SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
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FORM 8K
Current Report
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PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
July 1, 1996
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Neurex Corporation
(Exact name of registrant as specified in its charter)
DELAWARE
(State or other jurisdiction of incorporation or organization)
0-19874
(Commission File Number)
77-0128552
(I.R.S. Employer
Identification No.)
3760 Haven Avenue, Menlo Park, California 94025-1012
(Address of principal executive offices)
(415) 853-1500
(Registrant's telephone number, including area code)
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This report on form 8-K, including all exhibits, contains 13 pages.
Item 5. Other Events
On July 1, 1996, the Company announced the retirement of its Chief
Financial Officer and Vice-President, Finance, Bradford M. Wait and the
appointment of John M. Ames as the Company's new Chief Financial Officer and
Vice-President, Finance. Mr. Wait will assume the position of Vice-President and
Treasurer until his departure from the Company sometime in 1997.
On July 11, 1996, the Company's Board of Directors: (1) elected Robert
Luther as a new member of the Board of Directors; (2) adopted a form
Indemnification Agreement indemnifying its officers, directors and agents to the
fullest extent permitted by applicable law; and (3) adopted a voluntary
Systematic Stock Sales Program for the Company's executive officers and members
of the Board of Directors.
Item 7. Financial Statements and Exhibits
(c) Exhibits
99.1 Press Release
99.2 Indemnification Agreement
99.3 Systematic Stock Sales Program
Item 8. Change in Fiscal Year
On July 11, 1996, the Company's Board of Directors determined to change
the Company's fiscal year end from September 30 to December 31. The report
covering the transition period for the change in fiscal year end will be filed
on a Form 10-K.
Exhibit Index
Exhibit Sequential
No. Description of Exhibits Page Number
99.1 Press Release
99.2 Indemnification Agreement
99.3 Systematic Stock Sales Program
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
Date: July 26, 1996 Neurex Corporation (Registrant)
By: /s/ John M. Ames
--------------------------
John M. Ames
Chief Financial Officer and
Vice President of Finance
Exhibit 99.1
FOR IMMEDIATE RELEASE
Neurex Chief Financial Officer Announces
Retirement -
New Officer Appointed
MENLO PARK, California (July 1, 1996) - Bradford M. Wait, Vice President,
Finance and Chief Financial Officer of Neurex Corporation (NASDAQ: NXCO)
announced today his intention to retire from the Company. To effect a smooth
transition in the organization, Mr. Wait will leave the Company sometime during
1997. In the interim period, he will take on the responsibility of Vice
President & Treasurer and will also have specific responsibilities to support
and manage the Company though its period of rapid growth.
The Company also announced the appointment of John M. Ames as Vice President,
Finance and Chief Financial Officer, effective immediately. Mr. Ames joins
Neurex from Thera Tech, Inc., a Salt Lake City based drug delivery company where
he was Director of Administration and Corporate Services. His previous
experience included Corporate Information Systems Director at Otsuka, a Japanese
pharmaceutical company as well as an auditor and consultant at KPMG Peat
Marwick.
Neurex Corporation is developing products for acute care, principally in the
area of cardiorenal and neurological disease. Neurex' products under
development, CORLOPAM(R) (fenoldopam) and SNX-111, are currently in advanced
stage human trials. Each product has potential multiple indications. The
Company's strategy is to discover, develop and commercialize its products for
acute care treatment in hospital settings, such as emergency rooms, intensive
care units and pain clinics.
For further information contact: Paul Goddard, Ph.D.
