<PAGE>
As filed with the Securities and Exchange Commission on August __, 1998
Registration No.333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
MAGAININ PHARMACEUTICALS INC.
(Exact name of registrant as specified in its charter)
<TABLE>
<CAPTION>
<S> <C> <C>
Delaware 2834 13-3445668
- -------- ---- ----------
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification No.) Identification No.)
</TABLE>
MAGAININ PHARMACEUTICALS INC.
1998 Equity Compensation Plan
-----------------------------
(Full Title of the Plan)
5110 Campus Drive
Plymouth Meeting, PA 19462
(610) 941-4020
(Address, including zip code, and telephone number, including area code,
of registrant's principal executive offices)
MICHAEL R. DOUGHERTY
President, Chief Executive Officer and
CHIEF FINANCIAL OFFICER
MAGAININ PHARMACEUTICALS INC.
5110 CAMPUS DRIVE
PLYMOUTH MEETING, PA 19462
(610) 941-4020
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
Copies of all communications to:
DAVID R. KING
MORGAN, LEWIS & BOCKIUS LLP
2000 ONE LOGAN SQUARE
PHILADELPHIA, PA 19103-6993
(215) 963-5000
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Title of each class Amount to be Proposed maximum Proposed maximum Amount of
of securities to be registered offering price per share aggregate registration
registered (1) offering price(1) fee
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, 1,500,000 shares $4.84 $7,266,000 $2,145.00
$.002 par value
=============================================================================================================
</TABLE>
(1) Based on the average of the reported high and low prices of the Company's
Common Stock, as reported on the Nasdaq National Market on August 19, 1998,
estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(h) under the Securities Act of 1933.
<PAGE>
PART II
-------
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
--------------------------------------------------
Item 3. Incorporation of Documents by Reference.
---------------------------------------
The following documents filed by Magainin Pharmaceuticals Inc. (the
"Registrant") with the Securities and Exchange Commission pursuant to the
Securities Exchange Act of 1934 are incorporated in this registration
statement by reference:
1. The Registrant's Annual Report on Form 10-K for the fiscal year ended
December 31, 1997.
2. Proxy Statement for the Annual Meeting of Shareholders held on May 13,
1998.
3. The Registrant's Quarterly Report on Form10-Q, as amended on Form 10-Q/A,
for the quarterly period ended March 31, 1998.
4. The Registrant's Quarterly Report on Form10-Q for the quarterly period
ended June 30, 1998.
5. The description of the Registrant's Common Stock which is contained in the
Registrant's Registration Statement on Form 8-A filed under the Exchange
Act on November 7, 1991 and as amended on January 15, 1993, including any
amendment or reports filed for the purpose of updating such description.
All reports and other documents subsequently filed by the Registrant
pursuant to Sections 13(a), 13(c), 14 or 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 remaining unsold, shall be deemed to be incorporated by
reference herein and to be a part hereof from the date of the filing of
such reports and documents. Any statement contained in a document, all or a
portion of which is incorporated by reference herein, shall be deemed to be
modified or superseded for purposes of this Registration Statement to the
extent that a statement contained or incorporated by reference herein
modifies or supersedes such statement. Any statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Registration Statement.
Experts
-------
The financial statements of the Registrant as of December 31, 1997 and
December 31, 1996 and for each of the years in the three-year period ended
December 31, 1997, included in the Registrant's Annual Report on Form 10-K
for the fiscal year ended December 31, 1997, have been incorporated by
reference in this Registration Statement in reliance upon the report of
Richard A. Eisner & Company, LLP, independent auditors, incorporated by
reference herein, given upon the authority of said firm as experts in
accounting and auditing. To the extent that Richard A. Eisner & Company,
LLP audits and reports on financial statements of the Registrant issued at
future dates, and consents to the use of their reports thereon, such
financial statements also will be incorporated by reference in this
Registration Statement in reliance upon their reports to be given upon
said authority.
Item 4. Description of Securities.
-------------------------
Not applicable.
Item 5. Interests of Named Experts and Counsel.
--------------------------------------
Not applicable.
2
<PAGE>
Item 6. Indemnification of Directors and Officers.
-----------------------------------------
Section 145 of the Delaware General Corporation Law ("Section 145") permits
indemnification of directors, officers, agents and controlling persons of a
corporation under certain conditions and subject to certain limitations,
Article 9 of the Registrant's By-Laws provides for the indemnification of
directors, officers, employees and agents of the Registrant to the maximum
extent permitted by the Delaware General Corporation Law. Section 145
empowers a corporation to indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative, by reason of the fact that he is or was a director, officer
or agent of the corporation or another enterprise if serving at the request
of the corporation. Depending on the character of the proceeding, a
corporation may indemnify against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably
incurred in connection with such action, suit or proceeding if the person
indemnified acted in good faith and in respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was unlawful. In
the case of an action by or in the right of the corporation, no
indemnification may be made with respect to any claim, issue or matter as
to which such person shall have been adjudged to be liable to the
corporation unless and only to the extent that the Court of Chancery or the
court in which such action or suit was brought shall determine that despite
the adjudication of liability such person is fairly and reasonably entitled
to indemnity for such expenses which the court shall deem proper. Section
145 further provides that to the extent a director, officer, employee or
agent of a corporation has been successful in the defense of any action,
suit or proceeding referred to above or in the defense of any claim, issue
or matter therein, he shall be indemnified against expenses (including
attorneys' fees) actually and reasonably incurred by him in connection
therewith.
The Registrant's By-laws permit it to purchase insurance on behalf of such
person against any liability asserted against him and incurred by him in
any such capacity, or arising out of his status a such, whether or not the
Registrant would have the power to indemnify him against such liability
under the foregoing provision of the By-laws.
Item 7. Exemption from Registration Claimed.
-----------------------------------
Not applicable.
3
<PAGE>
Item 8. Exhibits.
--------
The following Exhibits are filed as part of this Registration Statement:
4.1 Restated Certificate of Incorporation, as amended (Exhibit 3.1)(1)
4.2 By-laws (Exhibit 3.2)(2)
4.3 Specimen Stock Certificate for Shares of Common Stock (Exhibit 4.1)(3)
4.4 Magainin Pharmaceuticals Inc. 1998 Equity Compensation Plan
4.5 Form of Employee Non-Qualified Stock Option Agreement under 1998 Equity
Compensation Plan
4.6 Form of Employee Incentive Stock Option Agreement under 1998 Equity
Compensation Plan
4.7 Form of Restricted Stock Grant Agreement under 1998 Equity Compensation
Plan
5 Opinion of Morgan, Lewis & Bockius LLP
23.1 Consent of Morgan, Lewis & Bockius LLP (contained in Exhibit 5)
23.2 Consent of Richard A. Eisner & Company, LLP
24 Power of Attorney (contained on signature page of this Registration
Statement)
_________________
(1) Filed as an Exhibit to the Annual Report on Form 10-K filed with the
Securities and Exchange Commission on September 24, 1992.
(2) Filed as an Exhibit to the Registration Statement on Form S-1 filed with
the Securities and Exchange Commission on October 24, 1991.
(3) Filed as an Exhibit to Pre-Effective Amendment No. 1 to the Registration
Statement on Form S-1 filed with the Securities and Exchange Commission on
November 27, 1991.
4
<PAGE>
Item 9. Undertakings.
------------
(a) The undersigned Registrant hereby undertakes:
1. To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of this Registration Statement (or the most
recent post-effective amendment thereof) which, individually or
in the aggregate, represent a fundamental change in the
information set forth in this Registration Statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in this Registration
Statement or any material change to such information in this
Registration Statement; provided, however, that paragraphs
(a)(l)(i) and (a)(1)(ii) do not apply if the information
required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the
Registrant pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in this
Registration Statement.
2. That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
3. To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing
of the Registrant's annual report pursuant to Section 13(a) or 15(d) of
the Securities Exchange Act of 1934 that is incorporated by reference in
this Registration Statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of
such securities at that time shall be deemed to be the initial bona fide
offering thereof.
(h) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or
otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Securities Act of 1933 and is, therefore,
unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the
Registrant in the successful defense of any action, suit or proceeding)
is asserted by such director, officer or controlling person in connection
with the securities being registered, the Registrant will, unless in the
opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question
whether such indemnification by it is against public policy as expressed
in the Securities Act of 1933 and will be governed by the final
adjudication of such issue.
5
<PAGE>
SIGNATURES AND POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned thereunto duly
authorized, in Plymouth Meeting, Pennsylvania, on this 11th day of August, 1998.
MAGAININ PHARMACEUTICALS INC.
BY: /s/ Michael R. Dougherty
-------------------------
Michael R. Dougherty
President, Chief Executive Officer,
Chief Financial Officer and Director
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below
constitutes and appoints Zola P. Horovitz, Chairman, and Michael R. Dougherty,
President, Chief Executive Officer, Chief Financial Officer and Director, and
each of them, his true and lawful attorneys-in-fact and agents, with full power
of substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments to this Registration
Statement, and to file the same, with the Securities and Exchange Commission,
granting unto said attorneys-in-fact and agents full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
and about the premises, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that said attorneys-in-
fact and agents, or their substitute or substitutes, may lawfully do or cause to
be done by virtue hereof.
