<PAGE> 1
As filed with the Securities and Exchange Commission on June 12, 1996
Registration No. 33-
- -------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
GENELABS TECHNOLOGIES, INC.
(Exact name of registrant as specified in its charter)
CALIFORNIA 94-3010150
(State of incorporation) (I.R.S. employer
identification no.)
505 PENOBSCOT DRIVE
REDWOOD CITY, CALIFORNIA 94063
(Address of principal executive offices)
1995 EMPLOYEE STOCK OPTION PLAN
(Full title of the plan)
IRENE A. CHOW
PRESIDENT AND CHIEF EXECUTIVE OFFICER
505 PENOBSCOT DRIVE
REDWOOD CITY, CALIFORNIA 94063
(415) 369-9500
(Name, address and telephone number of agent for service)
COPIES TO:
Gordon K. Davidson, Esq.
Fenwick & West
Two Palo Alto Square
Palo Alto, California 94306
(415) 494-0600
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------------
Amount Proposed Proposed Amount of
to be Maximum Offering Maximum Registration
TITLE OF SECURITIES TO BE REGISTERED Registered Price Per Share Aggregate Fee
Offering Price
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, no par value 1,000,000 (1) $ 8.1875 (2) $ 8,187,500 $ 2,823.28
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Additional shares available for grant and not yet subject to outstanding
options as of May 31, 1996 under the 1995 Employee Stock Option Plan.
(2) Estimated based on the average of the high and low prices reported on
The Nasdaq National Market on June 7, 1996 pursuant to Rule 457(c) and
(h)(1) solely for the purpose of calculating the registration fee.
The Exhibit Index appears on sequentially numbered page 9. Page 1 of 18 pages.
<PAGE> 2
GENELABS TECHNOLOGIES, INC.
REGISTRATION STATEMENT ON FORM S-8
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed with the Securities and Exchange
Commission (the "Commission") are incorporated herein by reference:
(a) The Registrant's Annual Report on Form 10-K and Form 10-K/A
for fiscal year ended December 31, 1995 filed pursuant to
Section 13(a) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act").
(b) The Registrant's Quarterly Report on Form 10-Q for the
quarterly period ended March 31, 1996 filed with the
Commission pursuant to Section 13(a) of the Exchange Act.
(c) The description of the Registrant's Common Stock contained in
the Registrant's registration statement on Form 8-A filed on
April 30, 1991 with the Commission under Section 12(g) of the
Exchange Act, including any amendment or report filed for the
purpose of updating such description.
All documents subsequently filed by the Registrant pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of
a post-effective amendment which indicates that all securities offered hereby
have been sold or which deregisters all securities then remaining unsold, shall
be deemed incorporated by reference herein and to be a part hereof from the date
of the filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
The validity of the issuance of the shares of Common Stock offered
hereby will be passed upon for the Registrant by Fenwick & West, Palo Alto,
California. Certain members of that law firm beneficially own an aggregate of
approximately 23,000 shares of the Registrant's Common Stock.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Registrant's Articles of Incorporation include a provision
that eliminates the personal liability of its directors to the Registrant and
its shareholders for monetary damages for breach of the directors' fiduciary
duties in certain circumstances. This limitation has no effect on a director's
liability (i) for acts or omissions that involve intentional misconduct or a
knowing and culpable violation of law, (ii) for acts or omissions that a
director believes to be contrary to the best interests of the Registrant or its
shareholders or that involve the absence of good faith on the part of the
director, (iii) for any transaction from which a director derived an improper
personal
2
<PAGE> 3
benefit, (iv) for acts or omissions that show a reckless disregard for the
director's duty to the Registrant or its shareholders in circumstances in which
the director was aware, or should have been aware, in the ordinary course of
performing a director's duties, of a risk of a serious injury to the Registrant
or its shareholders, (v) for acts or omissions that constitute an unexcused
pattern of inattention that amounts to an abdication of the director's duty to
the Registrant or its shareholders, (vi) under Section 310 of the California
Corporations Code (the "California Code") (concerning contracts or transactions
between the Registrant and a director) or (vii) under Section 316 of the
California Code (concerning directors' liability for improper dividends, loans
and guarantees). The provision does not extend to acts or omissions of a
director in his or her capacity as an officer. Further, the provision has no
effect on claims arising under federal or state securities laws and will not
affect the availability of injunctions and other equitable remedies available to
the Registrant's shareholders for any violation of a director's fiduciary duty
to the Registrant or its shareholders.