Chairman and Chief Financial Officer
(415) 85301500
# # # # # # # # #
Exhibit 99.2
NEUREX CORPORATION
INDEMNIFICATION AGREEMENT
This INDEMNIFICATION AGREEMENT (the "Agreement") is entered into by and
between Neurex Corporation, a Delaware corporation (the "Corporation") and
_______________________ ("Indemnitee"):
RECITALS
WHEREAS, competent persons have become more reluctant to serve
publicly-held corporations as directors, officers, or in other capacities,
unless they are provided with protection from the risk of personal claims and
actions against them arising out of their service to and activities on behalf of
such corporations and the current impracticability of obtaining adequate
insurance and the uncertainties related to indemnification have further
increased the difficulty of attracting and retaining such persons; and
WHEREAS, the Corporation has therefore provided in its Certificate of
Incorporation that a director's liability to its stockholders for monetary
damages shall be eliminated to the fullest extent permissible under Delaware
law, and further has provided in its Bylaws that the Corporation will indemnify
its directors and officers against expenses, fines, judgments, settlements,
etc., to the maximum extent permitted by applicable law, and that it has the
power to advance expenses of litigation to its directors and officers, in
defense of such actions; and
WHEREAS, the Board of Directors of the Corporation (the "Board") has
determined that it is reasonable, prudent and necessary for the Corporation to
also obligate itself contractually to indemnify its officers, directors and
agents to the fullest extent permitted by applicable law, and the Certificate of
Incorporation and Bylaws of the Corporation, so that such persons will serve or
continue to serve the Corporation free from undue concern that they will not be
adequately indemnified against expenses resulting from their service; and
WHEREAS, Indemnitee desires to enter into this Agreement in order to
serve, continue to serve or to take on additional service for or on behalf of
the Corporation;
NOW, THEREFORE, in consideration of the premises and the covenants
contained herein, the Corporation and Indemnitee do hereby covenant and agree as
follows:
Section 1. Definitions. For purposes of this Agreement:
(a) "Corporate Status" means the status of a person who is or
was a director, officer, employee, agent or fiduciary of the Corporation or any
of its majority-owned subsidiaries or of any other corporation, partnership,
joint venture, trust, employee benefit plan or other enterprise which such
person is or was serving at the request of the Corporation.
(b) "Disinterested Director" means a director of the
Corporation who is not and was not a party to the Proceeding in respect of
which indemnification is sought by Indemnitee.
(c) "Expenses" means all reasonable attorneys' fees,
retainers, court costs, transcript costs, fees of experts, witness fees, travel
expenses, duplicating costs, printing and binding costs, telephone charges,
postage, delivery service fees, and all other disbursements or expenses of the
types customarily incurred in connection with prosecuting, defending, preparing
to prosecute or defend, investigating, or being or preparing to be a witness in
a Proceeding.
(d) "Independent Counsel" means a law firm, or a member of a
law firm, that is experienced in matters of corporation law and neither
presently is, nor in the past five years has been, retained to represent: (i)
the Corporation or Indemnitee in any other matter material to either such party,
or (ii) any other party to the Proceeding giving rise to a claim for
indemnification hereunder. Notwithstanding the foregoing, the term "Independent
Counsel" shall not include any person who, under the applicable standards of
professional conduct then prevailing, would have a conflict of interest in
representing either the Corporation or Indemnitee in an action to determine
Indemnitee's rights under this Agreement.
(e) "Proceeding" means any action, suit, arbitration,
alternate dispute resolution mechanism, investigation, administrative hearing or
any other proceeding, or threat of such proceeding, whether civil, criminal,
administrative or investigative, except one initiated by an Indemnitee pursuant
to Section 11 of this Agreement to enforce his or her rights under this
Agreement, brought or threatened to be brought in connection with Indemnitee's
service to or position in the Corporation.
Section 2. Services by Indemnitee. Indemnitee may at any time and for
any reason resign from any position (subject to any other contractual obligation
or any obligation imposed by operation of law), without affecting the
indemnification agreed to hereunder.
Section 3. Indemnification - General. This Agreement is a supplement to
and in furtherance of Article VI of the Amended and Restated Certificate of
Incorporation of the Corporation (the "Certificate") and rights granted under
the Certificate and the Bylaws of the Corporation and any resolutions adopted
pursuant thereto and shall not be deemed to be a substitute therefor nor to
diminish or abrogate any rights of Indemnitee thereunder. The Corporation shall
indemnify, and advance Expenses to, Indemnitee as provided in this Agreement to
the fullest extent permitted by applicable law in effect on the date hereof and
to such greater extent as applicable law may thereafter from time to time
permit. The rights of Indemnitee provided under the preceding sentence shall
include, but shall not be limited to, the rights set forth in the other sections
of this Agreement.