<TABLE>
<CAPTION>
Signature Title Date
- ----------------------------------- --------------------------------------------------- ----------------------------------
<S> <C> <C>
/s/ Zola P. Horovitz, Ph.D.
- ----------------------------------- Chairman of the Board August 11, 1998
Zola P. Horovitz, Ph.D.
/s/ Michael R. Dougherty
- ----------------------------------- President, Chief Executive Officer, Chief August 11, 1998
Michael R. Dougherty Financial Officer and Director
(Principal Executive, Financial and Accounting
Officer)
/s/ Michael A. Zasloff, M.D., Ph.D.
- ----------------------------------- Vice Chairman, Executive Vice President and August 11, 1998
Michael A. Zasloff, M.D., Ph.D. Director
/s/ Roy C. Levitt, M.D.
- ----------------------------------- Chief Operating Officer and Director August 11, 1998
Roy C. Levitt, M.D.
/s/ Bernard Canavan, M.D.
- ----------------------------------- Director August 11, 1998
Bernard Canavan, M.D.
/s/ Charles A. Sanders, M.D.
- ----------------------------------- Director August 11, 1998
Charles A. Sanders, M.D.
/s/ Robert F. Shapiro
- ----------------------------------- Director August 11, 1998
Robert F. Shapiro
/s/ James B. Wyngaarden
- ----------------------------------- Director August 11, 1998
James B. Wyngaarden
</TABLE>
6
<PAGE>
INDEX TO EXHIBITS
-----------------
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DOCUMENT PAGE NUMBER
- ------ -------- -----------
<S> <C> <C>
4.4* Magainin Pharmaceuticals Inc. 1998 Equity Compensation Plan
4.5* Form of Employee Non-Qualified Stock Option Agreement under 1998 Equity
Compensation Plan
4.6* Form of Employee Incentive Stock Option Agreement under 1998 Equity
Compensation Plan
4.7* Form of Restricted Stock Grant under 1998 Equity Compensation Plan
5* Opinion of Morgan, Lewis & Bockius LLP regarding legality of Securities
being registered.
23.1 Consent of Morgan, Lewis & Bockius LLP (contained in Exhibit 5).
23.2* Consent of Richard A. Eisner & Company, LLP.
24 Powers of Attorney (included on the signature page).
</TABLE>
- ----------------
* Filed herewith
<PAGE>
EXHIBIT 4.4
MAGAININ PHARMACEUTICALS INC.
1998 EQUITY COMPENSATION PLAN
The purpose of the Magainin Pharmaceuticals Inc. 1998 Equity Compensation
Plan (the "Plan") is to provide (i) designated officers (including officers who
are also directors) and other employees of Magainin Pharmaceuticals Inc. (the
"Company") and its subsidiaries, (ii) non-employee members of the board of
directors of the Company (the "Board"), and (iii) consultants and advisors who
perform valuable services for the Company or its subsidiaries, with the
opportunity to receive grants of incentive stock options, nonqualified stock
options or restricted stock. The Company believes that the Plan will encourage
the participants to contribute materially to the growth of the Company, thereby
benefiting the Company's shareholders, and will align the economic interests of
the participants with those of the shareholders. For purposes of the Plan, the
term subsidiary shall refer to any company (whether a corporation, partnership,
joint venture or other entity) in which the Company owns, directly or
indirectly, a majority of the shares of capital stock or other equity interest.
1. ADMINISTRATION
(a) Committee. The Plan shall be administered and interpreted by a
committee (the "Committee"), which shall consist of two or more persons
appointed by the Board, all of whom shall be "outside directors" as defined
under section 162(m) of the Internal Revenue Code of 1986, as amended (the
"Code") and related Treasury regulations and non-employee directors as defined
under Rule 16b-3 under the Securities and Exchange Act of 1934, as amended (the
Exchange Act). Notwithstanding the foregoing, the Board of Directors may ratify
or approve (and, in the case of Grants to the members of the Committee, shall
approve) Grants, in which case references to the Committee shall be deemed to
include the Board of Directors.
(b) Committee Authority. The Committee shall have the sole authority to
(i) determine the individuals to whom grants shall be made under the Plan, (ii)
determine the type, size and terms of the grants to be made to each such
individual, (iii) determine the time when the grants will be made and the
duration of any applicable exercise or restriction period, including the
criteria for exercisability and the acceleration of exercisability, and (iv)
deal with any other matters arising under the Plan.
(c) Committee Determinations. The Committee shall have full power and
authority to administer and interpret the Plan, to make factual determinations
and to adopt or amend such rules, regulations, agreements and instruments for
implementing the Plan and for the conduct of its business as it deems necessary
or advisable, in its sole discretion. The Committee's interpretations of the
Plan and all determinations made by the Committee pursuant to the powers vested
in it hereunder shall be conclusive and binding on all persons having any
interest in the Plan or in any awards granted hereunder. All powers of the
Committee shall be executed in its sole discretion, in the best interest of the
Company, not as a fiduciary, and in keeping with the objectives of the Plan and
need not be uniform as to similarly situated individuals.
2. GRANTS
Awards under the Plan may consist of grants of stock options as described
in Section 5 ("Options") or restricted stock as described in Section 6
("Restricted Stock") or a combination of both (hereinafter collectively referred
to as "Grants"). All Grants shall be subject to the terms and conditions set
forth herein and to those other terms and conditions consistent with this Plan
as the Committee deems appropriate and as are specified in writing by the
Committee to the individual in a grant instrument or an amendment to the grant
instrument (the "Grant Instrument"). The Committee shall approve the form and
provisions of each Grant Instrument. Grants under a particular Section of the
Plan need not be uniform as among the grantees.
1
<PAGE>
3. SHARES SUBJECT TO THE PLAN
(a) Shares Authorized. Subject to the adjustment specified below, the
aggregate number of shares of common stock of the Company (the "Company Stock")
that may be issued or transferred under the Plan is 1,500,000 shares. The
maximum number of shares of Company Stock that may be issued or transferred as
Restricted Stock shall not exceed twenty-five percent (25%) of the aggregate
number of shares of Company Stock that may be issued or transferred under the
Plan. Notwithstanding anything in the Plan to the contrary, the maximum
aggregate number of shares of Company Stock that shall be subject to Grants made
under the Plan to any one individual during any calendar year shall be 250,000
shares. The shares may be authorized but unissued shares of Company Stock or
reacquired shares of Company Stock, including shares purchased by the Company on
the open market for purposes of the Plan. If and to the extent Options granted
under the Plan terminate, expire, or are canceled, forfeited, exchanged or
surrendered without having been exercised or if any shares of Restricted Stock
are forfeited, the shares subject to such Grants shall again be available for
purposes of the Plan. Notwithstanding anything in the Plan to the contrary, the
Committee shall not amend any Grant Instrument to decrease the Exercise Price of
an Option below the Fair Market Value of the Option as of the date on which such
Option was granted, and the Committee shall not exchange or substitute any
Option for an Option at an Exercise Price that is below the Fair Market Value of
the exchanged or substituted Option as of the date on which the exchanged or
substituted Option was granted.
(b) Adjustments. If there is any change in the number or kind of shares of
Company Stock outstanding (i) by reason of a stock dividend, spin-off,
recapitalization, stock split, or combination or exchange of shares, (ii) by
reason of a merger, reorganization or consolidation in which the Company is the
surviving corporation, (iii) by reason of a reclassification or change in par
value, or (iv) by reason of any other extraordinary or unusual event affecting
the outstanding Company Stock as a class without the Company's receipt of
consideration, or if the value of outstanding shares of Company Stock is
substantially reduced as a result of a spin-off or the Company's payment of an
extraordinary dividend or distribution, the maximum number of shares of Company
Stock available for Grants, the maximum number of shares of Company Stock that
any individual participating in the Plan may be granted in a year, the number of
shares covered by outstanding Grants, the kind of shares issued under the Plan,
and the price per share or the applicable market value of such Grants may be
appropriately adjusted by the Committee to reflect any increase or decrease in
the number of, or change in the kind or value of, issued shares of Company Stock
to preclude, to the extent practicable, the enlargement or dilution of rights
and benefits under such Grants; provided, however, that any fractional shares
resulting from such adjustment shall be eliminated. Any adjustments determined
by the Committee shall be final, binding and conclusive.
4. ELIGIBILITY FOR PARTICIPATION
(a) Eligible Persons. All employees of the Company and its subsidiaries
("Employees"), including Employees who are officers or members of the Board, and
members of the Board who are not Employees ("Non-Employee Directors") shall be
eligible to participate in the Plan. Consultants and advisors who perform
valuable services to the Company or any of its subsidiaries ("Consultants")
shall be eligible to participate in the Plan if the Consultants render bona fide
services and such services are not rendered in connection with the offer or sale
of securities in a capital-raising transaction.
