SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. . . . . . . . . )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
MEDIMMUNE, INC.
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1) Title of each class of securities to which transaction applies:
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2) Aggregate number of securities to which transaction applies:
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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
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2) Form, Schedule or Registration Statement No.:
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3) Filing Party:
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4) Date Filed:
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[MEDIMMUNE, INC. LOGO OMITTED]
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MEDIMMUNE, INC.
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NOTICE OF
ANNUAL MEETING
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AND PROXY
STATEMENT
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[MEDIMMUNE, INC. LOGO OMITTED]
MEDIMMUNE, INC.
April 16, 1999
Dear MedImmune Stockholder:
You are cordially invited to attend the Annual Meeting of Stockholders to
be held at the Gaithersburg Marriott, Washingtonian Center, 9751 Washingtonian
Boulevard, Gaithersburg, Maryland 20878 on May 20, 1999 at 10:00 a.m.
Information about the meeting, the nominees for directors and the proposals to
be considered is presented in the Notice of Annual Meeting and the Proxy
Statement on the following pages.
In addition to the formal items of business to be brought before the
meeting, I will report on our Company's operations during 1998. This will be
followed by a question and answer period.
Your participation in MedImmune's affairs is important, regardless of the
number of shares you hold. To ensure your representation, even if you cannot
attend the meeting, please sign, date and return the enclosed proxy promptly.
We look forward to seeing you on May 20th.
Sincerely,
/s/ WAYNE T. HOCKMEYER, PH.D.
WAYNE T. HOCKMEYER, PH.D.
Chairman and Chief Executive Officer
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35 West Watkins Mill Road Gaithersburg, Maryland 20878
301-417-0770 Fax: 301-527-4200
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[MEDIMMUNE, INC. LOGO OMITTED]
MEDIMMUNE, INC.
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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
MAY 20, 1999
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The Annual Meeting of Stockholders of MedImmune, Inc. will be held at the
Gaithersburg Marriott, Washingtonian Center, 9751 Washingtonian Boulevard,
Gaithersburg, Maryland on May 20, 1999 at 10:00 a.m., for the following
purposes:
1. To elect nine directors;
2. To approve the MedImmune, Inc. 1999 Stock Option Plan;
3. To approve and ratify the appointment of PricewaterhouseCoopers L.L.P.
as independent auditors; and
4. To transact such other business as properly may come before the
meeting and any adjournment thereof.
Stockholders of record at the close of business on March 31, 1999 are
entitled to receive notice of, and to vote at, the Annual Meeting.
By Order of the Board of Directors,
/s/ Carol A. Iorio
Carol A. Iorio
Corporate Secretary
35 West Watkins Mill Road
Gaithersburg, Maryland 20878
April 16, 1999
<PAGE>
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PROXY STATEMENT
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GENERAL INFORMATION
This Proxy Statement is furnished in connection with the solicitation by
the Board of Directors of MedImmune, Inc. ("MedImmune" or the "Company") of
proxies to be voted at the Annual Meeting of Stockholders on May 20, 1999. This
Proxy Statement, the accompanying proxy card and Annual Report to Stockholders
are being mailed to stockholders on or about April 16, 1999. Business at the
Annual Meeting is conducted in accordance with the procedures determined by the
presiding officer and is generally limited to matters properly brought before
the meeting by or at the suggestion of the Board of Directors or by a
stockholder pursuant to provisions requiring advance notice and disclosure of
relevant information.
The number of voting securities of MedImmune outstanding on March 31, 1999,
the record date for the meeting, was 55,622,518 shares of common stock, $.01 par
value per share, each share being entitled to one vote. Stockholders do not have
cumulative voting rights.
VOTING OF PROXIES
Since many MedImmune stockholders are unable to attend the Company's Annual
Meeting, the Board of Directors solicits proxies to give each stockholder an
opportunity to vote on all matters scheduled to come before the meeting and set
forth in this Proxy Statement. Stockholders are urged to read carefully the
material in this Proxy Statement, specify their choice on each matter by marking
the appropriate boxes on the enclosed proxy card, and sign, date and return the
card in the enclosed stamped envelope.
If no choice is specified and the card is properly signed and returned, the
shares will be voted by the Proxy Committee as recommended by the Company. A
stockholder who signs a proxy may revoke or revise that proxy at any time before
the meeting. A previously returned proxy may be canceled by voting by ballot at
the meeting. Stockholder proxies are received by American Stock Transfer & Trust
Company, the Company's independent proxy processing agent, and the vote is
certified by Inspectors of Election.
MedImmune's Proxy Committee consists of Dr. Wayne T. Hockmeyer, Chairman
and Chief Executive Officer, and Mr. David M. Mott, Vice Chairman and Chief
Financial Officer. Proxy cards, unless otherwise indicated by the stockholder,
also confer upon the Proxy Committee discretionary authority to vote all shares
of stock represented by the proxies on any matter which properly may be
presented for action at the meeting even if not covered herein. If any of the
nominees for director named in Proposal 1 -- Election of Directors should be
unavailable for election, the proxies will be voted for the election of such
other person as may be recommended by the Company in place of such nominee.
Stockholders of record at the close of business on March 31, 1999, are
entitled to receive notice of the meeting and to vote the shares held on that
date. The holders of a majority of the issued and outstanding shares of stock of
the Company entitled to vote at the meeting must be represented in person or by
proxy at the Annual Meeting in order for the meeting to be held. Other than the
election of directors, which requires
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a plurality of the votes of the stockholders represented at the meeting, each
matter to be submitted to the stockholders requires the affirmative vote of the
holders of a majority of the shares represented at the meeting, in person or by
proxy, and entitled to vote. Abstentions have the same effect as a vote against
any such matter. Broker non-votes are deemed not entitled to vote and are not
counted as votes for or against any such matter.
ATTENDANCE AT ANNUAL MEETING
To ensure the availability of adequate space for MedImmune stockholders
wishing to attend the meeting, priority seating will be given to stockholders of
record, beneficial owners of the Company's stock having evidence of such
ownership, or their authorized representatives, and invited guests of
management. In addition, a stockholder may bring one guest. In order that
seating may be equitably allocated, a stockholder wishing to bring more than one
guest must write to the Corporate Secretary in advance of the meeting and
receive written concurrence. Those unable to attend may request from the
Corporate Secretary a copy of the report of the proceedings of the meeting.
PROPOSAL 1 -- ELECTION OF DIRECTORS
A Board of nine directors is to be elected at the Annual Meeting, each
director so elected to hold office for a term of one year and until the election
and qualification of a successor. All directors hold office until the next
annual meeting of stockholders and until their successors are duly elected and
qualified. The Company's By-Laws authorize the Board of Directors from time to
time to determine the number of its members. Vacancies in unexpired terms and
any additional positions created by board action are filled by action of the
existing Board of Directors.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE FOLLOWING NOMINEES:
WAYNE T. HOCKMEYER, PH.D.
Dr. Hockmeyer (age 54) founded the Company in April 1988 as President and
Chief Executive Officer and was elected to serve on the Board of Directors
in May 1988. He became Chairman of the Board of Directors in May 1993. From
1986 to 1988, Dr. Hockmeyer served as Vice President, Research and
Development, of Praxis Biologics, Inc. From 1980 to 1986, Dr. Hockmeyer
served as Chairman, Department of Immunology, Walter Reed Army Institute of
Research. Dr. Hockmeyer is a member of the Maryland Economic Development
Commission, a member of the Board of Directors of Digene Corporation,
serves on the Advisory Board of the University of Maryland Biotechnology
Institute, is a member of Board of Advisors of the Institute of Human
Virology, is a Member of the Board of Directors of the High Technology
Council of Maryland, is Chairman of the Maryland Bioscience Alliance and a
member of the University of Maryland University College Graduate School
Advisory Board, Executive Programs. Dr. Hockmeyer received a Bachelor of
Science degree from Purdue University and a doctorate from the University
of Florida.
MELVIN D. BOOTH
Mr. Booth (age 54) joined the Company in October 1998 as President and
Chief Operating Officer and was elected to serve on the Board of Directors
in November 1998. Prior to joining the Company, he was President, Chief
Operating Officer and a member of the Board of Directors of Human Genome
Sci-
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ences, Inc. from July 1995 until October 1998. Prior to this time, Mr.
Booth was employed at Syntex Corporation from 1975 to 1995, where he held a
variety of positions, including President of Syntex Laboratories, Inc. from
1993 to 1995 and Vice President of Syntex Corporation from 1992 to 1995.
From 1992 to 1993, he served as the President of Syntex Pharmaceuticals
Pacific. From 1991 to 1992, he served as an area Vice President of Syntex,
Inc. From 1986 to 1991, he served as the President of Syntex, Inc., Canada.
Mr. Booth is a past Chairman of the Pharmaceutical Manufacturers
Association of Canada and currently is a member of the Board of Directors
of Neoprobe Corporation. Mr. Booth graduated from Northwest Missouri State
University and holds a Certified Public Accountant Certificate.
DAVID M. MOTT
Mr. Mott (age 33) joined the Company in April 1992 as Vice President, with
responsibility for business development, strategic planning and investor
relations. In 1994, Mr. Mott assumed additional responsibility for the
medical and regulatory groups, and in March 1995 was appointed Executive
Vice President and Chief Financial Officer. In November 1995, Mr. Mott was
appointed to the position of President and Chief Operating Officer and was
elected to the Board of Directors. In October 1998, Mr. Mott was appointed
Vice Chairman and Chief Financial Officer. Prior to joining the Company, he
was a Vice President in the Health Care Investment Banking Group at Smith
Barney, Harris Upham & Co., Inc. At Smith Barney, where he was employed
from July 1986 to April 1992, Mr. Mott's activities included public and
private equity and debt financings as well as merger and acquisition work
for biotechnology, healthcare services, and medical product and device
companies. Mr. Mott is a member of the Board of Directors of Conceptis
Technologies. He holds a Bachelor of Arts degree in economics and
government from Dartmouth College.