Section 4. Proceedings Other than Proceedings by or in the Right of the
Corporation. Indemnitee shall be entitled to the rights of indemnification
provided in this Section 4 if, by reason of his or her Corporate Status, he or
she is, or is threatened to be made, a party to any threatened, pending or
completed Proceeding, other than a Proceeding by or in the right of the
Corporation against him or her, or if he or she has initiated or participated in
a Proceeding approved by the Board of Directors. Pursuant to this Section 4,
Indemnitee shall be indemnified against Expenses, judgments, penalties, fines
and amounts paid in settlement actually and reasonably incurred by him or her or
on his or her behalf in connection with any such Proceeding or any claim, issue
or matter therein, unless he or she is determined in a final judicial
determination, from which there is no appeal, not to have acted in good faith
or, with respect to any criminal Proceeding, that he or she had no reasonable
cause to believe their conduct was lawful.
Section 5. Proceedings by or in the Right of the Corporation.
Indemnitee shall be entitled to the rights of indemnification provided in this
Section 5 if, by reason of his or her Corporate Status, he or she is, or is
threatened to be made, a party to any threatened, pending, or completed
Proceeding brought by or in the right of the Corporation to procure a judgment
in its favor. Pursuant to this Section 5, Indemnitee shall be indemnified
against Expenses, judgments, penalties, fines and amounts paid in settlement
actually and reasonably incurred by him or her or on his or her behalf in
connection with any such Proceeding if he or she prevails in the Proceeding, the
matter is terminated for whatever reason, or he or she is determined to have
acted in good faith and in a manner he or she reasonably believed to be in or
not opposed to the best interests of the Corporation. Notwithstanding the
foregoing, no indemnification against such Expenses, judgments, penalties, or
fines shall be made in respect of any claim, issue or matter in any such
Proceeding as to which Indemnitee shall have been finally adjudged to be liable
to the Corporation, in a decision from which there is no appeal, if applicable
law prohibits such indemnification, unless the Chancery Court of the State of
Delaware or the court in which such Proceeding shall have been brought or is
pending, shall determine that indemnification against Expenses may nevertheless
be made by the Corporation.
Section 6. Indemnification for Expenses of a Party Who is Wholly or
Partly Successful. Notwithstanding any other provision of this Agreement, to the
extent that Indemnitee is, by reason of his or her Corporate Status, a party to
and is successful, on the merits or otherwise, in any Proceeding, he or she
shall be indemnified against all Expenses actually and reasonably incurred by
him or her or on his or her behalf in connection therewith. If Indemnitee is not
wholly successful in such Proceeding but is successful, on the merits or
otherwise, as to one or more but less than all claims, issues or matters in such
Proceeding, the Corporation shall indemnify Indemnitee against all Expenses
actually and reasonably incurred by him or her or on his or her behalf in
connection with each successfully resolved claim, issue or matter. For the
purposes of this Section and without limiting the foregoing, the termination of
any claim, issue or matter in any such Proceeding by dismissal, with or without
prejudice, shall be deemed to be a successful result as to such claim, issue or
matter.
Section 7. Indemnification for Expenses of a Witness. Notwithstanding
any other provision of this Agreement, to the extent that Indemnitee is, by
reason of his or her Corporate Status, a witness in any Proceeding, he or she
shall be indemnified against all Expenses actually and reasonably incurred by
him or her or on his or her behalf in connection therewith, including reasonable
compensation for time expended by any Indemnitee who is not an employee of the
Corporation.
Section 8. Advancement of Expenses. The Corporation shall advance all
Expenses incurred by or on behalf of Indemnitee in connection with any
Proceeding within 20 days after the receipt by the Corporation of a statement or
statements from Indemnitee requesting such advance or advances from time to
time, whether prior to or after final disposition of such Proceeding. Such
statement or statements shall reasonably evidence the Expenses incurred by
Indemnitee and shall include or be preceded or accompanied by an undertaking by
or on behalf of Indemnitee to repay any Expenses advanced if it shall ultimately
be determined that Indemnitee is not entitled to be indemnified against such
Expenses. Further, notwithstanding the foregoing or any other provision of this
Agreement, the Corporation shall not be required to advance any expenses to
Indemnitee if the Corporation directly (i.e. not by way of a derivative or
shareholder suit) brings a claim against Indemnitee, in a proceeding, alleging
that Indemnitee has breached Indemnitee's duty of loyalty to the Corporation,
committed an act or omission not in good faith or that involves intentional
misconduct or a knowing violation of law, or derived an improper personal
benefit from any transaction with the Corporation.