(b) Selection of Grantees. The Committee shall select the Employees,
Consultants, and Non-Employee Directors to receive Grants and determine the
number of shares of Company Stock subject to a particular Grant in such manner
as the Committee determines. Employees, Consultants, and Non-Employee Directors
who receive Grants under this Plan shall hereinafter be referred to as
"Grantees."
2
<PAGE>
5. GRANTING OF OPTIONS
(a) Number of Shares. The Committee, in its sole discretion, shall
determine the number of shares of Company Stock that will be subject to each
Grant of Options to any Employee, Consultant, or Non-Employee Director.
(b) Type of Option and Price.
(i) The Committee may grant Options that are intended to qualify as
"incentive stock options" within the meaning of section 422 of the Code
("Incentive Stock Options") or Options which are not intended to so qualify
("Nonqualified Stock Options") or any combination of Incentive Stock Options and
Nonqualified Stock Options, all in accordance with the terms and conditions set
forth herein.
(ii) The purchase price (the "Exercise Price") of Company Stock
subject to an Option shall be determined by the Committee and shall not be less
than the Fair Market Value (as defined below) of a share of such Stock on the
date the Option is granted; provided, however, that an Incentive Stock Option
may not be granted to an Employee who, at the time of grant, owns stock
possessing more than 10 percent of the total combined voting power of all
classes of stock of the Company or any "parent corporation" or "subsidiary
corporation" of the Company (within the meaning of sections 424(e) and 424(f) of
the Code, respectively), unless the Exercise Price per share is not less than
110% of the Fair Market Value of Company Stock on the date of grant.
(iii) If the Company Stock is publicly traded, then the Fair Market
Value per share shall be determined as follows: (1) if the principal trading
market for the Company Stock is a national securities exchange or the Nasdaq
National Market, the last reported sale price thereof on the relevant date or
(if there were no trades on that date) the latest preceding date upon which a
sale was reported, or (2) if the Company Stock is not principally traded on such
exchange or market, the mean between the last reported "bid" and "asked" prices
of Company Stock on the relevant date, as reported on Nasdaq or, if not so
reported, as reported by the National Daily Quotation Bureau, Inc. or as
reported in a customary financial reporting service, as applicable and as the
Committee determines. If the Company Stock is not publicly traded or, if
publicly traded, is not subject to reported transactions or "bid" or "asked"
quotations as set forth above, the Fair Market Value per share shall be as
determined by the Committee.
(c) Option Term. The Committee shall determine the term of each Option.
The term of any Option shall not exceed ten years from the date of grant.
However, an Incentive Stock Option that is granted to an Employee who, at the
time of grant, owns stock possessing more than 10 percent of the total combined
voting power of all classes of stock of the Company, or any parent or subsidiary
of the Company, may not have a term that exceeds five years from the date of
grant.
(d) Exercisability of Options. Options shall become exercisable in
accordance with such terms and conditions, consistent with the Plan, as may be
determined by the Committee, in its sole discretion, and specified in the Grant
Instrument. The Committee, in its sole discretion, may accelerate the
exercisability of any or all outstanding Options at any time for any reason.
(e) Termination of Employment or Service.
(i) Except as provided below, an Option may only be exercised while
the Grantee is employed by, or providing service to, the Company as an Employee,
Consultant, or Non-Employee Director. In the event that a Grantee ceases to be
employed by, or provide service to, the Company for any reason, any Option which
is otherwise exercisable by the Grantee shall terminate unless exercised within
such time period after the date on which the Grantee ceases to be employed by,
or provide service to, the Company as determined by the Committee, but in any
event no later than the date of expiration of the Option term (Post-Termination
Exercise Period). The Committee may specify the Post-Termination Exercise
Period applicable to a Grantee in the Grant Instrument or at any time
thereafter; provided, however, that the Post-Termination Exercise Period shall
extend for at least 30 days after the date on which the Grantee is notified of
the Post-Termination Exercise Period. Except as otherwise provided by the
Committee, any of the Grantee's Options that are not otherwise exercisable as of
the date on which the Grantee ceases to be employed by, or provide service to,
the Company shall terminate as of such date.
3
<PAGE>
(ii) Notwithstanding the foregoing, in the event the Grantee ceases to
be employed by, or provide service to, the Company on account of termination for
cause by the Company, any Option held by the Grantee shall terminate as of the
date the Grantee ceases to be employed by, or provide service to, the Company,
and the Grantee shall automatically forfeit all shares underlying any exercised
portion of an Option for which the Company has not yet delivered the share
certificates, upon refund by the Company of the Exercise Price paid by the
Grantee for such shares.
(iii) For purposes of this Section 5(e) and Section 6,
(A) The term "Company" shall refer to the Company and its
subsidiaries.
(B) Employed by, or provide service to, the Company shall mean
employment or service as an Employee, Consultant or Non-Employee Director (so
that, for purposes of exercising Options and satisfying conditions with respect
to Restricted Stock, a Grantee shall not be considered to have terminated
employment or service until the Grantee ceases to be an Employee, Consultant
and/or a Non-Employee Director), unless the Committee determines otherwise.
(C) Cause shall mean (i) the Grantee's willful misconduct with respect
to the business and affairs of the Company or any subsidiary or affiliate
thereof; (ii) the Grantee's gross neglect of duties or failure to act which
materially and adversely affects the business or affairs of the Company or any
subsidiary or affiliate thereof; (iii) the Grantee's commission of an act
involving embezzlement or fraud or conviction for any felony; or the (iv) the
Grantee's breach of an employment or consulting agreement with the Company or
any subsidiary or affiliate thereof.
(f) Exercise of Options. A Grantee may exercise an Option that has become
exercisable, in whole or in part, by delivering a notice of exercise to the
Committee with payment of the Exercise Price. The Grantee shall pay the
Exercise Price specified in the Grant Instrument (1) in cash, (2) with the
approval of the Committee, by delivering shares of Company Stock owned by the
Grantee (including Company Stock acquired in connection with the exercise of a
Option, subject to such restrictions as the Committee deems appropriate) and
having a Fair Market Value on the date of exercise equal to the Exercise Price,
or (3) by such other method as the Committee may approve, including payment
through a broker in accordance with procedures permitted by Regulation T of the
Federal Reserve Board. Such notice may instruct the Company to deliver shares
of Company Stock due upon the exercise of the Option to any registered broker or
dealer designated by the Committee ("Designated Broker") in lieu of delivery to
the Grantee. Such instructions must designate the account into which the shares
are to be deposited. The Grantee may tender a notice of exercise, which has
been properly executed by the Grantee, and the aforementioned delivery
instructions to any Designated Broker. Shares of Company Stock used to exercise
an Option shall have been held by the Grantee for the requisite period of time
to avoid adverse accounting consequences to the Company with respect to the
Option. The Grantee shall pay the Exercise Price and the amount of any
withholding tax due at the time of exercise.
(g) Limits on Incentive Stock Options. Each Incentive Stock Option shall
provide that, if the aggregate Fair Market Value of the Company Stock on the
date of the grant with respect to which Incentive Stock Options are exercisable
for the first time by a Grantee during any calendar year, under the Plan or any
other stock option plan of the Company or subsidiary, exceeds $100,000, then
such Option, as to the excess, shall be treated as a Nonqualified Stock Option.
An Incentive Stock Option shall not be granted to any person who is not an
Employee of the Company or a parent corporation or a subsidiary corporation
(within the meaning of sections 424(e) and 424(f) of the Code, respectively).
4
<PAGE>
6. RESTRICTED STOCK GRANTS
The Committee may issue or transfer shares of Company Stock to any
Employee, Consultant, or Non-Employee Director under a Grant of Restricted
Stock, upon such terms as the Committee deems appropriate. The following
provisions are applicable to Restricted Stock:
(a) General Requirements. Shares of Company Stock issued or transferred
pursuant to Restricted Stock Grants may be issued or transferred for cash
consideration or for no cash consideration, at the sole discretion of the
Committee. The Committee may establish conditions under which restrictions on
shares of Restricted Stock shall lapse over a period of time or according to
such other criteria as the Committee deems appropriate. The period of time
during which the Restricted Stock will remain subject to restrictions will be
designated in the Grant Instrument as the "Restriction Period."
(b) Number of Shares. The Committee shall determine the number of shares
of Company Stock to be issued or transferred pursuant to a Restricted Stock
Grant and the restrictions applicable to such shares.
(c) Requirement of Employment or Service. If the Grantee ceases to be
employed by, or provide service to, the Company (as defined in Section 5(e))
during a period designated in the Grant Instrument as the Restriction Period, or
if other specified conditions are not met, the Restricted Stock Grant shall
terminate as to all shares covered by the Grant as to which the restrictions
have not lapsed, and those shares of Company Stock must be immediately returned
to the Company. The Committee may, however, provide for complete or partial
exceptions to this requirement as it deems appropriate.
