<PAGE>
As filed with the Securities and Exchange Commission on June 15, 1999.
File No. 333-_______
- ------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
VICAL INCORPORATED
(Exact name of registrant as specified in its charter)
Delaware 93-0948554
- ------------------------------------ ---------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
9373 Towne Centre Drive, Suite 100
San Diego, California 92121
- ------------------------------------ ---------------------------
(Address of Principal (Zip Code)
Executive Offices)
STOCK INCENTIVE PLAN OF VICAL INCORPORATED
(Full title of the plan)
Copy to:
ALAIN B. SCHREIBER, M.D. THOMAS E. SPARKS, JR.
President and Chief Executive Officer PILLSBURY
VICAL INCORPORATED MADISON & SUTRO LLP
9373 Towne Centre Drive, Suite 100 Post Office Box 7880
San Diego, California 92121 San Francisco, California 94120
(619) 453-9900 (415) 983-1000
- ------------------------------------------ --------------------------------
(Name, address and telephone
number, including area code,
of agent for service)
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
- -------------------------- --------------------- ------------------------- -------------------------- ----------------------
Title of Securities To Amount To Be Proposed Maximum Proposed Maximum Amount of
Be Registered Registered(1) Offering Price Per Aggregate Offering Registration Fee
Share(2) Price(2)
- -------------------------- --------------------- ------------------------- -------------------------- ----------------------
<S> <C> <C> <C> <C>
Common Stock, $.01 par 750,000 shares $11.25 $8,437,500 $2,345.63
value
- -------------------------- --------------------- ------------------------- -------------------------- ----------------------
</TABLE>
(1) Calculated pursuant to General Instruction E to Form S-8
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c), based upon the average of the high and low
prices of the Registrant's Common Stock as reported on The Nasdaq
National Market on June 1, 1999.
----------------
The Registration Statement shall become effective upon filing in accordance with
Rule 462 under the Securities Act of 1933.
<PAGE>
INFORMATION REQUIRED PURSUANT TO
GENERAL INSTRUCTION E TO FORM S-8
GENERAL INSTRUCTION E INFORMATION
This Registration Statement is being filed for the purpose of increasing
the number of securities of the same class as other securities for which a
Registration Statement of the Registrant on Form S-8 relating to the same
employee benefit plan is effective.
Registrant's Form S-8 Registration Statements filed with the Securities and
Exchange Commission on April 9, 1993 (File No. 33-60826), July 15, 1994 (File
No. 33-81602), June 27, 1997 (File No. 333-30181) and July 31, 1998 (File No.
333-60293) are hereby incorporated by reference.
INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents filed by Registrant with the Securities and
Exchange Commission are incorporated by reference in this Registration
Statement:
(1) Registrant's Annual Report on Form 10-K (File No. 0-21088) for the
fiscal year ended December 31, 1998, which contains, among other things, the
financial statements of Registrant for the fiscal year ended December 31, 1998
together with the report thereon of Arthur Andersen LLP, independent public
accountants.
(2) Registrant's Quarterly Report on Form 10-Q for the quarter ended March
31, 1999.
(3) The description of Registrant's common stock contained in Registrant's
Registration Statement on Form 8-A filed as of January 8, 1993 and the
description of the Preferred Stock Purchase Rights for Series A Participating
Preferred Stock, par value $.001 per share, of the Registrant contained in
Registrant's Registration Statement on Form 8-A filed March 23, 1995.
In addition, all documents subsequently filed by Registrant pursuant to
Section 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.
1
<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 June 11, 1999.
VICAL INCORPORATED
By /s/ Alain B. Schreiber
------------------------------------
President and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN AND WOMEN BY THESE PRESENTS, that each person whose
signature appears below constitutes and appoints Alain B. Schreiber or Martha J.
Demski his or her attorney-in-fact, with power of substitution for him or her in
any and all capacities, to sign any amendments to this Registration Statement,
and to file the same, with exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, hereby ratifying and
confirming all that said attorney-in-fact, or his or her substitute or
substitutes, may do or cause to be done by virtue thereof.