Section 9.Procedure for Determination of Entitlement to Indemnification
(a) To obtain indemnification under this Agreement in
connection with any Proceeding, and for the duration thereof, Indemnitee shall
submit to the Corporation a written request, including therein or therewith such
documentation and information as is reasonably available to Indemnitee and is
reasonably necessary to determine whether and to what extent Indemnitee is
entitled to indemnification. The Secretary of the Corporation shall, promptly
upon receipt of any such request for indemnification, advise the Board in
writing that Indemnitee has requested indemnification.
(b) Upon written request by Indemnitee for indemnification
pursuant to Section 9(a) hereof, a determination, if required by applicable law,
with respect to Indemnitee's entitlement thereto shall be made in such case by
the Board by a majority vote of a quorum consisting of Disinterested Directors,
or if a quorum of the Board consisting of Disinterested Directors is not
obtainable, or even if such quorum is obtainable, if such quorum of
Disinterested Directors so directs, by Independent Counsel in a written opinion
to the Board, a copy of which shall be delivered to Indemnitee, if no such
action is taken, or as provided in Section 10(b) of this Agreement. If it is so
determined that Indemnitee is entitled to indemnification, payment to Indemnitee
shall be made within 20 days after such determination. Indemnitee shall
cooperate with the person, persons or entity making such determination with
respect to Indemnitee's entitlement to indemnification, including providing to
such person, persons or entity upon reasonable advance request any documentation
or information which is not privileged or otherwise protected from disclosure
and which is reasonably available to Indemnitee and reasonably necessary to such
determination. Any costs or expenses (including attorneys' fees and
disbursements) incurred by Indemnitee in so cooperating with the person, persons
or entity making such determination shall be borne by the Corporation
(irrespective of the determination as to Indemnitee's entitlement to
indemnification) and the Corporation hereby indemnifies and agrees to hold
Indemnitee harmless therefrom.
(c) If required, Independent Counsel shall be selected by the
Board, and the Corporation shall give written notice to Indemnitee advising him
or her of the identity of Independent Counsel so selected. Indemnitee may within
seven days after such written notice of selection shall have been given, deliver
to the Corporation, a written objection to such selection. Such objection may be
asserted only on the grounds that Independent Counsel so selected does not meet
the requirements of "Independent Counsel" as defined in Section 1 of this
Agreement, and the objection shall set forth with particularity the factual
basis of such assertion. If such written objection is made, Independent Counsel
so selected may not serve as Independent Counsel unless and until a court has
determined that such objection is without merit. If, within 20 days after
submission by Indemnitee of a written request for indemnification pursuant to
Section 9(a) hereof, no Independent Counsel shall have been selected and not
objected to, either the Corporation or Indemnitee may petition the Chancery
Court of the State of Delaware, or other court of competent jurisdiction, for
resolution of any objection which shall have been made by the Corporation or
Indemnitee to the other's selection of Independent Counsel and/or for the
appointment as Independent Counsel of a person selected by such court or by such
other person as such court shall designate, and the person with respect to whom
an objection is so resolved or the person so appointed shall act as Independent
Counsel under Section 9(b) hereof. The Corporation shall pay any and all
reasonable fees and expenses of Independent Counsel incurred by such Independent
Counsel in connection with its actions pursuant to this Agreement, and the
Corporation shall pay all reasonable fees and expenses incident to the
procedures of this Section 9(c), regardless of the manner in which such
Independent Counsel was selected or appointed. Upon the due commencement date of
any judicial proceeding or arbitration pursuant to Section 11(a)(iii) of this
Agreement, Independent Counsel shall be discharged and relieved of any further
responsibility in such capacity (subject to the applicable standards of
professional conduct then prevailing).