FRANKLIN H. TOP, JR., M.D.
Dr. Top (age 63) joined the Company in June 1988 as Executive Vice
President. He was elected to the Board of Directors in July 1988 and became
the Company's Medical Director in 1990. From 1987 to 1988, Dr. Top served
as Senior Vice President for Clinical and Regulatory Affairs at Praxis.
Prior to 1987, Dr. Top served for 22 years in the U.S. Army Medical
Research and Development Command, where he was appointed Director, Walter
Reed Army Institute of Research in 1983. Dr. Top holds a doctorate of
medicine cum laude and a Bachelor of Science degree in biochemistry from
Yale University.
M. JAMES BARRETT, PH.D.
Dr. Barrett (age 56) has been a director of the Company since 1988 and is
the Chairman, Chief Executive Officer and a director of Sensors for
Medicine and Science, Inc. From July 1987 to September 1996, he was Chief
Executive Officer and a director of Genetic Therapy, Inc. From 1982 to July
1987, Dr. Barrett served as President of Life Technologies, Inc. and its
predecessor, Bethesda Research Laboratories, Inc. Prior to 1982, he was
employed at SmithKline Beecham Corporation for 13 years, where he held a
variety of positions, including President of its In Vitro Diagnostic
Division and President of SmithKline Clinical Laboratories. Dr. Barrett
holds a doctorate in biochemistry from the University of Tennessee and a
master's degree in business administration from the University of Santa
Clara.
JAMES H. CAVANAUGH, PH.D.
Dr. Cavanaugh (age 62) has been a director of the Company since September
1990 and has been President of HealthCare Ventures L.L.C. since 1989. Prior
thereto, Dr. Cavanaugh served as President of SmithKline and French
Laboratories U.S., Inc., from March 1985 to February 1989 and as President
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of SmithKline Clinical Laboratories from 1981 to 1985. Prior thereto, Dr.
Cavanaugh was the President of Allergan International, a specialty eye care
company. Dr. Cavanaugh also serves as a member of the Board of Directors of
Human Genome Sciences, Inc., 3-Dimensional Pharmaceuticals, Inc., Shire
Pharmaceuticals Group PLC, LeukoSite, Inc., and Diversa Corp. Prior to his
industry experience, Dr. Cavanaugh was Deputy Assistant to the President
for Domestic Affairs and Deputy Chief of the White House Staff. Before his
White House tour, he served as Deputy Assistant Secretary for Health and
Scientific Affairs in the U.S. Department of Health, Education and Welfare
and as Special Assistant to the Surgeon General of the U.S. Public Health
Service. In addition to serving on the boards of directors of several
health care and biotechnology companies, Dr. Cavanaugh currently serves on
the Board of Trustees of the National Committee for Quality Health Care
(Chairman, 1988) and as Trustee Emeritus of the California College of
Medicine. He has served on the Board of Directors of the Pharmaceutical
Manufacturers Association, Unihealth America, and the Proprietary
Association. He was a Founding Director of the Marine National Bank in
Santa Ana, California. Dr. Cavanaugh holds a doctorate and a master's
degree from the University of Iowa and a Bachelor of Science degree from
Fairleigh Dickinson University.
BARBARA HACKMAN FRANKLIN
Ms. Franklin (age 59) has been a director of the Company since November
1995 and, since January 1995, has served as the President and Chief
Executive Officer of Barbara Franklin Enterprises, a private international
consulting and investment firm in Washington, D.C. Between January 1993 and
January 1995, Ms. Franklin was a lecturer and served as a director of
various corporations and organizations. Previously, Ms. Franklin served as
the 29th U.S. Secretary of Commerce. She has also served as an Alternate
Representative to the United Nations General Assembly and was appointed to
four terms on the President's Advisory Council for Trade Policy and
Negotiations. Ms. Franklin founded Franklin Associates, an internationally
recognized consulting firm, and served as its President from 1984 through
1992, was Senior Fellow of the Wharton School of the University of
Pennsylvania (1979-1988), one of the original Commissioners of the U.S.
Consumer Product Safety Commission (1973-1979) and a staff assistant to the
President, creating the first White House effort to recruit women for high
level government jobs (1971-1973). Ms. Franklin currently serves on the
board of directors of Aetna Inc., The Dow Chemical Company, AMP Inc., and
Milacron, Inc. She has been a director of the Nasdaq Stock Market, Inc. and
the American Institute of CPA's. Ms. Franklin graduated from The
Pennsylvania State University and received a master's degree in business
administration from Harvard University.
LAWRENCE C. HOFF
Mr. Hoff (age 70) has been a director of the Company since April 1991. In
1990, Mr. Hoff retired as President and Chief Operating Officer of the
Upjohn Company. Mr. Hoff joined Upjohn in 1950 as a pharmaceutical sales
representative. He was appointed Vice President for Domestic Pharmaceutical
marketing in 1969. In 1973, Mr. Hoff was elected to the Board of Directors
of Upjohn and the following year became Vice President and General Manager
of Domestic Pharmaceutical Operations. He was promoted to Executive Vice
President in 1977, was named President in 1984, and President and Chief
Operating Officer in 1987. Mr. Hoff was elected to the Board of Directors
of the Pharmaceutical Manufacturers Association ("PMA") in 1984. He was
elected Chairman-elect of the PMA in 1986 and Chairman in 1987. Mr. Hoff
currently serves on the board of directors of Curative Health Systems, Inc.
He graduated from Stanford University and has received honorary degrees
from the Massachusetts College of Pharmacy and Allied Health Sciences and
from Kalamazoo College.
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GORDON S. MACKLIN
Mr. Macklin (age 70) has been a director of the Company since July 1994.
Mr. Macklin served as Chairman of the White River Corporation from 1994 to
June 1998, and as President and Chief Executive Officer from January to
June 1998. From 1987 through 1992, he was Chairman of Hambrecht and Quist
Group, an investment banking and venture capital firm. Previously, Mr.
Macklin was President of the National Association of Securities Dealers,
Inc. from 1970 through 1987. He also served as Chairman of National
Clearing Corporation (1970 to 1975) and as a partner and member of the
Executive Committee of McDonald & Company Securities, Inc. where he was
employed from 1950 through 1970. Mr. Macklin serves on the Board of
Directors of Fund American Enterprises Holdings, Inc., MCI WorldCom, Inc.,
Martek Biosciences Corporation, Spacehab, Inc., Real 3D, and director,
trustee or managing general partner, as the case may be, of 49 of the
investment companies in the Franklin Templeton Group of Funds.
THE BOARD OF DIRECTORS AND ITS COMMITTEES
Board Meetings
During 1998, the Board of Directors met seven times, and all directors
attended more than 75% of the meetings of the Board.
Committees of the Board
Committees of the Board of Directors consist of the Audit Committee, the
Compensation and Stock Committee and the Executive Committee. Information
concerning the committees is set forth below. All directors attended more than
75% of the meetings of the Board Committees on which they served, except Mr.
Hoff who was unable to attend one meeting of the Audit Committee.
The Audit Committee oversees the performance, and reviews the scope, of the
audit performed by the Company's independent accountants. The Audit Committee
also reviews audit plans and procedures, changes in accounting policies and the
use of the independent accountants for non-audit services. The Audit Committee
consists of Mr. Hoff (Chairman), Dr. Barrett, Ms. Franklin and Mr. Macklin.
During 1998, the Audit Committee met three times.
The Compensation and Stock Committee determines the compensation and
benefits of all officers of the Company and establishes general policies
relating to compensation and benefits of employees of the Company. The
Compensation and Stock Committee is also responsible for administering the
Company's 1991 Stock Option Plan (the "1991 Plan") in accordance with the terms
and conditions set forth therein. The Compensation and Stock Committee consists
of Dr. Cavanaugh (Chairman), Dr. Barrett, Ms. Franklin, Mr. Macklin and Mr.
Hoff, with Dr. Hockmeyer serving as a non-voting ex officio member. During 1998,
the Compensation and Stock Committee met six times.
The Executive Committee is responsible for all matters which arise between
regular meetings of the Board of Directors to the extent permitted by applicable
law. The Executive Committee consists of Dr. Hockmeyer (Chairman), Dr. Barrett,
Dr. Cavanaugh and Mr. Macklin. During 1998, the Executive Committee met once.
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COMPENSATION AND STOCK COMMITTEE REPORT ON EXECUTIVE COMPENSATION
Compensation of the Company's executives is subject to review and approval
by the Compensation and Stock Committee (the "Committee") of the Company's Board
of Directors. The Committee consists of five outside directors (James H.
Cavanaugh, Ph.D. (Chairman), M. James Barrett, Ph.D., Barbara Hackman Franklin,
Lawrence C. Hoff and Gordon S. Macklin) and the Chairman and Chief Executive
Officer of the Company (Wayne T. Hockmeyer, Ph.D.), who serves as a non-voting
ex officio member.
In determining the 1998 compensation to be paid to the Company's executive
officers, the Committee employed compensation policies designed to align such
compensation with the interests of the Company's stockholders and to relate it
to overall corporate performance. These policies are intended to attract and
retain executives whose abilities are critical to the long-term success of the
Company, to support a performance-oriented environment that rewards achievement
of internal corporate goals and to reward executives for the enhancement of
stockholder value.
The components of the compensation of each executive officer, including the
Chief Executive Officer, are base salary, cash bonus awards and stock option
grants, as described below:
Base salaries of the executive officers are targeted to be within the
competitive range among biotechnology companies similar in size to the
Company. The Committee utilizes the annual survey report of approximately
400 biotechnology companies prepared by a leading compensation consulting
firm for this purpose. The base salaries of the executive officers are
subject to certain minimums set forth in individual employment agreements.
Cash bonuses are designed to provide annual incentives based on
individual performance in achieving the Company's annual business goals.