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:
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- -----
<S> <C> <C>
/s/ Alain B. Schreiber, M.D. President, Chief Executive Officer June 11, 1999
- --------------------------------------- (Principal Executive Officer) and
Director
/s/ Martha J. Demski Vice President, Chief Financial June 11, 1999
- --------------------------------------- Officer, Secretary and Treasurer
/s/ R. Gordon Douglas, Jr. Director June 11, 1999
- ---------------------------------------
/s/ Patrick F. Latterell Director June 11, 1999
- ---------------------------------------
/s/ Philip M. Young Director June 11, 1999
- ---------------------------------------
/s/ Dale A. Smith Director June 11, 1999
- ---------------------------------------
/s/ M. Blake Ingle Director June 11, 1999
- ---------------------------------------
/s/ Gary A. Lyons Director June 11, 1999
- ---------------------------------------
</TABLE>
2
<PAGE>
INDEX TO EXHIBITS
Exhibit
Number Exhibit
------ ------------
5.1 Opinion regarding legality of securities to be offered.
10.1 Stock Incentive Plan of Vical Incorporated.
23.1 Consent of Arthur Andersen LLP.
23.2 Consent of Pillsbury Madison & Sutro LLP (included in Exhibit 5.1).
25.1 Power of Attorney (see page 3).
3
<PAGE>
EXHIBIT 5.1
OPINION OF PILLSBURY MADISON & SUTRO LLP
June 15, 1999
Vical Incorporated
9373 Towne Centre Drive, Suite 100
San Diego, CA 92121
Ladies and Gentlemen:
With reference to the Registration Statement on Form S-8 to be filed by
Vical Incorporated, a Delaware corporation (the "Company"), with the Securities
and Exchange Commission under the Securities Act of 1933, relating to 750,000
shares of the Company's Common Stock issuable pursuant to the Amended and
Restated Stock Incentive Plan of Vical Incorporated (the "Plan"), it is our
opinion that such shares of the Common Stock of the Company, when issued and
sold in accordance with the Plan, will be legally issued, fully paid and
nonassessable.
We hereby consent to the filing of this opinion with the Securities and
Exchange Commission as Exhibit 5.1 to the Registration Statement.
Very truly yours,
/s/ Pillsbury Madison & Sutro LLP
Pillsbury Madison & Sutro LLP
<PAGE>
EXHIBIT 10.1
STOCK INCENTIVE PLAN OF VICAL INCORPORATED
SECTION 1. ESTABLISHMENT AND PURPOSE.
The Plan was adopted on October 14, 1992. The Plan was amended and
restated effective as of January 7, 1993, was amended and restated effective as
of December 4, 1996, was amended and restated March 11, 1998, and was amended
and restated March 2, 1999.
The purpose of the Plan is to offer Employees an opportunity to acquire
a proprietary interest in the success of the Company, or to increase such
interest, by purchasing Shares of the Company's Stock. The Plan provides both
for the direct award or sale of Shares and for the grant of Options to purchase
Shares. Options granted under the Plan may include NSOs as well as ISOs intended
to qualify under Section 422 of the Code.
The Plan is intended to comply in all respects with Rule 16b-3 (or its
successor) under the Exchange Act and shall be construed accordingly.
SECTION 2. DEFINITIONS.
(a) "BOARD OF DIRECTORS" shall mean the Board of Directors of the
Company, as constituted from time to time.
(b) "CHANGE IN CONTROL" shall mean the occurrence of either of the
following events:
(i) A change in the composition of the Board of Directors, as
a result of which fewer than one-half of the incumbent directors are
directors who either:
(A) Had been directors of the Company 24 months prior to
such change; or
(B) Were elected, or nominated for election, to the
Board of Directors with the affirmative votes of at least a
majority of the directors who had been directors of the
Company 24 months prior to such change and who were still in
office at the time of the election or nomination; or
(ii) Any "person" (as such term is used in Sections 13(d) and
14(d) of the Exchange Act) by the acquisition or aggregation of securities
is or becomes the beneficial owner, directly or indirectly, of securities
of the Company representing 50 percent or more of the combined voting power
of the Company's then outstanding securities ordinarily (and apart from
rights accruing under special circumstances) having the right to vote at
elections of directors (the "Base Capital Stock"); except that any change
in the relative beneficial ownership of the Company's securities by
<PAGE>
any person resulting solely from a reduction in the aggregate number of
outstanding shares of Base Capital Stock, and any decrease thereafter in
such person's ownership of securities, shall be disregarded until such
person increases in any manner, directly or indirectly, such person's
beneficial ownership of any securities of the Company.
(c) "CODE" shall mean the Internal Revenue Code of 1986, as amended.