The Registrant's Articles of Incorporation also include an
authorization for the Registrant to indemnify its agents (as defined in Section
317 of the California Code), through bylaw provisions, by agreement or
otherwise, to the fullest extent permitted by law. Pursuant to this latter
provision, the Registrant's Bylaws provide for indemnification of the
Registrant's directors, officers and employees. In addition, the Registrant, at
its discretion, may provide indemnification to persons whom the Registrant is
not obligated to indemnify. The Bylaws also allow the Registrant to enter into
indemnity agreements with individual directors, officers, employees and other
agents. These indemnity agreements have been entered into with all directors and
provide the maximum indemnification permitted by law. These agreements, together
with the Registrant's Bylaws and Articles of Incorporation, may require the
Registrant, among other things, to indemnify such directors against certain
liabilities that may arise by reason of their status or service as directors
(other than liabilities resulting from willful misconduct of a culpable nature),
to advance expenses to them as they are incurred, provided that they undertake
to repay the amount advanced if it is ultimately determined by a court that they
are not entitled to indemnification, and to obtain directors' and officers'
insurance if available on reasonable terms.
Section 317 of the California Code and the Registrant's Bylaws
make provision for the indemnification of officers, directors and other
corporate agents in terms sufficiently broad to indemnify such persons, under
certain circumstances, for liabilities (including reimbursement of expenses
incurred) arising under the Securities Act.
Reference is also made to Section 7 of the Underwriting Agreement
filed as Exhibit 1.01 to the Registrant's registration statement on Form S-3
(No. 33-76242) filed by the Registrant with the Commission on March 8, 1994, as
amended (the "Form S-3"), which sets forth certain provisions with respect to
the indemnification of certain controlling persons, directors and officers
against certain losses and liabilities, including certain liabilities under the
Securities Act.
In addition, the Registrant's Amended and Restated Registration
Rights Agreement, filed as Exhibit 4.02 to the Registrant's registration
statement on Form S-1 (No. 33-40120) filed by the Registrant with the Commission
on April 29, 1991, as amended, provides in Section 7 for cross indemnification
of certain holders of the Registrant's Common Stock and of the Registrant and
its officers and directors for certain liabilities existing under the Securities
Act and otherwise. Additionally, Section 5.4 of the Unit Purchase Agreements, a
form of which is filed as Exhibit 4.4 to the Registrant's Registration Statement
on Form S-3 (Registration No. 33-97336), provides for cross indemnification of
the Selling Shareholders and the Company for certain liabilities existing under
the Securities Act and otherwise.
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<PAGE> 4
The Registrant currently carries a directors and officers
liability insurance policy.
Reference is also made to the following documents incorporated by
reference herewith regarding relevant indemnification provisions described above
and elsewhere herein: Registrant's Amended and Restated Articles of
Incorporation (incorporated herein by reference to Exhibit 3.01 to Registrant's
Annual Report on Form 10-K for the fiscal year ended December 31, 1991); and
Registrant's Bylaws, as amended to date (incorporated herein by reference to
Exhibit 4.02 to Registrant's Registration Statement on Form S-3 filed with the
Securities and Exchange Commission on June 15, 1994 (Registration No.
33-76242)).
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
The following exhibits are incorporated by reference or filed
herewith.
4.01 Registrant's Amended and Restated Articles of Incorporation
(incorporated herein by reference to Exhibit 3.01 to
Registrant's Annual Report on Form 10-K for the fiscal year
ended December 31, 1991).
4.02 Registrant's Certificate of Determination of Preferences of
Series A Convertible Preferred Stock of Genelabs
Technologies, Inc. (incorporated herein by reference to
Exhibit 10.37 to Registrant's Quarterly Report on Form 10-Q
for the Quarter ended June 30, 1995).
4.03 Registrant's Bylaws, as amended to date (incorporated herein
by reference to Exhibit 3.02 to Registrant's Annual Report on
Form 10-K for the fiscal year ended December 31, 1993).
