(i) and (a)(l)(ii) do 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 Securities Exchange Act of
1934 that are incorporated by reference in this Registration Statement.
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, 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.
(3) To remove from Registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes
of determining any liability under the Securities Act of 1933, each filing of
the Registrant's annual report pursuant to Section 13(a) or Section 15(d) of
the Securities Exchange Act of 1934 (and each filing of the annual report of
the Plan pursuant to Section 15(d) of the Securities Exchange Act of 1934)
that is incorporated by reference in 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
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the foregoing provisions,
or otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the 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 Act and will be governed by the final
adjudication of such issue.
II-4
[PAGE]
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of San Diego, State of California, on
November 26, 1996.
AGOURON PHARMACEUTICALS, INC.
November 26, 1996 By /s/ Peter Johnson
----------------------------------
Peter Johnson
President, Principal Executive Officer
November 26, 1996 By /s/ Steven S. Cowell
---------------------------------
Steven S. Cowell
Vice President, Finance, Chief Financial
Officer and Principal Accounting Officer
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[PAGE]
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Peter Johnson and Gary E. Friedman, or any of
them, his true and lawful attorney-in-fact and agents, with full power of
substitution and resubstitution, for him/her and in his/her name, place and
stead, in any and all capacities, to sign any or all amendments to this
Registration Statement, and to file the same, with all exhibits thereto, and
under documents in connection therewith with the Securities and Exchange
Commission, granting unto said attorney-in-fact and agents full power and
authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises, as fully and to all intents
and purposes as he/she might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents or their substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
Signature Title Date
/s/ Peter Johnson President, Principal November 26, 1996
- ------------------------- Executive Officer, and
Peter Johnson Director
/s/ Steven S. Cowell Vice President, Finance,
- ------------------------- Chief Financial Officer and November 26, 1996
Steven S. Cowell Principal Accounting Officer
/s/ Gary E. Friedman Vice President and General November 26, 1996
- ------------------------- Counsel, Secretary and Director
Gary E. Friedman
/s/ John N. Abelson Director November 26, 1996
- ------------------------
John N. Abelson
/s/ Patricia M. Cloherty Director November 26, 1996
- ------------------------
Patricia M. Cloherty
/s/ A.E. Cohen Director November 26, 1996
- -----------------------
A.E. Cohen
/s/ Michael E. Herman Director November 26, 1996
- -----------------------
Michael E. Herman
/s/ Irving S. Johnson Director November 26, 1996
- -----------------------
Irving S. Johnson
/s/Antonie T. Knoppers Director November 26, 1996
- -----------------------
Antonie T. Knoppers
/s/ Melvin I. Simon Director November 26, 1996
- -----------------------
Melvin I. Simon
II-6
[PAGE]
EXHIBIT INDEX
EXHIBIT Page
4.1 Restated Articles of Incorporation dated October 20, 1990,
incorporated by reference to the Company's Form 10-Q
for the Quarter ended December 31, 1992.
4.2 Rights Agreement dated as of November 7, 1996, between
the Company and Chase Mellon Shareholder Services,
L.L.C., which includes the Certificate of Designation,
Preferences and Rights of Series B Participating Preferred
Stock as Exhibit A, the Form of Rights Certificate as
Exhibit B and the Form of Summary of Rights as Exhibit C,
incorporated by reference to Exhibit 4.4 of the Company's
current report on Form 8-K dated November 7, 1996.
5 Opinion of Gary E. Friedman, Esq.
23.1 Consent of Price Waterhouse LLP.
23.2 Consent of Gary E. Friedman, Esq. (included in his opinion filed as
Exhibit 5).
24 Power of Attorney (contained on signature page of this Registration
Statement).
99.1 The Agouron Pharmaceuticals, Inc. 1996 Stock Option Plan.
99.2 Form of Notice of Grant.
99.3 Agouron Pharmaceuticals, Inc. 1996 Incentive Stock Option Agreement.
99.4 Agouron Pharmaceuticals, Inc. 1996 Non-Statutory Stock Option
Agreement - Employee/Officer/Director.
99.5 Agouron Pharmaceuticals, Inc. 1996 Non-Statutory Stock Option
Agreement - Consultant.
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[PAGE]
Exhibit 5
[AGOURON LETTERHEAD]
November 26, 1996
AGOURON PHARMACEUTICALS, INC.
10350 North Torrey Pines Road
La Jolla, California 92037
Gentlemen:
In connection with your registration on Form S-8 (the "Registration
Statement") under the Securities Act of 1933, as amended, of 2,000,000 shares
of Common Stock of Agouron Pharmaceuticals, Inc. (the "Company"), I advise
you that, in my opinion, when such shares have been issued and sold pursuant
to the provisions of the Agouron Pharmaceuticals, Inc. 1996 Stock Option
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.
Sincerely,
Gary E. Friedman, Esq.
Vice President and General Counsel
GEF:hhf
Exhibit 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated August 7, 1996 included in the
Annual Report on Form 10-K of Agouron Pharmaceuticals, Inc. for the year
ended June 30, 1996.
PRICE WATERHOUSE LLP
San Diego, California
November 26, 1996
EXHIBIT 99.1
AGOURON PHARMACEUTICALS, INC.
1996 STOCK OPTION PLAN
(Adopted by the Board of Directors August 7, 1996)
(Approved by the Shareholders November 7, 1996)
1. Purpose.
This 1996 Stock Option Plan is intended to encourage stock ownership in
Agouron Pharmaceuticals, Inc. by the officers, directors, employees and
consultants of the Company and its affiliates in order to promote their
interest in the success of the Company and to encourage their continued
affiliation. All options granted under this 1996 Stock Option Plan are
intended to be either (a) Incentive Stock Options or (b) Non-Statutory Stock
Options.
2. Definitions.
As used herein the following definitions shall apply:
"Act" shall mean the Securities Exchange Act of 1934, as amended from
time to time.
"Affiliate" shall mean any corporation defined as a "parent corporation"
or a "subsidiary corporation" by Code Section 424(e) and (f), respectively.
"Agreement" shall mean either a 1996 Incentive Stock Option Agreement or
a 1996 Non-Statutory Stock Option Agreement, embodying the terms of the
agreement between the Company and the Optionee with respect to Optionee's
Option.
"Board" shall mean the Board of Directors of the Company.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time.
"Company" shall mean Agouron Pharmaceuticals, Inc., a California
corporation.
"Consultant" shall mean any person who is placed on the Company's
Consultants List by the Board and who agrees in writing to be included
thereon.
"Disability" or "Disabled" shall mean the condition of being "disabled"
within the meaning of Section 422(c)(6) of the Code or any successor
provision.
"Director" shall mean an individual member of the Board.
"Employee" shall mean any salaried employee of the Company or its
Affiliates, including those employees who are officers of the Company or its
Affiliates.
"ERISA" shall mean the Employee Retirement Income Security Act or the
rules thereunder, as amended from time to time.
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[PAGE]
"Fair Market Value" of Stock on a given date shall mean an amount per
share as determined by the Board or its delegates by applying any reasonable
valuation method determined without regard to any restriction other than a
restriction which, by its terms, will never lapse. Notwithstanding the
preceding, if the Stock is traded upon an established stock exchange, then
the "Fair Market Value" of Stock on a given date per share shall be deemed to
be the average of the highest and lowest selling price per share of the Stock
on the principal stock exchange on which the Stock is then trading or, if
there was no trading of the Stock on that day, on the next preceding day on
which there was such trading; if the Stock is not traded upon an established
stock exchange but is quoted on a quotation system, the "Fair Market Value"
of Stock on a given date shall be deemed to be the mean between the closing
representative "bid" and "ask" prices per share of the Stock on such date as
reported by such quotation system or, if there was no trading of the Stock on
that day, on the next preceding day on which there was such trading.
"Incentive Stock Option" shall mean an option granted pursuant to the
Plan which is designated by the Board or its delegates as an "Incentive Stock
Option" and which qualifies as an incentive stock option under Section 422 of
the Code or any successor provision.
"Non-Statutory Stock Option" shall mean a stock option granted pursuant
to the Plan which is not an Incentive Stock Option.
"Option" shall refer to either or both an Incentive Stock Option or Non-
Statutory Stock Option, as the context shall indicate.
"Optionee" shall mean the recipient of an Incentive Stock Option or a
Non-Statutory Stock Option.
"Option Price" shall mean the price per share of Stock to be paid by the
Optionee upon exercise of the Option.
"Option Stock" shall mean the total number of shares of Stock the
Optionee shall be entitled to purchase pursuant to the Agreement.
"Plan" shall mean this Agouron Pharmaceuticals, Inc. 1996 Stock Option
Plan, as amended from time to time.
"Reporting Person" shall mean an Optionee who is required to file
statements relating to his or her beneficial ownership of Stock with the SEC
pursuant to Section 16(a) of the Act.
"Rule 16b-3" shall mean Rule 16b-3 (as amended from time to time),
promulgated by the SEC under the Act, and any successor thereto.
"SEC" shall mean the Securities and Exchange Commission.
"Stock" shall mean the no par Common Stock of the Company.
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[PAGE]
3. Administration.
The Plan shall be administered by the Board; provided, however, that the
Board may delegate all or any part of its authority to administer the Plan in
its entirety or, with respect to any group or groups of persons eligible to
receive Options hereunder, to such persons or committee as the Board shall in
its sole discretion determine. The Board and its delegates may adopt, amend
and rescind such rules and regulations for carrying out the Plan and
implementing agreements and take such act as it deems proper. The
interpretation, construction and application by the Board or any individuals
who are delegated authority by the Board to administer the Plan or any of the
provisions of the Plan or any Option granted thereunder shall be final and
binding on the Company, all Optionees, their legal representatives, and any
person who may acquire an Option directly from an Optionee by permitted
transfer, bequest or inheritance. Reference to administrative acts by the
Board in the Plan shall also refer to acts by its delegates, unless the
context otherwise indicates. Whether or not the Board has delegated
administrative authority, the Board has the final power to determine all
questions of policy or expediency that may arise in administration of the
Plan.
4. Eligibility.
Only Employees are eligible to receive Incentive Stock Options under the
Plan. Employees, officers, Directors and Consultants of the Company or its
Affiliates are eligible to receive Non-Statutory Stock Options under the
Plan.
No person shall be eligible to receive an Option for a larger number of
shares than is recommended for him by the Board. Any Optionee may hold more
than one Option (whether Incentive Stock Options, Non-Statutory Stock
Options, or both), but only on the terms and conditions and subject to the
restrictions set forth herein.
Incentive Stock Options granted to an Employee who owns stock at the
time the Incentive Stock Option is granted, representing more than ten
percent (10%) of the total combined voting power of all classes of stock of
the Company and its Affiliates, shall be granted at an Option Price at least
one hundred ten percent (110%) of the Fair Market Value of the Stock at the
time the Incentive Stock Option is granted. In determining ownership of
Stock by an Employee, the attribution standards set forth in Code Section
424(d) shall be applicable.