(d) "COMMITTEE" shall mean a committee of the Board of Directors, as
described in Section 3(a).
(e) "COMMON-LAW EMPLOYEE" means an individual paid from W-2 Payroll of
the Company or a Subsidiary. If, during any period, the Company (or a
Subsidiary, as applicable) has not treated an individual as a Common-Law
Employee and, for that reason, has not withheld employment taxes with respect to
him or her, then that individual shall not be an Employee for that period, even
if any person, court of law or government agency determines, retroactively, that
individual is or was a Common-Law Employee during all or any portion of that
period.
(f) "COMPANY" shall mean Vical Incorporated, a Delaware corporation.
(g) "EMPLOYEE" shall mean (i) any individual who is a Common-Law
Employee of the Company or of a Subsidiary or (ii) an Outside Director and (iii)
a consultant or adviser who provides services to the Company or a Subsidiary as
an independent contractor. Service as an Outside Director or as an independent
contractor shall be considered employment for all purposes of the Plan except as
provided in Sections 4(b) and 4(c).
(h) "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended.
(i) "EXERCISE PRICE" shall mean the amount for which one Share may be
purchased upon exercise of an option, as specified by the Committee in the
applicable Stock Option Agreement.
(j) "FAIR MARKET VALUE" shall mean the market price of Stock,
determined by the Committee as follows:
(i) If Stock was traded over-the-counter on the date in
question but was not traded on the Nasdaq Stock Market or the Nasdaq
National Market, then the Fair Market Value shall be equal to the mean
between the last reported representative bid and asked prices quoted
for such date by the principal automated inter-dealer quotation system
on which Stock is quoted or, if Stock is not quoted on any such system,
the "Pink Sheets" published by the National Quotation Bureau, Inc.;
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<PAGE>
(ii) If Stock was traded over-the-counter on the date in
question and was traded on the Nasdaq Stock Market or the Nasdaq
National Market, then the Fair Market Value shall be equal to the last
transaction price quoted for such date by the Nasdaq Stock Market or
the Nasdaq National Market;
(iii) If Stock was traded on a stock exchange on the date in
question, then the Fair Market Value shall be equal to the closing
price reported by the applicable composite transactions report for such
date; and
(iv) If none of the foregoing provisions is applicable, then
the Fair Market Value shall be determined by the Committee in good
faith on such basis as it deems appropriate.
Whenever possible, the determination of Fair Market Value by the
Committee shall be based on the prices reported in the Western Edition of THE
WALL STREET JOURNAL. Such determination shall be conclusive and binding on all
persons.
(k) "INCENTIVE STOCK OPTION" or "ISO" shall mean an employee incentive
stock option described in Section 422(b) of the Code.
(l) "NONSTATUTORY OPTION" or "NSO" shall mean an employee stock option
not described in Sections 422(b) or 423(b) of the Code.
(m) "OFFEREE" shall mean an individual to whom the Committee has
offered the right to acquire Shares under the Plan (other than upon exercise
of an Option).
(n) "OPTION" shall mean an ISO or NSO granted under the Plan and
entitling the holder to purchase Shares.
(o) "OPTIONEE" shall mean an individual who holds an Option.
(p) "OUTSIDE DIRECTOR" shall mean a member of the Board of Directors
who is not a Common-Law Employee of the Company or of a Subsidiary.
(q) "PLAN" shall mean this Stock Incentive Plan of Vical Incorporated,
formerly the 1992 Stock Plan of Vical Incorporated.
(r) "PURCHASE PRICE" shall mean the consideration for which one Share
may be acquired under the Plan (other than upon exercise of an Option), as
specified by the Committee.
(s) "SERVICE" shall mean service as an Employee.
(t) "SHARE" shall mean one share of Stock, as adjusted in
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<PAGE>
accordance with Section 9 (if applicable).
(u) "STOCK" shall mean the Common Stock ($.01 par value) of the
Company.
(v) "STOCK OPTION AGREEMENT" shall mean the agreement between the
Company and an Optionee which contains the terms, conditions and restrictions
pertaining to the Optionee's Option.
(w) "STOCK PURCHASE AGREEMENT" shall mean the agreement between the
Company and an Offeree who acquires Shares under the Plan which contains the
terms, conditions and restrictions pertaining to the acquisition of such
Shares.