4.04 Registrant's 1995 Employee Stock Option Plan, as amended.
5.01 Opinion of Fenwick & West LLP.
23.01 Consent of Fenwick & West LLP (included in Exhibit 5.01).
23.02 Consent of Ernst & Young LLP, Independent Auditors.
24.01 Power of Attorney (see page 7).
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<PAGE> 5
ITEM 9. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the Registration
Statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the Registration Statement or
any material change to such information in the Registration Statement:
Provided, however, that paragraphs (1)(i) and (1)(ii) above
do not apply if the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed by the
Registrant pursuant to Section 13 or Section 15(d) of the Exchange Act that are
incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under
the Securities Act, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit plan's
annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the Registration Statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
Insofar as indemnification for liabilities arising under the
Securities Act may be permitted for directors, officers and controlling persons
of the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered hereby, the Registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether
5
<PAGE> 6
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.
EXPERTS
The consolidated financial statements of Genelabs Technologies,
Inc., appearing in Genelabs Technologies, Inc.'s Annual Report (Form 10-K) for
the year ended December 31, 1995, have been audited by Ernst & Young LLP,
independent auditors, as set forth in their report thereon included therein and
incorporated herein by reference. Such consolidated financial statements are
incorporated herein by reference in reliance upon such report given upon the
authority of such firm as experts in accounting and auditing.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Redwood City, State of California, on the 11th
day of June 1996.
GENELABS TECHNOLOGIES, INC.
By: /s/ Irene A. Chow
-------------------------------------
Chief Executive Officer, President
and Director
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS that each individual whose signature
appears below constitutes and appoints Irene A. Chow and Melinda Griffith, and
each of them, his or her true and lawful attorneys-in-fact and agents with full
power of substitution, for him or her and in his or her name, place and stead,
in any and all capacities, to sign any and all amendments (including
post-effective amendments) to this Registration Statement on Form S-8, and to
file the same with all exhibits thereto and all documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
and about the premises, as fully to all intents and purposes as he or she might
or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents or any of them, or his, her or their substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------------- ---------- --------
PRINCIPAL EXECUTIVE OFFICER:
<S> <C> <C>
/s/ Irene A. Chow Chief Executive Officer, President June 11, 1996
- ------------------------------------ and Director
Irene A. Chow
PRINCIPAL FINANCIAL AND ACCOUNTING OFFICER:
/s/ Cynthia E. Nathan Vice President and Controller June 11, 1996
- ------------------------------------
Cynthia E. Nathan
</TABLE>
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<TABLE>
<CAPTION>
ADDITIONAL DIRECTORS:
<S> <C> <C>
/s/ Edgar G. Engleman Director June 11, 1996
- ------------------------------------
Edgar G. Engleman
/s/ Zhongxin M. Gong Director June 11, 1996
- ------------------------------------
Zhongxin M. Gong
/s/ Arthur Gray, Jr. Director June 11, 1996
- ------------------------------------
Arthur Gray, Jr.
/s/ H. H. Haight Director June 11, 1996
- ------------------------------------
H. H. Haight
/s/ Frank F.C. Kung Director June 11, 1996
- ------------------------------------
Frank F.C. Kung
/s/ Damaris Skouras Director June 11, 1996
- ------------------------------------
Damaris Skouras
/s/ Max Wilhelm Director June 11, 1996
- ------------------------------------
Max Wilhelm
</TABLE>
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<TABLE>
<CAPTION>
EXHIBIT INDEX
-------------
Exhibit No. Description
- ----------- -----------
<S> <C>
4.01 Registrant's Amended and Restated Articles of Incorporation
(incorporated herein by reference to Exhibit 3.01 to Registrant's
Annual Report on Form 10-K for the fiscal year ended December 31,
1991).
4.02 Registrant's Certificate of Determination of Preferences of Series
A Convertible Preferred Stock of Genelabs Technologies, Inc.
(incorporated herein by reference to Exhibit 10.37 to Registrant's
Quarterly Report on Form 10-Q for the Quarter ended June 30, 1995).
4.03 Registrant's Bylaws, as amended to date (incorporated herein by
reference to Exhibit 3.02 to Registrant's Annual Report on Form
10-K for the fiscal year ended December 31, 1993).
4.04 Registrant's 1995 Employee Stock Ownership Plan, as amended.
5.01 Opinion of Fenwick & West LLP.
23.01 Consent of Fenwick & West LLP (included in Exhibit 5.01).
23.02 Consent of Ernst & Young LLP, Independent Auditors.
24.01 Power of Attorney (see page 7).
</TABLE>
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EXHIBIT 4.04
GENELABS TECHNOLOGIES, INC.