5. Stock Subject to the Plan.
Options granted under the Plan shall be for shares of the Company's
authorized but unissued or re-acquired Stock. The aggregate number of shares
of Stock which may be subject to Options pursuant to the Plan shall not
exceed two million (2,000,000) shares. The number of shares available shall
be adjusted as provided in Paragraph 6(j) below. Stock issued under other
stock option plans of the Company shall not be counted against the maximum
number of shares that can be issued under the Plan.
In the event that any outstanding Option expires or is terminated for
any reason, the shares of Stock allocable to the unexercised portion of such
Option may again be subject to an Option under the Plan.
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[PAGE]
If an Optionee pays all or part of any Option Price with shares of
Stock, the number of shares deemed to be issued to the Optionee (and counted
against the maximum number of shares that can be issued under the Plan) shall
be the number of shares transferred to the Optionee by the Company, less the
number of shares transferred by the Optionee to the Company as payment.
Stock issued on the exercise of an Option which is forfeited in accordance
with the conditions contained in the grant by the Optionee after issuance
shall be deemed to have never been issued under the Plan and, accordingly,
shall not be counted against the maximum number of shares that can be issued
under the Plan. Notwithstanding the terms of the previous two sentences, the
maximum number of shares for which Incentive Stock Options may be issued
under the Plan shall be two million (2,000,000) shares, subject to adjustment
as provided under Paragraph 6(j), regardless of the fact that under the terms
of the preceding sentences, a lesser number of shares is deemed to be issued
pursuant to the exercise of Incentive Stock Options.
6. Terms and Conditions of Options.
The Board or its delegates shall authorize the granting of all Options
under the Plan with such Options to be evidenced by Incentive Stock Option
Agreements or Non-Statutory Stock Option Agreements, as the case may be.
Each Agreement shall be in such form as the Board may approve from time to
time. Each Agreement shall comply with and be subject to the following terms
and conditions:
(a) Type of Option; Number of Shares. Each particular Option
Agreement shall state the type of Options to be granted (whether
Incentive Stock Options or Non-Statutory Stock Options) and the number
of shares to which the Option pertains. Under no circumstances shall
the aggregate Fair Market Value of the Stock (determined as of the time
the Option is granted) with respect to which incentive stock options are
exercisable for the first time by any Employee during any calendar year
(under all incentive stock option plans of the Company and its
Affiliates) exceed $100,000.
(b) Option Price. Each particular Option Agreement shall state the
Option Price. The Option Price for an Incentive Stock Option shall not
be less than one hundred percent (100%) of the Fair Market Value per
share of Stock on the date the Incentive Stock Option is granted. The
Option Price for a Non-Statutory Stock Option shall be the price per
share of Stock set by the Board or its delegates.
(c) Certificate Legends. Certificates for shares of Stock issued
and delivered to Reporting Persons may be legended, as the Board deems
appropriate, if required by the provisions of any applicable rule or
regulation.
(d) Medium and Time of Payment. The aggregate Option Price shall be
payable upon the exercise of the Option and shall be paid in any
combination of:
(i) United States cash currency;
(ii) a cashier's or certified check to the order of the
Company;
(iii) a personal check acceptable to the Company;
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[PAGE]
(iv) to the extent permitted by the Board, shares of Stock of
the Company (including previously owned Stock or Stock issuable
in connection with the Option exercise), properly endorsed to
the Company, whose Fair Market Value on the date of exercise
equals the aggregate Option Price of the Option being exercised;
or
(v) to the extent permitted by the Board, the Optionee's
entering into an agreement with the Company, whereby a portion
of the Optionee's Options are terminated and where the "built-in
gain" on any Options which are terminated as part of such
agreement equals the aggregate Option Price of the Option being
exercised. "Built-in gain" means the excess of the aggregate
Fair Market Value of any Stock otherwise issuable on exercise of
a terminated Option, over the aggregate Option Price otherwise
due the Company on such exercise.
The Board may permit deemed or constructive transfer of shares in lieu
of actual transfer and physical delivery of certificates. Except to the
extent prohibited by applicable law, the Board may take any necessary or
appropriate steps in order to facilitate the payment of any such Option
Price. Without limiting the foregoing, the Board may cause the Company
to loan the Option Price to the Optionee or to guarantee that any Stock
to be issued will be delivered to a broker or lender in order to allow
the Optionee to borrow the Option Price. The Board, in its sole and
exclusive discretion, may require satisfaction of any rules or
conditions in connection with payment of the Option Price at any
particular time, in any particular form, or with the Company's
assistance. If Stock used to pay any Option Price is subject to any
prior restrictions imposed in connection with any plan of the Company
(including this Plan), an equal number of the shares of Stock acquired on
exercise shall be made subject to such prior restrictions in addition to
any further restrictions imposed on such Stock by the terms of the
Optionee's Agreement or by the Plan.
(e) Duration of Options. Each particular Option Agreement shall
state the term of the Option; provided, however, that all Incentive
Stock Options granted under this Plan shall expire and not be
exercisable after the expiration of ten (10) years from the date
granted; provided, further, that any Incentive Stock Option granted to
an Employee who owns stock at the time the Incentive Stock Option is
granted representing more than ten percent (10%) of the total combined
voting power of all classes of stock of the Company and its Affiliates
shall expire and not be exercisable after the expiration of five (5)
years from the date granted. Non-Statutory Stock Options shall expire
and not be exercisable after the date set by the Board or its delegates
in the particular Option Agreement, or on any later date subsequently
approved by the Board or its delegates.
(f) Exercise of Options.
(i) Each particular Option Agreement shall state when the
Optionee's right to purchase Stock pursuant to the terms of an
Option are exercisable in whole or in part. Subject to the
earlier termination of the right to exercise the Options as
provided under this Plan, Options shall be exercisable in whole
or in part as the Board, in its sole and exclusive discretion,
may provide in the particular Option Agreement, as amended. The
Board may at any time increase the percentage an
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Option is otherwise exercisable under the terms of a particular
Option Agreement. The Board, in its sole and exclusive
discretion, may permit the issuance of Stock underlying an
Option prior to the date the Option is otherwise exercisable,
provided such Stock is subject to repurchase rights which expire
pro rata as the Option would otherwise have become exercisable.
(ii) If the Optionee does not exercise in any one (1) year
period the full number of shares to which he or she is then
entitled to exercise, the Optionee may exercise those shares in
any subsequent year during the term of the Option.
(g) Transfer of Options. An attempted non-permitted transfer of an
Option shall be void.
(h) Death of Optionee. If the Optionee who is an Employee, officer
or Director of the Company or its Affiliates dies while in the employ or
service of the Company or its Affiliates or within a period of three (3)
months after termination of such employment or term of corporate office
and before he or she has fully exercised an Option, the Option may be
exercised, regardless of the expiration date stated in the particular
Option Agreement (to the extent that the Option was exercisable on the
date of death and had not previously been exercised), for one (1) year
after the date of the Optionee's death. Such exercise may be made by a
personal representative of the Optionee or by any person or persons who
shall have acquired the Option directly from the Optionee by bequest or
inheritance. Notwithstanding the foregoing, an Incentive Stock Option
may not be exercised after ten (10) years following the date of grant.
(i) Termination of Employment or Service Other than Death. Subject
to the provisions of Paragraph 6(h) above, in the event that an Optionee who
is an Employee, officer or Director of the Company or its Affiliates shall
cease to be employed by or perform services for the Company or its Affiliates
prior to the Option's expiration date, the exercise of Options held by such
Optionee shall be subject to such limitations on the periods of time during
which such Options may be exercised as may be specified in the particular
Option Agreement, as amended, between the Optionee and the Company.
Notwithstanding the foregoing (and subject to the provisions of Paragraph
6(h) above), an Optionee who is Disabled on the date of termination of
employment or term of corporate office may exercise his or her Option, to the
extent that the Option was exercisable on the date of such termination and
had not previously been exercised, for one (1) year from the date of such
termination; provided, however, that an Option may not be exercised after the
expiration date set forth in the particular Option Agreement, as amended.
Whether authorized leave of absence or absence for military or governmental
service shall constitute termination of employment for purposes of the Plan
shall be determined by the Board in their sole and exclusive discretion. No
provision of the Plan shall be construed so as to grant any individual the
right to remain in the employ or service of the Company for any period of
specific duration.
(j) Recapitalization.
(i) The number of shares issuable under the Plan and the
number and amount of the Option Stock and the Option Price of
outstanding Options shall be
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proportionately adjusted for any increase or decrease in the
number of issued shares of Stock resulting from a subdivision or
consolidation of shares, or for the payment of a stock dividend,
or any other increase or decrease in the number of such shares
effected without receipt of consideration by the Company in
order to preclude the dilution or enlargement of benefits under
the Plan.
(ii) The Board, in its sole and exclusive discretion, may
make such equitable adjustments to the Plan and outstanding
Options, as it deems appropriate in order to preclude the
dilution or enlargement of benefits under the Plan, upon
exchange of all of the outstanding stock of the Company for a
different class or series of capital stock or the separation of
assets of the Company, including a spin-off or other
distribution of stock or property by the Company.
(iii) If the Company shall be the surviving corporation in any
merger or consolidation, each outstanding Option shall pertain
to and apply to the securities to which a holder of the number
of shares of Option Stock would have been entitled. A
dissolution or liquidation of the Company, a merger (other than
a merger the principal purpose of which is to change the state
of the Company's incorporation) or consolidation in which the
Company is not the surviving corporation, a reverse merger in
which the Company is the surviving corporation but the Company's
Common Stock outstanding immediately preceding the merger is
converted by virtue of the merger into other property, or other
capital reorganization in which more than fifty percent (50%) of
the Company's Common Stock is exchanged (unless the dissolution
or liquidation plan, merger or consolidation agreement or
capital reorganization corporate documents expressly provide to
the contrary) shall cause each outstanding Option to terminate,
provided, that each Optionee shall, immediately prior to such
event, have the right to exercise his or her Option in whole or
in part, unless the Option in connection with such event is
either to be assumed by the successor corporation or parent
thereof, or to be replaced with a comparable option to purchase
shares of the capital stock of the successor corporation or
parent thereof, or the Option is to be replaced by a comparable
cash incentive program of the successor corporation based on the
value of the Option on the date of such event. Notwithstanding
the preceding, if, within one (1) year from the date of such
event, an Employee's employment is involuntarily terminated,
then the Employee's outstanding Options, if any, shall become
immediately exercisable.
(iv) All adjustments required by the preceding paragraphs
shall be made by the Board, whose determination in that respect
shall be final, binding and conclusive, provided, that
adjustments shall not be made in a manner that causes an
Incentive Stock Option to fail to continue to qualify as an
"incentive stock option" within the meaning of Code Section 422.