(x) "SUBSIDIARY" shall mean any corporation if the Company and/or
one or more other Subsidiaries own not less than 50 percent of the total
combined voting power of all classes of outstanding stock of such
corporation. A corporation that attains the status of a Subsidiary on a date
after the adoption of the Plan shall be considered a Subsidiary commencing as
of such date.
(y) "TOTAL AND PERMANENT DISABILITY" shall mean that the Optionee is
unable to engage in any substantial gainful activity by reason of any
medically determinable physical or mental impairment which can be expected to
result in death or which has lasted, or can be expected to last, for a
continuous period of not less than one year.
(z) "W-2 PAYROLL" shall mean whatever mechanism or procedure that the
Company or a Subsidiary utilizes to pay any individual which results in the
issuance of a Form W-2 to the individual. "W-2 Payroll" does not include any
mechanism or procedure which results in the issuance of any form other than a
Form W-2 to an individual, including, but not limited to, any Form 1099 which
may be issued to an independent contractor, an agency employee or a consultant.
Whether a mechanism or procedure qualifies as a "W-2 Payroll" shall be
determined in the absolute discretion of the Company (or Subsidiary, as
applicable), and the Company or Subsidiary determination shall be conclusive and
binding on all persons.
SECTION 3. ADMINISTRATION.
(a) COMMITTEE COMPOSITION. The Plan shall be administered by the
Committee. Except as provided below, the Committee shall consist exclusively of
directors of the Company, who shall be appointed by the Board. In addition, the
composition of the Committee shall satisfy:
(i) Such requirements, if any, as the Securities and Exchange
Commission may establish for administrators acting under plans intended
to qualify for exemption under Rule 16b-3 (or its successor) under the
Exchange Act; and
-4-
<PAGE>
(ii) Such requirements as the Internal Revenue Service may
establish for outside directors acting under plans intended to qualify
for exemption under Section 162(m)(4)(C) of the Code.
The Board may act on its own behalf with respect to Outside Directors and may
also appoint one or more separate committees composed of one or more officers of
the Company, who need not be directors of the Company and who need not satisfy
the foregoing requirements, who may administer the Plan with respect to
Employees who are not "covered employees" under Section 162(m)(3) of the Code
and who are not required to report pursuant to Section 16(a) of the Exchange
Act.
(b) COMMITTEE RESPONSIBILITIES. The Committee shall (i) select the
Employees who are to receive Options and other rights to acquire shares under
the Plan, (ii) determine the type, number, vesting requirements and other
features and conditions of such Options or other rights, (iii) interpret the
Plan and (iv) make all other decisions relating to the operation of the Plan.
The Committee may adopt such rules or guidelines as it deems appropriate to
implement the Plan. The Committee's determinations under the Plan shall be final
and binding on all persons.
SECTION 4. ELIGIBILITY.
(a) GENERAL RULES. Only Employees (including, without limitation,
independent contractors who are not members of the Board) shall be eligible for
designation as Optionees or Offerees by the Committee.
(b) OUTSIDE DIRECTORS. The Committee may provide that the NSOs that
otherwise would be granted to an Outside Director under this Plan shall instead
be granted to an affiliate of such Outside Director. Such affiliate shall then
be deemed to be an Outside Director for purposes of the Plan, provided that the
service-related vesting and termination provisions pertaining to the NSOs shall
be applied with regard to the service of the Outside Director.
(c) INCENTIVE STOCK OPTIONS. Only Employees who are Common-Law
Employees of the Company or a Subsidiary shall be eligible for the grant of
ISOs. In addition, an Employee who owns more than 10% of the total combined
voting power of all classes of outstanding stock of the Company or any of its
Subsidiaries shall not be eligible for the grant of an ISO unless the
requirements set forth in Section 422(c)(6) of the Code are satisfied.
-5-
<PAGE>
SECTION 5. STOCK SUBJECT TO PLAN.
(a) BASIC LIMITATION. Shares offered under the Plan shall be authorized
but unissued Shares or treasury Shares. The aggregate number of Shares which may
be issued under the Plan (upon exercise of Options or other rights to acquire
Shares) shall not exceed 3,200,000 Shares (subject to adjustment pursuant to
Section 9). Of the Shares available hereunder, no more than 30% in the aggregate
shall be available with respect to Outside Directors, subject to adjustment
pursuant to Section 9. The number of Shares that are subject to Options or other
rights outstanding at any time under the Plan shall not exceed the number of
Shares that then remain available for issuance under the Plan. The Company,
during the term of the Plan, shall at all times reserve and keep available
sufficient Shares to satisfy the requirements of the Plan. Notwithstanding any
other provision of the Plan, no Employee shall receive a grant of more than
300,000 Shares in any calendar year.