(d) Restrictions on Transfer and Legend on Stock Certificate. During the
Restriction Period, a Grantee may not sell, assign, transfer, pledge or
otherwise dispose of the shares of Restricted Stock except to a Successor
Grantee under Section 9(a). Each certificate for a share of Restricted Stock
shall contain a legend giving appropriate notice of the restrictions in the
Grant. The Grantee shall be entitled to receive a stock certificate or
certificates, or have the legend removed from the stock certificate or
certificates covering any of the shares subject to restrictions, as applicable,
when all restrictions on such shares have lapsed. The Committee, in its sole
discretion, may determine that the Company will not issue certificates for
shares of Restricted Stock, or that the Company retain possession of
certificates for any shares issued pursuant to a Restricted Stock Grant, until
all restrictions on such shares have lapsed.
(e) Right to Vote and to Receive Cash Dividends. Unless the Committee
determines otherwise, during the Restriction Period, the Grantee shall have the
right to vote any shares of Restricted Stock which have been issued or
transferred to the Grantee on the stock transfer records of the Company and to
receive any dividends or other distributions paid on such shares, subject to any
restrictions deemed appropriate by the Committee.
(f) Lapse of Restrictions. All restrictions imposed on Restricted Stock
shall lapse upon the expiration of the applicable Restriction Period and the
satisfaction of all conditions imposed by the Committee. The Committee may
determine, as to any or all Restricted Stock Grants, that all the restrictions
shall lapse without regard to any Restriction Period.
5
<PAGE>
7. QUALIFIED PERFORMANCE-BASED COMPENSATION
(a) Designation as Qualified Performance-Based Compensation. The Committee
may determine that Restricted Stock granted to an Employee shall be considered
qualified performance-based compensation under section 162(m) of the Code. The
provisions of this Section 7 shall apply to Grants of Restricted Stock that are
to be considered qualified performance-based compensation under section 162(m)
of the Code.
(b) Performance Period and Performance Goals. When shares of Restricted
Stock that are to be considered qualified performance-based compensation are
granted, the Committee shall establish in writing (i) the objective performance
goals that must be met in order for restrictions on the Restricted Stock to
lapse (Performance Goals), (ii) the Performance Period during which the
Performance Goals must be met (Performance Period), (iii) the threshold, target
and maximum amounts that may be paid if the Performance Goals are met, and (iv)
any other conditions, including without limitation provisions relating to death,
disability, other termination of employment or Change of Control, that the
Committee deems appropriate and consistent with the Plan and section 162(m) of
the Code. The Performance Goals may relate to the Employee's business unit or
the performance of the Company and its subsidiaries as a whole, or any
combination of the foregoing. The Committee shall use objectively determinable
Performance Goals based on one or more of the following criteria: stock price,
earnings per share, net earnings, operating earnings, return on assets,
shareholder return, return on equity, growth in assets, unit volume, sales,
market share, or strategic business criteria consisting of one or more
objectives based on meeting specified revenue goals, market penetration goals,
geographic business expansion goals, cost targets, goals relating to
acquisitions or divestitures, or goals relating to product development
objectives.
(c) Establishment of Performance Goals. The Committee shall establish the
Performance Goals in writing either before the beginning of the Performance
Period or during a period ending no later than the earlier of (i) 90 days after
the beginning of the Performance Period or (ii) the date on which 25% of the
Performance Period has been completed, or such other date as may be required or
permitted under applicable regulations under section 162(m) of the Code. The
Performance Goals shall satisfy the requirements for qualified performance-based
compensation, including the requirement that the achievement of the goals be
substantially uncertain at the time they are established and that the goals be
established in such a way that a third party with knowledge of the relevant
facts could determine whether and to what extent the Performance Goals have been
met. The Committee shall not have discretion to increase the amount of
compensation that is payable upon achievement of the designated Performance
Goals.
(d) Announcement of Grants. The Committee shall certify and announce the
results for each Performance Period to all Grantees immediately following the
announcement of the Company's financial results for the Performance Period. If
and to the extent that the Committee does not certify that the Performance Goals
have been met, the grants of Restricted Stock for the Performance Period shall
not vest.
8. WITHHOLDING OF TAXES
(a) Required Withholding. All Grants under the Plan shall be subject to
applicable federal (including FICA), state and local tax withholding
requirements. The Company may require the Grantee or other person receiving
shares to pay to the Company the amount of any such taxes that the Company is
required to withhold with respect to such Grants, or the Company may deduct from
the amount payable under a Grant or from other wages paid by the Company the
amount of any withholding taxes due with respect to such Grants.
(b) Election to Withhold Shares. If the Committee so permits, a Grantee
may elect to satisfy the Company's income tax withholding obligation with
respect to an Option or Restricted Stock by having shares withheld up to an
amount that does not exceed the applicable withholding tax for federal
(including FICA), state and local tax liabilities. The election must be in the
form and manner prescribed by the Committee and is subject to the prior approval
of the Committee.
6
<PAGE>
9. TRANSFERABILITY OF GRANTS
(a) Nontransferability of Grants. Except as provided below, only the
Grantee may exercise rights under a Grant during the Grantee's lifetime. The
Grantee may not transfer those rights except by will or by the laws of descent
and distribution or, with respect to Grants other than Incentive Stock Options,
if permitted in any specific case by the Committee in its sole discretion,
pursuant to a qualified domestic relations order (as defined under the Code or
Title I of the Employee Retirement Income Security Act of 1974, as amended or
the regulations thereunder). When a Grantee dies, the personal representative
or other person entitled to succeed to the rights of the Grantee ("Successor
Grantee") may exercise such rights. A Successor Grantee must furnish proof
satisfactory to the Company of his or her right to receive the Grant under the
Grantee's will or under the applicable laws of descent and distribution.
(b) Transfer of Nonqualified Stock Options. Notwithstanding the foregoing,
the Committee may provide, in a Grant Instrument, that a Grantee may transfer
Nonqualified Stock Options to family members, one or more trusts for the benefit
of family members, or one or more partnerships of which family members are the
only partners, or other persons or entities according to such terms as the
Committee may determine; provided that the Grantee receives no consideration for
the transfer of an Option and the transferred Option shall continue to be
subject to the same terms and conditions as were applicable to the Option
immediately before the transfer.
10. CHANGE OF CONTROL OF THE COMPANY
As used herein, a "Change of Control" shall mean the occurrence of any of
the following:
(a) Any "person" (as such term is used in sections 13(d) and 14(d) of the
Exchange Act) is or becomes a "beneficial owner" (as defined in Rule 13d-3 under
the Exchange Act), directly or indirectly, of securities of the Company
representing 40% or more of the voting power of the then outstanding securities
of the Company;
(b) During any period of two consecutive calendar years there is a change
of 25% or more in the composition of the Board of the Company in office at the
beginning of the period except for changes approved by at least two-thirds of
the Directors then in office who were Directors at the beginning of the period;
(c) The shareholders of the Company approve an agreement providing for (A)
the merger or consolidation of the Company with another corporation where the
shareholders of the Company, immediately prior to the merger or consolidation,
will not beneficially own, immediately after the merger or consolidation, shares
entitling such shareholders to 50% or more of all votes (without consideration
of the rights of any class of stock to elect Directors by a separate class vote)
to which all shareholders of the corporation issuing cash or securities in the
merger or consolidation would be entitled in the election of directors, or where
the members of the Board, immediately prior to the merger or consolidation,
would not, immediately after the merger or consolidation, constitute a majority
of the Board of Directors of the corporation issuing cash or securities in the
merger or consolidation, or (B) the sale or other disposition of all or
substantially all the assets of the Company, or a liquidation, dissolution or
statutory exchange of the Company; or
(d) Any person has commenced, or announced an intention to commence, a
tender offer or exchange offer for 40% or more of the voting power of the then-
outstanding securities of the Company.
7
<PAGE>
11. CONSEQUENCES OF A CHANGE OF CONTROL
(a) Notice and Acceleration. Upon a Change of Control, unless the
Committee determines otherwise, (i) the Company shall provide each Grantee with
outstanding Grants written notice of such Change of Control, (ii) all
outstanding Options shall automatically accelerate and become fully exercisable,
and (iii) the restrictions and conditions on all outstanding Restricted Stock
shall immediately lapse.
(b) Assumption of Grants. Upon a Change of Control where the Company is
not the surviving corporation (or survives only as a subsidiary of another
corporation), unless the Committee determines otherwise, all outstanding Options
that are not exercised shall be assumed by, or replaced with comparable options
by, the surviving corporation.
(c) Other Alternatives. Notwithstanding the foregoing, subject to
subsection (d) below, in the event of a Change of Control, the Committee may
take one or both of the following actions: the Committee may (i) require that
Grantees surrender their outstanding Options in exchange for a payment by the
Company, in cash or Company Stock as determined by the Committee, in an amount
equal to the amount by which the then Fair Market Value of the shares of Company
Stock subject to the Grantee's unexercised Options exceeds the Exercise Price of
the Options or (ii) after giving Grantees an opportunity to exercise their
outstanding Options, terminate any or all unexercised Options at such time as
the Committee deems appropriate. Such surrender or termination shall take place
as of the date of the Change of Control or such other date as the Committee may
specify.