(v) Except as expressly provided in this Paragraph 6(j), an
Optionee shall have no rights by reason of any subdivision or
consolidation of shares of stock of any class, or the payment of
any stock dividend, or any other increase in the number of
shares of stock of any class by reason of any dissolution,
liquidation, merger, consolidation, reorganization, or
separation of assets, and any issue by the
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[PAGE]
Company of shares of stock of any class, or securities
convertible into shares of stock of any class, shall not affect,
and no adjustment by reason thereof shall be made with respect
to, the number or amount of the Option Stock or the Option Price
of outstanding Options.
(vi) The grant or existence of an Option shall not affect in
any way the right or power of the Company to make adjustments,
reclassifications, reorganizations or 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.
(k) Rights as a Shareholder. An Optionee shall not have rights as
a shareholder with respect to any shares until the date of the issuance of a
stock certificate to him or her for such shares. No adjustment shall be made
for dividends (ordinary or extraordinary, whether in cash, securities or
other property) or distributions or other rights for which the record date is
prior to the date of issuance of such stock certificate, except as provided
in Paragraph 6(j) above.
(l) Modification, Extension and Renewal of Options. Subject to the
terms and conditions of the Plan, the Board may modify (including lowering
the Option Price or changing Incentive Stock Options into Non-Statutory Stock
Options), extend or renew outstanding Options granted under the Plan, or
accept the surrender of outstanding Options under this Plan and/or other
stock option plans of the Company (to the extent not previously exercised)
and authorize the granting of new Options in substitution therefor.
Notwithstanding the foregoing, no modification of an Option shall, without
the consent of the Optionee, alter or impair any rights or obligations under
any Option previously granted under the Plan.
(m) Investment Purpose. Each Option under the Plan shall be granted
on the condition that the purchase of Stock thereunder shall be for
investment purposes for the Optionee's own account and not with a view to
resale or distribution. In the event the Stock subject to such Option is
registered under the Securities Act of 1933, as amended, or in the event a
resale of such Stock without such registration would otherwise be
permissible, such condition shall be inoperative if, in the opinion of
counsel for the Company, such condition is not required under the Securities
Act of 1933, or any other applicable law, regulation or rule of any
governmental agency.
(n) Transfer and Exercise of Options. To the extent required by Code
Section 422, each Incentive Stock Option shall state that it is not
transferable or assignable by Optionee otherwise than by will or the laws of
descent and distribution, and that during an Optionee's lifetime, such
Incentive Stock Option shall be exercisable only by the Optionee.
(o) Other Provisions. Each Option Agreement may contain such other
provisions, including without limitation, restrictions upon the exercise or
transferability of the Option, as the Board may deem advisable. Any
Incentive Stock Option Agreement shall contain such limitations and
restrictions upon the exercise of the Incentive Stock Option as shall be
necessary in order that such Incentive Stock Option shall be an "incentive
stock option" as defined in Code Section 422, or to conform to any change in
the law.
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[PAGE]
(p) Withholding Taxes. When the Company becomes required to collect
federal and state income and employment taxes in connection with the exercise
of an Option ("withholding taxes"), the Optionee shall promptly pay to the
Company the amount of such taxes in cash, unless the Board permits or
requires payment in another form. Subject to such conditions as it may
require, the Board, in its sole discretion, may allow an Optionee to
reimburse the Company for payment of withholding taxes with shares of Stock.
If an Optionee is a Reporting Person at the time of exercise and is given an
election to pay any withholding taxes with Stock, the Board shall have sole
discretion to approve or disapprove such election.
(q) Limitation on Grants. The following limitation will apply to
grants of Options under the Plan: no Employee will be granted Options under
the Plan to receive more than seven hundred fifty thousand (750,000) shares
of Stock in any one fiscal year. The limitation set forth in this Paragraph
6(q) is intended to satisfy the requirements applicable to Options intended
to qualify as "performance-based compensation" within the meaning of Section
162(m) of the Code. In the event that such limitation is not required to
qualify Options as performance-based compensation, this limitation shall not
apply under the Plan.
7. Term of Plan.
Incentive Stock Options may be granted pursuant to the Plan from time to
time within a period of ten (10) years from the date the Plan is adopted by
the Board, or the date the Plan is approved by the shareholders of the
Company, whichever is earlier.
8. Amendment of Plan.
With respect to any shares at the time not subject to Options, the Board
may from time to time, insofar as permitted by law, suspend or discontinue
the Plan or revise or amend the Plan in any respect whatsoever, except that,
without approval of the shareholders, no such revision or amendment shall
change the number of shares for which Options may be granted under the Plan,
change the designation of the class of persons eligible to receive Options
under the Plan, materially increase the benefits accruing to Optionees under
the Plan, or decrease the price at which Incentive Stock Options may be
granted. Furthermore, without the approval of the shareholders, the Plan may
not, be amended in any manner that will cause Incentive Stock Options issued
under it to fail to meet the requirements of "incentive stock options" as
defined in Code Section 422. The Board may amend the Plan from time to time
to the extent necessary to comply with any applicable law, rule or other
regulatory requirement.
9. Application of Funds.
The proceeds received by the Company from the sale of Stock pursuant to
the exercise of an Option will be used for general corporate purposes.
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[PAGE]
10. No Obligation to Exercise Option.
The granting of an Option shall impose no obligation upon the Optionee
to exercise such Option.
11. Indemnification.
In addition to such other rights of indemnification as they may have as
Directors, Employees or agents of the Company, the Directors, or any
individuals who are delegated authority by the Board to administer the Plan,
shall be indemnified by the Company against: (i) their reasonable expenses,
including attorneys' fees actually and necessarily incurred in connection
with the defense of any action, suit or proceeding, or in connection with any
appeal therein, to which they or any of them may be a party by reason of any
action taken or failure to act under or in connection with the Plan or any
Option granted thereunder; and (ii) against all amounts paid by them in
settlement thereof (provided such settlement is approved by independent legal
counsel selected by the Company), or paid by them in satisfaction of a
judgment in any such action, suit or proceeding, except in actions to matters
as to which it shall be adjudged in such action, suit or proceeding that such
Director or individual is liable for negligence or misconduct in the
performance of his duties; this indemnification is expressly conditioned upon
the indemnified party, within ninety (90) days after institution of any such
action, suit or proceeding, offering the Company in writing the opportunity,
at its own expense, to handle and defend the same.
12. Approval of Shareholders.
The portions of the Plan dealing with Incentive Stock Options shall not
take effect unless approved by the shareholders of the Company's preferred
(if any) and Common Stock, which approval must occur within a period
commencing twelve (12) months before and ending twelve (12) months after the
date the Plan is adopted by the Board. Nothing in the Plan shall be
construed to limit the authority of the Company to exercise its corporate
rights and powers, including the right of the Company to grant non-statutory
options for proper corporate purposes.
Adopted by the Board of Directors on August 7, 1996.
AGOURON PHARMACEUTICALS, INC.
By:_______________________________
Peter Johnson, President & CEO
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[PAGE]
EXHIBIT 99.2
Notice of Grant of Stock Option
Agouron Pharmaceuticals, Inc.
10350 North Torrey Pines Road
La Jolla, California 92037
(619) 622-8000
[Insert Grantee's Name & Address]
_____________________________
_____________________________
_____________________________
_____________________________
You have been granted an option ("Option") to buy Agouron Pharmaceuticals,
Inc. ("Agouron") common stock as follows:
Stock Option Grant No. _________
Date of Grant _________
Stock Option Agreement _________ (Attachment 1)
Option Price per Share _________
Total Number of Shares Granted _________
Expiration Date/Time _________ 12:00 p.m.
VESTING SCHEDULE
Cumulative Amount
Stock Available of Stock Available
On or After For Exercise For Exercise
_________ _________ _________
_________ _________ _________
_________ _________ _________
_________ _________ TOTAL
By your signature and Agouron's signature below, you and Agouron agree that
this Option is granted under and governed by the terms and conditions of
Agouron's 1996 Stock Option Agreement (Attachment 1) and the 1996 Stock
Option Plan (Attachment 2), which are attachments hereto and are made a part
hereof by this reference.
Attachments:
1. 1996 Stock Option Agreement (Form Dated November 7, 1996).
2. 1996 Stock Option Plan (Adopted by the Shareholders November 7, 1996).
3. Prospectus Information Memorandum, which describes, among other
things, the federal income tax consequences of exercising your
options.
Additionally, if you have not received a copy of Agouron's latest annual
report, please contact the Investor Relations Department, or you may review
the latest annual report information over the Internet at Agouron's Web Site
address:
http://www.agouron.com
AGOURON PHARMACEUTICALS, INC. OPTIONEE
By: ______________________________ __________________________
[Name of Corporate Officer] [Name of Grantee]
EXHIBIT 99.3
ATTACHMENT NO. 1
TO
NOTICE OF GRANT STOCK OPTION
AGOURON PHARMACEUTICALS, INC.
(a California Corporation)
1996 INCENTIVE STOCK OPTION AGREEMENT
This Option Agreement is entered into between Agouron Pharmaceuticals,
Inc., a California corporation and the Optionee whose name appears on the
Notice of Grant of Stock Option to which this Agreement is an attachment.
1. Recitals.
1.01 The Board of Directors of the Company or its duly authorized
delegates authorized the granting of this Option to Optionee who is an
Employee of the Company or its Affiliates pursuant to the Agouron
Pharmaceuticals, Inc. 1996 Stock Option Plan.
1.02 This Option Agreement is intended to constitute an "incentive
stock option" within the meaning of Section 422 of Internal Revenue Code of
1986, as amended from time to time.
2. Definitions.
In addition to those words and phrases defined above and unless
otherwise required by the context in which they appear, words and phrases
having their initial letters capitalized shall have the following meanings:
2.01 Act. "Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time.
2.02 Affiliate. "Affiliate" shall mean any corporation defined as a
"parent corporation" or a "subsidiary corporation" by Code Section 424(e) and
(f), respectively.
2.03 Agreement. "Agreement" shall mean this 1996 Incentive Stock
Option Agreement (including any schedules, attachments, documents
incorporated by reference, or modifications agreed to in writing by the
Company and Optionee) which sets forth the Optionee's and the Company's
rights and obligations with respect to the Option granted Optionee by the
Board or its duly authorized delegates as described on the Notice of Grant.
2.04 Board. "Board" shall mean the Board of Directors of the
Company.
2.05 Code. "Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time.
1996 ISO Form Dated: November 7, 1996 1 of 9
[PAGE]
2.06 Company. "Company" shall mean Agouron Pharmaceuticals, Inc., a
California corporation, and any successors or assigns.
2.07 Date of Grant. "Date of Grant" shall mean the Date of Grant
set forth on the Notice of Grant.