(b) ADDITIONAL SHARES. In the event that any outstanding option or
other right for any reason expires or is canceled or otherwise terminated, the
Shares allocable to the unexercised portion of such Option or other right shall
again be available for the purposes of the Plan. In the event that Shares issued
under the Plan are reacquired by the Company pursuant to any forfeiture
provision, right of repurchase or right of first refusal, such Shares shall
again be available for the purposes of the Plan.
SECTION 6. TERMS AND CONDITIONS OF AWARDS OR SALES.
(a) STOCK PURCHASE AGREEMENT. Each award or sale of Shares under the
Plan (other than upon exercise of an option) shall be evidenced by a Stock
Purchase Agreement between the Offeree and the Company. Such award or sale shall
be subject to all applicable terms and conditions of the Plan and may be subject
to any other terms and conditions which are not inconsistent with the Plan and
which the Committee deems appropriate for inclusion in a Stock Purchase
Agreement. The provisions of the various Stock Purchase Agreements entered into
under the Plan need not be identical.
(b) DURATION OF OFFERS AND NON-TRANSFERABILITY OF RIGHTS. Any right to
acquire Shares under the Plan (other than an Option) shall automatically expire
if not exercised by the Offeree within 30 days after the grant of such right was
communicated to the Offeree by the Committee. Such right shall not be
transferable and shall be exercisable only by the Offeree to whom such right was
granted.
(c) PURCHASE PRICE. The Purchase Price of Shares to be offered under
the Plan shall not be less than the par value of such Shares. Subject to the
preceding sentence, the Purchase Price shall be determined by the Committee at
its sole
-6-
<PAGE>
discretion. The Purchase Price shall be payable in a form described in
Section 8.
(d) WITHHOLDING TAXES. As a condition to the purchase of Shares, the
Offeree shall make such arrangements as the Committee may require for the
satisfaction of any federal, state, local or foreign withholding tax obligations
that may arise in connection with such purchase. The Committee may permit the
Offeree to satisfy all or part of his or her tax obligations related to such
Shares by having the Company withhold a portion of any Shares that otherwise
would be issued to him or her or by surrendering any Shares that previously were
acquired by him or her. The Shares withheld or surrendered shall be valued at
their Fair Market Value on the date when taxes otherwise would be withheld in
cash. The payment of taxes by assigning Shares to the Company, if permitted by
the Committee, shall be subject to such restrictions as the Committee may
impose, including any restrictions required by rules of the Securities and
Exchange Commission.
(e) RESTRICTIONS ON TRANSFER OF SHARES. Any Shares awarded or sold
under the Plan shall be subject to such special forfeiture conditions, rights of
repurchase, rights of first refusal and other transfer restrictions as the
Committee may determine. Such restrictions shall be set forth in the applicable
Stock Purchase Agreement and shall apply in addition to any restrictions that
may apply to holders of Shares generally.
(f) EFFECT OF CHANGE IN CONTROL. The Committee may determine, at the
time of granting Shares or thereafter, that such Shares shall become fully
vested on an accelerated basis in the event that a Change in Control occurs with
respect to the Company. If the Committee finds that there is a reasonable
possibility that, within the succeeding six months, a Change in Control will
occur with respect to the Company, then the Committee may determine that all
Shares shall be fully vested on an accelerated basis.
SECTION 7. TERMS AND CONDITIONS OF OPTIONS.
(a) STOCK OPTION AGREEMENT. Each grant of an Option under the Plan
shall be evidenced by a Stock Option Agreement between the Optionee and the
Company. Such Option shall be subject to all applicable terms and conditions of
the Plan and may be subject to any other terms and conditions which are not
inconsistent with the Plan and which the Committee deems appropriate for
inclusion in a Stock Option Agreement. The Stock Option Agreement shall specify
whether the Option is an ISO or an NSO. The provisions of the various Stock
Option Agreements entered into under the Plan need not be identical.
-7-
<PAGE>
(b) NUMBER OF SHARES. Each Stock Option Agreement shall specify the
number of Shares that are subject to the Option and shall provide for the
adjustment of such number in accordance
with Section 9.