For 1998, these goals included expanding the market presence and sales of
the Company's FDA-approved products, further advancing the development,
manufacture and marketing of new therapeutic and vaccine products and
continuing to recruit and train the Company's scientific, marketing and
manufacturing teams. The Committee makes the determination as to bonus
awards at the end of each year based on the subjective evaluation of the
contributions of each executive officer towards the achievement of the
Company's annual business goals.
Stock option grants are intended to provide the most meaningful
component of executive compensation. Stock options provide compensation in
a manner that is intrinsically related to long-term stockholder value
because options have value only to the extent of share appreciation from
date of grant. Stock options granted by the Company generally become
exercisable in 25% annual increments beginning on the first anniversary of
the date of grant and remain exercisable for 10 years from the date of
grant unless the optionee's employment with the Company is terminated.
The Committee believes that periodic stock option grants are appropriate,
particularly in view of the absence of a Company-sponsored long-term incentive
or pension plan. Periodic awards of stock options are granted to executives at
the discretion of the Committee, based on an individual's contribution toward
achieving the Company's strategic and product development goals. These goals
include: developing product candidates with significant potential for
commercialization; driving product candidates through the research, development,
regulatory approval, manufacturing and commercialization
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process; and establishing strategic alliances with corporate partners and
research institutions to leverage the Company's resources and to expand its
research and development pipeline. The Committee also takes into account the
number of stock options previously granted.
The Compensation and Stock Committee based the 1998 compensation of the
Chief Executive Officer and the Company's other executive officers on the
policies described above. The base salaries of the Chief Executive Officer and
the Company's other executive officers generally increased in 1998 commensurate
with their increased responsibilities and the growth in scope of the Company's
operations. The 1998 cash bonuses paid to the executive officers, including the
Chief Executive Officer, were based on the achievement during the year of
individual productivity and performance goals consistent with the Company's
annual business goals. In January 1998, new stock option grants were made to the
executive officers, including the Chief Executive Officer. These stock option
grants were made by the Committee as part of the program of making periodic
stock option grants to executive officers, with the number of stock options
granted to each officer determined on the basis of such officer's contribution
toward achieving the Company's 1997 strategic and product development goals, as
described above. See "Executive Compensation."
A federal tax law disallows corporate deductibility for certain
compensation paid in excess of $1 million to the chief executive officer and the
four other most highly paid executive officers of publicly held companies.
"Performance-based compensation," as defined in the tax law, is not subject to
the deductibility limitation provided certain stockholder approval and other
requirements are met. The Company believes that the stock options granted in
1998 and prior years satisfied the requirements of federal tax law and thus
compensation recognized in connection with such awards should be fully
deductible. It is the Company's intention to make efforts to maximize
deductibility of compensation paid to its officers under such law. During 1998,
the Company did not exceed the $1 million deductibility cap with respect to any
officer covered by such law.
James H. Cavanaugh, Ph.D., Chairman
M. James Barrett, Ph.D.
Barbara Hackman Franklin
Lawrence C. Hoff
Gordon S. Macklin
Wayne T. Hockmeyer, Ph.D., ex officio
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COMPENSATION AND STOCK COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Dr. Hockmeyer, the Company's Chairman and Chief Executive Officer, is a
non-voting ex officio member of the Compensation and Stock Committee.
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table summarizes the compensation paid by the Company to its
Chief Executive Officer and the Company's six most highly compensated executive
officers other than the Chief Executive Officer (collectively, the "Named
Executive Officers") for the last three years.
<TABLE>
<CAPTION>
LONG-TERM
ANNUAL COMPENSATION COMPENSATION
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OTHER ANNUAL OPTION
NAME AND PRINCIPAL POSITION YEAR SALARY ($) BONUS ($) COMPENSATION ($) AWARDS (#)
- -------------------------------- ------ ------------ ----------- ------------------ -------------
<S> <C> <C> <C> <C> <C>
Wayne T. Hockmeyer ............. 1998 435,000 350,000 -- 240,000
Chairman and CEO 1997 353,333 225,000 -- 240,000
1996 313,939 120,000 -- 150,000
Melvin D. Booth (1) ............ 1998 103,034 250,000 -- 500,000
President and COO
David M. Mott .................. 1998 358,668 250,000 -- 200,000
Vice Chairman and CFO 1997 271,504 200,000 -- 200,000
1996 240,933 100,000 -- 70,000
Franklin H. Top, Jr. ........... 1998 239,680 150,000 -- 80,000
Executive Vice President 1997 210,806 100,000 -- 60,000
and Medical Director 1996 196,289 50,000 -- 60,000
David P. Wright ................ 1998 242,680 200,000 -- 80,000
Executive Vice President, 1997 229,833 100,000 -- 60,000
Sales and Marketing 1996 222,767 40,000 -- 60,000
James F. Young ................. 1998 239,513 150,000 -- 150,000
Executive Vice President, 1997 208,907 100,000 -- 60,000
Research & Development 1996 189,565 40,000 -- 60,000
Bogdan Dziurzynski (2) ......... 1998 206,500 150,000 16,500 80,000
Senior Vice President, 1997 183,499 100,000 16,501 160,000
Regulatory Affairs 1996 178,975 40,000 10,644 60,000
and Quality Assurance
</TABLE>
- ----------
(1) Hired in October 1998.
(2) Mr. Dziurzynski's other compensation consisted of a forgiven loan and
tuition expense reimbursement in 1998 and 1997, and a forgiven loan and
relocation expense reimbursement in 1996.
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Option Grants in Fiscal 1998
The following table sets forth information relating to the grant of stock
options by the Company during 1998 to the Named Executive Officers.
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE VALUE
AT ASSUMED ANNUAL RATES
OF STOCK PRICE APPRECIATION
INDIVIDUAL GRANTS FOR OPTION TERM (1)
----------------------------------------------------- ---------------------------
% OF TOTAL
NUMBER OF OPTIONS
SECURITIES GRANTED TO EXERCISE
UNDERLYING EMPLOYEES OR BASE
OPTIONS IN FISCAL PRICE EXPIRATION
NAME (#)(2) 1998 ($/SH) DATE 5%($) 10%($)
- ------------------------------ ------------ ------------ --------- ----------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
Wayne T. Hockmeyer ........... 240,000 9.96% 22.19 1/29/08 3,354,674 8,466,559
Melvin D. Booth .............. 500,000 20.74% 33.00 10/5/08 10,395,000 26,235,000
David M. Mott ................ 200,000 8.30% 22.19 1/29/08 2,795,562 7,055,466
Franklin H. Top, Jr. ......... 80,000 3.32% 22.19 1/29/08 1,118,225 2,822,186
David P. Wright .............. 80,000 3.32% 22.19 1/29/08 1,118,225 2,822,186
James F. Young ............... 150,000 6.22% 22.19 1/29/08 2,096,672 5,291,600
Bogdan Dziurzynski ........... 80,000 3.32% 22.19 1/29/08 1,118,225 2,822,186
</TABLE>
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(1) The indicated dollar amounts are the result of calculations based on the
exercise price of each option and assume five and ten percent appreciation
rates set by the Securities and Exchange Commission and, therefore, are not
intended to forecast possible future appreciation, if any, of the Company's
stock price.
(2) Granted options become exercisable in 25% annual increments beginning on
the first anniversary of the date of grant.
Aggregated Option Exercises in 1998 and Fiscal Year-End Values
The following table sets forth information relating to the exercise of
stock options by the Named Executive Officers during 1998, the number of shares
covered by stock options held by them at December 31, 1998, and also shows the
value of their "in-the-money" options (market price of the Company's stock less
the exercise price) at that date.
<TABLE>
<CAPTION>
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS HELD AT IN-THE-MONEY OPTIONS AT
SHARES DECEMBER 31, 1998 (#) DECEMBER 31, 1998 ($)
ACQUIRED VALUE ---------------------------------- ----------------------------
NAME ON EXERCISE (#) REALIZED ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ------------------------ ----------------- ---------------- ------------------ --------------- ------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Wayne T. Hockmeyer ...... 210,000 6,122,312 315,000 515,000 12,537,735 18,264,155
Melvin D. Booth ......... - - - 500,000 - 8,359,500
David M. Mott ........... 500,000 15,054,361 267,578 435,000 11,482,437 15,492,265
Franklin H. Top, Jr. .... - - 404,372 167,500 17,929,468 5,929,848
David P. Wright ......... 294,322 8,697,660 64,154 155,000 2,711,835 5,352,110
James F. Young .......... 40,720 (1) 1,059,306 (1) 246,792 (2) 237,500 12,053,158 7,857,088
Bogdan Dziurzynski ...... 70,000 1,690,422 51,250 211,250 2,168,099 7,386,329
</TABLE>
- ----------
(1) Excludes transfer of beneficial interest in 59,400 acquired shares pursuant
to a qualified domestic relations order.
(2) Excludes 36,320 shares that are subject to a qualified domestic relations
order.
9
<PAGE>
Employment Agreements
The Company has entered into employment agreements (the "Agreements") with
Dr. Hockmeyer, Mr. Booth, Mr. Mott, Dr. Top, Mr. Wright, Dr. Young and Mr.
Dziurzynski dated as of November 1, 1998. The Agreements provide that these
executives will serve the Company in the respective offices listed in the
Summary Compensation Table for a term of two years (such period subject to
extension, with consent of the executives), for one or more one-year periods by
resolution adopted by the Compensation and Stock Committee, subject to earlier
termination as provided in the Agreements. The Agreements set forth the minimum
base salary of each executive during the term of the Agreements ($450,000 for
Dr. Hockmeyer, $425,000 for Mr. Booth, $375,000 for Mr. Mott, $245,000 for Dr.
Top, $245,000 for Mr. Wright, $245,000 for Dr. Young and $210,000 for Mr.
Dziurzynski), with such base salary to be reviewed for possible increase each
year by the Committee. Under the Agreements, each executive (i) will have an
opportunity to earn an annual cash bonus based upon pre-determined performance
standards of the Company, (ii) will be entitled to participate in such employee
benefit and fringe benefit plans or programs as are made available from time to
time to similarly situated executives of the Company and (iii) will be eligible
for the grant of stock options, as determined in the sole discretion of the
Committee.