2.08 Disability. "Disability" or "Disabled" shall mean the
condition of being "disabled" within the meaning of Section 422(c)(6) of the
Code or any successor provision.
2.09 Employee. "Employee" shall mean any salaried employee of the
Company or its Affiliates, including those employees who are officers of the
Company or its Affiliates.
2.10 Expiration Date. "Expiration Date" shall mean the Expiration
Date set forth on the Notice of Grant.
2.11 Fair Market Value. "Fair Market Value" of Stock on a given
date shall mean an amount per share, as determined by the Board or its
delegates by applying any reasonable valuation method determined without
regard to any restriction other than a restriction which, by its terms, will
never lapse. Notwithstanding the preceding, if the Stock is traded upon an
established stock exchange, then the "Fair Market Value" of Stock on a given
date per share shall be deemed to be the average of the highest and lowest
selling price per share of the Stock on the principal stock exchange on which
the Stock is then trading or, if there was no trading of the Stock on that
day, on the next preceding day on which there was such trading; if the Stock
is not traded upon an established stock exchange but is quoted on a quotation
system, the "Fair Market Value" of Stock on a given date shall be deemed to
be the mean between the closing representative "bid" and "ask" prices per
share of the Stock on such date as reported by such quotation system or, if
there was no trading of the Stock on that day, on the next preceding day on
which there was such trading.
2.12 Notice of Grant of Stock Option. "Notice of Grant of Stock
Option" or "Notice of Grant" shall mean the Notice of Grant executed by the
Company and the Optionee to which this Agreement is an attachment.
2.13 Option. "Option" shall mean the right of Optionee to purchase
the number of shares of Stock set forth on the Notice of Grant in accordance
with the terms and conditions of this Agreement.
2.14 Optionee. "Optionee" shall mean the person whose name is set
forth on the Notice of Grant.
2.15 Option Price. "Option Price" shall mean the price per share of
Stock to be paid by the Optionee upon exercise of the Option, which amount is
set forth on the Notice of Grant.
1996 ISO Form Dated: November 7, 1996 2 of 9
[PAGE]
2.16 Option Stock. "Option Stock" shall mean the total number of
shares of Stock the Optionee shall be entitled to purchase pursuant to this
Agreement, which number of shares is set forth on the Notice of Grant.
2.17 Plan. "Plan" shall mean the 1996 Agouron Pharmaceuticals, Inc.
Stock Option Plan, as amended from time to time.
2.18 Reporting Person. "Reporting Person" shall mean an Optionee
who is required to file statements relating to his or her beneficial
ownership of Stock with the SEC pursuant to Section 16(a) of the Act.
2.19 Rule 16b-3. "Rule 16b-3" shall mean Rule 16b-3 (as amended
from time to time) promulgated by the SEC under the Act, and any successor
thereto.
2.20 SEC. "SEC" shall mean the Securities and Exchange Commission.
2.21 Stock. "Stock" shall mean the no par common stock of the
Company.
2.22 Vesting. "Vesting" shall mean the date(s) when all or a portion
of the Option Stock becomes available for exercise.
2.23 Vesting Schedule. "Vesting Schedule" shall mean the Vesting
Schedule set forth on the Notice of Grant which indicates on what dates all or
a portion of the Option Stock becomes available for exercise.
3. Option.
3.01 Grant. The Company hereby grants to Optionee an Option to
purchase all or any part of the Option Stock on the terms and conditions set
forth in this Agreement. The Date of Grant shall be the Date of Grant set
forth on the Notice of Grant.
3.02 Purchase Price. The purchase price per share of Stock to be
paid upon the exercise of this Option shall be the Option Price set forth on
the Notice of Grant. This Option Price is deemed by the Board or its
delegatees to be not less than the Fair Market Value of the Stock on the Date
of Grant.
3.03 Restrictions on Transfer. This Option shall not be
transferable by Optionee, other than by will or the laws of descent and
distribution, and may be exercised during Optionee's lifetime only by
Optionee; provided, however, that this Option may be transferred to a trust
for the benefit of the Optionee or members of his or her immediate family,
provided that such transfer does not violate the requirements of Rule 16b-3
and Code Section 422. Upon any attempt to sell, assign, encumber or
otherwise transfer this Option in violation of this Agreement, or upon the
levy of any attachment or similar process upon this Option, this Option shall
immediately become null and void.
1996 ISO Form Dated: November 7, 1996 3 of 9
[PAGE]
3.04 Modifications of Rights. As set forth in Paragraph 6(l) of the
Plan, the Board may modify (including, lowering the Option Price or
converting this Option, which is an incentive stock option, into a non-
statutory stock option), extend or renew this Option (to the extent not
previously exercised), or accept the surrender of this Option (to the extent
not previously exercised) and authorize the granting of new Stock options in
substitution therefor; provided, however, that no modification of this Option
shall, without the consent of the Optionee, alter or impair any existing
rights or obligations of Optionee under this Option.
3.05 Changes in Company's Equity Structure; Recapitalization of
Company. Upon the occurrence of the capital and/or recapitalization
transactions described in Paragraph 6(j) of the Plan, this Option (to the
extent not previously exercised) shall be adjusted or modified as provided in
Paragraph 6(j) of the Plan. Notwithstanding any provision of this Agreement,
the Company reserves the right to:
(a) make or enter into any adjustments, reclassifications,
reorganizations or changes of its capital or business
structure;
(b) merge or consolidate with other entities; or
(c) dissolve, liquidate or sell, or transfer all or any part
of its business or assets.
3.06 Shareholder's Rights. Optionee shall have no rights as a
shareholder with respect to any shares Optionee is entitled to purchase under
this Option until the date of the issuance of a certificate for such shares.
No adjustment shall be made for dividends (ordinary or extraordinary, whether
in cash, securities or other property) or distributions or other rights for
which the record date is prior to the date of issuance of such certificate,
except as provided in this Agreement or in the Plan.
4. Employment Conditions.
4.01 Employment Status. Optionee shall be considered to be in the
employment of the Company as long as Optionee remains an Employee of the
Company or its Affiliates. The Board exclusively shall determine:
(a) whether or when there has been a termination of
Optionee's employment;
(b) if there has been a failure to comply with Optionee's
covenant not to compete obligations; and
(c) the cause of such termination,
which determination shall be final.
4.02 Covenant Not to Compete. Unless otherwise permitted in
writing, Optionee, who is an Employee of the Company or its Affiliates, shall
devote his or her entire time, energy and
1996 ISO Form Dated: November 7, 1996 4 of 9
[PAGE]
skill to the service of the Company or its Affiliates, subject to vacation,
sick leave and other approved absences. Failure of Optionee to comply with
the covenant not to compete obligations stated above within thirty (30) days
of written notice of such failure shall cause, on the thirtieth (30th) day
after such written notice, the cancellation of Optionee's right to purchase
Option Stock (to the extent not previously exercised) without further action
by the Company.
4.03 Termination for Cause. Unless otherwise agreed to by the
Board, if Optionee's employment is terminated for cause, the right of
Optionee to purchase Option Stock shall only be exercisable by Optionee for a
period of thirty (30) days after the date of such termination.
5. Exercise.
5.01 Exercise Amounts. Subject to the earlier termination of the
right to exercise this Option as provided under this Agreement, including
Paragraphs 4.02 and 4.03 above, the Optionee shall be entitled to exercise
the amounts of Option Stock, in whole or in part, as set forth in the Vesting
Schedule on the Notice of Grant.
5.02 Additional Adjustments. Notwithstanding the terms of Paragraph
5.01 of this Agreement, the Board in its sole and exclusive discretion may
provide for conditions for the exercise of this Option and/or modify the
Vesting Schedule set forth on the Notice of Grant; provided, however, the
Board may only modify the conditions for the exercise of this Option and/or
modify the Vesting Schedule to provide for a more restrictive Vesting
Schedule with the consent of Optionee, if such modification alters or impairs
any existing rights or obligations of Optionee under this Option.
5.03 Cumulative Exercise Rights. If the Optionee does not exercise
in any one year period the full number of shares to which he or she is then
entitled to exercise, Optionee may exercise those shares in any subsequent
year prior to the Expiration Date of this Option as set forth on the Notice
of Grant, or such later date subsequently approved by the Board or its
delegates.
5.04 Expiration of Exercise Rights. Subject to the provisions of
Paragraph 5.08, in no event shall this Option be exercisable after the
Expiration Date or such later date subsequently approved by the Board or its
delegates; provided, however, that this Option shall expire and not be
exercisable after the expiration of ten (10) years from the Date of Grant.
5.05 Fractional Shares. This Option shall not be exercisable with
respect to any fractional shares of the Stock.
5.06 Exercise Procedure. This Option shall be exercised by the
giving of written notice of exercise to the Company which specifies the
number of shares of Stock to be purchased, accompanied by payment (in
accordance with the terms of Paragraph 6(d) of the Plan) of the aggregate
Option Price for the shares of Stock being purchased, such payment to be made
in any combination of:
1996 ISO Form Dated: November 7, 1996 5 of 9
[PAGE]
(a) United States cash currency;
(b) a cashier's or certified check to the order of the
Company;
(c) a personal check acceptable to the Company;
(d) to the extent permitted by the Board, shares of Stock
(including previously owned Stock or Stock issuable in
connection with the Option exercise), properly endorsed
to the Company, whose Fair Market Value on the date of
exercise equals the aggregate Option Price of the
Option being exercised; or
(e) to the extent agreed to by the Board, the Optionee's
entering into an agreement with the Company whereby a
portion of the Optionee's Options are terminated and
where the "built-in gain" on any Options which are
terminated as part of such agreement equals the
aggregate Option Price of the Option being exercised.
"Built-in gain" means the excess of the aggregate Fair
Market Value of any Stock otherwise issuable on
exercise of a terminated Option, over the aggregate
Option Price otherwise due the Company on such
exercise;
provided, however, that the form of payment which Optionee selects shall be
permissible under the Code Section 422. The Board (in accordance with the
terms of Paragraph 6(d) of the Plan) may provide such assistance to the
Optionee to facilitate the exercise of this Option as it deems appropriate;
provided, however, that the Board, as a prerequisite to providing such
assistance, may require satisfaction of any rules or conditions it deems
appropriate. Shares of Stock used to pay the Option Price shall be valued at
their Fair Market Value on the date of exercise. The Optionee's notice of
exercise shall also be accompanied by payment (in accordance with the terms
of Paragraph 6(p) of the Plan) of the amount of federal and state income and
employment taxes that the Company is required to collect from Optionee
because of the exercise of the Option.