(c) EXERCISE PRICE. Each Stock Option Agreement shall specify the
Exercise Price; provided that the Exercise Price shall in no event be less than
100% of the Fair Market Value of a Share on the date of grant (except as a
higher percentage may be required by Section 4(c)). Subject to the preceding
sentence, the Exercise Price under any Option shall be determined by the
Committee at its sole discretion. The Exercise Price shall be payable in a form
described in Section 8.
(d) WITHHOLDING TAXES. As a condition to the exercise of an Option, the
Optionee shall make such arrangements as the Committee may require for the
satisfaction of any federal, state, local or foreign withholding tax obligations
that may arise in connection with such exercise. The Optionee shall also make
such arrangements as the Committee may require for the satisfaction of any
federal, state, local or foreign withholding tax obligations that may arise in
connection with the disposition of Shares acquired by exercising an Option. The
Committee may permit the Optionee to satisfy all or part of his or her tax
obligations related to the Option by having the Company withhold a portion of
any Shares that otherwise would be issued to him or her or by surrendering any
Shares that previously were acquired by him or her. Such Shares shall be valued
at their Fair Market Value on the date when taxes otherwise would be withheld in
cash. The payment of taxes by assigning Shares to the Company, if permitted by
the Committee, shall be subject to such restrictions as the Committee may
impose, including any restrictions required by rules of the Securities and
Exchange Commission.
(e) EXERCISABILITY. Each Stock Option Agreement shall specify the date
when all or any installment of the Option is to become exercisable. The vesting
of any Option shall be determined by the Committee at its sole discretion. A
Stock Option Agreement may provide for accelerated exercisability in the event
of the Optionee's death, Total and Permanent Disability, retirement or other
events.
(f) EFFECT OF CHANGE IN CONTROL. The Committee may determine, at the
time of granting an Option or thereafter, that such Option shall become
exercisable on an accelerated basis in the event that a Change in Control occurs
with respect to the Company. If the Committee finds that there is a reasonable
possibility that, within the succeeding six months, a Change in Control will
occur with respect to the Company, then the Committee may determine that all
outstanding Options shall be exercisable on an accelerated basis.
-8-
<PAGE>
(g) TERM. The Stock Option Agreement shall specify the term of the
Option. The term shall not exceed 10 years from the date of grant, except as
otherwise provided in Section 4(c). Subject to the preceding sentence, the
Committee at its sole discretion shall determine when an Option is to expire.
(h) NON-TRANSFERABILITY. An option granted under the Plan shall not be
anticipated, assigned, attached, garnished, optioned, transferred or made
subject to any creditor's process, whether voluntarily, involuntarily or by
operation of law, except as approved by the Committee. Notwithstanding the
foregoing, ISOs may not be transferable. However, this Section 7 shall not
preclude an Optionee from designating a beneficiary who will receive any
outstanding Options in the event of the Optionee's death, nor shall it preclude
a transfer of Options by will or by the laws of descent and distribution.
(i) TERMINATION OF SERVICE (EXCEPT BY DEATH). If an Optionee's Service
terminates for any reason other than the Optionee's death, then the Optionee's
Option(s) shall, except to the extent determined by the Committee, expire on the
earliest of the following occasions:
(i) The expiration date determined pursuant to
Subsection (g) above;
(ii) The date 90 days after the termination of the Optionee's
Service for any reason other than Total and Permanent Disability; or
(iii) The date six months after the termination of the
Optionee's Service by reason of Total and Permanent Disability.
The Optionee may exercise all or part of the Optionee's Option(s) at any time
before the expiration of such Option(s) under the preceding sentence, but only
to the extent that such Option(s) had become exercisable before the Optionee's
Service terminated. The balance of such Option(s) shall lapse when the
Optionee's Service terminates. In the event that the Optionee dies after the
termination of the Optionee's Service but before the expiration of the
Optionee's Option(s), all or part of such Option(s) may be exercised (prior to
expiration) by the executors or administrators of the Optionee's estate or by
any person who has acquired such Option(s) directly from the Optionee by
bequest, beneficiary designation or inheritance, but only to the extent that
such Option(s) had become exercisable before the Optionee's Service terminated.
(j) LEAVES OF ABSENCE. For purposes of Subsection (i) above, Service
shall, except to the extent determined by the Committee, be deemed to continue
while the Optionee is on military leave, sick-leave or other bona fide leave of
absence (as determined by the Committee). The foregoing notwithstanding,
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<PAGE>
in the case of an ISO granted under the Plan, Service shall not be deemed to
continue beyond the first 90 days of such leave, unless the Optionee's
reemployment rights are guaranteed by statute or by contract.