Section 10. Presumption and Effects of Certain Proceedings.
(a) In making a determination with respect to entitlement to
indemnification hereunder, the person or persons or entity making such
determination shall presume that Indemnitee is entitled to indemnification under
this Agreement if Indemnitee has submitted a request for indemnification in
accordance with Section 9(a) of this Agreement, and the Corporation shall have
the burden of proof to overcome that presumption in connection with the making
by any person, persons or entity of any determination contrary to that
presumption.
(b) If the person, persons or entity empowered or selected
under Section 9 of this Agreement to determine whether Indemnitee is entitled to
indemnification shall not have made a determination within 30 days after receipt
by the Corporation of the request therefor, the requisite determination of
entitlement to indemnification shall be deemed to have been made and Indemnitee
shall be entitled to such indemnification, absent (i) a misstatement by
Indemnitee of a material fact, or an omission of a material fact necessary to
make Indemnitee's statement not materially misleading, in connection with the
request for indemnification, or (ii) prohibition of such indemnification under
applicable law; provided, however, that such 30-day period may be extended for a
reasonable time, not to exceed an additional 30 days, if the person, persons or
entity making the determination with respect to entitlement to indemnification
in good faith require(s) such additional time for the obtaining or evaluating of
documentation and/or information relating thereto.
Section 11. Remedies of Indemnitee.
(a) In the event that (i) a determination not to indemnify has
been made pursuant to Section 9 of this Agreement, or (ii) advancement of
Expenses is not timely made pursuant to Section 8 of this Agreement, or (iii)
the determination of entitlement to indemnification is to be made by Independent
Counsel pursuant to Section 9(b) of this Agreement and such determination shall
not have been made and delivered in a written opinion within 60 days after
receipt by the Corporation of the request for indemnification, or (iv) payment
of indemnification is not made pursuant to Section 7 of this Agreement within 10
days after receipt by the Corporation of a written request therefor, or (v)
payment of indemnification is not made within 10 days after a determination has
been made that Indemnitee is entitled to indemnification or such determination
is deemed to have been made pursuant to Section 9 or 10 of this Agreement,
Indemnitee shall be entitled to an adjudication in the Chancery Court of the
State of Delaware, or in any other court of competent jurisdiction, of his or
her entitlement to such indemnification or advancement of Expenses.
Alternatively, Indemnitee, at his or her option, may seek an award in
arbitration to be conducted by a single arbitrator in Delaware. Indemnitee shall
commence such proceeding seeking an adjudication or an award in arbitration
within 180 days following the date on which Indemnitee first has the right to
commence such proceeding pursuant to this Section 11(a). The Corporation shall
not oppose Indemnitee's right to seek any such adjudication or award in
arbitration.
(b) In the event that a determination shall have been made
pursuant to Section 9 of this Agreement that Indemnitee is not entitled to
indemnification, any judicial proceeding or arbitration commenced pursuant to
this Section shall be conducted in all respects as a de novo trial or
arbitration on the merits and Indemnitee shall not be prejudiced by reason of
that adverse determination.
(c) If a determination shall have been made or deemed to have
been made pursuant to Section 9 or 10 of this Agreement that Indemnitee is
entitled to indemnification, the Corporation shall be bound by such
determination in any judicial proceeding or arbitration commenced pursuant to
this Section 11, absent (i) a misstatement by Indemnitee of a material fact, or
an omission of a material fact necessary to make Indemnitee's statement not
materially misleading, in connection with the request for indemnification, or
(ii) prohibition of such indemnification under applicable law.
(d) In the event that Indemnitee, pursuant to this Section 11,
seeks a judicial adjudication of, or an award in arbitration to enforce, his or
her rights under, or to recover damages for breach of, this Agreement,
Indemnitee shall be entitled to advancement of the expenses of such action under
Section 8 and shall be entitled to recover from the Corporation, and shall be
indemnified by the Corporation against, any and all expenses (of the kinds
described in the definition of Expenses) actually and reasonably incurred by him
or her in such judicial adjudication or arbitration, but only if he or she
prevails therein. If Indemnitee fails to prevail in all aspects of any action
under this Section 11(d) he or she shall promptly repay all Expenses advanced
under Section 8 in connection with such action. If Indemnitee prevails in any
aspects of such action, he or she shall retain all Expenses so advanced.