5.07 Exercise During Life. Subject to the provisions of Paragraphs
4.02, 4.03, 5.04 and 5.08, during Optionee's lifetime, this Option shall be
exercisable only by Optionee either:
(a) while Optionee is employed by the Company or its
Affiliates;
(b) within three (3) months after the date on which
Optionee's employment terminates for reasons other than
"termination for cause" as provided in Paragraph 4.03
of this Agreement; or
(c) within one (1) year after the date on which the
Optionee's employment terminates due to a Disability;
provided, however, that in no event shall the period of exercise be extended
beyond the Expiration Date. Unless the Board or its delegates otherwise
agree, if Optionee is entitled to purchase shares of Stock after the
termination of Optionee's employment, the number of shares of Stock Optionee
1996 ISO Form Dated: November 7, 1996 6 of 9
[PAGE]
may so purchase shall be limited to the number of shares of Stock Optionee
was entitled to purchase as of such date of termination.
5.08 Exercise After Death. If Optionee dies while employed by or
while serving as an officer or director of the Company or its Affiliates or
within a period of three (3) months after the date such employment
terminates, but prior to the complete exercise of this Option, the Option may
be exercised within one (1) year from the date of Optionee's death, but:
(a) only by a personal representative of Optionee, or by
any person or persons who shall have acquired the
Option directly from the Optionee by bequest or
inheritance; and
(b) only to the extent that the Option was exercisable on
the date of death and had not previously been
exercised.
5.09 Consultancy to the Company or Service as a Corporate Officer
After Termination of Employment. If Optionee acts as a consultant or
corporate officer for the Company or its Affiliates after the termination of
his or her employment, then Optionee shall not be deemed to have terminated
his or her employment for the Company or its Affiliates for the purposes of
Paragraphs 5.07 and 5.08 of this Agreement until Optionee ceases to be a
consultant or corporate officer for the Company or its Affiliates, provided
Optionee does not violate any covenant not to compete obligations contained
in his or her employment or consulting agreement with the Company or its
Affiliates. Notwithstanding Optionee not being deemed to have terminated his
or her employment for the Company or its Affiliates pursuant to the terms of
the preceding sentence, this Option, which is an incentive stock option,
shall automatically convert into a non-statutory stock option three (3)
months after the date on which Optionee actually terminates his or her
employment with the Company or its Affiliates (one (1) year if the Optionee
is Disabled on the date of termination).
5.10 Exercise of Option Prior to Vesting. The Board, in its sole
and exclusive discretion, may permit the Optionee to exercise this Option
prior to the date this Option is otherwise exercisable, provided the Stock
issued on such exercise is subject to repurchase rights which expire pro rata
as the Option would otherwise have become exercisable.
5.11 Non-Sequential Exercise Permitted. Subject to the exercise
limitations set forth herein, this Option shall be exercisable
notwithstanding the fact that there is an outstanding incentive stock option
or non-statutory stock option for the purchase of Stock of the Company which
was granted before this Option was granted, and no subsequently-granted
incentive stock option shall fail to be exercisable solely because this Option
remains outstanding.
5.12 Legends. Certificates for shares of Stock acquired upon
exercise of this Option may contain such legends and transfer restrictions as
the Company shall deem reasonably necessary or desirable to:
1996 ISO Form Dated: November 7, 1996 7 of 9
[PAGE]
(a) assure the satisfaction of any liability that the
Company may or will have incurred for withholding of any
federal and state income and employment taxes;
(b) facilitate compliance by the Company with any federal or
state laws or regulations, including, without
limitation, legends restricting transfer of the Stock
until there has been compliance with federal and state
securities laws;
(c) assure notice of the Company's repurchase rights under
Paragraph 5.10 of this Agreement; or
(d) assure notice of such other restrictions as may be
imposed on the Stock under the terms of this Agreement.
6. Conflict Between Plan and Agreement.
This Agreement, including the Option and Optionee's rights hereunder, is
subject to and governed by the Plan. Any conflict between the terms and
provisions of this Agreement and the terms and provisions of the Plan shall
be governed by the terms and provisions of the Plan.
7. Investment Intent.
This Option is granted on the condition that Optionee's purchase of
Stock shall be for investment purposes for Optionee's own account and not
with a view to resale or distribution. The Company shall not, upon the
exercise of this Option, be required to issue or deliver shares of Stock or
certificates therefor if, in the opinion of counsel for the Company, such
issuance or delivery would be in violation of, or would not comply with, any
applicable state or federal securities law, regulation or rule.
8. Notices.
8.01 In Writing. All notices, demands, requests, declarations,
service of process, or other communications permitted or required under this
Agreement or applicable law shall be in writing.
8.02 Delivery. All such communications may be served personally or
may be sent by registered or certified mail, return receipt requested,
postage prepaid and addressed to either Optionee or the Company at the
addresses appearing at the top of the Notice of Grant, or at such other
address as either party shall have communicated to the other pursuant to this
Paragraph 8.02. All such communications shall be deemed effectively
delivered upon personal service or three (3) days after deposit in the United
States Mail.
1996 ISO Form Dated: November 7, 1996 8 of 9
[PAGE]
9. Miscellaneous.
9.01 Successors and Assigns. Except as otherwise provided in this
Agreement, this Agreement shall inure to the benefit of only the Company,
Optionee and their respective successors or assigns.
9.02 Status. Nothing contained in this Agreement shall be construed
as giving Optionee any right to be retained as an Employee, officer or
director of the Company.
9.03 Severability. If any provision or provisions of this Agreement
are adjudged to be, for any reason, unenforceable, illegal or void, the
remainder of the provisions shall remain in full force and effect.
9.04 Integration. This Agreement and the Notice of Grant to which
this Agreement is an attachment constitute the entire understanding of the
parties concerning this Option. Except as otherwise provided, any changes,
modifications, variations, or subordinations pertaining to this Agreement and
the Notice of Grant are invalid, unless stated in writing and executed by the
Company and Optionee.
9.05 Governing Law. This Agreement and the Option granted hereby
shall be governed by the laws of the State of California.
9.06 Attorneys' Fees. If either party brings an action or seeks to
enforce or interpret any of the terms or provisions of this Agreement, the
prevailing party shall be entitled to recover its reasonable attorneys' fees
and costs, in addition to any other remedy it may be awarded.
9.07 Counterparts. This Agreement may be executed in counterparts,
and the counterparts shall constitute the whole instrument.
9.08 Titles for Convenience; Gender; and Plurals. Titles of
articles and paragraph headings are for convenience only and shall not affect
the construction or interpretation of this Agreement, or any portion thereof.
Whenever required by the context hereof, the singular shall include the
plural, and vice versa; the masculine gender shall include the feminine and
neuter, and vice versa.
1996 ISO Form Dated: November 7, 1996 9 of 9
[PAGE]
EXHIBIT 99.4
ATTACHMENT NO. 1
TO
NOTICE OF GRANT OF STOCK OPTION
AGOURON PHARMACEUTICALS, INC.
(a California Corporation)
1996 NON-STATUTORY STOCK OPTION AGREEMENT
FOR
EMPLOYEES, OFFICERS AND DIRECTORS
This Option Agreement is entered into between Agouron Pharmaceuticals,
Inc., a California corporation and the Optionee whose name appears on the
Notice of Grant of Stock Option to which this Agreement is an attachment.
1. Recitals.
1.01 The Board of Directors of the Company or its duly authorized
delegates authorized the granting of this Option to Optionee pursuant to the
Agouron Pharmaceuticals, Inc. 1996 Stock Option Plan.
1.02 This Option Agreement is intended to constitute a non-statutory
stock option, meaning an option which is not an "incentive stock option"
within the meaning of Section 422 of Internal Revenue Code of 1986, as
amended from time to time.
2. Definitions.
In addition to those words and phrases defined above and unless
otherwise required by the context in which they appear, words and phrases
having their initial letters capitalized shall have the following meanings:
2.01 Act. "Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time.
2.02 Affiliate. "Affiliate" shall mean any corporation defined as a
"parent corporation" or a "subsidiary corporation" by Code Section 424(e) and
(f), respectively.
2.03 Agreement. "Agreement" shall mean this 1996 Non-Statutory
Stock Option Agreement (including any schedules, attachments, documents
incorporated by reference, or modifications agreed to in writing by the
Company and Optionee) which sets forth the Optionee's and the Company's rights
and obligations with respect to the Option granted Optionee by the Board or
its duly authorized delegates as described on the Notice of Grant.
2.04 Board. "Board" shall mean the Board of Directors of the
Company.
1996 NS Form Dated: November 7, 1996 1 of 9
[PAGE]
2.05 Code. "Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time.
2.06 Company. "Company" shall mean Agouron Pharmaceuticals, Inc., a
California corporation, and any successors or assigns.
2.07 Date of Grant. "Date of Grant" shall mean the Date of Grant
set forth on the Notice of Grant.
2.08 Disability. "Disability" or "Disabled" shall mean the
condition of being "disabled" within the meaning of Section 422(c)(6) of the
Code or any successor provision.
2.09 Employee. "Employee" shall mean any salaried employee of the
Company or its Affiliates, including those employees who are officers of the
Company or its Affiliates.
2.10 Expiration Date. "Expiration Date" shall mean the Expiration
Date set forth on the Notice of Grant.
2.11 Fair Market Value. "Fair Market Value" of Stock on a given
date shall mean an amount per share, as determined by the Board or its
delegates by applying any reasonable valuation method determined without
regard to any restriction other than a restriction which, by its terms, will
never lapse. Notwithstanding the preceding, if the Stock is traded upon an
established stock exchange, then the "Fair Market Value" of Stock on a given
date per share shall be deemed to be the average of the highest and lowest
selling price per share of the Stock on the principal stock exchange on which
the Stock is then trading or, if there was no trading of the Stock on that
day, on the next preceding day on which there was such trading; if the Stock
is not traded upon an established stock exchange but is quoted on a quotation
system, the "Fair Market Value" of Stock on a given date shall be deemed to be
the mean between the closing representative "bid" and "ask" prices per
share of the Stock on such date as reported by such quotation system or, if
there was no trading of the Stock on that day, on the next preceding day on
which there was such trading.
2.12 Notice of Grant of Stock Option. "Notice of Grant of Stock
Option" or "Notice of Grant" shall mean the Notice of Grant executed by the
Company and the Optionee to which this Agreement is an attachment.
2.13 Option. "Option" shall mean the right of Optionee to purchase
the number of shares of Stock set forth on the Notice of Grant in accordance
with the terms and conditions of this Agreement.
2.14 Optionee. "Optionee" shall mean the person whose name is set
forth on the Notice of Grant.
2.15 Option Price. "Option Price" shall mean the price per share of
Stock to be paid by the Optionee upon exercise of the Option, which amount is
set forth on the Notice of Grant.
1996 NS Form Dated: November 7, 1996 2 of 9
[PAGE]
2.16 Option Stock. "Option Stock" shall mean the total number of
shares of Stock the Optionee shall be entitled to purchase pursuant to this
Agreement, which number of shares is set forth on the Notice of Grant.