The Agreements include provisions that are effective upon the termination
of employment of the executive under certain circumstances. In the event that
such a termination by the Company constitutes a "termination without cause" (as
defined in the Agreements), he will be entitled to (i) accrued but unpaid
compensation and benefits, (ii) continued payment of base salary plus a pro rata
bonus amount for a period of two years (or one year in the cases of Dr. Top, Mr.
Wright, Dr. Young and Mr. Dziurzynski) and (iii) continued benefit coverage for
two years (or one year in the cases of Dr. Top, Mr. Wright, Dr. Young and Mr.
Dziurzynski). In the event that the executive resigns or his termination of
employment constitutes a "termination for cause" (as defined in the Agreements),
he will be entitled to accrued but unpaid compensation and benefits. In the
event the executive is terminated on account of death or "disability" (as
defined in the Agreements), he will be entitled to (i) accrued but unpaid
compensation and benefits, (ii) a lump-sum payment equal to one year of base
salary and (iii) in the case of "disability," continuation of medical benefit
coverage for one year.
In the event of the termination of employment of the executive constitutes
a "termination without cause," or a resignation for "good reason," following a
"change in control" of the Company (such terms as defined in the Agreements), he
will be entitled to (i) accrued but unpaid compensation and benefits (ii) a lump
sum payment equal to his base salary (as in effect immediately prior to such
termination) plus a pro rata bonus amount for three years (or two years in the
cases of Dr. Top, Mr. Wright, Dr. Young and Mr. Dziurzynski) as set forth in the
Agreements, discounted to present value from the dates such payments would be
made if paid on a semi-monthly basis and (iii) continuation of the medical
benefits coverage for a period of three years (or two years in the cases of Dr.
Top, Mr. Wright, Dr. Young and Mr. Dziurzynski). In the event that Dr.
Hockmeyer's, Mr. Booth's or Mr. Mott's termination of employment constitutes a
"termination without cause" or a resignation for "good reason" within six months
following a "change in control" of the Company, such executives shall retain the
right to exercise any options to purchase shares of the Company's stock until
the earlier of (a) three years following the date of such termination or (b) the
expiration of the original full term of each such option. Dr. Hockmeyer's
Agreement also provides for lifetime continuation of Company-provided medical
and dental coverage as in effect from time to time for officers of the Company,
which coverage shall not be affected by any termination of employment at any
time for any reason.
10
<PAGE>
Upon a "change in control" of the Company, all options to purchase Company
stock held by Dr. Hockmeyer, Mr. Booth and Mr. Mott shall become fully vested
and exercisable. In the event that any payment under the Agreements constitutes
an excess parachute payment under Section 280G of the Internal Revenue Code (the
"Code"), the executive will be entitled to additional gross-up payments such
that the net amount retained by the executive after deduction of any excise
taxes and all other taxes on the gross-up payments shall be equal to the net
amount that would have been retained from the initial payments under the
Agreements.
The Agreements include certain restrictive covenants for the benefit of the
Company relating to non-disclosure by the executives of the Company's
confidential business information, the Company's right to inventions and
intellectual property, nonsolicitation of the Company's employees and customers
and noncompetition by the executives with the Company's business. In the event
that, subsequent to termination of employment, the executives breach any of the
restrictive covenants or directly or indirectly make any adverse public
statements or disclosures with respect to the business or securities of the
Company, all payments and benefits to which the executives may otherwise be due
under the Agreements shall immediately terminate and be forfeited.
Director Compensation
Other than Dr. Barrett, Ms. Franklin and Messrs. Hoff and Macklin,
directors receive no cash compensation for their services to the Company as
directors, but are reimbursed for expenses actually incurred in connection with
attending meetings of the Board of Directors. As compensation for serving on the
Board, Dr. Barrett, Ms. Franklin, and Messrs. Hoff and Macklin receive an annual
retainer of $10,000, a fee of $2,500 per Board meeting attended in person plus
expenses and a fee of $1,000 for participating in a telephonic Board meeting.
For attendance at meetings of Board committees held on days when the Board does
not meet, such directors receive $1,000 per meeting attended in person plus
expenses and $500 for participating by telephone. Directors may also be
compensated for special assignments delegated by the Board of Directors. The
Company also has a Non-Employee Directors Stock Option Plan pursuant to which
options for 20,000 shares are granted to each non-employee director, upon
commencement of service on the Board, and options for 10,000 shares are granted
to each non-employee director on June 30 of each year of continued service on
the Board.
CERTAIN TRANSACTIONS
In 1998, the Company entered into a loan agreement with Melvin D. Booth,
President and Chief Operating Officer, through which Mr. Booth borrowed $100,000
from the Company. This loan bears interest at a rate of 5.06% per annum and is
payable in three annual installments of principal and interest. As long as Mr.
Booth remains employed by the Company, annual payments of principal and interest
will be forgiven by the Company. In the event that Mr. Booth is terminated
"without cause" as defined in his employment agreement, all sums outstanding
will be forgiven.
11
<PAGE>
PERFORMANCE GRAPH
Set forth below is a line graph based on monthly data comparing the
Company's cumulative total shareholder return (as measured by dividing the
difference between the Company's share price at the beginning and the end of the
measurement period by the share price at the beginning of the measurement
period) with (i) the cumulative total return of The Nasdaq Stock Market (U.S.)
Index and (ii) the cumulative total return of the Nasdaq Pharmaceutical Stocks
Index. The Company has selected the Nasdaq Pharmaceutical Stocks Index as the
appropriate published industry index for this comparison, as this Index is
comprised of 260 companies, of which a large majority are biotechnology
companies.
COMPARISON OF 1994-1998 CUMMULATIVE SHAREHOLDER RETURN (1)
PERFORMANCE CHART
<TABLE>
<CAPTION>
Jan-94 Jul-94 Jan-95 Jul-95 Jan-96 Jul-96
<S> <C> <C> <C> <C> <C> <C>
Medimmune 100.00 79.55 31.82 130.69 181.82 154.55
Nasdaq Pharmaceutical 100.00 71.19 75.26 94.77 138.04 139.53
NASDAQ(U.S.) 100.00 91.32 97.75 121.91 138.26 156.51
<CAPTION>
Jan-97 Jul-97 Jan-98 Jul-98 Dec-98
<S> <C> <C> <C> <C> <C>
Medimmune 154.55 168.18 389.78 567.06 903.98
Nasdaq Pharmaceutical 138.47 141.97 142.98 145.67 183.02
NASDAQ(U.S.) 170.02 190.27 208.58 251.12 293.21
</TABLE>
12
<PAGE>
PROPOSAL 2 - APPROVAL OF 1999 STOCK OPTION PLAN
Stock options have been an integral part of the Company's incentive
compensation program since the formation of the Company. The Board believes that
the stockholders have benefited from employee stock options over the years as
options have enabled the Company to attract and retain employees who enhance the
value of the Company and align the interests of employees with those of
stockholders through increased employee ownership of the Company. The Company's
existing employee stock option plan was adopted in 1991 (the "1991 Plan") and
expires by its terms in two years. The 1991 Plan contains limitations on
flexibility that the Board no longer considers necessary (e.g., a total
prohibition on transferability of stock options and the requirement that options
could only be granted to existing rather than prospective employees, consultants
and certain others). Furthermore, as of March 31, 1999, only 2,882 shares remain
available for the grant of options under the 1991 Plan. Accordingly, the Board
has adopted a new stock option plan (the "1999 Plan") which would become
effective upon approval by the Company's stockholders. The following is a
general description of the 1999 Plan, and is qualified in its entirety by the
full text of the 1999 Plan, which is attached to this Proxy Statement as Exhibit
A.
Plan Description. The purpose of the 1999 Plan is to advance the interests
of the Company and its stockholders by attracting, retaining and motivating key
personnel upon whose judgment, initiative and effort the Company depends for the
successful conduct of its business, and to encourage and enable such persons to
acquire a proprietary interest in the Company. The 1999 Plan allows for the
grant of "incentive stock options" qualified under section 422 of the Code, and
for the grant of nonqualified stock options.
A total of 2,750,000 shares of the Company's common stock ("Common Stock")
have been reserved for issuance pursuant to options under the 1999 Plan. The
shares of Common Stock to be issued will be made available from authorized but
unissued shares or shares held in the Company's treasury. Shares of Common Stock
that have been exercised will not again be available for an option grant.
However, if an option terminates for any reason without being wholly exercised,
the number of shares to which the option termination relates will again be made
available for an option grant under the 1999 Plan. In the event of certain
corporate reorganizations, recapitalizations, or other specified corporate
transactions affecting the Company or the Common Stock, the 1999 Plan permits
proportionate adjustments to the number and kinds of shares subject to options
and the exercise price of options.
The 1999 Plan will be administered by the Compensation and Stock Committee
of the Board. To the extent the Board deems it necessary or advisable, each
Committee member will meet the definition of a "nonemployee director" for
purposes of Rule 16b-3 under the Securities Exchange Act of 1934 ("Rule 16b-3")
and of an "outside director" under section 162(m) of the Code. Subject to the
limitations set forth in the 1999 Plan, the Committee has the authority to
determine the persons to whom options are granted, the time at which options
will be granted, the number of shares subject to an option, the exercise price
of an option, the time or times at which the options will become vested and
exercisable, and the duration of the option. The Committee will have the right,
from time to time, to delegate to one or more officers of the Company the
authority of the Committee to grant and determine the terms and conditions of
option grants, subject to such limitations as the Committee shall determine.
However, no such authority may be delegated with respect to options to be
awarded to any member of the Board or any optionee whom the Committee determines
may be subject to Rule 16b-3 or section 162(m) of the Code. Furthermore, option
grants to nonemployee members of the Board of the Company
13
<PAGE>
must be approved by the Board. With respect to awards to such members of the
Board, all rights, powers and authorities vested in the Committee under the 1999
Plan must instead be exercised by the Board.