Section 12. Non-Exclusivity; Survival of Rights; Insurance; Subrogation.
(a) The rights of indemnification and to receive advancement
of Expenses as provided by this Agreement shall not be deemed exclusive of any
other rights to which Indemnitee may at any time be entitled under applicable
law, the Certificate or By-laws of the Corporation, any agreement, a vote of
stockholders or a resolution of directors, or otherwise. No termination of this
Agreement pursuant to Section 13 herein shall be effective as to any Indemnitee
with respect to any action taken or omitted by such Indemnitee in his or her
Corporate Status prior to such termination and he or she shall continue to be
fully indemnified for such actions or omissions in accordance with the terms of
this Agreement.
(b) In the event of any payment under this Agreement, the
Corporation shall be subrogated to the extent of such payment to all of the
rights of recovery of Indemnitee, who shall execute all papers required and take
all action necessary to secure such rights, including execution of such
documents as are necessary to enable the Corporation to bring suit to enforce
such rights.
(c) The Corporation shall not be liable under this Agreement
to make any payment of amounts otherwise indemnifiable hereunder if and to the
extent that Indemnitee has otherwise actually received such payment under any
insurance policy, contract, agreement or otherwise.
Section 13. Duration of Agreement. This Agreement shall be binding
upon the Corporation and its successors and assigns and shall inure to the
benefit of Indemnitee and his or her heirs, executors and administrators.
Section 14. Severability. If any provision or provisions of this
Agreement shall be held to be invalid, illegal or unenforceable for any reason
whatsoever: (a) the validity, legality and enforceability of the remaining
provisions of this Agreement (including, without limitation. each portion of any
section of this Agreement containing any such provision held to be invalid,
illegal or unenforceable, that is not itself invalid, illegal or unenforceable)
shall not in any way be affected or impaired thereby; and (b) to the fullest
extent possible, the provisions of this Agreement (including, without
limitation, each portion of any section of this Agreement containing any such
provision held to be invalid, illegal or unenforceable, that is not itself
invalid, illegal or unenforceable) shall be construed so as to give effect to
the intent manifested by the provision held invalid, illegal or unenforceable
Section 15. Identical Counterparts. This Agreement may be executed in
one or more counterparts, each of which shall for all purposes be deemed to be
an original but all of which together shall constitute one and the same
Agreement. Only one such counterpart signed by the party against whom
enforceability is sought needs to be produced to evidence the existence of this
Agreement.
Section 16. Headings. The headings of the paragraphs of this Agreement are
inserted for convenience only and shall not be deemed to constitute part of this
Agreement or to affect the construction thereof.
Section 17. Modification and Waiver. No supplement, cancellation,
modification or amendment of this Agreement shall be binding unless executed in
writing by both of the parties hereto. No waiver of any of the provisions of
this Agreement shall be deemed or shall constitute a waiver of any other
provisions hereof (whether or not similar) nor shall such waiver constitute a
continuing waiver.
Section 18. Notice by Indemnitee. Indemnitee agrees promptly to notify
the Corporation in writing upon being served with any summons, citation,
subpoena, complaint, indictment, information or other document relating to any
Proceeding or matter which may be subject to indemnification or advancement of
Expenses covered hereunder.
Section 19. Notices. All notices, requests, demands and other
communications hereunder shall be in writing and shall be deemed to have been
duly given if (i) delivered by hand and receipted for by the party to whom such
notice or other communication shall have been directed, or (ii) mailed by
certified or registered mail with postage prepaid, on the third business day
after the date on which it is so mailed to Indemnitee at his or her address set
forth in the Corporation's records and to the Corporation at its principal
executive offices, or to such other address as may have been furnished to
Indemnitee by the Corporation or to the Corporation by Indemnitee, as the case
may be.
Section 20. Governing Law. The parties agree that this Agreement shall be
governed by, and construed and enforced in accordance with, the laws of the
State of Delaware.