1995 EMPLOYEE STOCK OPTION PLAN
Adopted April 14, 1995
(As Amended May 30, 1996)
1. PURPOSE. This 1995 Stock Option Plan (this "Plan") is established as
a compensatory plan to attract, retain and provide equity incentives to selected
persons to promote the financial success of Genelabs Technologies, Inc., a
California corporation (the "Company"). Capitalized terms not previously defined
herein are defined in Section 16 of this Plan.
2. TYPES OF OPTIONS AND SHARES. Options granted under this Plan (the
"Options") may be either (a) incentive stock options ("ISOs") within the meaning
of Section 422 of the Internal Revenue Code of 1986, as amended (the "Code"), or
(b) nonqualified stock options ("NQSOs"), as designated at the time of grant.
The shares of stock that may be purchased upon exercise of Options granted under
this Plan (the "Shares") are shares of the common stock of the Company.
3. NUMBER OF SHARES. Shares of Common Stock remaining available for future
grants of stock options under the Company's 1985 Employee Stock Option Plan (the
"1985 Plan") and shares of Common Stock issuable upon exercise or currently
outstanding pursuant to the 1985 Plan that expire or become unexercisable for
any reason without having been exercised in full will be available for issuance
under the Plan, subject to adjustment as provided in this Plan. Upon adoption of
the Plan by the Company's shareholders on June 2, 1995, the number of shares of
Common Stock reserved for issuance under this Plan was 3,912,889. On May 30,
1996, the Company's shareholders approved an amendment to increase the aggregate
number of shares that may be issued pursuant to options granted under this Plan
to 4,912,889 shares. At all times during the term of this Plan, the Company
shall reserve and keep available such number of Shares as shall be required to
satisfy the requirements of outstanding Options under this Plan.
4. ELIGIBILITY. Options may be granted to employees, consultants (including
employees who are directors), officers, independent contractors and advisers
(provided such consultants, independent contractors and advisers render bona
fide services not in connection with the offer and sale of securities in a
capital-raising transaction) of the Company or any Parent, Subsidiary or
Affiliate of the Company. ISOs may be granted only to employees (including
officers and directors who are also employees) of the Company or a Parent or
Subsidiary of the Company. The Committee (as defined in Section 13) in its sole
discretion shall select the recipients of Options ("Optionees"). An Optionee may
be granted more than one Option under this Plan. No one Optionee shall be
eligible to receive more than 800,000 Shares at any time during the term of this
Plan pursuant to the grant of Options hereunder.
5. TERMS AND CONDITIONS OF OPTIONS. The Committee shall determine whether
each Option is to be an ISO or an NQSO, the number of Shares subject to the
Option, the exercise price of the Option, the period during which the Option may
be exercised, and all other terms and conditions of the Option, subject to the
following:
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<PAGE> 2
(a) Form of Option Grant. Each Option granted under this Plan
shall be evidenced by a written Stock Option Grant (the "Grant") in such form
(which need not be the same for each Optionee) as the Committee shall from time
to time approve, which Grant shall comply with and be subject to the terms and
conditions of this Plan.
(b) Date of Grant. The date of grant of an Option shall be
the date on which the Committee makes the determination to grant such Option
unless otherwise specified by the Committee. The Grant representing the Option
will be delivered to Optionee with a copy of this Plan within a reasonable time
after the granting of the Option.
(c) Exercise Price. The exercise price of an Option shall be
determined by the Committee on the date the Option is granted; provided that (i)
the exercise price of an NQSO shall be not less than 85% of the Fair Market
Value of the Shares on the date the Option is granted; (ii) the exercise price
of an ISO shall be not less than 100% of the Fair Market Value of the Shares on
the date the Option is granted; and (iii) the exercise price of any ISO granted
to a person owning more than l0% of the total combined voting power of all
classes of stock of the Company or any Parent or Subsidiary of the Company ("Ten
Percent Shareholder") shall not be less than 110% of the Fair Market Value of
the Shares on the date the Option is granted.