(d) Limitations. Notwithstanding anything in the Plan to the contrary, in
the event of a Change of Control, the Committee shall not have the right to take
any actions described in the Plan (including without limitation actions
described in Subsection (c) above) that would make the Change of Control
ineligible for pooling of interest accounting treatment or that would make the
Change of Control ineligible for desired tax treatment if, in the absence of
such right, the Change of Control would qualify for such treatment and the
Company intends to use such treatment with respect to the Change of Control.
12. REQUIREMENTS FOR ISSUANCE OR TRANSFER OF SHARES
No Company Stock shall be issued or transferred in connection with any
Grant hereunder unless and until all legal requirements applicable to the
issuance or transfer of such Company Stock have been complied with to the
satisfaction of the Committee. The Committee shall have the right to condition
any Grant made to any Grantee hereunder on such Grantee's undertaking in writing
to comply with such restrictions on his or her subsequent disposition of such
shares of Company Stock as the Committee shall deem necessary or advisable as a
result of any applicable law, regulation or official interpretation thereof, and
certificates representing such shares may be legended to reflect any such
restrictions. Certificates representing shares of Company Stock issued or
transferred under the Plan will be subject to such stop-transfer orders and
other restrictions as may be required by applicable laws, regulations and
interpretations, including any requirement that a legend be placed thereon.
8
<PAGE>
13. AMENDMENT AND TERMINATION OF THE PLAN
(a) Amendment. The Board may amend or terminate the Plan at any time;
provided, however, that the Committee shall not amend the Plan without
shareholder approval if such approval is required by section 422 of the Code or
section 162(m) of the Code.
(b) Termination of Plan. The Plan shall terminate on the day immediately
preceding the tenth anniversary of its effective date, unless the Plan is
terminated earlier by the Board or unless extended by the Board with the
approval of the shareholders.
(c) Termination and Amendment of Outstanding Grants. A termination or
amendment of the Plan that occurs after a Grant is made shall not materially
impair the rights of a Grantee unless the Grantee consents or unless the
Committee acts under section 19(b) hereof. The termination of the Plan shall
not impair the power and authority of the Committee with respect to an
outstanding Grant. Whether or not the Plan has terminated, an outstanding Grant
may be terminated or amended under Section 19(b) hereof or may be amended by
agreement of the Company and the Grantee consistent with the Plan.
(d) Governing Document. The Plan shall be the controlling document. No
other statements, representations, explanatory materials or examples, oral or
written, may amend the Plan in any manner. The Plan shall be binding upon and
enforceable against the Company and its successors and assigns.
14. FUNDING OF THE PLAN
This Plan shall be unfunded. The Company shall not be required to
establish any special or separate fund or to make any other segregation of
assets to assure the payment of any Grants under this Plan. In no event shall
interest be paid or accrued on any Grant, including unpaid installments of
Grants.
15. RIGHTS OF PARTICIPANTS
Nothing in this Plan shall entitle any Employee, Consultant, Non-Employee
Director or other person to any claim or right to be granted a Grant under this
Plan. Neither this Plan nor any action taken hereunder shall be construed as
giving any individual any rights to be retained by or in the employ of the
Company or any other employment rights.
16. NO FRACTIONAL SHARES
No fractional shares of Company Stock shall be issued or delivered pursuant
to the Plan or any Grant. The Committee shall determine whether cash, other
awards or other property shall be issued or paid in lieu of such fractional
shares or whether such fractional shares or any rights thereto shall be
forfeited or otherwise eliminated.
17. HEADINGS
Section headings are for reference only. In the event of a conflict
between a title and the content of a Section, the content of the Section shall
control.
18. EFFECTIVE DATE OF THE PLAN
Subject to the approval of the Company's shareholders, this Plan shall be
effective on February 11, 1998.
9
<PAGE>
19. MISCELLANEOUS
(a) Grants in Connection with Corporate Transactions and Otherwise. Nothing
contained in this Plan shall be construed to (i) limit the right of the
Committee to make Grants under this Plan in connection with the acquisition, by
purchase, lease, merger, consolidation or otherwise, of the business or assets
of any corporation, firm or association, including Grants to employees thereof
who become Employees of the Company, or for other proper corporate purposes, or
(ii) limit the right of the Company to grant stock options or make other awards
outside of this Plan. Without limiting the foregoing, the Committee may make a
Grant to an employee of another corporation who becomes an Employee by reason of
a corporate merger, consolidation, acquisition of stock or property,
reorganization or liquidation involving the Company or any of its subsidiaries
in substitution for a stock option or restricted stock grant made by such
corporation. The terms and conditions of the substitute grants may vary from
the terms and conditions required by the Plan and from those of the substituted
stock incentives. The Committee shall prescribe the provisions of the
substitute grants.
(b) Compliance with Law. The Plan, the exercise of Options and the
obligations of the Company to issue or transfer shares of Company Stock under
Grants shall be subject to all applicable laws and to approvals by any
governmental or regulatory agency as may be required. With respect to persons
subject to Section 16 of the Exchange Act, it is the intent of the Company that
the Plan and all transactions under the Plan comply with all applicable
provisions of Rule 16b-3 or its successors under the Exchange Act. In addition,
it is the intent of the Company that the Plan and applicable grants under the
Plan comply with the applicable provisions of sections 162(m) and 422 of the
Code. To the extent that any legal requirement of section 16 of the Exchange
Act or section 162(m) or 422 of the Code as set forth in the Plan ceases to be
required under section 16 of the Exchange Act or section 162(m) or 422 of the
Code, that provision shall cease to apply. The Committee may revoke any Grant
if it is contrary to law or modify a Grant to bring it into compliance with any
valid and mandatory government regulation. The Committee may, in its sole
discretion, agree to limit its authority under this Section.
(c) No Shareholder Rights. Except as otherwise provided by the Committee,
a Grantee or Successor Grantee shall have no rights as a shareholder with
respect to any shares of Company Stock covered by a Grant until the shares are
issued or transferred to the Grantee or Successor Grantee on the stock transfer
records of the Company.
(d) Governing Law. The validity, construction, interpretation and effect
of the Plan and Grant Instruments issued under the Plan shall exclusively be
governed by and determined in accordance with the law of the Commonwealth of
Pennsylvania.
10
<PAGE>
EXHIBIT 4.5
Magainin Pharmaceuticals Inc
1998 Equity Compensation Plan
Non-Qualified Stock Option Grant
- --------------------------------------------------------------------------------
This STOCK OPTION GRANT (hereafter "Agreement"), dated as of ________________,
199__ (the "Date of Grant"), is delivered by Magainin Pharmaceuticals Inc. (the
"Company") to _______________ (the "Grantee").
RECITALS
--------
A. The Magainin Pharmaceuticals Inc. 1998 Equity Compensation Plan (the
"Plan") provides for the grant of options to purchase shares of common stock of
the Company.
B. The Committee, appointed by the Board of Directors of the Company (the
"Board") under the terms of the Plan, has decided to make a stock option grant
as an inducement for the Grantee to promote the best interests of the Company
and its shareholders. A copy of the Plan is attached.
NOW, THEREFORE, the parties to this Agreement, intending to be legally
bound hereby, agree as follows:
1. Grant of Option. Subject to the terms and conditions set forth in this
---------------
Agreement and in the Plan, the Company hereby grants to the Grantee a
nonqualified stock option (the "Option") to purchase ____ shares of common stock
of the Company ("Shares") at an Exercise Price of $_____ per Share. The Option
shall become exercisable according to Paragraph 2 below.
2. Exercisability of Option. The Option shall become exercisable on the
------------------------
following dates, if the Grantee is employed by, or providing service to, the
Company (as defined in the Plan) on the applicable date:
Shares for Which the
Date Option is Exercisable
---- ---------------------
--------------- 199_ -------------------------
--------------- 200_ -------------------------
--------------- 200_ -------------------------
--------------- 200_ -------------------------
The exercisability of the Option is cumulative.
1
<PAGE>
Magainin Pharmaceuticals Inc
1998 Equity Compensation Plan
Non-Qualified Stock Option Grant
(Continued)
- --------------------------------------------------------------------------------
3. Term of Option.
--------------
(a) The Option shall have a term of 10 years from the Date of Grant and
shall terminate at the expiration of that period (_______________,
______________), unless it is terminated at an earlier date pursuant to the
provisions of this Agreement or the Plan.
(b) The Option shall automatically terminate upon the expiration of the
Post- Termination Exercise Period, as defined in the Plan, and specified by the
Committee.
(c) Notwithstanding the foregoing, in the event the Grantees ceases to be
employed by, or provide service to, the Company on account of termination for
cause (as defined in the Plan), any Option held by the Grantee shall terminate
as of the date the Grantee ceases to be employed by, or provide service to, the
Company, and the Grantee shall automatically forfeit all shares underlying any
exercised portion of an Option for which the Company has not yet delivered the
share certificates, upon refund by the Company of the Exercise Price paid by the
Grantee for such shares.