2.17 Plan. "Plan" shall mean the 1996 Agouron Pharmaceuticals, Inc.
Stock Option Plan, as amended from time to time.
2.18 Reporting Person. "Reporting Person" shall mean an Optionee
who is required to file statements relating to his or her beneficial
ownership of Stock with the SEC pursuant to Section 16(a) of the Act.
2.19 Rule 16b-3. "Rule 16b-3" shall mean Rule 16b-3 (as amended
from time to time) promulgated by the SEC under the Act, and any successor
thereto.
2.20 SEC. "SEC" shall mean the Securities and Exchange Commission.
2.21 Stock. "Stock" shall mean the no par common stock of the
Company.
2.22 Vesting. "Vesting" shall mean the date(s) when all or a
portion of the Option Stock becomes available for exercise.
2.23 Vesting Schedule. "Vesting Schedule" shall mean the Vesting
Schedule set forth on the Notice of Grant which indicates on what dates all
or a portion of the Option Stock becomes available for exercise.
3. Option.
3.01 Grant. The Company hereby grants to Optionee an Option to
purchase all or any part of the Option Stock on the terms and conditions set
forth in this Agreement. The Date of Grant shall be the Date of Grant set
forth on the Notice of Grant.
3.02 Purchase Price. The purchase price per share of Stock to be
paid upon the exercise of this Option shall be the Option Price set forth on
the Notice of Grant.
3.03 Restrictions on Transfer. This Option may be transferred to a
trust for the benefit of the Optionee or members of his or her immediate
family. Upon any attempt to sell, assign, encumber or otherwise transfer this
Option in violation of this Agreement, or upon the levy of any attachment
or similar process upon this Option, this Option shall immediately become
null and void.
3.04 Modifications of Rights. As set forth in Paragraph 6(l) of the
Plan, the Board may modify (including, lowering the Option Price), extend or
renew this Option (to the extent not previously exercised), or accept the
surrender of this Option (to the extent not previously exercised) and
authorize the granting of a new Stock option in substitution therefor;
provided, however, that no modification of this Option shall, without the
consent of the Optionee, alter or impair any existing rights or obligations
of Optionee under this Option.
1996 NS Form Dated: November 7, 1996 3 of 9
[PAGE]
3.05 Changes in Company's Equity Structure; Recapitalization of
Company. Upon the occurrence of the capital and/or recapitalization
transactions described in Paragraph 6(j) of the Plan, this Option (to the
extent not previously exercised) shall be adjusted or modified as provided in
Paragraph 6(j) of the Plan. Notwithstanding any provision of this Agreement,
the Company reserves the right to:
(a) make or enter into any adjustments, reclassifications,
reorganizations or changes of its capital or business
structure;
(b) merge or consolidate with other entities; or
(c) dissolve, liquidate or sell, or transfer all or any
part of its business or assets.
3.06 Shareholder's Rights. Optionee shall have no rights as a
shareholder with respect to any shares Optionee is entitled to purchase under
this Option until the date of the issuance of a stock certificate for such
shares. No adjustment shall be made for dividends (ordinary or
extraordinary, whether in cash, securities or other property) or
distributions or other rights for which the record date is prior to the date
of issuance of such certificate, except as provided in this Agreement or in
the Plan.
4. Employment Conditions.
4.01 Employment Status. Optionee shall be considered to be in the
employment of the Company as long as Optionee remains an Employee of the
Company or its Affiliates. The Board exclusively shall determine:
(a) whether or when there has been a termination of
Optionee's employment or term of corporate office;
(b) if there has been a failure to comply with Optionee's
covenant not to compete obligations; and
(c) the cause of such termination,
which determination shall be final.
4.02 Covenant Not to Compete. Unless otherwise permitted in
writing, Optionee, who is an Employee of the Company or its Affiliates, shall
devote his or her entire time, energy and skill to the service of the Company
or its Affiliates, subject to vacation, sick leave and other approved
absences. Failure of Optionee to comply with the covenant not to compete
obligations stated above within thirty (30) days of written notice of such
failure shall cause, on the thirtieth (30th) day after such written notice,
the cancellation of Optionee's right to purchase Option Stock (to the extent
not previously exercised) without further action by the Company. The
restriction contained in this Paragraph 4.02 shall only apply to Employees,
and not to officers or directors who are not Employees or consultants for the
Company.
1996 NS Form Dated: November 7, 1996 4 of 9
[PAGE]
4.03 Termination for Cause. Unless otherwise agreed to by the
Board, if Optionee's employment or his or her position as an officer or
director of the Company or its Affiliates is terminated for cause, the right
of Optionee to purchase Option Stock shall only be exercisable for a period
of thirty (30) days after the date of such termination.
5. Exercise.
5.01 Exercise Amounts. Subject to the earlier termination of the
right to exercise this Option as provided under this Agreement, including
Paragraphs 4.02 and 4.03 above, the Optionee shall be entitled to exercise
the amounts of Option Stock, in whole or in part, as set forth in the Vesting
Schedule on the Notice of Grant.
5.02 Additional Adjustments. Notwithstanding the terms of Paragraph
5.01 of this Agreement, the Board in its sole and exclusive discretion may
provide for conditions for the exercise of this Option and/or modify the
Vesting Schedule set forth on the Notice of Grant; provided, however, the
Board may only modify the conditions for the exercise of this Option and/or
modify the Vesting Schedule to provide for a more restrictive Vesting
Schedule with the consent of Optionee, if such modification alters or impairs
any existing rights or obligations of Optionee under this Option.
5.03 Cumulative Exercise Rights. If the Optionee does not exercise
in any one year period the full number of shares to which he or she is then
entitled to exercise, Optionee may exercise those shares in any subsequent
year prior to the Expiration Date of this Option as set forth on the Notice
of Grant, or such later date subsequently approved by the Board or its
delegates.
5.04 Expiration of Exercise Rights. Subject to the provisions of
Paragraph 5.08, in no event shall this Option be exercisable after the
Expiration Date or such later date subsequently approved by the Board or its
delegates.
5.05 Fractional Shares. This Option shall not be exercisable with
respect to any fractional shares of the Stock.
5.06 Exercise Procedure. This Option shall be exercised by the
giving of written notice of exercise to the Company which specifies the
number of shares of Stock to be purchased, accompanied by payment (in
accordance with the terms of Paragraph 6(d) of the Plan) of the aggregate
Option Price for the shares of Stock being purchased, such payment to be made
in any combination of:
(a) United States cash currency;
(b) a cashier's or certified check to the order of the
Company;
(c) a personal check acceptable to the Company;
(d) to the extent permitted by the Board, shares of Stock
(including previously owned Stock or Stock issuable in
connection with the Option exercise),
1996 NS Form Dated: November 7, 1996 5 of 9
[PAGE]
properly endorsed to the Company, whose Fair Market
Value on the date of exercise equals the aggregate
Option Price of the Option being exercised; or
(e) to the extent agreed to by the Board, the Optionee's
entering into an agreement with the Company whereby a
portion of the Optionee's Options are terminated and
where the "built-in gain" on any Options which are
terminated as part of such agreement equals the
aggregate Option Price of the Option being exercised.
"Built-in gain" means the excess of the aggregate Fair
Market Value of any Stock otherwise issuable on
exercise of a terminated Option, over the aggregate
Option Price otherwise due the Company on such
exercise.
The Board (in accordance with the terms of Paragraph 6(d) of the Plan) may
provide such assistance to the Optionee to facilitate the exercise of this
Option as it deems appropriate; provided, however, that the Board, as a
prerequisite to providing such assistance, may require satisfaction of any
rules or conditions it deems appropriate. Shares of Stock used to pay the
Option Price shall be valued at their Fair Market Value on the date of
exercise. The Optionee's notice of exercise shall also be accompanied by
payment (in accordance with the terms of Paragraph 6(p) of the Plan) of the
amount of federal and state income and employment taxes that the Company is
required to collect from Optionee because of the exercise of the Option.
5.07 Exercise During Life. Subject to the provisions of Paragraphs
4.02, 4.03 and 5.08, during Optionee's lifetime, this Option shall be
exercisable only by Optionee either:
(a) while Optionee is employed by or serves as an officer
or director of the Company or its Affiliates;
(b) within three (3) months after the date on which
Optionee's employment or term of corporate office
terminates for reasons other than "termination for
cause" as provided in Paragraph 4.03 of this Agreement;
or
(c) within one (1) year after the date on which the
Optionee's employment or term of corporate office
terminates due to a Disability;
provided, however, that in no event shall the period of exercise be extended
beyond the Expiration Date or such later date subsequently approved by the
Board or its delegates. Unless the Board or its delegates otherwise agree,
if Optionee is entitled to purchase shares of Stock after the termination of
Optionee's employment or termination of his or her corporate office, the
number of shares of Stock Optionee may so purchase shall be limited to the
number of shares of Stock Optionee was entitled to purchase as of such date
of termination.
5.08 Exercise After Death. If Optionee dies while employed by or
while serving as an officer or director of the Company or its Affiliates or
within a period of three (3) months after the date such employment or term of
corporate office terminates, but prior to the complete exercise of this
Option, the Option may be exercised within one (1) year from the date of
Optionee's death, but:
1996 NS Form Dated: November 7, 1996 6 of 9
[PAGE]
(a) only by a personal representative of Optionee, or by
any person or persons who shall have acquired the
Option directly from the Optionee by bequest or
inheritance; and
(b) only as to the number of shares of Stock that Optionee
was entitled to purchase under this Option on the date
of Optionee's death .
5.09 Consultancy to the Company After Termination of Employment or
Term of Corporate Office. If Optionee acts as a consultant for the Company
or its Affiliates after the termination of his or her employment or term of
corporate office, then Optionee shall not be deemed to have terminated his or
her employment or term of corporate office for the Company or its Affiliates
for the purposes of Paragraphs 5.07 and 5.08 of this Agreement until Optionee
ceases to be a consultant for the Company or its Affiliates, provided
Optionee does not violate any covenant not to compete obligations contained
in his or her consulting agreement with the Company or its Affiliates.
5.10 Exercise of Option Prior to Vesting. The Board, in its sole
and exclusive discretion, may permit the Optionee to exercise this Option
prior to the date this Option is otherwise exercisable, provided the Stock
issued on such exercise is subject to repurchase rights which expire pro rata
as the Option would otherwise have become exercisable.
5.11 Non-Sequential Exercise Permitted. Subject to the exercise
limitations set forth herein, this Option shall be exercisable
notwithstanding the fact that there is an outstanding incentive stock option
or non-statutory stock option for the purchase of Stock of the Company which
was granted before this Option was granted, and no subsequently-granted
incentive stock option shall fail to be exercisable solely because this
Option remains outstanding.