All employees, officers, directors, consultants and advisors of the Company
or any subsidiary (and any prospective employee, officer, director, consultant
or advisor) are eligible to be granted options under the 1999 Plan, as selected
from time to time by the Committee. However, only persons who are employees of
the Company are eligible to be granted an incentive stock option under the Code.
The exercise price of an option shall be determined by the Committee,
provided that the exercise price per share may not be less than 100% of the fair
market value of a share of Common Stock on the date of grant. The aggregate
value of Common Stock (determined at the time of grant) that may be subject to
incentive stock options that become exercisable by any one employee in any one
year is limited to $100,000 by section 422 of the Code. For purposes of the tax
deduction requirements of section 162(m) of the Code, the maximum number of
shares of Common Stock that may be subject to all stock options granted under
the 1999 Plan to any optionee during any one calendar year will be 1,000,000,
subject to adjustment in the event of certain corporate reorganizations,
recapitalizations or other specified corporate transactions. The maximum term of
options granted under the 1999 Plan is ten years from the date of grant.
Options will become vested and exercisable in the manner and subject to the
conditions approved by the Committee for individual grants and set forth in
stock option agreements. However, the Committee, in its sole discretion, may
accelerate the vesting and exercisability of any option at any time, including
upon a change in control of the Company. Unless otherwise provided by the
Committee, in the event of an optionee's death or disability, outstanding
options that have become exercisable will remain exercisable for a period of one
year. In the case of any other termination of employment, unless otherwise
provided by the Committee, outstanding options that have previously become
vested will remain exercisable for a period of three months, except for a
termination for "cause" (as defined in the 1999 Plan), in which case all
unexercised options will be immediately forfeited.
An option may be exercised in whole or in part at any time following
vesting during the term of the option by written notice to the Company, together
with payment of the aggregate exercise price of the option and any required
withholding tax. Such payment shall be made in cash or, at the Committee's
discretion, in Common Stock or in another form of payment permitted under the
1999 Plan. All options shall be nontransferable except upon death by the
optionee's will or the laws of descent and distribution and, in the case of
nonqualified stock options only, to family members of the optionee, as may be
approved by the Committee in accordance with the terms of the 1999 Plan.
The 1999 Plan has a term of ten years, subject to earlier termination by
the Board. The Board may at any time and from time to time and in any respect,
amend or modify the Plan. Solely to the extent deemed necessary or advisable by
the Board, for purposes of complying with sections 422 or 162(m) of the Code or
rules of any securities exchange or for any other reason, the Board may seek the
approval of any such amendment by the stockholders. The Committee is not
permitted to reduce the exercise price of stock options previously granted or
increase the number of shares issuable pursuant to the 1999 Plan without
obtaining the approval of the Company's stockholders.
Federal Income Tax Consequences. The following is a general description of
federal income tax consequences to optionees and the Company relating to stock
options granted under the 1999 Plan. This discussion does not purport to cover
all tax consequences relating to the optionees or the Company.
14
<PAGE>
An optionee will not generally recognize income upon the grant of a
nonqualified stock option to purchase shares of Common Stock. Upon exercise of
the option, the optionee will generally recognize ordinary compensation income
equal to the excess of the fair market value for such shares over the exercise
price. The tax basis of the shares of Common Stock in the hands of the optionee
will equal the exercise price paid for the shares plus the amount of ordinary
compensation income the optionee recognizes upon exercise of the option, and the
holding period for the shares for capital gains purposes will commence on the
day the option is exercised. An optionee who sells any of such shares of Common
Stock will recognize capital gain or loss measured by the difference between the
tax basis of the shares and the amount realized on the sale. The Company will be
entitled to a deduction equal to the amount of ordinary compensation income
recognized by the optionee. The deduction will be allowed at the same time the
optionee recognizes the income.
An optionee will not generally recognize income upon the grant of an
incentive stock option to purchase shares of Common Stock and will not generally
recognize income upon exercise of the option, provided the optionee is an
employee of the Company or a subsidiary at all times from the date of grant
until three months prior to exercise. However, the amount by which the fair
market value of the shares of Common Stock on the date of exercise exceeds the
exercise price will be includable for purposes of determining any alternative
minimum taxable income of an optionee. Where an optionee who has exercised an
incentive stock option sells the shares of Common Stock acquired upon exercise
more than two years after the grant date and more than one year after exercise,
capital gain or loss will be recognized equal to the difference between the
sales price and the exercise price. An optionee who sells such shares of Common
Stock within two years after the grant date or within one year after exercise
will recognize ordinary compensation income in an amount equal to the lesser of
the difference between (a) the exercise price and the fair market value of such
shares on the date of exercise, or (b) the exercise price and the sales
proceeds. Any remaining gain or loss will be treated as a capital gain or loss.
The Company will be entitled to a deduction equal to the amount of ordinary
compensation income recognized by the optionee in this case. The deduction will
be allowable at the same time the optionee recognizes the income.
Compensation of persons who are Named Executive Officers of the Company is
subject to the tax deduction limits of section 162(m) of the Code. Stock option
compensation that qualifies as "performance-based compensation" is exempt from
section 162(m), thus allowing the Company the full tax deduction otherwise
permitted for such compensation. If approved by the Company's stockholders, the
1999 Plan will enable the Committee to grant stock options that will be exempt
from the deduction limits of section 162(m) of the Code.
15
<PAGE>
1991 Plan and New Plan Benefits. During 1998, stock options were granted
under the 1991 Plan to the Named Executive Officers as set forth in the table on
page 9 entitled "Option Grants in Fiscal 1998." The Committee granted stock
options during 1998 under the 1991 Plan for 1,330,000 shares to all executive
officers as a group at an average weighted exercise price of $26.25 per share
and 1,080,600 shares to other employees as a group at an average weighted
exercise price of $28.59 per share. The Committee has not yet made any
determinations as to grants of stock options under the 1999 Plan.
The closing price of the Common Stock on the Nasdaq Stock Market on March
31, 1999 was $59.188 per share.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE APPROVAL OF THE MEDIMMUNE,
INC. 1999 STOCK OPTION PLAN.
PROPOSAL 3 - APPOINTMENT OF INDEPENDENT AUDITORS
The Audit Committee recommended and the Board of Directors approved the
appointment of PricewaterhouseCoopers L.L.P. as independent auditors for fiscal
1999, subject to stockholder approval and ratification. The Audit Committee, in
arriving at its recommendation to the Board, reviewed the performance of
PricewaterhouseCoopers L.L.P. in prior years as well as the firm's reputation
for integrity and competence in the fields of accounting and auditing. The Audit
Committee has expressed its satisfaction with PricewaterhouseCoopers L.L.P. in
these respects.
PricewaterhouseCoopers L.L.P. has served as the Company's independent
auditor since the Company's inception. Representatives of PricewaterhouseCoopers
L.L.P. will be present at the stockholders' meeting and will have the
opportunity to make such statements as they may desire. They will also be
available to respond to appropriate questions from the stockholders present.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE APPROVAL OF THE
APPOINTMENT OF PRICEWATERHOUSECOOPERS L.L.P. AS INDEPENDENT AUDITORS OF THE
COMPANY FOR THE YEAR 1999.
16
<PAGE>
SECURITY OWNERSHIP
PRINCIPAL STOCKHOLDERS
The following table sets forth certain information at January 31, 1999
regarding the beneficial ownership of Common Stock of each person known by the
Company to be the beneficial owner of more than five percent of the outstanding
Common Stock, each of the directors of the Company, each of the Named Executive
Officers and all Named Executive Officers and directors of the Company as a
group.
<TABLE>
<CAPTION>
BENEFICIAL OWNERSHIP
-----------------------------
NAME NUMBER OF SHARES PERCENT
- -------------------------------------------------------------------------- ------------------ --------
<S> <C> <C>
BB Biotech AG ............................................................ 7,786,000 14.2
Vordergasse 3
8200 Schaffhausen
CH/Switzerland
FMR Corp. ................................................................ 6,946,940 12.7
82 Devonshire Street
Boston, Massachusetts 02109
The Equitable Companies Incorporated(1) .................................. 4,629,168 8.3
787 Seventh Avenue
New York, New York 10019
Investor AB .............................................................. 3,238,000 5.9
S-103 32
Stockholm, Sweden
Wayne T. Hockmeyer, Ph.D.(2) ............................................. 492,500 *
David M. Mott(2) ......................................................... 385,078 *
Franklin H. Top, Jr., M.D.(2) ............................................ 698,838 1.3
M. James Barrett, Ph.D.(2) ............................................... 35,000 *
James H. Cavanaugh, Ph.D.(3) ............................................. 57,476 *
Barbara Hackman Franklin(2) .............................................. 34,500 *
Lawrence C. Hoff(2) ...................................................... 10,400 *
Gordon S. Macklin(2) ..................................................... 85,000 *
David P. Wright(2) ....................................................... 100,654 *
James F. Young, Ph.D.(2) ................................................. 402,610 *
Bogdan Dziurzynski(2) .................................................... 87,500 *
All executive officers and directors as a group (12 persons)(2)(3) ....... 2,389,556 4.2
</TABLE>
- ----------
* Less than one percent.
(1) Includes 802,846 shares of Common Stock issuable upon conversion of 7%
Convertible Notes due 2003 of MedImmune, Inc. beneficially owned by The
Equitable Companies Incorporated.
(2) Includes shares of Common Stock issuable upon exercise of options vesting
prior to April 2, 1999 as follows: Dr. Hockmeyer, 492,500 shares: Dr.
Barrett, 35,000 shares; Ms. Franklin, 32,500 shares; Mr. Hoff, 10,000
shares; Mr. Macklin, 55,000 shares; Mr. Mott, 385,078 shares; Dr. Top,
466,872 shares; Mr. Wright 100,654 shares; Dr. Young, 358,258 shares; Mr.