Notwithstanding the foregoing, in no event may the Option be exercised after the
date on which the Option term expires. Any portion of the Option that is not
exercisable at the time the Grantee ceases to be employed by, or provide service
to, the Company shall immediately terminate.
4. Exercise Procedures.
-------------------
(a) Subject to the provisions of Paragraphs 2 and 3 above, the Grantee may
exercise part or all of the exercisable Option by giving the Committee written
notice of intent to exercise in the manner provided in Paragraph 11 below,
specifying the number of Shares as to which the Option is to be exercised. On
the delivery date, the Grantee shall pay the Exercise Price (i) in cash, (ii)
with the approval of the Committee, by delivering Shares of the Company having a
fair market value on the date of exercise equal to the Exercise Price on the
date of delivery, or (iii) by such other method as the Committee may approve,
including payment through a broker in accordance with procedures permitted by
Regulation T of the Federal Reserve Board. The Committee may impose from time
to time such limitations as it deems appropriate on the use of Shares of the
Company to exercise the Option. Shares used to exercise an Option shall have
been held by the Grantee for the requisite period of time to avoid adverse
accounting consequences of the Company with respect to the Option.
2
<PAGE>
Magainin Pharmaceuticals Inc
1998 Equity Compensation Plan
Non-Qualified Stock Option Grant
(Continued)
- --------------------------------------------------------------------------------
4. Exercise Procedures. (continued)
-------------------
(b) The obligation of the Company to deliver Shares upon exercise of the
Option shall be subject to all applicable laws, rules, and regulations and such
approvals by governmental agencies as may be deemed appropriate by the
Committee, including such actions as Company counsel shall deem necessary or
appropriate to comply with relevant securities laws and regulations. The
Company may require that the Grantee (or other person exercising the Option
after the Grantee's death) represent that the Grantee is purchasing Shares for
the Grantee's own account and not with a view to or for sale in connection with
any distribution of the Shares, or such other representation as the Committee
deems appropriate. All obligations of the Company under this Agreement shall be
subject to the rights of the Company as set forth in the Plan to withhold
amounts required to be withheld for any taxes, if applicable. Subject to
Committee approval, the Grantee may elect to satisfy any income tax withholding
obligation of the Company with respect to the Option by having Shares withheld
up to an amount that does not exceed the applicable withholding tax rate for
federal (including FICA), state and local tax liabilities.
5. Change of Control. The provisions of the Plan applicable to a Change of
-----------------
Control shall apply to the Option, and, in the event of a Change of Control, the
Committee may take such actions as it deems appropriate pursuant to the Plan.
6. Grant Subject to Plan Provisions. This grant is made pursuant to the Plan,
--------------------------------
the terms of which are incorporated herein by reference, and in all respects
shall be interpreted in accordance with the Plan. The grant and exercise of the
option are subject to the provisions of the Plan and to interpretations,
regulations and determinations concerning the Plan established from time to time
by the Committee in accordance with the provisions of the Plan, including, but
not limited to, provisions pertaining to (i) rights and obligations with respect
to withholding taxes, (ii) the registration, qualification or listing of the
Shares, (iii) capital or other changes of the Company and (iv) other
requirements of applicable law. The Committee shall have the authority to
interpret and construe the Option pursuant to the terms of the Plan, and its
decisions shall be conclusive as to any questions arising hereunder.
7. No Employment or Other Rights. The grant of the Option shall not confer
-----------------------------
upon the Grantee any right to be retained by or in the employ or service of the
Company and shall not interfere in any way with the right of the Company to
terminate the Grantee's employment or service at any time. The right of the
Company to terminate at will the Grantee's employment or service at any time for
any reason is specifically reserved.
8. No Shareholder Rights. Neither the Grantee, nor any person entitled to
---------------------
exercise the Grantee's rights in the event of the Grantee's death, shall have
any of the rights and privileges of a shareholder with respect to the Shares
subject to the Option, until certificates for Shares have been issued upon the
exercise of the Option.
3
<PAGE>
Magainin Pharmaceuticals Inc
1998 Equity Compensation Plan
Non-Qualified Stock Option Grant
(Continued)
- --------------------------------------------------------------------------------
9. Assignment and Transfers.
------------------------
(a) Except as provided in subparagraph (b) below, the rights and interests
of the Grantee under this Agreement may not be sold, assigned, encumbered or
otherwise transferred except, in the event of the death of the Grantee, by will
or by the laws of descent and distribution. Only the Grantee may exercise the
Option during the Grantee's lifetime. After the Grantee's death, the Option
shall be exercisable (subject to the limitations specified in the Plan) solely
by the legal representative of the Grantee, or by the person who acquires the
right to exercise the Option by will or by the laws of descent and distribution,
to the extent that the Option is exercisable pursuant to this Agreement. In the
event of any attempt by the Grantee to alienate, assign, pledge, hypothecate, or
otherwise dispose of the Option or any right hereunder, except as provided for
in this Agreement, or in the event of the levy or any attachment, execution or
similar process upon the rights or interests hereby conferred, the Company may
terminate the Option by notice to the Grantee, and the Option and all rights
hereunder shall thereupon become null and void. The rights and protections of
the Company hereunder shall extend to any successors or assigns of the Company
and to the Company's parents, subsidiaries, and affiliates. This Agreement may
be assigned by the Company without the Grantee's consent.
(b) Notwithstanding the foregoing, and only upon approval of the
Committee, the Grantee may transfer the Option to family members, one or more
trusts for the benefit of family members, or one or more partnerships of which
family members are the only partners, (or other persons or entities as Committee
may determine); provided that the Grantee receives no consideration for the
transfer of an Option and the transferred Option shall continue to be subject to
the same terms and conditions as were applicable to the Option immediately
before the transfer.
10. Applicable Law. The validity, construction, interpretation and effect of
--------------
this instrument shall be governed by and determined in accordance with the laws
of the Commonwealth of Pennsylvania.
4
<PAGE>
Magainin Pharmaceuticals Inc
1998 Equity Compensation Plan
Non-Qualified Stock Option Grant
(Continued)
- --------------------------------------------------------------------------------
11. Notice. Any notice to the Company provided for in this instrument shall be
------
addressed to the Company in care of the Chief Financial Officer at 5110 Campus
Drive, Plymouth Meeting, PA 19462, and any notice to the Grantee shall be
addressed to such Grantee at the current address shown on the payroll of the
Company, or to such other address as the Grantee may designate to the Company in
writing. Any notice shall be delivered by hand, sent by telecopier or enclosed
in a properly sealed envelope addressed as stated above, registered and
deposited, postage prepaid, in a post office regularly maintained by the United
States Postal Service.
IN WITNESS WHEREOF, the Company has caused its duly authorized officers to
execute and attest this Agreement, and the Grantee has executed this Agreement,
effective as of the Date of Grant.
MAGAININ PHARMACEUTICALS INC.
Attest:
By:
- -------------------------------- -----------------------------
Accepted:
-----------------------
Grantee
5
<PAGE>
EXHIBIT 4.6
Magainin Pharmaceuticals Inc
1998 EQUITY COMPENSATION PLAN
Incentive Stock Option Grant
- --------------------------------------------------------------------------------
This STOCK OPTION GRANT (hereafter "Agreement"), dated as of ________________,
199__ (the "Date of Grant"), is delivered by Magainin Pharmaceuticals Inc. (the
"Company") to _______________, who is an employee of the Company or its
subsidiaries (the "Grantee").
RECITALS
--------
A. The Magainin Pharmaceuticals Inc. 1998 Equity Compensation Plan (the
"Plan") provides for the grant of options to purchase shares of common stock of
the Company.
B. The Committee, appointed by the Board of Directors of the Company (the
"Board") under the terms of the Plan, has decided to make a stock option grant
as an inducement f for the Grantee to promote the best interests of the Company
and its shareholders. A copy of the Plan is attached.
NOW, THEREFORE, the parties to this Agreement, intending to be legally
bound hereby, agree as follows:
1. Grant of Option.
---------------
(a) Subject to the terms and conditions set forth in this Agreement and in
the Plan, the Company hereby grants to the Grantee an incentive stock option
(the "Option") to purchase ____ shares of common stock of the Company ("Shares")
at an Exercise Price of $_____ per Share. The Option shall become exercisable
according to Paragraph 2 below.
(b) The Option is designated as an incentive stock option, as described in
Paragraph 5 below. However, if and to the extent the Option exceeds the limits
for an incentive stock option, as described in Paragraph 5, the option shall be
a nonqualified stock option.
2. Exercisability of Option. The Option shall become exercisable on the
------------------------
following dates, if the Grantee is employed by, or providing service to, the
Company (as defined in the Plan) on the applicable date:
Shares for Which the
Date Option is Exercisable
---- ---------------------
---------------- 199_ -----------------------
---------------- 200_ -----------------------
---------------- 200_ -----------------------
---------------- 200_ -----------------------
The exercisability of the Option is cumulative.