(d) Exercise Period. Options shall be exercisable within the
times or upon the events determined by the Committee as set forth in the Grant;
provided, however, that no Option shall be exercisable after the expiration of
ten (10) years from the date the Option is granted, and provided further that no
ISO granted to a Ten Percent Shareholder shall be exercisable after the
expiration of five (5) years from the date the Option is granted.
(e) Limitations on ISOs. The aggregate Fair Market Value
(determined as of the time an Option is granted) of stock with respect to which
ISOs are exercisable for the first time by an Optionee during any calendar year
(under this Plan or under any other incentive stock option plan of the Company
or any Parent or Subsidiary of the Company) shall not exceed $100,000. If the
Fair Market Value of Shares with respect to which ISOs are exercisable for the
first time by an Optionee during any calendar year exceeds $100,000, the Options
for the first $100,000 worth of Shares to become exercisable in such year shall
be ISOs and the Options for the amount in excess of $100,000 that become
exercisable in that year shall be NQSOs. In the event that the Code or the
regulations promulgated thereunder are amended after the effective date of this
Plan to provide for a different limit on the Fair Market Value of Shares
permitted to be subject to ISOs, such different limit shall be incorporated
herein and shall apply to any Options granted after the effective date of such
amendment.
(f) Options Non-Transferable. Options granted under this
Plan, and any interest therein, shall not be transferable or assignable by
Optionee, and may not be made subject to execution, attachment or similar
process, otherwise than by will or by the laws of descent and distribution, and
shall be exercisable during the lifetime of Optionee only by Optionee; provided,
however, that NQSOs held by an Optionee who is not an officer or director of the
Company or other person (in each case, an "Insider") whose transactions in the
Company's common stock are subject to Section 16(b) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), may be transferred to such family
members, trusts and charitable institutions as the Committee, in its sole
discretion, shall approve at the time of the grant of such Option.
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<PAGE> 3
(g) Assumed Options. In the event the Company assumes an
option granted by another company, the terms and conditions of such option shall
remain unchanged (except the exercise price and the number and nature of shares
issuable upon exercise, which will be adjusted appropriately pursuant to Section
424(a) of the Code). In the event the Company elects to grant a new option
rather than assuming an existing option, such new option may be granted with a
similarly adjusted exercise price.
6. EXERCISE OF OPTIONS.
(a) Notice. Options may be exercised only by delivery to the
Company of a written stock option exercise agreement (the "Exercise Agreement")
in a form approved by the Committee (which need not be the same for each
Optionee), stating the number of Shares being purchased, the restrictions
imposed on the Shares, if any, and such representations and agreements regarding
Optionee's investment intent and access to information, if any, as may be
required by the Company to comply with applicable securities laws, together with
payment in full of the exercise price for the number of Shares being purchased.
(b) Payment. Payment for the Shares may be made in cash (by
check) or, where approved by the Committee in its sole discretion at the time of
grant and where permitted by law: (i) by cancellation of indebtedness of the
Company to the Optionee; (ii) by surrender of shares of common stock of the
Company having a Fair Market Value equal to the applicable exercise price of the
Options, that have been owned by Optionee for more than six (6) months (and
which have been paid for within the meaning of Securities and Exchange
Commission ("SEC") Rule 144 and, if such Shares were purchased from the Company
by use of a promissory note, such note has been fully paid with respect to such
shares), or were obtained by Optionee in the open public market; (iii) by tender
of a full recourse promissory note having such terms as may be approved by the
Committee and bearing interest at a rate sufficient to avoid imputation of
income under Sections 483 and 1274 of the Code; (iv) by waiver of compensation
due or accrued to Optionee for services rendered; (v) provided that a public
market for the Company's stock exists, through a "same day sale" commitment from
Optionee and a broker-dealer that is a member of the National Association of
Securities Dealers (an "NASD Dealer") whereby Optionee irrevocably elects to
exercise the Option and to sell a portion of the Shares so purchased to pay for
the exercise price and whereby the NASD Dealer irrevocably commits upon receipt
of such Shares to forward the exercise price directly to the Company; (vi)
provided that a public market for the Company's stock exists, through a "margin"
commitment from Optionee and an NASD Dealer whereby Optionee irrevocably elects
to exercise the Option and to pledge the Shares so purchased to the NASD Dealer
in a margin account as security for a loan from the NASD Dealer in the amount of
the exercise price, and whereby the NASD Dealer irrevocably commits upon receipt
of such Shares to forward the exercise price directly to the Company; or (vii)
by any combination of the foregoing. Optionees who are not employees of the
Company shall not be entitled to purchase Shares with a promissory note unless
the note is adequately secured by collateral other than the Shares.