Section 21. Miscellaneous. Use of the masculine pronoun shall be deemed to
include usage of the feminine pronoun where appropriate.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the day and year first above written.
[COMPANY]
By: _______________________________
Title: _____________________________
INDEMNITEE
----------------------------------
Exhibit 99.3
Please review the following terms and conditions for participation in
Neurex Corporation's (the "Company") Systematic Stock Sales Program (the
"Program"). If you elect to participate in the Program, please complete and sign
the attached Participation Agreement and return it to the Company's Chief
Financial Officer ( the "Program Administrator").
NEUREX CORPORATION
SYSTEMATIC STOCK SALES PROGRAM
TERMS AND CONDITIONS
1. Eligible Participants and Participation Period
(a) All executive officers of the Company, or members of its Board of
Directors (the "Participant(s)") who have held their positions with the
Company for a period of one year, and have not within the 6 (six) months
immediately preceding the first sale transaction date under the Program,
executed a purchase of Company issued securities, other than purchases
described in Section 6(b)(1) & (2) below, are eligible to participate in
the Program.
(b) The term "executive officer" is defined only to include the
Company's Chairman of the Board, President, Vice-Presidents, Secretary,
Chief Financial Officer and Treasurer.
(c) Participation in the Program must continue uninterrupted for the
12 (twelve) consecutive calendar months beginning the month following the
month of enrollment unless and until written notice is provided to the
Program Administrator under the conditions provided in Section 5(b).
2. Enrollment Requirements and Procedures
(a) Enrollment in the Program is voluntary.
(b) The open enrollment period is the month of July.
(c) Enrollment requires submission to the Program
Administrator of a fully executed Participation
Agreement.
3. Designation of the Type and Number of Shares to be Enrolled
in Total and Sold per Calendar Month
(a) Each Participant must enroll a block of no less than 1200 (twelve
hundred) shares of Company stock to be sold under the Program during the 12
(twelve) calendar month minimum participation period. The number of shares
enrolled may be reduced at the sole discretion of the Company's Chief
Executive Officer if he or she believes that the sale of such volume of
shares will significantly affect the Company's stock price.
(b) The number designated must be the same for each calendar month and
cannot total, for the 3 (three) consecutive calendar month periods
preceding each sale, more than the greater of one percent of the shares of
common stock outstanding or the average weekly trading volume of such stock
over the four calendar weeks immediately preceding each monthly sales
transaction date.
4. Designated Date that Sales Transactions are to be Executed
(a) Sales transactions under the Program shall be executed on the last
business day of each calendar month (the "Sale Date"), commencing in August
of each year, unless such day is less than ten business days after the
filing of the Company's Form 10-Q or 10-K or less than five business days
after the Company's release of extraordinary information or other news
announcement, in which case the Sale Date will be the next business day
following the expiration of these time periods. The Participant shall make
all sales through the brokerage firm selected by the Program Administrator
(the "Brokerage Firm") and shall furnish the Brokerage Firm with the shares
necessary to make each sale within at least 30 (thirty) days of the
expected Sale Date.
(b) If the Brokerage Firm is unable to sell at the prevailing market
"bid" price (the "Bid Price") all shares designated to be sold on a
particular Sale Date, then such Brokerage Firm shall sell each
Participant's shares on a pro-rata basis and execute additional sales
transactions on as many successive business days as are necessary to sell
all such shares at the same Bid Price as sales executed on the Sale Date,
provided that any such business day does not fall within the prohibited
time periods specified in subsection (a) above or the quantity of shares
sold does not exceed that specified in Section 3(b)(2) above. If all shares
designated to be sold on the Sale Date cannot be sold prior to the next
Sale Date at the Bid Price, then the remaining shares will be held and sold
on the next scheduled Sale Date at the then prevailing new Bid Price, and
so on, until all the shares are sold. This process shall be repeated from
month to month if necessary.
5. Discretionary Withdrawals from the Program
(a) Discretionary withdrawals from the Program will not be permitted
during the designated Program period.
(b) Early termination will be permitted only upon separation from the
Company, liquidation of all of the terminating Participant's Company common
stock holdings, a Company merger, or the sale of the Company or
substantially all of its assets.