1
<PAGE>
Magainin Pharmaceuticals Inc
1998 EQUITY COMPENSATION PLAN
Incentive Stock Option Grant
(Continued)
- --------------------------------------------------------------------------------
3. Term of Option.
--------------
(a) The Option shall have a term of 10 years from the Date of Grant and
shall terminate at the expiration of that period (_______________,
______________), unless it is terminated at an earlier date pursuant to the
provisions of this Agreement or the Plan.
(b) The Option shall automatically terminate upon the expiration of the
Post- Termination Exercise Period, as defined in the Plan, and specified by the
Committee.
(c) Notwithstanding the foregoing, in the event the Grantees ceases to be
employed by, or provide service to, the Company on account of termination for
cause (as defined in the Plan), any Option held by the Grantee shall terminate
as of the date the Grantee ceases to be employed by, or provide service to, the
Company, and the Grantee shall automatically forfeit all shares underlying any
exercised portion of an Option for which the Company has not yet delivered the
share certificates, upon refund by the Company of the Exercise Price paid by the
Grantee for such shares.
Notwithstanding the foregoing, in no event may the Option be exercised after the
date on which the Option term expires. Any portion of the Option that is not
exercisable at the time the Grantee ceases to be employed by, or provide service
to, the Company shall immediately terminate.
4. Exercise Procedures.
-------------------
(a) Subject to the provisions of Paragraphs 2 and 3 above, the Grantee may
exercise part or all of the exercisable Option by giving the Committee written
notice of intent to exercise in the manner provided in Paragraph 12 below,
specifying the number of Shares as to which the Option is to be exercised. On
the delivery date, the Grantee shall pay the Exercise Price (i) in cash, (ii)
with the approval of the Committee, by delivering Shares of the Company having a
fair market value on the date of exercise equal to the Exercise Price on the
date of delivery, or (iii) by such other method as the Committee may approve,
including payment through a broker in accordance with procedures permitted by
Regulation T of the Federal Reserve Board. The Committee may impose from time
to time such limitations as it deems appropriate on the use of Shares of the
Company to exercise the Option. Shares used to exercise an Option shall have
been held by the Grantee for the requisite period of time to avoid adverse
accounting consequences of the Company with respect to the Option.
2
<PAGE>
Magainin Pharmaceuticals Inc
1998 EQUITY COMPENSATION PLAN
Incentive Stock Option Grant
(Continued)
- --------------------------------------------------------------------------------
4. Exercise Procedures. (continued)
-------------------
(b) The obligation of the Company to deliver Shares upon exercise of the
Option shall be subject to all applicable laws, rules, and regulations and such
approvals by governmental agencies as may be deemed appropriate by the
Committee, including such actions as Company counsel shall deem necessary or
appropriate to comply with relevant securities laws and regulations. The
Company may require that the Grantee (or other person exercising the Option
after the Grantee's death) represent that the Grantee is purchasing Shares for
the Grantee's own account and not with a view to or for sale in connection with
any distribution of the Shares, or such other representation as the Committee
deems appropriate. All obligations of the Company under this Agreement shall be
subject to the rights of the Company as set forth in the Plan to withhold
amounts required to be withheld for any taxes, if applicable. Subject to
Committee approval, the Grantee may elect to satisfy any income tax withholding
obligation of the Company with respect to the Option by having Shares withheld
up to an amount that does not exceed the applicable withholding tax rate for
federal (including FICA), state and local tax liabilities.
5. Designation as Incentive Stock Option.
-------------------------------------
(a) This Option is designated an incentive stock option under Section 422
of the Internal Revenue Code of 1986, as amended (the "Code"). If the aggregate
fair market value of the stock on the Date of Grant with respect to which
incentive stock options are exercisable for the first time by the Grantee during
any calendar year, under the Plan or any other stock option plan of the Company
or subsidiary, exceeds $100,000, then the Option, as to the excess, shall be
treated as a nonqualified stock option that does not meet the requirements of
Section 422. If and to the extent that the Option fails to qualify as an
incentive stock option under the Code, the Option shall remain outstanding
according to its terms as a nonqualified stock option.
(b) The Grantee understands that favorable incentive stock option tax
treatment is available only if the Option is exercised while the Grantee is an
employee of the Company or a parent or subsidiary or within a time specified in
the Code after the Grantee ceases to be an employee. The Grantee should consult
with his or her tax adviser regarding the tax consequences of the Option.
6. Change of Control. The provisions of the Plan applicable to a Change of
-----------------
Control shall apply to the Option, and, in the event of a Change of Control, the
Committee may take such actions as it deems appropriate pursuant to the Plan.
3
<PAGE>
Magainin Pharmaceuticals Inc
1998 EQUITY COMPENSATION PLAN
Incentive Stock Option Grant
(Continued)
- --------------------------------------------------------------------------------
7. Grant Subject to Plan Provisions. This grant is made pursuant to the Plan,
--------------------------------
the terms of which are incorporated herein by reference, and in all respects
shall be interpreted in accordance with the Plan. The grant and exercise of the
option are subject to the provisions of the Plan and to interpretations,
regulations and determinations concerning the Plan established from time to time
by the Committee in accordance with the provisions of the Plan, including, but
not limited to, provisions pertaining to (i) rights and obligations with respect
to withholding taxes, (ii) the registration, qualification or listing of the
Shares, (iii) capital or other changes of the Company and (iv) other
requirements of applicable law. The Committee shall have the authority to
interpret and construe the Option pursuant to the terms of the Plan, and its
decisions shall be conclusive as to any questions arising hereunder.
8. No Employment or Other Rights. The grant of the Option shall not confer
-----------------------------
upon the Grantee any right to be retained by or in the employ or service of the
Company and shall not interfere in any way with the right of the Company to
terminate the Grantee's employment or service at any time. The right of the
Company to terminate at will the Grantee's employment or service at any time for
any reason is specifically reserved.
9. No Shareholder Rights. Neither the Grantee, nor any person entitled to
---------------------
exercise the Grantee's rights in the event of the Grantee's death, shall have
any of the rights and privileges of a shareholder with respect to the Shares
subject to the Option, until certificates for Shares have been issued upon the
exercise of the Option.
10. Assignment and Transfers. The rights and interests of the Grantee under
------------------------
this Agreement may not be sold, assigned, encumbered or otherwise transferred
except, in the event of the death of the Grantee, by will or by the laws of
descent and distribution. Only the Grantee may exercise the Option during the
Grantee's lifetime. After the Grantee's death, the Option shall be exercisable
(subject to the limitations specified in the Plan) solely by the legal
representative of the Grantee, or by the person who acquires the right to
exercise the Option by will or by the laws of descent and distribution, to the
extent that the Option is exercisable pursuant to this Agreement. In the event
of any attempt by the Grantee to alienate, assign, pledge, hypothecate, or
otherwise dispose of the Option or any right hereunder, except as provided for
in this Agreement, or in the event of the levy or any attachment, execution or
similar process upon the rights or interests hereby conferred, the Company may
terminate the Option by notice to the Grantee, and the Option and all rights
hereunder shall thereupon become null and void. The rights and protections of
the Company hereunder shall extend to any successors or assigns of the Company
and to the Company's parents, subsidiaries, and affiliates. This Agreement may
be assigned by the Company without the Grantee's consent.
11. Applicable Law. The validity, construction, interpretation and effect of
--------------
this instrument shall be governed by and determined in accordance with the laws
of the Commonwealth of Pennsylvania.
4
<PAGE>
Magainin Pharmaceuticals Inc
1998 EQUITY COMPENSATION PLAN
Incentive Stock Option Grant
(Continued)
- --------------------------------------------------------------------------------
12. Notice. Any notice to the Company provided for in this instrument shall be
------
addressed to the Company in care of the Chief Financial Officer at 5110 Campus
Drive, Plymouth Meeting, PA 19462, and any notice to the Grantee shall be
addressed to such Grantee at the current address shown on the payroll of the
Company, or to such other address as the Grantee may designate to the Company in
writing. Any notice shall be delivered by hand, sent by telecopier or enclosed
in a properly sealed envelope addressed as stated above, registered and
deposited, postage prepaid, in a post office regularly maintained by the United
States Postal Service.
IN WITNESS WHEREOF, the Company has caused its duly authorized officers to
execute and attest this Agreement, and the Grantee has executed this Agreement,
effective as of the Date of Grant.
MAGAININ PHARMACEUTICALS INC.
Attest:
By:
- ------------------------------- ------------------------------------
Accepted:
------------------------------
Grantee
5
<PAGE>
EXHIBIT 4.7
Magainin Pharmaceuticals Inc
1998 EQUITY COMPENSATION PLAN
Restricted Stock Grant
- --------------------------------------------------------------------------------
This RESTRICTED STOCK GRANT (hereafter "Agreement"), dated as of _____________,
1998 (the "Date of Grant"), is delivered by Magainin Pharmaceuticals Inc. (the
"Company"), to ________________ (the "Grantee").
RECITALS
--------
A. The Magainin Pharmaceuticals Inc. 1998 Equity Compensation Plan (the
"Plan") provides for the grant of restricted stock.