Dziurzynski, 49,620 shares; and all executive officers and directors as a
group, 1,985,482 shares.
(3) Includes 29,530 shares owned directly by Dr. Cavanaugh and 27,946 shares
owned by a partnership of which Dr. Cavanaugh is a general partner.
17
<PAGE>
OTHER MATTERS
The Board of Directors of the Company knows of no matters to be presented
at the Annual Meeting other than those described in this Proxy Statement. Other
business may properly come before the meeting and, in that event, it is the
intention of the Proxy Committee to vote as recommended by the Company.
PROXY SOLICITATION
The cost of the solicitation of proxies will be borne by the Company. The
Company will request brokerage houses, banks and other custodians or nominees
holding stock in their names for others to forward proxy materials to their
customers or principals who are the beneficial owners of shares and will
reimburse them for their expenses in doing so. The Company expects to solicit
proxies primarily by mail, but directors, officers, and other employees of the
Company may also solicit in person, by telephone, by facsimile, or by mail. The
Company has retained MacKenzie Partners, Inc. to assist in the solicitation of
proxies. MacKenzie Partners, Inc. will solicit proxies by personal interview,
telephone, facsimile, and mail. It is anticipated that the fee for those
services will not exceed $3,000 plus reimbursement of customary out-of-pocket
expenses.
DEADLINE FOR SUBMISSION OF STOCKHOLDER
PROPOSALS FOR NEXT YEAR'S ANNUAL MEETING
The proxy rules adopted by the Securities and Exchange Commission provide
that certain stockholder proposals must be included in the proxy statement for
the Company's Annual Meeting. For a proposal to be considered for inclusion in
next year's proxy statement, it must be received by the Company no later than
December 1, 1999.
The Company's Annual Report to Stockholders, including the Company's
audited financial statements for the year ended December 31, 1998, is being
mailed herewith to all stockholders of record.
ALL STOCKHOLDERS ARE URGED TO COMPLETE, SIGN AND RETURN THE ACCOMPANYING
PROXY CARD IN THE ENCLOSED ENVELOPE.
By Order of the Board of Directors,
/s/ Carol A. Iorio
Carol A. Iorio
Corporate Secretary
35 West Watkins Mill Road
Gaithersburg, Maryland 20878
April 16, 1999
18
<PAGE>
EXHIBIT A
- --------------------------------------------------------------------------------
MEDIMMUNE, INC.
1999 STOCK OPTION PLAN
- --------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
PAGE
----
Article I. PURPOSE ........................................................ A-3
Article II. DEFINITIONS ................................................... A-3
Article III. ELIGIBILITY .................................................. A-4
Article IV. ADMINISTRATION ................................................ A-4
Section 4.1 Committee Members ............................................ A-4
Section 4.2 Committee Authority .......................................... A-4
Section 4.3 Delegation of Authority ...................................... A-5
Section 4.4 Grants to Non-Employee Members of the Board .................. A-5
Article V. SHARES OF STOCK SUBJECT TO PLAN ............................... A-5
Section 5.1 Number of Shares ............................................. A-5
Section 5.2 Adjustments .................................................. A-5
Article VI. OPTIONS ....................................................... A-6
Section 6.1 Grant of Option .............................................. A-6
Section 6.2 Maximum Limit ................................................ A-6
Section 6.3 Option Price ................................................. A-6
Section 6.4 Vesting; Term of Option ...................................... A-6
Section 6.5 Option Exercise; Withholding ................................. A-6
Section 6.6 Limited Transferability of Option ............................ A-7
Section 6.7 Cancellation, Substitution and Amendment of Options .......... A-7
Article VII. ADDITIONAL RULES FOR ISOs .................................... A-8
Section 7.1 Annual Limits ................................................ A-8
Section 7.2 Termination of Employment .................................... A-8
Section 7.3 Other Terms and Conditions; Nontransferability ............... A-8
Section 7.4 Disqualifying Dispositions ................................... A-8
Article VIII. TERMINATION OF SERVICE ...................................... A-8
Section 8.1 Death ........................................................ A-8
Section 8.2 Disability ................................................... A-9
Section 8.3 Termination for Cause ........................................ A-9
Section 8.4 Other Termination of Service ................................. A-9
Article IX. STOCK CERTIFICATES ............................................ A-9
Section 9.1 Issuance of Certificates ..................................... A-9
Section 9.2 Conditions ................................................... A-10
Section 9.3 Legends ...................................................... A-10
Article X. EFFECTIVE DATE, TERMINATION AND AMENDMENT ...................... A-10
Section 10.1 Effective Date; Stockholder Approval ........................ A-10
Section 10.2 Termination ................................................. A-10
Section 10.3 Amendment ................................................... A-10
Article XI. MISCELLANEOUS ................................................. A-11
Section 11.1 Employment or Other Service ................................. A-11
Section 11.2 Rights as Stockholder ....................................... A-11
Section 11.3 Other Compensation and Benefit Plans ........................ A-11
Section 11.4 Plan Binding on Successors .................................. A-11
Section 11.6 Severability ................................................ A-11
Section 11.7 Governing Law ............................................... A-11
A-2
<PAGE>
MEDIMMUNE, INC.
1999 STOCK OPTION PLAN
ARTICLE I
PURPOSE
This MedImmune, Inc. 1999 Stock Option Plan is intended to advance the
interests of the Company and its stockholders by attracting, retaining and
motivating key personnel of the Company upon whose judgment, initiative and
effort the Company is largely dependent for the successful conduct of its
business, and to encourage and enable such persons to acquire a proprietary
interest in the Company by ownership of its stock. Options granted under the
Plan may either be "incentive stock options" intended to qualify as such under
the Internal Revenue Code, or "nonqualified stock options," which are not
intended to so qualify.
ARTICLE II
DEFINITIONS
(a) "Board" means the Board of Directors of the Company.
(b) "Code" means the Internal Revenue Code of 1986, as amended.
(c) "Common Stock" means the Company's Common Stock, par value $.01
per share.
(d) "Committee" means the Compensation and Stock Committee of the
Board or any other committee of the Board appointed by the Board to
administer the Plan from time to time.
(e) "Company" means MedImmune, Inc., a Delaware corporation.
(f) "Date of Grant" means the date on which an Option becomes
effective in accordance with Section 6.1 hereof.
(g) "Eligible Person" means any person who is an employee, officer,
member of the Board, consultant or advisor of the Company or any
Subsidiary, or any person who is determined by the Committee to be a
prospective employee, officer, member of the Board, consultant or advisor
of the Company or any Subsidiary.
(h) "Employee" means any person who is an employee of the Company or
any Subsidiary; provided, however, that with respect to Incentive Stock
Options, "Employee" means any person who is considered an employee of the
Company or any Subsidiary for purposes of Treasury Regulation
(section)1.421-7(h).
(i) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
(j) "Fair Market Value" of a share of Common Stock as of a given date
means the closing sales price of the Common Stock on the Nasdaq Stock
Market, Inc. on the trading day immediately preceding the date as of which
Fair Market Value is to be determined or, in the absence of any reported
sales of Common Stock on such date, on the first preceding date on which
any such sale
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shall have been reported. If Common Stock is not listed on the Nasdaq Stock
Market, Inc. on the date as of which Fair Market Value is to be determined,
the Committee shall determine in good faith the Fair Market Value in
whatever manner it considers appropriate.
(k) "Incentive Stock Option" means a stock option granted under the
Plan that is intended to meet the requirements of section 422 of the Code
and the regulations promulgated thereunder.
(l) "Nonqualified Stock Option" means a stock option granted under the
Plan that is not an Incentive Stock Option.
(m) "Option" means an Incentive Stock Option or a Nonqualified Stock
Option granted under the Plan.
(n) "Optionee" means an Eligible Person to whom an Option has been
granted, which Option has not expired, under the Plan.
(o) "Option Price" means the price at which each share of Common Stock
subject to an Option may be purchased, determined in accordance with
Section 6.3 hereof.
(p) "Plan" means this MedImmune, Inc. 1999 Stock Option Plan.
(q) "Stock Option Agreement" means an agreement between the Company
and an Optionee under which the Optionee may purchase Common Stock under
the Plan.
(r) "Subsidiary" means a subsidiary corporation of the Company, within
the meaning of section 424(f) of the Code.
ARTICLE III
ELIGIBILITY
All Eligible Persons are eligible to receive a grant of an Option under the
Plan. The Committee shall, in its sole discretion, determine and designate from
time to time those Eligible Persons who are to be granted an Option.
ARTICLE IV
ADMINISTRATION
Section 4.1 Committee Members. The Plan shall be administered by a
Committee comprised of no fewer than two persons selected by the Board. Solely
to the extent deemed necessary or advisable by the Board, each Committee member
shall meet the definition of a "nonemployee director" for purposes of such Rule
16b-3 under the Exchange Act and of an "outside director" under section 162(m)
of the Code. The Board shall also have the authority to exercise the powers and
duties of the Committee under the Plan.
Section 4.2 Committee Authority. Subject to the express provisions of the
Plan, the Committee shall have the authority, in its discretion, to determine
the Eligible Persons to whom an Option shall be granted, the time or times at
which an Option shall be granted, the number of shares of Common Stock
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subject to each Option, the Option Price of the shares subject to each Option
and the time or times when each Option shall become exercisable and the duration
of the exercise period. Subject to the express provisions of the Plan, the
Committee shall also have discretionary authority to interpret the Plan, to
prescribe, amend and rescind rules and regulations relating to it, to determine
the provisions of each Stock Option Agreement, and to make all the
determinations necessary or advisable in the administration of the Plan. All
such actions and determinations by the Committee shall be conclusively binding
for all purposes and upon all persons. No Committee member shall be liable for
any action or determination made in good faith with respect to the Plan, any
Option or any Stock Option Agreement entered into hereunder.