(c) Withholding Taxes. Prior to issuance of the Shares upon
exercise of an Option, Optionee shall pay or make adequate provision for any
federal or state withholding obligations of the Company, if applicable.
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<PAGE> 4
(d) Limitations on Exercise. Notwithstanding the exercise
periods set forth in the Grant, exercise of an Option shall always be subject to
the following:
(i) If Optionee ceases to be employed by the Company or
any Parent, Subsidiary or Affiliate of the Company for any reason except death
or disability, Optionee may exercise such Optionee's ISOs to the extent (and
only to the extent) that they would have been exercisable upon the date of
termination, within three (3) months after the date of termination (or such
shorter time period as may be specified in the Grant); provided, however, that
if Optionee's employment ceases between March 1, 1991 and July 1, 1991 for any
reason except death or disability, such exercise period shall be extended to
nine (9) months after the date of termination.
(ii) If Optionee's employment with the Company or any
Parent, Subsidiary or Affiliate of the Company is terminated because of the
death of Optionee or disability of Optionee within the meaning of Section
22(e)(3) of the Code, Optionee's ISOs may be exercised to the extent (and only
to the extent) that they would have been exercisable by Optionee on the date of
termination, by Optionee (or Optionee's legal representa-tive) within twelve
(12) months after the date of termination (or such shorter time period as may be
specified in the Grant), but in any event no later than the expiration date of
the ISOs.
(iii) The Committee shall have discretion to determine
whether Optionee has ceased to be employed by the Company or any Parent,
Subsidiary or Affiliate of the Company and the effective date on which such
employment terminated.
(iv) In the case of an Optionee who is a director,
consultant, independent contractor or adviser, the Committee will have the
discretion to determine whether Optionee is "employed by the Company or any
Parent, Subsidiary or Affiliate of the Company" pursuant to the foregoing
Sections.
(v) The Committee may specify a reasonable minimum
number of Shares that may be purchased on any exercise of an Option, provided
that such minimum number will not prevent Optionee from exercising the full
number of Shares as to which the Option is then exercisable.
(vi) An Option shall not be exercisable unless such
exercise is in compliance with the Securities Act of 1933, as amended (the
"Securities Act"), all applicable state securities laws and the requirements of
any stock exchange or national market system upon which the Shares may then be
listed, as they are in effect on the date of exercise. The Company shall be
under no obligation to register the Shares with the SEC or to effect compliance
with the registration, qualification or listing requirements of any state
securities laws, stock exchange or national market system, and the Company shall
have no liability for any inability or failure to do so.
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<PAGE> 5
7. MODIFICATION, EXTENSION AND RENEWAL OF OPTIONS. The Committee
shall have the power to modify, extend or renew outstanding Options and to
authorize the grant of new Options in substitution therefor, provided that any
such action may not, without the written consent of Optionee, impair any rights
under any Option previously granted. Any outstanding ISO that is modified,
extended, renewed or otherwise altered shall be treated in accordance with
Section 424(h) of the Code. The Committee shall have the power to reduce the
exercise price of outstanding Options without the consent of Optionees by a
written notice to the Optionees affected; provided, however, that the exercise
price per Share may not be reduced below the minimum exercise price that would
be permitted under Section 5(c) of this Plan for Options granted on the date the
action is taken to reduce the exercise price.
8. PRIVILEGES OF STOCK OWNERSHIP. No Optionee shall have any of
the rights of a shareholder with respect to any Shares subject to an Option
until such Option is properly exercised. No adjustment shall be made for
dividends or distributions or other rights for which the record date is prior to
such date, except as provided in this Plan. The Company shall provide to each
Optionee a copy of the annual financial statements of the Company at such time
after the close of each fiscal year of the Company as such statements are
released by the Company to its common shareholders generally.
9. NO OBLIGATION TO EMPLOY. Nothing in this Plan or any Option
granted under this Plan shall confer on any Optionee any right to continue in
the employ of, or other relationship with, the Company or any Parent, Subsidiary
or Affiliate of the Company or limit in any way the right of the Company or any
Parent, Subsidiary or Affiliate of the Company to terminate Optionee's
employment or other relationship at any time, with or without cause.