5.12 Legends. Certificates for shares of Stock acquired upon
exercise of this Option may contain such legends and transfer restrictions as
the Company shall deem reasonably necessary or desirable to:
(a) assure the satisfaction of any liability that the
Company may or will have incurred for withholding of
any federal and state income and employment taxes;
(b) facilitate compliance by the Company with any federal
or state laws or regulations, including, without
limitation, legends restricting transfer of the Stock
until there has been compliance with federal and state
securities laws;
(c) assure notice of the Company's repurchase rights under
Paragraph 5.10 of this Agreement; or
(d) assure notice of such other restrictions as may be
imposed on the Stock under the terms of this Agreement.
1996 NS Form Dated: November 7, 1996 7 of 9
[PAGE]
6. Conflict Between Plan and Agreement.
This Agreement, including the Option and Optionee's rights hereunder, is
subject to and governed by the Plan. Any conflict between the terms and
provisions of this Agreement and the terms and provisions of the Plan shall
be governed by the terms and provisions of the Plan.
7. Investment Intent.
This Option is granted on the condition that Optionee's purchase of
Stock shall be for investment purposes for Optionee's own account and not
with a view to resale or distribution. The Company shall not, upon the
exercise of this Option, be required to issue or deliver shares of Stock or
certificates therefor if, in the opinion of counsel for the Company, such
issuance or delivery would be in violation of, or would not comply with, any
applicable state or federal securities law, regulation or rule.
8. Notices.
8.01 In Writing. All notices, demands, requests, declarations,
service of process, or other communications permitted or required under this
Agreement or applicable law shall be in writing.
8.02 Delivery. All such communications may be served personally or
may be sent by registered or certified mail, return receipt requested,
postage prepaid and addressed to either Optionee or the Company at the
addresses appearing at the top of the Notice of Grant, or at such other
address as either party shall have communicated to the other pursuant to this
Paragraph 8.02. All such communications shall be deemed effectively
delivered upon personal service or three (3) days after deposit in the United
States Mail.
9. Miscellaneous.
9.01 Successors and Assigns. Except as otherwise provided in this
Agreement, this Agreement shall inure to the benefit of only the Company,
Optionee and their respective successors or assigns.
9.02 Status. Nothing contained in this Agreement shall be construed
as giving Optionee any right to be retained as an Employee, officer or
director of the Company.
9.03 Severability. If any provision or provisions of this Agreement
are adjudged to be, for any reason, unenforceable, illegal or void, the
remainder of the provisions shall remain in full force and effect.
9.04 Integration. This Agreement and the Notice of Grant to which
this Agreement is an attachment constitute the entire understanding of the
parties concerning this Option. Except as otherwise provided, any changes,
modifications, variations, or subordinations pertaining to this
1996 NS Form Dated: November 7, 1996 8 of 9
[PAGE]
Agreement and the Notice of Grant are invalid, unless stated in writing and
executed by the Company and Optionee.
9.05 Governing Law. This Agreement and the Option granted hereby
shall be governed by the laws of the State of California.
9.06 Attorneys' Fees. If either party brings an action or seeks to
enforce or interpret any of the terms or provisions of this Agreement, the
prevailing party shall be entitled to recover its reasonable attorneys' fees
and costs, in addition to any other remedy it may be awarded.
9.07 Counterparts. This Agreement may be executed in counterparts,
and the counterparts shall constitute the whole instrument.
9.08 Titles for Convenience; Gender; and Plurals. Titles of
articles and paragraph headings are for convenience only and shall not affect
the construction or interpretation of this Agreement, or any portion thereof.
Whenever required by the context hereof, the singular shall include the
plural, and vice versa; the masculine gender shall include the feminine and
neuter, and vice versa.
1996 NS Form Dated: November 7, 1996 9 of 9
[PAGE]
EXHIBIT 99.5
ATTACHMENT NO. 1
TO
NOTICE OF GRANT OF STOCK OPTION
AGOURON PHARMACEUTICALS, INC.
(a California Corporation)
1996 NON-STATUTORY STOCK OPTION AGREEMENT
FOR CONSULTANTS
This Option Agreement is entered into between Agouron Pharmaceuticals,
Inc., a California corporation and the Optionee whose name appears on the
Notice of Grant of Stock Option to which this Agreement is an attachment.
1. Recitals.
1.01 The Board of Directors of the Company or its duly authorized
delegates authorized the granting of this Option to Optionee who is a
Consultant to the Company or its Affiliates pursuant to the Agouron
Pharmaceuticals, Inc. 1996 Stock Option Plan.
1.02 This Option Agreement is intended to constitute a non-statutory
stock option, meaning an option which is not an "incentive stock option"
within the meaning of Section 422 of Internal Revenue Code of 1986, as
amended from time to time.
2. Definitions.
In addition to those words and phrases defined above and unless
otherwise required by the context in which they appear, words and phrases
having their initial letters capitalized shall have the following meanings:
2.01 Act. "Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time.
2.02 Affiliate. "Affiliate" shall mean any corporation defined as a
"parent corporation" or a "subsidiary corporation" by Code Section 424(e) and
(f), respectively.
2.03 Agreement. "Agreement" shall mean this 1996 Non-Statutory
Stock Option Agreement for Consultants (including any schedules, attachments,
documents incorporated by reference, or modifications agreed to in writing by
the Company and Optionee) which sets forth the Optionee's and the Company's
rights and obligations with respect to the Option granted Optionee by the
Board or its duly authorized delegates as described on the Notice of Grant.
2.04 Board. "Board" shall mean the Board of Directors of the
Company.
1996 NS Form - Consultant Dated: November 7, 1996 1 of 9
[PAGE]
2.05 Code. "Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time.
2.06 Company. "Company" shall mean Agouron Pharmaceuticals, Inc., a
California corporation, and any successors or assigns.
2.07 Consultant. "Consultant" shall mean any person who is placed
on the Corporation's Consultants List by the Board or its duly authorized
delegates and who agrees in writing to be included thereon.
2.08 Consultant's Agreement. "Consultant's Agreement" shall mean a
consulting agreement between Optionee and the Company and/or its Affiliates.
2.09 Date of Grant. "Date of Grant" shall mean the Date of Grant
set forth on the Notice of Grant.
2.10 Disability. "Disability" or "Disabled" shall mean the
condition of being "disabled" within the meaning of Section 422(c)(6) of the
Code or any successor provision.
2.11 Expiration Date. "Expiration Date" shall mean the Expiration
Date set forth on the Notice of Grant.
2.12 Fair Market Value. "Fair Market Value" of Stock on a given
date shall mean an amount per share, as determined by the Board or its
delegates by applying any reasonable valuation method determined without
regard to any restriction other than a restriction which, by its terms, will
never lapse. Notwithstanding the preceding, if the Stock is traded upon an
established stock exchange, then the "Fair Market Value" of Stock on a given
date per share shall be deemed to be the average of the highest and lowest
selling price per share of the Stock on the principal stock exchange on which
the Stock is then trading or, if there was no trading of the Stock on that
day, on the next preceding day on which there was such trading; if the Stock
is not traded upon an established stock exchange but is quoted on a quotation
system, the "Fair Market Value" of Stock on a given date shall be deemed to
be the mean between the closing representative "bid" and "ask" prices per
share of the Stock on such date as reported by such quotation system or, if
there was no trading of the Stock on that day, on the next preceding day on
which there was such trading.
2.13 Notice of Grant of Stock Option. "Notice of Grant of Stock
Option" or "Notice of Grant" shall mean the Notice of Grant executed by the
Company and the Optionee to which this Agreement is an attachment.
2.14 Option. "Option" shall mean the right of Optionee to purchase
the number of shares of Stock set forth on the Notice of Grant in accordance
with the terms and conditions of this Agreement.
2.15 Optionee. "Optionee" shall mean the person whose name is set
forth on the Notice of Grant.
1996 NS Form - Consultant Dated: November 7, 1996 2 of 9
[PAGE]
2.16 Option Price. "Option Price" shall mean the price per share of
Stock to be paid by the Optionee upon exercise of the Option, which amount is
set forth on the Notice of Grant.
2.17 Option Stock. "Option Stock" shall mean the total number of
shares of Stock the Optionee shall be entitled to purchase pursuant to this
Agreement, which number of shares is set forth on the Notice of Grant.
2.18 Plan. "Plan" shall mean the 1996 Agouron Pharmaceuticals, Inc.
Stock Option Plan, as amended from time to time.
2.19 Reporting Person. "Reporting Person" shall mean an Optionee
who is required to file statements relating to his or her beneficial
ownership of Stock with the SEC pursuant to Section 16(a) of the Act.
2.20 Rule 16b-3. "Rule 16b-3" shall mean Rule 16b-3 (as amended
from time to time) promulgated by the SEC under the Act, and any successor
thereto.
2.21 SEC. "SEC" shall mean the Securities and Exchange Commission.
2.22 Stock. "Stock" shall mean the no par common stock of the
Company.
2.23 Vesting. "Vesting" shall mean the date(s) when all or a
portion of the Option Stock becomes available for exercise.
2.24 Vesting Schedule. "Vesting Schedule" shall mean the Vesting
Schedule set forth on the Notice of Grant which indicates on what dates all
or a portion of the Option Stock becomes available for exercise.
3. Option.
3.01 Grant. The Company hereby grants to Optionee an Option to
purchase all or any part of the Option Stock on the terms and conditions set
forth in this Agreement. The Date of Grant shall be the Date of Grant set
forth on the Notice of Grant.
3.02 Purchase Price. The purchase price per share of Stock to be
paid upon the exercise of this Option shall be the Option Price set forth on
the Notice of Grant.
3.03 Restrictions on Transfer. This Option may be transferred to a
trust for the benefit of the Optionee or members of his or her immediate
family. Upon any attempt to sell, assign, encumber or otherwise transfer
this Option in violation of this Agreement, or upon the levy of any
attachment or similar process upon this Option, this Option shall immediately
become null and void.
3.04 Modifications of Rights. As set forth in Paragraph 6(l) of the
Plan, the Board may modify (including, lowering the Option Price), extend or
renew this Option (to the extent not previously exercised), or accept the
surrender of this Option (to the extent not previously exercised)
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and authorize the granting of a new Stock option in substitution therefor;
provided, however, that no modification of this Option shall, without the
consent of the Optionee, alter or impair any existing rights or obligations
of Optionee under this Option.
3.05 Changes in Company's Equity Structure; Recapitalization of
Company. Upon the occurrence of the capital and/or recapitalization
transactions described in Paragraph 6(j) of the Plan, this Option (to the
extent not previously exercised) shall be adjusted or modified as provided in
Paragraph 6(j) of the Plan. Notwithstanding any provision of this Agreement,
the Company reserves the right to:
(a) make or enter into any adjustments, reclassifications,
reorganizations or changes of its capital or business
structure;
(b) merge or consolidate with other entities; or
(c) dissolve, liquidate or sell, or transfer all or any
part of its business or assets.