Section 4.3 Delegation of Authority. The Committee shall have the right,
from time to time, to delegate to one or more officers of the Company the
authority of the Committee to grant and determine the terms and conditions of
Options awarded under the Plan, subject to such limitations as the Committee
shall determine; provided, however, that no such authority may be delegated with
respect to Options awarded to any Optionee who the Committee determines may be
subject to Rule 16b-3 under the Exchange Act or section 162(m) of the Code.
Section 4.4 Grants to Non-Employee Members of the Board. Awards of Options
to non-employee members of the Board under the Plan shall be approved by the
Board. With respect to awards to such directors, all rights, powers and
authorities vested in the Committee under the Plan shall instead be exercised by
the Board, and all provisions of the Plan relating to the Committee shall be
interpreted in a manner consistent with the foregoing by treating any such
reference as a reference to the Board for such purpose.
ARTICLE V
SHARES OF STOCK SUBJECT TO PLAN
Section 5.1 Number of Shares. Subject to adjustment pursuant to the
provisions of Section 5.2 hereof, the maximum aggregate number of shares of
Common Stock which may be issued and sold hereunder shall be 2,750,000 shares.
Shares of Common Stock issued and sold under the Plan may be either authorized
but unissued shares or shares held in the Company's treasury. The number of
shares of Common Stock reserved for issuance under the Plan shall at no time be
less than the maximum number of shares which may be purchased at any time
pursuant to outstanding options. Shares of Common Stock covered by an Option
that shall have been exercised shall not again be available for an Option grant.
If an Option shall terminate or expire for any reason without being wholly
exercised, the number of shares to which such Option termination or expiration
relates shall again be available for grant hereunder.
Section 5.2 Adjustments. In the event that the number of shares of Common
Stock of the Company shall be increased or decreased through reclassification,
combination of shares, stock split or the payment of a stock dividend, or
otherwise, then (i) the number of shares of Common Stock currently subject to
Options and the Option Prices of such Options, (ii) the maximum aggregate number
and kind of shares of Common Stock that may be issued and sold under the Plan,
and (iii) the maximum number of shares that may be subject to Options granted to
any Optionee during any one calendar year, shall be proportionately adjusted to
reflect such increase or decrease.
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In the event there shall be any other change in the number or kind of the
outstanding shares of Common Stock of the Company, or any stock or other
securities into which such Common Stock shall have been changed, or for which it
shall have been exchanged, whether by reason of merger, consolidation or
otherwise, then if the Committee shall, in its sole discretion, determine that
such change equitably requires an adjustment to (i) the number and kind of
shares of Common Stock currently subject to Options and the Option Prices or
terms of such Options, (ii) the maximum aggregate number and kind of shares of
Common Stock that may be issued and sold under the Plan, and (iii) the maximum
number of shares of Common Stock that may be subject to Options granted to any
Optionee during any one calendar year, such adjustments shall be made in the
manner that the Committee shall deem to be equitable and appropriate. In no
event may any such change be made to an Incentive Stock Option which would
constitute a "modification" within the meaning of section 424(h)(3) of the Code
without the consent of any affected Optionee. In the event of any merger,
consolidation, reorganization or similar corporate event in which shares of the
Common Stock are to be exchanged for payment of cash (the "Cash Consideration"),
the Committee may, in its discretion, (i) make equitable adjustments as provided
above, or (ii) cancel any outstanding Option in exchange for payment in cash, if
any, equal to the excess of the Cash Consideration for the shares underlying
such Option over the Option Price for such shares.
ARTICLE VI
OPTIONS
Section 6.1 Grant of Option. An Option may be granted to any Eligible
Person selected by the Committee. The grant of an Option shall first be
effective upon the date it is approved by the Committee, except to the extent
the Committee shall specify a later date upon which the grant of an Option shall
first be effective. Each Option shall be designated, at the discretion of the
Committee, as an Incentive Stock Option or a Nonqualified Stock Option;
provided, however, that Incentive Stock Options may only be granted to Eligible
Persons who are Employees of the Company. The Company and the Optionee shall
execute a Stock Option Agreement which shall set forth such terms and conditions
of the Option as may be determined by the Committee to be consistent with the
Plan, and which may include additional provisions and restrictions that are not
inconsistent with the Plan.
Section 6.2 Maximum Limit. Notwithstanding anything elsewhere in the Plan
to the contrary, the maximum number of shares of Common Stock that may be
subject to Options granted to any Optionee during any one calendar year shall be
1,000,000 shares, subject to adjustment as provided in Section 5.2 hereof.
Section 6.3 Option Price. The Option Price shall be determined by the
Committee; provided, however, that the Option Price shall not be less than 100%
of the Fair Market Value of a share of Common Stock on the Date of Grant.
Section 6.4 Vesting; Term of Option. An Option shall vest and become
exercisable in the manner and subject to such conditions provided by the
Committee and set forth in the Stock Option Agreement. The Committee, in its
sole discretion, may accelerate the exercisability of any Option at any time.
The period during which a vested Option may be exercised shall be determined by
the Committee, subject to
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a maximum term of ten years from the Date of Grant and such other limitations as
may apply upon the termination of an Optionee's employment or other service or
as otherwise specified by the Committee in the Stock Option Agreement.
Section 6.5 Option Exercise; Withholding. Subject to such terms and
conditions as shall be specified in a Stock Option Agreement, an Option may be
exercised in whole or in part at any time, with respect to whole shares only,
within the period permitted for the exercise thereof, and shall be exercised by
written notice of intent to exercise the Option with respect to a specified
number of shares delivered to the Company at its principal office, and payment
in full to the Company at said office of the amount of the Option Price for the
number of shares of the Common Stock with respect to which the Option is then
being exercised. Payment of the Option Price shall be made (i) in cash or by
cash equivalent, (ii) at the discretion of the Committee, in Common Stock that
has been held by the Optionee for at least six months (or such other period as
the Committee may deem appropriate for purposes of applicable accounting rules),
valued at the Fair Market Value of such shares determined on the date of
exercise, (iii) at the discretion of the Committee, by a delivery of a notice
that the Optionee has placed a market sell order (or similar instruction) with a
broker with respect to shares of Common Stock then issuable upon exercise of the
Option, and that the broker has been directed to pay a sufficient portion of the
net proceeds of the sale to the Company in satisfaction of the Option Price
(conditioned upon the payment of such net proceeds), (iv) at the discretion of
the Committee, by a combination of the methods described above, or (v) by such
other method as may be approved by the Committee and set forth in the Stock
Option Agreement. In addition to and at the time of payment of the Option Price,
the Optionee shall pay to the Company the full amount of all federal and state
withholding and other employment taxes required to be withheld in connection
with such exercise, in any manner consistent with the foregoing that is approved
by the Committee and set forth in the Stock Option Agreement.
Section 6.6 Limited Transferability of Option. All Options shall be
nontransferable except (i) upon the Optionee's death, by the Optionee's will or
the laws of descent and distribution or (ii) in the case Nonqualified Stock
Options only, on a case-by-case basis as may be approved by the Committee in its
discretion, in accordance with the terms provided below. A Stock Option
Agreement for a Nonqualified Stock Option may provide that the Optionee shall be
permitted to, during his or her lifetime and subject to the prior approval of
the Committee at the time of proposed transfer, transfer all or part of the
Option to the Optionee's family member (as defined in the Stock Option Agreement
in a manner consistent with the requirements for the Form S-8 registration
statement, if applicable). Any such transfer shall be subject to the condition
that it is made by the Optionee for estate planning, tax planning or donative
purposes, and no consideration (other than nominal consideration) is received by
the Optionee therefor. The transfer of a Nonqualified Stock Option may be
subject to such other terms and conditions as the Committee may in its
discretion impose from time to time, including a condition that the portion of
the Option to be transferred be vested and exercisable by the Optionee at the
time of the transfer. Subsequent transfers of an Option shall be prohibited
other than by will or the laws of descent and distribution upon the death of the
transferee.
Section 6.7 Cancellation, Substitution and Amendment of Options. The
Committee shall have the authority to effect, at any time and from time to time,
with the consent of the affected Optionees, (i) the cancellation of any or all
outstanding Options and the grant in substitution therefor of new Options
covering the same or different numbers of shares of Common Stock and having an
Option Price which may be the same as or different than the Option Price of the
cancelled Options or (ii) the amendment of the terms of any and all outstanding
Options; provided, however, that the Committee shall not, without
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the approval of the Company's stockholders, cause the cancellation, substitution
or amendment of Options that would have the effect of reducing the exercise
price of Options previously granted under the Plan, other than as permitted by
Section 5.2 hereof.
ARTICLE VII
ADDITIONAL RULES FOR ISO
Section 7.1 Annual Limits. No Incentive Stock Option shall be granted to an
Optionee as a result of which the aggregate Fair Market Value (determined as of
the date of grant) of the stock with respect to which "incentive stock options"
are exercisable for the first time in any calendar year under the Plan and any
other stock option plans of the Company, any Subsidiary, or any parent
corporation, would exceed the maximum amount permitted under section 422(d) of
the Code. This limitation shall be applied by taking options into account in the
order in which granted.
Section 7.2 Termination of Employment. An Incentive Stock Option may
provide that such Option may be exercised not later than three months following
termination of employment of the Optionee with the Company and all Subsidiaries,
subject to special rules relating to death and disability, as and to the extent
determined by the Committee to be consistent with the requirements of section
422 of the Code and Treasury Regulations thereunder.
Section 7.3 Other Terms and Conditions; Nontransferability. Any Incentive
Stock Option granted hereunder shall contain such additional terms and
conditions, not inconsistent with the terms of this Plan, as are deemed
necessary or desirable by the Committee, which terms, together with the terms of
this Plan, shall be intended and interpreted to cause such Incentive Stock
Option to qualify as an "incentive stock option" under section 422 of the Code.
Such terms shall include, if applicable, limitations on Incentive Stock Options
granted to ten-percent owners of the Company as determined under sections
422(b)(6) and 424(d) of the Code. A Stock Option Agreement for an Incentive
Stock Option may provide that such Option shall be treated as a Nonqualified
Stock Option to the extent that certain requirements applicable to "incentive
stock options" under the Code shall not be satisfied. An Incentive Stock Option
shall by its terms be nontransferable otherwise than by will or by the laws of
descent and distribution, and shall be exercisable during the lifetime of an
Optionee only by such Optionee.