(k) DEATH OF OPTIONEE. If an Optionee dies while the Optionee is in
Service, then the Optionee's Option(s) shall, except to the extent determined by
the Committee, expire on the earlier of the following dates:
(i) The expiration date determined pursuant to
Subsection (f) above; or
(ii) The date six months after the Optionee's death.
All or part of the Optionee's Option(s) may be exercised at any time before the
expiration of such Option(s) under the preceding sentence by the executors or
administrators of the Optionee's estate or by any person who has acquired such
Option(s) directly from the Optionee by bequest, beneficiary designation or
inheritance, but only to the extent that such Option(s) had become exercisable
before the Optionee's death. The balance of such Option(s) shall lapse when the
Optionee dies.
(l) NO RIGHTS AS A STOCKHOLDER. An Optionee, or a transferee of an
Optionee, shall have no rights as a stockholder with respect to any Shares
covered by the Optionee's Option until such person is entitled, pursuant to the
terms of such Option, to receive such Shares. No adjustments shall be made,
except as provided in Section 9.
(m) MODIFICATION, EXTENSION AND ASSUMPTION OF OPTIONS. Within the
limitations of the Plan, the Committee may modify, extend or assume outstanding
Options or may accept the cancellation of outstanding Options (whether granted
by the Company or another issuer) in return for the grant of new Options for the
same or a different number of Shares and at the same or a different Exercise
Price. The foregoing notwithstanding, no modification of an Option shall,
without the consent of the Optionee, impair the Optionee's rights or increase
the Optionee's obligations under such Option.
(n) RESTRICTIONS ON TRANSFER OF SHARES. Any Shares issued upon exercise
of an Option shall be subject to such special forfeiture conditions, rights of
repurchase, rights of first refusal and other transfer restrictions as the
Committee may determine. Such restrictions shall be set forth in the applicable
Stock Option Agreement and shall apply in addition to any restrictions that may
apply to holders of Shares generally.
SECTION 8. PAYMENT FOR SHARES.
(a) GENERAL RULE. The entire Purchase Price or Exercise Price of Shares
issued under the Plan shall be payable in lawful
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money of the United States of America at the time when such Shares are
purchased, except as provided in Subsections (b), (c), (d), (e) and (f) below.
(b) SURRENDER OF STOCK. To the extent that a Stock Option Agreement so
provides, payment may be made all or in part with Shares which have already been
owned by the Optionee or the Optionee's representative for more than six months
and which are surrendered to the Company in good form for transfer. Such Shares
shall be valued at their Fair Market Value on the date when the new Shares are
purchased under the Plan.
(c) SERVICES RENDERED. At the discretion of the Committee, Shares may
be awarded under the Plan in consideration of services rendered to the Company
or a Subsidiary prior to the award. If Shares are awarded without the payment of
a Purchase Price in cash, the Committee shall make a determination (at the time
of the award) of the value of the services rendered by the Offeree and the
sufficiency of the consideration to meet the requirements of Section 6(c).
(d) PROMISSORY NOTE. To the extent that a Stock Option Agreement or
Stock Purchase Agreement so provides, a portion of the Exercise Price or
Purchase Price (as the case may be) of Shares issued under the Plan may be paid
with a full-recourse promissory note, provided that (i) the par value of such
Shares must be paid in lawful money of the United States of America at the time
when such Shares are purchased, (ii) the Shares are pledged as security for
payment of the principal amount of the promissory note and interest thereon and
(iii) the interest rate payable under the terms of the promissory note shall not
be less than the minimum rate (if any) required to avoid the imputation of
additional interest under the Code. Subject to the foregoing, the Committee (at
its sole discretion) shall specify the term, interest rate, amortization
requirements (if any) and other provisions of such note.
(e) EXERCISE/SALE. To the extent that a Stock Option Agreement so
provides, payment may be made all or in part by the delivery (on a form
prescribed by the Company) of an irrevocable direction to a securities broker
approved by the Company to sell Shares and to deliver all or part of the sales
proceeds to the Company in payment of all or part of the Exercise Price and any
withholding taxes.