3.06 Shareholder's Rights. Optionee shall have no rights as a
shareholder with respect to any shares Optionee is entitled to purchase under
this Option until the date of the issuance of a stock certificate for such
shares. No adjustment shall be made for dividends (ordinary or
extraordinary, whether in cash, securities or other property) or
distributions or other rights for which the record date is prior to the date
of issuance of such certificate, except as provided in this Agreement or in
the Plan.
4. Consultant Conditions.
4.01 Consultant's Agreement. Optionee shall be considered to be
engaged by the Company and its Affiliates until the date of termination of
Optionee's engagement under the terms of his or her Consultant's Agreement.
The Board, in accordance with the terms of Optionee's Consultant's Agreement
shall determine:
(a) whether or when there has been a termination of
Optionee's engagement by the Company and its
Affiliates;
(b) if there has been a failure to comply with Optionee's
covenant not to compete obligations; and
(c) the cause of such termination,
which determination shall be final.
4.02 Covenant Not to Compete. Failure of Optionee to comply with
the covenant not to compete obligations under the terms of his or her
Consultant's Agreement within thirty (30) days of written notice of such
failure shall cause, on the thirtieth (30th) day after such written notice,
the cancellation of Optionee's right to purchase Option Stock (to the extent
not previously exercised) without further action by the Company.
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4.03 Termination for Cause. If Optionee's engagement under the
terms of his or her Consultant's Agreement is terminated for cause, the right
of Optionee to purchase Option Stock shall only be exercisable for a period
of thirty (30) days after the date of such termination.
5. Exercise.
5.01 Exercise Amounts. Subject to the earlier termination of the
right to exercise this Option as provided under this Agreement, including
Paragraphs 4.02 and 4.03 above, the Optionee shall be entitled to exercise
the amounts of Option Stock, in whole or in part, as set forth in the Vesting
Schedule on the Notice of Grant.
5.02 Additional Adjustments. Notwithstanding the terms of Paragraph
5.01 of this Agreement, the Board in its sole and exclusive discretion may
provide for conditions for the exercise of this Option and/or modify the
Vesting Schedule set forth on the Notice of Grant; provided, however, the
Board may only modify the conditions for the exercise of this Option and/or
modify the Vesting Schedule to provide for a more restrictive Vesting
Schedule with the consent of Optionee, if such modification alters or impairs
any existing rights or obligations of Optionee under this Option.
5.03 Cumulative Exercise Rights. If the Optionee does not exercise
in any one year period the full number of shares to which he or she is then
entitled to exercise, Optionee may exercise those shares in any subsequent
year prior to the Expiration Date of this Option as set forth on the Notice
of Grant, or such later date subsequently approved by the Board or its
delegates.
5.04 Expiration of Exercise Rights. Subject to the provisions of
Paragraph 5.08, in no event shall this Option be exercisable after the
Expiration Date or such later date subsequently approved by the Board or its
delegates.
5.05 Fractional Shares. This Option shall not be exercisable with
respect to any fractional shares of the Stock.
5.06 Exercise Procedure. This Option shall be exercised by the
giving of written notice of exercise to the Company which specifies the
number of shares of Stock to be purchased, accompanied by payment (in
accordance with the terms of Paragraph 6(d) of the Plan) of the aggregate
Option Price for the shares of Stock being purchased, such payment to be made
in any combination of:
(a) United States cash currency;
(b) a cashier's or certified check to the order of the
Company;
(c) a personal check acceptable to the Company;
(d) to the extent permitted by the Board, shares of Stock
(including previously owned Stock or Stock issuable in
connection with the Option exercise), properly endorsed
to the Company, whose Fair Market Value on the date of
exercise equals the aggregate Option Price of the
Option being exercised; or
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(e) to the extent agreed to by the Board, the Optionee's
entering into an agreement with the Company whereby a
portion of the Optionee's Options are terminated and
where the "built-in gain" on any Options which are
terminated as part of such agreement equals the
aggregate Option Price of the Option being exercised.
"Built-in gain" means the excess of the aggregate Fair
Market Value of any Stock otherwise issuable on
exercise of a terminated Option, over the aggregate
Option Price otherwise due the Company on such
exercise.
The Board (in accordance with the terms of Paragraph 6(d) of the Plan) may
provide such assistance to the Optionee to facilitate the exercise of this
Option as it deems appropriate; provided, however, that the Board, as a
prerequisite to providing such assistance, may require satisfaction of any
rules or conditions it deems appropriate. Shares of Stock used to pay the
Option Price shall be valued at their Fair Market Value on the date of
exercise. The Optionee's notice of exercise shall also be accompanied by
payment (in accordance with the terms of Paragraph 6(p) of the Plan) of the
amount of federal and state income and employment taxes that the Company is
required to collect from Optionee because of the exercise of the Option.
5.07 Exercise During Life. Subject to the provisions of Paragraphs
4.02, 4.03 and 5.08, during Optionee's lifetime, this Option shall be
exercisable only by Optionee either:
(a) while Optionee is engaged by the Company or its
Affiliates under the terms of his or her Consultant's
Agreement;
(b) within three (3) months after the date on which
Optionee's engagement terminates for reasons other than
"termination for cause" under the terms of his or her
Consultant's Agreement and as provided in Paragraph
4.03 of this Agreement; or
(c) within one (1) year after the date on which the
Optionee's engagement terminates due to a Disability
under the terms of his or her Consultant's Agreement;
provided, however, that in no event shall the period of exercise be extended
beyond the Expiration Date or such later date subsequently approved by the
Board or its delegates. Unless the Board or its delegates otherwise agree,
if Optionee is entitled to purchase shares of Stock after the termination of
Optionee's engagement under his or her Consultant's Agreement, the number of
shares of Stock Optionee may so purchase shall be limited to the number of
shares of Stock Optionee was entitled to purchase as of such date of
termination.
5.08 Exercise After Death. If Optionee dies while engaged by the
Company or its Affiliates under the terms of his or her Consultant's
Agreement or within a period of three (3) months after the date such
engagement terminates, but prior to the complete exercise of this Option, the
Option may be exercised within one (1) year from the date of Optionee's
death, but:
1996 NS Form - Consultant Dated: November 7, 1996 6 of 9
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(a) only by a personal representative of Optionee, or by
any person or persons who shall have acquired the
Option directly from the Optionee by bequest or
inheritance; and
(b) only as to the number of shares of Stock that Optionee
was entitled to purchase under this Option on the date
of Optionee's death .
5.09 Exercise of Option Prior to Vesting. The Board, in its sole
and exclusive discretion, may permit the Optionee to exercise this Option
prior to the date this Option is otherwise exercisable, provided the Stock
issued on such exercise is subject to repurchase rights which expire pro rata
as the Option would otherwise have become exercisable.
5.10 Non-Sequential Exercise Permitted. Subject to the exercise
limitations set forth herein, this Option shall be exercisable
notwithstanding the fact that there is an outstanding incentive stock option
or non-statutory stock option for the purchase of Stock of the Company which
was granted before this Option was granted, and no subsequently-granted
incentive stock option shall fail to be exercisable solely because this
Option remains outstanding.
5.11 Legends. Certificates for shares of Stock acquired upon
exercise of this Option may contain such legends and transfer restrictions as
the Company shall deem reasonably necessary or desirable to:
(a) assure the satisfaction of any liability that the
Company may or will have incurred for withholding of
any federal and state income and employment taxes;
(b) facilitate compliance by the Company with any federal
or state laws or regulations, including, without
limitation, legends restricting transfer of the Stock
until there has been compliance with federal and state
securities laws;
(c) assure notice of the Company's repurchase rights under
Paragraph 5.09 of this Agreement; or
(d) assure notice of such other restrictions as may be
imposed on the Stock under the terms of this Agreement.
6. Conflict Between Plan and Agreement.
This Agreement, including the Option and Optionee's rights hereunder, is
subject to and governed by the Plan. Any conflict between the terms and
provisions of this Agreement and the terms and provisions of the Plan shall
be governed by the terms and provisions of the Plan.
1996 NS Form - Consultant Dated: November 7, 1996 7 of 9
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7. Investment Intent.
This Option is granted on the condition that Optionee's purchase of
Stock shall be for investment purposes for Optionee's own account and not
with a view to resale or distribution. The Company shall not, upon the
exercise of this Option, be required to issue or deliver shares of Stock or
certificates therefor if, in the opinion of counsel for the Company, such
issuance or delivery would be in violation of, or would not comply with, any
applicable state or federal securities law, regulation or rule.
8. Notices.
8.01 In Writing. All notices, demands, requests, declarations,
service of process, or other communications permitted or required under this
Agreement or applicable law shall be in writing.
8.02 Delivery. All such communications may be served personally or
may be sent by registered or certified mail, return receipt requested,
postage prepaid and addressed to either Optionee or the Company at the
addresses appearing at the top of the Notice of Grant, or at such other
address as either party shall have communicated to the other pursuant to this
Paragraph 8.02. All such communications shall be deemed effectively
delivered upon personal service or three (3) days after deposit in the United
States Mail.
9. Miscellaneous.
9.01 Successors and Assigns. Except as otherwise provided in this
Agreement, this Agreement shall inure to the benefit of only the Company,
Optionee and their respective successors or assigns.
9.02 No Right to be a Consultant. Nothing contained in this
Agreement shall be construed as giving Optionee any right to be retained as a
consultant for the Company.
9.03 Severability. If any provision or provisions of this Agreement
are adjudged to be, for any reason, unenforceable, illegal or void, the
remainder of the provisions shall remain in full force and effect.
9.04 Integration. This Agreement and the Notice of Grant to which
this Agreement is an attachment constitute the entire understanding of the
parties concerning this Option. Except as otherwise provided, any changes,
modifications, variations, or subordinations pertaining to this Agreement and
the Notice of Grant are invalid, unless stated in writing and executed by the
Company and Optionee.
9.05 Governing Law. This Agreement and the Option granted hereby
shall be governed by the laws of the State of California.
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9.06 Attorneys' Fees. If either party brings an action or seeks to
enforce or interpret any of the terms or provisions of this Agreement, the
prevailing party shall be entitled to recover its reasonable attorneys' fees
and costs, in addition to any other remedy it may be awarded.
9.07 Counterparts. This Agreement may be executed in counterparts,
and the counterparts shall constitute the whole instrument.
9.08 Titles for Convenience; Gender; and Plurals. Titles of
articles and paragraph headings are for convenience only and shall not affect
the construction or interpretation of this Agreement, or any portion thereof.
Whenever required by the context hereof, the singular shall include the
plural, and vice versa; the masculine gender shall include the feminine and
neuter, and vice versa.
9.09 Consultants List. Consultant's execution of this Agreement
indicates his written agreement to be placed on the Company's Consultants
List.
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