10. ADJUSTMENT OF OPTION SHARES. In the event that the number of
outstanding shares of common stock of the Company is changed by a stock
dividend, stock split, reverse stock split, combination, reclassification or
similar change in the capital structure of the Company without consideration, or
if a substantial portion of the assets of the Company are distributed, without
consideration in a spin-off or similar transaction, to the shareholders of the
Company, the number of Shares available under this Plan and the number of Shares
subject to outstanding Options and the exercise price per Share of such Options
shall be proportionately adjusted, subject to any required action by the Board
of Directors (the "Board") or shareholders of the Company and compliance with
applicable securities laws; provided, however, that a fractional share shall not
be issued upon exercise of any Option and any fractions of a Share that would
have resulted shall either be cashed out at Fair Market Value or the number of
Shares issuable under the Option shall be rounded up to the nearest whole
number, as determined by the Committee; and provided further that the exercise
price may not be decreased to below the par value, if any, for the Shares.
11. ASSUMPTION OF OPTIONS BY SUCCESSORS.
In the event of a dissolution or liquidation of the Company, a
merger in which the Company is not the surviving corporation, a transaction in
which 100% of the then-outstanding voting stock is sold or otherwise transferred
or the sale of substantially all of the assets of the Company any or all
outstanding Options shall, notwithstanding any contrary terms of the Grant,
accelerate and become exercisable in full at least 10 days prior to (and shall
expire on) the consummation of such dissolution, liquidation, merger or sale of
assets on
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such conditions as the Committee shall determine unless the successor
corporation assume the outstanding options or substitutes substantially
equivalent options. The aggregate Fair Market Value of ISOs which first become
exercisable in the year of such dissolution, liquidation, merger or sale of
assets cannot exceed $100,000. Any remaining accelerated options shall be
treated as NQSOs.
12. ADOPTION AND SHAREHOLDER APPROVAL. This Plan shall become
effective on the date that it is adopted by the Board of the Company. This Plan
shall be approved by the shareholders of the Company, in any manner permitted by
applicable corporate law, within twelve months before or after the date this
Plan is adopted by the Board. Upon the effective date of the Plan, the Board may
grant Options pursuant to this Plan; provided that, in the event that
shareholder approval is not obtained within the time period provided herein, all
Options granted hereunder shall terminate. No Option that is issued as a result
of any increase in the number of shares authorized to be issued under this Plan
shall be exercised prior to the time such increase has been approved by the
shareholders of the Company and all such Options granted pursuant to such
increase shall similarly terminate if such Shareholder approval is not obtained.
After the Company becomes subject to Section 16(b) of the Exchange Act, the
Company will comply with the requirements of Rule 16b-3 with respect to
shareholder approval.
13. ADMINISTRATION. This Plan may be administered by the Board or
a committee appointed by the Board (the "Committee"). As used in this Plan,
references to the "Committee" shall mean either such Committee or the Board if
no Committee has been established. If the Company is registered under the
Exchange Act and two or more members of the Board are Outside Directors, the
Committee shall be comprised of at least two members of the Board, all of whom
are Outside Directors and Disinterested Persons. The interpretation by the
Committee of any of the provisions of this Plan or any Option granted under this
Plan shall be final and binding upon the Company and all persons having an
interest in any Option or any Shares purchased pursuant to an Option. The
Committee may delegate the authority to grant Options under this Plan to
Optionees who are not Insiders of the Company to officers of the Company.
14. TERM OF PLAN. Options may be granted pursuant to this Plan
from time to time within a period of ten (10) years from the date on which this
Plan is adopted by the Board.
15. AMENDMENT OR TERMINATION OF PLAN. The Committee may at any
time terminate or amend this Plan in any respect including (but not limited to)
amendment of any form of grant, exercise agreement or instrument to be executed
pursuant to this Plan; provided, however, that the Committee shall not, without
the approval of the shareholders of the Company, amend this Plan in any manner
that requires such shareholder approval pursuant to the Code or the regulations
promulgated thereunder as such provisions apply to ISO plans or pursuant to the
Exchange Act or Rule 16b-3 (or its successor) promulgated thereunder.