(f) EXERCISE/PLEDGE. To the extent that a Stock Option Agreement so
provides, payment may be made all or in part by the delivery (on a form
prescribed by the Company) of an irrevocable direction to pledge Shares to a
securities broker or lender approved by the Company, as security for a loan, and
to deliver all or part of the loan proceeds to the Company in payment of all or
part of the Exercise Price and any withholding taxes.
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SECTION 9. ADJUSTMENT OF SHARES.
(a) GENERAL. In the event of a subdivision of the outstanding Stock, a
declaration of a dividend payable in Shares, a declaration of a dividend payable
in a form other than Shares in an amount that has a material effect on the value
of Shares, a combination or consolidation of the outstanding Stock into a lesser
number of Shares, a recapitalization, a spinoff, a reclassification or a similar
occurrence, the Committee shall make appropriate adjustments in one or more of
(i) the number of Shares available for future grants under Section 5, (ii) the
number of Shares covered by each outstanding Option or (iii) the Exercise Price
under each outstanding Option.
(b) MERGERS AND CONSOLIDATIONS. In the event that the Company is a
party to a merger or consolidation, outstanding Options shall be subject to the
agreement of merger or consolidation. Such agreement may provide for the
assumption of outstanding Options by the surviving corporation or its parent or
for their continuation by the Company (if the Company is the surviving
corporation). In the event the Company is not the surviving corporation and the
surviving corporation will not assume the outstanding Options, the agreement of
merger or consolidation may provide for payment of a cash settlement for
exercisable options equal to the difference between the amount to be paid for
one Share under such agreement and the Exercise Price and for the cancellation
of Options not exercised or settled, in either case without the Optionees'
consent.
(c) RESERVATION OF RIGHTS. Except as provided in this Section 9, an
Optionee or Offeree shall have no rights by reason of (i) any subdivision or
consolidation of shares of stock of any class, (ii) the payment of any dividend
or (iii) any other increase or decrease in the number of shares of stock of any
class. Any issue by the 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
Exercise Price of Shares subject to an Option. The grant of an Option pursuant
to the Plan shall not affect in any way the right or power of the Company to
make adjustments, reclassifications, reorganizations or changes of its capital
or business structure, to merge or consolidate or to dissolve, liquidate, sell
or transfer all or any part of its business or assets.
SECTION 10. SECURITIES LAWS.
Shares shall not be issued under the Plan unless the issuance and
delivery of such Shares comply with (or are exempt from) all applicable
requirements of law, including (without limitation) the Securities Act of 1933,
as amended, the Exchange Act, the rules and regulations promulgated thereunder,
state securities laws and regulations, and the regulations of any stock exchange
on which the Company's securities may then be listed.
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SECTION 11. NO EMPLOYMENT RIGHTS.
No provision of the Plan, nor any right or Option granted under the
Plan, shall be construed to give any person any right to become, to be treated
as, or to remain an Employee. The Company and its Subsidiaries reserve the right
to terminate any person's Service at any time and for any reason.
SECTION 12. DURATION AND AMENDMENTS.
(a) TERM OF THE PLAN. The Plan, as set forth herein, shall become
effective as of the date indicated herein. The Plan shall terminate
automatically 10 years after its amendment and restatement by the Board of
Directors to read as set forth herein and may be terminated on any earlier date
pursuant to Subsection (b) below.
(b) RIGHT TO AMEND OR TERMINATE THE PLAN. The Board of Directors may at
any time and for any reason, amend, suspend or terminate the Plan. An amendment
of the Plan shall be subject to the approval the Company's stockholders only to
the extent required by applicable laws, regulations and rules, including the
rules of any applicable exchange.
(c) EFFECT OF AMENDMENT OR TERMINATION. No Shares shall be issued or
sold under the Plan after the termination thereof, except upon exercise of an
Option granted prior to such termination. The termination of the Plan, or any
amendment thereof, shall not affect any Share previously issued or any Option
previously granted under the Plan.
SECTION 13. EXECUTION.
To record the amendment and restatement of the Plan by the Board of
Directors, effective March 2, 1999, the Company has caused its authorized
officer to execute the same.
VICAL INCORPORATED
By /s/ Martha J. Demski
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EXHIBIT 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation
by reference in this registration statement of our reports dated February 8,
1999 included in Vical Incorporated's Form 10-K for the year ended December 31,
1998 and to all references to our Firm included in this registration statement.
Arthur Andersen LLP
San Diego, California
June 10, 1999