B. The Committee, appointed by the Board of Directors of the Company (the
"Board") under the terms of the Plan, has decided to make a restricted stock
grant as an inducement for the Grantee and to promote the best interests of the
Company and its shareholders. A copy of the Plan is attached.
NOW, THEREFORE, the parties to this Agreement, intending to be legally
bound hereby, agree as follows:
1. Restricted Stock Grant. The Company hereby grants the Grantee _______
-----------------------
shares of common stock of the Company, subject to the restrictions set forth
below and in the Plan ("Restricted Stock"). The shares of Restricted Stock may
not be transferred by the Grantee or subjected to any security interest until
the shares have become vested pursuant to this Agreement and the Plan.
2. Vesting of Grant.
-----------------
(a) The shares of Restricted Stock shall become vested, and the
restrictions shall lapse, over the following vesting period:
Vesting Date Vested Shares
------------ -------------
---------------- 199_ ----------------
---------------- 200_ ----------------
---------------- 200_ ----------------
---------------- 200_ ----------------
(b) The Restricted Stock shall become fully vested if a Change of Control
(as defined in the Plan) occurs while the Restricted Stock is outstanding and
the Grantee is employed by the Company, unless the Committee determines
otherwise.
1
<PAGE>
Magainin Pharmaceuticals Inc
1998 EQUITY COMPENSATION PLAN
Restricted Stock Grant
(Continued)
- --------------------------------------------------------------------------------
2. Vesting of Grant. (Continued)
-----------------
(c) If the Grantee's employment with the Company terminates for any reason
before the Restricted Stock is fully vested, any shares of Restricted
Stock that have not vested shall be forfeited immediately and any such
shares issued to the Grantee must be immediately returned to the Company.
(d) For purposes of this Agreement, employment with the Company shall mean
employment as an employee of the Company or its subsidiaries, service as a
consultant of the Company or its subsidiaries, or service as a member of
the Board of Directors of the Company.
3. Issuance of Certificates.
------------------------
(a) The Committee may determine that the Company will not issue certificates
for shares of Restricted Stock, or that the Company will retain possession
of certificates for any shares issued pursuant to this Restricted Stock
Grant, until the Restricted Stock vests. During the period before the
shares vest, the Grantee shall receive any cash dividends with respect to
the shares of Restricted Stock, may vote such shares and may participate
in any distribution pursuant to a plan of dissolution or complete
liquidation of the Company. In the event of a dividend or distribution
payable in stock or other property or a reclassification, split up or
similar event, the shares or other property issued or declared with
respect to the shares of Restricted Stock held in escrow shall also be
held in escrow and shall be subject to the same terms and conditions
relating to vesting as the shares to which they relate.
(b) When the Grantee obtains a vested right to the shares of Restricted
Stock, a certificate representing the vested shares shall be issued to the
Grantee. The certificate shall be duly endorsed (or accompanied by an
executed stock power) so as to transfer to the Grantee all right, title
and interest in and to the shares represented by such certificate.
4. Withholding. Pursuant to the Plan, the Grantee, or any other person
-----------
receiving shares, shall be required to pay to the Company the amount of
any taxes which the Company is required to withhold with respect to the
grant and the vesting of the shares. The Company shall have the right to
require that the Grantee (or such other person) make such provision, or
furnish the Company with such authorization, as may be necessary or
desirable so that the Company may satisfy its obligations under applicable
tax laws to withhold for income or other taxes due upon or incident to
such grant or vesting.
2
<PAGE>
Magainin Pharmaceuticals Inc
1998 EQUITY COMPENSATION PLAN
Restricted Stock Grant
(Continued)
- --------------------------------------------------------------------------------
5. Grant Subject to Plan Provisions. This grant is made pursuant to the Plan,
--------------------------------
the terms of which are incorporated herein by reference, and in all
respects shall be interpreted in accordance with the Plan. The grant is
subject to the provisions of the Plan and to interpretations, regulations
and determinations concerning the Plan established from time to time by the
Committee in accordance with the provisions of the Plan, including, but not
limited to, provisions pertaining to (i) rights and obligations with
respect to withholding taxes, (ii) the registration, qualification or
listing of the Shares, (iii) capital or other changes of the Company and
(iv) other requirements of applicable law. The Committee shall have the
authority to interpret and construe the grant pursuant to the terms of the
Plan, and its decisions shall be conclusive as to any questions arising
hereunder.
6. No Employment or Other Rights. This grant shall not confer upon the
-----------------------------
Grantee any right to be retained by or in the employ or service of the
Company and shall not interfere in any way with the right of the Company to
terminate the Grantee's employment or service at any time. The right of the
Company to terminate at will the Grantee's employment or service at any
time for any reason is specifically reserved.
7. Assignment and Transfers. The rights and interests of the Grantee under
------------------------
this Agreement may not be sold, assigned, encumbered or otherwise
transferred except, in the event of the death of the Grantee, by will or by
the laws of descent and distribution. In the event of any attempt by the
Grantee to alienate, assign, pledge, hypothecate, or otherwise dispose of
the Restricted Stock, except as provided for in this Agreement, or in the
event of the levy or any attachment, execution or similar process upon the
rights or interests hereby conferred, the Company may terminate this
Agreement by notice to the Grantee, and the grant and all rights hereunder
shall thereupon become null and void. The rights and protections of the
Company hereunder shall extend to any successors or assigns of the Company
and to the Company's parents, subsidiaries, and affiliates. This Agreement
may be assigned by the Company without the Grantee's consent.
8. Applicable Law. The validity, construction, interpretation and effect of
--------------
this instrument shall be governed by and determined in accordance with the
laws of the Commonwealth of Pennsylvania.
9. Notice. Any notice to the Company provided for in this instrument shall be
------
addressed to the Company in care of the Chief Financial Officer at 5110
Campus Drive, Plymouth Meeting, PA 19462, and any notice to the Grantee
shall be addressed to such Grantee at the current address shown on the
payroll of the Company, or to such other address as the Grantee may
designate to the Company in writing. Any notice shall be delivered by
hand, sent by telecopy or enclosed in a properly sealed envelope addressed
as stated above, registered and deposited, postage prepaid, in a post
office regularly maintained by the United States Postal Service.
3
<PAGE>
Magainin Pharmaceuticals Inc
1998 EQUITY COMPENSATION PLAN
Restricted Stock Grant
(Continued)
- --------------------------------------------------------------------------------
IN WITNESS WHEREOF, the Company has caused its duly authorized officer to
execute and attest this instrument, and the Grantee has placed his signature
hereon, effective as of the Date of the Grant.
Attest: MAGAININ PHARMACEUTICALS INC.
By:
-------------------------- -----------------------------------
Accepted:
-----------------------------
Grantee
4
<PAGE>
Exhibit 5.1
August 21, 1998
Magainin Pharmaceuticals Inc.
5110 Campus Drive
Plymouth Meeting, PA 19462
Re: Magainin Pharmaceuticals Inc. -- Form S-8 Registration Statement
----------------------------------------------------------------
Ladies and Gentlemen:
We have acted as counsel to Magainin Pharmaceuticals Inc., a Delaware
corporation (the "Company") in connection with the preparation of the above-
referenced Registration Statement on Form S-8 (the "Registration Statement") for
filing with the Securities and Exchange Commission pursuant to the Securities
Act of 1933, as amended (the "Act"), and the rules and regulations promulgated
thereunder.
The Registration Statement relates to 1,500,000 shares of the Company's Common
Stock, par value $.002 per share (the "Common Stock"), issuable under the
Magainin Pharmaceuticals Inc. 1998 Equity Compensation Plan (the "Plan"). We
have examined copies of the Company's Amended and Restated Articles of
Incorporation, By-Laws, resolutions adopted by the board of directors and such
other documents, and have made such inquiries of the Company's officers, as we
have deemed relevant in rendering this opinion. As to matters of fact, we have
relied on representations of officers of the Company. In our examination, we
have assumed the genuineness of documents submitted to us as originals and the
conformity with the original of all documents submitted to us as copies thereof.
Based upon the foregoing, we are of the opinion that the Company's Common Stock,
when issued and delivered in accordance with the terms and conditions of the
Plan, will be validly issued, fully paid and non-assessable.
We hereby consent to the use of this opinion as Exhibit 5 to the Registration
Statement. In giving such consent, we do not thereby admit that we are acting
within the category of persons whose consent is required under Section 7 of the
Act or the rules or regulations of the Securities and Exchange Commission
thereunder.
Very truly yours,
/s/ Morgan, Lewis & Bockius LLP
<PAGE>
EXHIBIT 23.2
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in the Registration Statement
on Form S-8 of our report dated February 6, 1998 on the financial statements
included in the annual report on Form 10-K of Magainin Pharmaceuticals
Inc. as of and for the year ended December 31, 1997 and to the reference to our
firm under the caption "Experts".
/s/ Richard A. Eisner & Company
-------------------------------
Richard A. Eisner & Company
New York, New York
August 20, 1998