16. CERTAIN DEFINITIONS. As used in this Plan, the following terms
shall have the following meanings:
(a) "Parent" means any corporation (other than the
Company) in an unbroken chain of corporations ending with the Company if, at the
time of the granting of the
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Option, each of such corporations other than the Company owns stock possessing
50% or more of the total combined voting power of all classes of stock in one of
the other corporations in such chain.
(b) "Subsidiary" means any corporation (other than the
Company) in an unbroken chain of corporations beginning with the Company if, at
the time of granting of the Option, each of the corporations other than the last
corporation in the unbroken chain owns stock possessing 50% or more of the total
combined voting power of all classes of stock in one of the other corporations
in such chain.
(c) "Affiliate" means any corporation that directly, or
indirectly through one or more intermediaries, controls or is controlled by, or
is under common control with, another corporation, where "control" (including
the terms "controlled by" and "under common control with") means the possession,
direct or indirect, of the power to cause the direction of the management and
policies of the corporation, whether through the ownership of voting securities,
by contract or otherwise.
(d) "Disinterested Person" means a director who is not,
during the period that he is a member of the Committee and for one year prior to
service as a member of the Committee, granted or awarded equity securities
pursuant to this Plan or any other plan of the Company, or any Parent,
Subsidiary or Affiliate of the Company, except in accordance with the
requirements set forth in Rule 16b-3(d)(3) as promulgated by the SEC under
Section 16(b) of the Exchange Act, as such rule is amended from time to time and
as interpreted by the SEC.
(e) "Fair Market Value" shall mean the fair market value
of the Shares as determined by the Committee from time to time in good faith. If
a public market exists for the Shares, the Fair Market Value shall be the
average of the last reported bid and asked prices for common stock of the
Company on the last trading day prior to the date of determination, or in the
event the common stock of the Company is listed on the Nasdaq National Market,
the Fair Market Value shall be the average of the high and low prices of the
common stock on the option grant date as quoted on the Nasdaq National Market
and reported in the Wall Street Journal.
(f) "Outside Director" shall mean any director who is
not (i) a current employee of the Company or any Parent, Subsidiary or Affiliate
of the Company, (ii) a former employee of the Company or any Parent, Subsidiary
or Affiliate of the Company who is receiving compensation for prior services
(other than benefits under a tax-qualified pension plan), (iii) a current or
former officer of the Company or any Parent, Subsidiary or Affiliate of the
Company or (iv) currently receiving compensation for personal services in any
capacity, other than as a director, from the Company or any capacity, other than
as a director, from the Company or any Parent, Subsidiary or Affiliate of the
Company; provided, however, that at such time as the term "Outside Director", as
is used in Section 162(m) of the Code is defined under regulations promulgated
under such Code Section, "Outside Director" shall have the meaning set forth in
such regulations, as amended from time to time and as interpreted by the
Internal Revenue Service.
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EXHIBIT 5.01
June 10, 1996
Genelabs Technologies, Inc.
505 Penobscot Drive
Redwood City, CA 94063
Ladies/Gentlemen:
At your request, we have examined the Registration Statement on Form
S-8 (the "Registration Statement") to be filed by you with the Securities and
Exchange Commission on or about June 11, 1996 in connection with the
registration under the Securities Act of 1933, as amended, of up to 1,000,000
shares of your Common Stock (the "Common Stock") to be issued pursuant to awards
to be granted by you under your 1995 Employee Stock Option Plan (the "Plan").
As your counsel, we have examined the proceedings taken by you in
connection with the increase in shares available under the Plan.
It is our opinion that the Common Stock that may be issued pursuant to
awards to be granted by you under the Plan, when issued and sold in the manner
referred to in the Plan and the associated prospectus, will be legally issued,
fully paid and non-assessable.
We consent to the use of this opinion as an exhibit to the Registration
Statement and further consent to all references to us, if any, in the
Registration Statement and any amendments thereto.
Very truly yours,
Fenwick & West LLP
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CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-8) pertaining to the 1995 Employee Stock Option
Plan and to the incorporation by reference therein of our report dated February
20, 1996, with respect to the consolidated financial statements of Genelabs
Technologies, Inc. included in its Annual Report on Form 10-K for the year ended
December 31, 1995, filed with the Securities and Exchange Commission.
ERNST & YOUNG LLP
Palo Alto, California
June 11, 1996
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