Section 7.4 Disqualifying Dispositions. If shares of Common Stock acquired
by exercise of an Incentive Stock Option are disposed of within two years
following the Date of Grant or one year following the transfer of such shares to
the Optionee upon exercise, the Optionee shall, promptly following such
disposition, notify the Company in writing of the date and terms of such
disposition and provide such other information regarding the disposition as the
Committee may reasonably require.
ARTICLE VIII
TERMINATION OF SERVICE
Section 8.1 Death. Unless otherwise provided by the Committee and set forth
in the Stock Option Agreement, if an Optionee shall die at any time after the
Date of Grant and while he is an Eligible Person, the executor or administrator
of the estate of the decedent, or the person or persons to whom an
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Option shall have been validly transferred in accordance with Section 6.6 hereof
pursuant to will or the laws of descent and distribution, shall have the right,
during the period ending one year after the date of the Optionee's death
(subject to the term of the Option), to exercise the Optionee's Option to the
extent that it was exercisable at the date of the Optionee's death and shall not
have been previously exercised. The Committee may determine at or after grant to
make any portion of the Optionee's Option that is not exercisable at the date of
death immediately vested and exercisable.
Section 8.2 Disability. Unless otherwise provided by the Committee and set
forth in the Stock Option Agreement, if an Optionee's employment or other
service with the Company or any Subsidiary shall be terminated as a result of
permanent and total disability (within the meaning of section 22(e)(3) of the
Code) at any time after the Date of Grant and while the Optionee is an Eligible
Person, the Optionee (or in the case of an Optionee who is legally
incapacitated, his guardian or legal representative) shall have the right,
during a period ending one year after the date of his disability (subject to the
term of the Option), to exercise an Option to the extent that it was exercisable
at the date of such termination of employment or other service and shall not
have been exercised. The Committee may determine at or after grant to make any
portion of the Optionee's Option that is not exercisable at the date of
termination of employment or other service due to disability immediately vested
and exercisable.
Section 8.3 Termination for Cause. Unless otherwise provided by the
Committee and set forth in the Stock Option Agreement, if an Optionee's
employment or other service with the Company or any Subsidiary shall be
terminated for cause, the Optionee's right to exercise any unexercised portion
of an Option shall immediately terminate and all rights thereunder shall cease.
For purposes of this Section 8.3, termination for "cause" shall include, but not
be limited to, embezzlement or misappropriation of corporate funds, any acts of
dishonesty resulting in conviction for a felony, misconduct resulting in
material injury to the Company or any Subsidiary, significant activities harmful
to the reputation of the Company or any Subsidiary, a significant violation of
Company or Subsidiary policy, willful refusal to perform, or substantial
disregard of, the duties properly assigned to the Optionee, or a significant
violation of any contractual, statutory or common law duty of loyalty to the
Company or any Subsidiary. Notwithstanding the foregoing, in the event an
Optionee is party to an employment (or similar) agreement with the Company or
any Subsidiary that defines the term "cause," such definition shall apply for
purpose of the Plan. The Committee shall have the power to determine whether the
Optionee has been terminated for cause and the date upon which such termination
for cause occurs. Any such determination shall be final, conclusive and binding
upon the Optionee.
Section 8.4 Other Termination of Service. Unless otherwise provided by the
Committee and set forth in the Stock Option Agreement, if an Optionee's
employment or other service with the Company or any Subsidiary shall be
terminated for any reason other than death, permanent and total disability or
termination for cause, the Optionee shall have the right, during the period
ending three months after such termination (subject to the term of the Option),
to exercise an Option to the extent that it was exercisable at the date of such
termination and shall not have been exercised. For purposes of this Section 8.4,
an Optionee shall not be considered to have terminated employment or other
service with the Company or any Subsidiary until the expiration of the period of
any military, sick leave or other bona fide leave of absence, up to a maximum
period of 90 days (or such greater period during which the Optionee is
guaranteed reemployment either by statute or contract).
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ARTICLE IX
STOCK CERTIFICATES
Section 9.1 Issuance of Certificates. Subject to Section 9.2 hereof, the
Company shall issue a stock certificate in the name of the Optionee (or other
person exercising the Option in accordance with the provisions of the Plan) for
the shares of Common Stock purchased by exercise of an Option as soon as
practicable after due exercise and payment of the aggregate Option Price for
such shares. A separate stock certificate or separate stock certificates shall
be issued for any shares of Common Stock purchased pursuant to the exercise of
an Option that is an Incentive Stock Option, which certificate or certificates
shall not include any shares of Common Stock that were purchased pursuant to the
exercise of an Option that is a Nonqualified Stock Option.
Section 9.2 Conditions. The Company shall not be required to issue or
deliver any certificate for shares of Common Stock purchased upon the exercise
of any Option granted hereunder or any portion thereof prior to fulfillment of
all of the following conditions:
(i) the completion of any registration or other qualification of such
shares, under any federal or state law or under the rulings or regulations
of the Securities and Exchange Commission or any other governmental
regulatory body, that the Committee shall in its sole discretion deem
necessary or advisable;
(ii) the obtaining of any approval or other clearance from any federal
or state governmental agency which the Committee shall in its sole
discretion determine to be necessary or advisable;
(iii) the lapse of such reasonable period of time following the
exercise of the Option as the Committee from time to time may establish for
reasons of administrative convenience;
(iv) satisfaction by the Optionee of all applicable withholding taxes
or other withholding liabilities; and
(v) if required by the Committee, in its sole discretion, the receipt
by the Company from an Optionee of (i) a representation in writing that the
shares of Common Stock received upon exercise of an Option are being
acquired for investment and not with a view to distribution and (ii) such
other representations and warranties as are deemed necessary by counsel to
the Company.
Section 9.3 Legends. The Company reserves the right to legend any
certificate for shares of Common Stock, conditioning sales of such shares upon
compliance with applicable federal and state securities laws and regulations.
ARTICLE X
EFFECTIVE DATE, TERMINATION AND AMENDMENT
Section 10.1 Effective Date; Stockholder Approval. The Plan shall become
effective on the date of its approval by the stockholders of the Company, which
approval shall be obtained within 12 months after the adoption of the Plan by
the Board.
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Section 10.2 Termination. The Plan shall terminate on the date immediately
preceding the tenth anniversary of the date the Plan is adopted by the Board.
The Board may, in its sole discretion and at any earlier date, terminate the
Plan. Notwithstanding the foregoing, no termination of the Plan shall in any
manner affect any Option theretofore granted without the consent of the Optionee
or the permitted transferee of the Option.
Section 10.3 Amendment. The Board may at any time and from time to time and
in any respect, amend or modify the Plan. Solely to the extent deemed necessary
or advisable by the Board, for purposes of complying with sections 422 or 162(m)
of the Code or rules of any securities exchange or for any other reason, the
Board may seek the approval of any such amendment by the Company's stockholders.
Notwithstanding the foregoing, no amendment or modification of the Plan shall in
any manner affect any Option theretofore granted without the consent of the
Optionee or the permitted transferee of the Option.
ARTICLE XI
MISCELLANEOUS
Section 11.1 Employment or Other Service. Nothing in the Plan, in the grant
of any Option or in any Stock Option Agreement shall confer upon any Eligible
Person the right to continue in the capacity in which he is employed by or
otherwise provides services to the Company or any Subsidiary. Notwithstanding
anything contained in the Plan to the contrary, unless otherwise provided in a
Stock Option Agreement, no Option shall be affected by any change of duties or
position of the Optionee (including a transfer to or from the Company or any
Subsidiary), so long as such Optionee continues to be an Eligible Person.
Section 11.2 Rights as Stockholder. An Optionee or the permitted transferee
of an Option shall have no rights as a stockholder with respect to any shares
subject to such Option prior to the purchase of such shares by exercise of such
Option as provided herein. Nothing contained herein or in the Stock Option
Agreement relating to any Option shall create an obligation on the part of the
Company to repurchase any shares of Common Stock purchased hereunder.
Section 11.3 Other Compensation and Benefit Plans. The adoption of the Plan
shall not affect any other stock option or incentive or other compensation plans
in effect for the Company or any Subsidiary, nor shall the Plan preclude the
Company from establishing any other forms of incentive or other compensation for
employees of the Company or any Subsidiary. The amount of any compensation
deemed to be received by an Optionee as a result of the exercise of an Option or
the sale of shares received upon such exercise shall not constitute compensation
with respect to which any other employee benefits of such Optionee are
determined, including, without limitation, benefits under any bonus, pension,
profit sharing, life insurance or salary continuation plan, except as otherwise
specifically determined by the Board or the Committee or provided by the terms
of such plan.
Section 11.4 Plan Binding on Successors. The Plan shall be binding upon the
Company, its successors and assigns, and the Optionee, his executor,
administrator and permitted transferees.
Section 11.5 Construction and Interpretation. Whenever used herein, nouns
in the singular shall include the plural, and the masculine pronoun shall
include the feminine gender. Headings of Articles and Sections hereof are
inserted for convenience and reference and constitute no part of the Plan.
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Section 11.6 Severability. If any provision of the Plan or any Stock Option
Agreement shall be determined to be illegal or unenforceable by any court of law
in any jurisdiction, the remaining provisions hereof and thereof shall be
severable and enforceable in accordance with their terms, and all provisions
shall remain enforceable in any other jurisdiction.
Section 11.7 Governing Law. The validity and construction of this Plan and
of the Stock Option Agreements shall be governed by the laws of the State of
Delaware.
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[MEDIMMUNE, INC. LOGO OMITTED]
MEDIMMUNE, INC.
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35 West Watkins Mill Road Gaithersburg, Maryland 20878
301-417-0770 Fax: 301-527-4200