6. Securities & Exchange Commission ("SEC") Compliance Requirements
(a) SEC Forms 4 and 5 must be filed on a regular basis to
report the systematic change in the Participants'
securities holdings by the 10th day following the
close of each month of Program participation.
(b) While participating in the Program, Participants will
be prohibited under Section 16(b) of the securities
laws from purchasing any security issued by he
Company except that during the participation period,
Participants may:
(1) purchase such securities through the
Company's Employee Stock Purchase
Plan provided those securities are
held for a period of six months from
the date of such purchase; and
(2) exercise options granted pursuant
to a properly exempted Company
stock option plan.
<PAGE>
NEUREX CORPORATION
SYSTEMATIC STOCK SALES PROGRAM
PARTICIPATION AGREEMENT
I, _____________, certify that I am eligible to participate in Neurex
Corporation's Systematic Stock Sales Program (the "Program") and that I have
read and agree to all of the Terms and Conditions of the Program. I hereby elect
to participate in the Program and enroll for such participation the following
block of _______ shares of Neurex Corp. stock (the "Shares") which are legally
held by me and over which I hold full and sole authority with regard to sales or
other disposition. I understand that once enrolled for participation in the
Program, the Shares may not be withdrawn from the Program for a period of at
least 12 (twelve) consecutive calendar months beginning with the first full
calendar month following the effective date of this Agreement, except as
provided in the Terms and Conditions of the Program.
- --------------------------------- -------------- -------------
Participant Position Date
- --------------------------------- --------------
Program Administrator Date
- --------------------------------- --------------
Broker Date
<PAGE>
NEUREX CORPORATION
SYSTEMATIC STOCK SALES PROGRAM
BROKERAGE FIRM GUIDELINES
Pursuant to the Neurex Corporation Systematic Stock Sales Program (the
"Program"), a copy of which is attached as Appendix A, the Brokerage Firm (the
"Firm"), as authorized by the Program Administrator will execute all sales
transactions subject to the following guidelines:
1. Each Program Participant will enroll a block of no less than 1200
(twelve hundred) shares of Company stock to be sold under the Program
during the 12 (twelve) calendar month minimum Program participation period.
2. Each Participant will designate the number of shares from the
enrolled block to be sold per calendar month of participation. The number
designated will be the same for each calendar month and will not: total,
for the 3 (three) consecutive calendar month periods preceding each sale,
more than the greater of one percent of the shares of common stock
outstanding or the average weekly trading volume of such stock over the
four calendar weeks immediately preceding each monthly sales transaction
date.
3. All Sales transactions under the Program must be executed on the
last business day of each calendar month (the "Sale Date") unless such day
is less than ten business days after the filing of the Company's Form 10-Q
or 10-K or less than five business days after the Company's release of
extraordinary information or other news announcement, in which case the
Sale Date will be the next business day following the expiration of these
time periods. The Program Administrator will inform the firm of any such
adjustment to the Sale Date. If the Firm is unable to sell at the
prevailing market "bid" price all shares designated to be sold on a
particular Sale Date, then the Firm shall sell each Participant's shares on
a pro rata basis and shall execute additional sales transactions on as many
successive business days as are necessary to sell all such shares at the
same market "bid" price for sales executed on the Sale Date, provided that
any such business day does not fall within the prohibited time periods
specified above and the quantities sold do not exceed those specified
above. If all shares designated to be sold on the Sale Date cannot be sold
prior to the next Sale Date at the same market "bid" price, then the
remaining shares must be held and sold on the next scheduled Sale Date at
the new bid price, if possible, and this process shall be continued from
month to month, if necessary.
4. Discretionary withdrawals from the Program will not be permitted
during the designated Program period. Early termination by any Participant
will be permitted only upon separation from the Company or liquidation of
all of the terminating Participant's Company common stock holdings. The
Firm will be informed in writing by the Program Administrator or the sale
or merger of the Company in the event of either Participant or Program
termination. The Firm shall accept instructions regarding the Program only
from the Program Administrator, and such instruction shall be binding.
