As filed with the Securities and Exchange Commission on April 25, 1997
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
HUMAN GENOME SCIENCES, INC.
(Exact name of registrant as specified in its charter)
DELAWARE
(State or other jurisdiction of incorporation or organization)
22-3178468
(I.R.S. employer identification no.)
9410 KEY WEST AVENUE, ROCKVILLE MARYLAND 20850-3338
(Address of principal executive offices) (Zip code)
HUMAN GENOME SCIENCES, INC. 1994 STOCK OPTION PLAN
(Full title of the plan)
WILLIAM A. HASELTINE, PH.D.
HUMAN GENOME SCIENCES, INC.
9410 KEY WEST AVENUE
ROCKVILLE, MARYLAND 20850-3338
(Name and address of agent for service)
(301) 309-8504
(Telephone number, including area code, of agent for service)
Copy to:
Sheldon E. Misher
Steven A. Fishman, Esq.
Bachner, Tally, Polevoy & Misher LLP
380 Madison Avenue
New York, New York 10017
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
========================================================================================================================
Proposed Proposed
Maximum Maximum
Offering Aggregate Amount of
Title of Each Class of Amount to Price Per Offering Registration
Securities to be Registered be Registered(1) Share(2) Price Fee
- --------------------------- ---------------- -------- ----- ---
Common Stock,
<S> <C> <C> <C> <C>
$.01 par value 2,500,000 $32.50 $81,250,000 $24,621.21
</TABLE>
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(1) Includes 1,000,000 shares issuable pursuant to an amendment to the 1994
Stock Option Plan which was approved by the Company's Board of
Directors or January 21, 1997 and is subject to stockholder approval.
Pursuant to Rule 416, promulgated under the Securities Act of 1933, as
amended, an additional undeterminable number of shares of Common Stock
is being registered to cover any adjustment in the number of shares of
Common Stock pursuant to the anti-dilution provisions of the 1994 Stock
Option Plan.
(2) Estimated in accordance with Rule 457(h) solely for the purpose of
calculating the registration fee. The price shown is the average of the
high and low price of the Common Stock on April 22, 1997 as reported on
Nasdaq.
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The documents containing the information specified in Part I
will be sent or given to employees as specified by Rule 428(b)(1). In accordance
with the instructions to Part I of Form S-8, such documents will not be filed
with the Commission either as part of this registration statement or as
prospectuses or prospectus supplements pursuant to Rule 424.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
The documents listed below are hereby incorporated by
reference into this Registration Statement. In addition, all documents
subsequently filed by Human Genome Sciences, Inc. (the "Registrant") pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934
(prior to the filing of a post-effective amendment which indicates that all
securities offered have been sold or which deregisters all securities then
remaining unsold) shall be deemed to be incorporated by reference in this
Registration Statement and to be a part hereof from the date of filing such
documents:
(i) the Registrant's Annual Report on Form 10-K
for the fiscal year ended December 31, 1996,
including any documents or portions thereof
incorporated by reference therein;
(b) None;
(c) the Registrant's Registration Statement on
Form 8-A filed with the Securities and
Exchange Commission on November 2, 1993,
including any amendment or supplement thereto.
Item 6. Indemnification of Directors and Officers
The Certificate of Incorporation and By-Laws of the Company
provide that the Company shall indemnify any person to the full extent permitted
by the Delaware General Corporation Law (the "GCL").
In accordance with Section 102(b)(7) of the GCL, the
Certificate of Incorporation of the Company eliminates the personal liability of
directors to the Company or its stockholders for monetary damages for breach of
fiduciary duty as a director with certain limited exceptions set forth in
Section 102(b)(7).
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The Company has obtained and maintains a policy of insurance
with a face amount of $10,000,000 (subject to certain deductible provisions and
exclusions) covering its officers and directors and indemnifying them against
loss on account of claims made against them, including, but not limited to,
damages, judgments, costs and the costs of defense of such claims, arising from
breach of duty, neglect, error, negligent misrepresentations, omission or act,
or any claim arising solely by reason of status as an officer or director.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933, as amended (the "1933 Act"), may be permitted to
directors, officers or persons controlling the Company pursuant tot the
foregoing provisions, the Company has been informed that, in the opinion of the
Securities and Exchange Commission, such indemnification is against public
policy as expressed in the 1933 Act and is therefore unenforceable.
Item 8. Exhibits
4 Human Genome Sciences, Inc. 1994 Stock Option
Plan, as amended
5 Opinion of Bachner, Tally, Polevoy & Misher
LLP with respect to the legality of the Common
Stock to be registered hereunder
23.1 Consent of Ernst & Young LLP, Independent
Auditors
23.2 Consent of Richard A. Eisner & Company LLP,
Independent Auditors
23.3 Consent of Bachner, Tally, Polevoy & Misher
LLP (contained in Exhibit 5)
24 Power of Attorney (included on signature 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 the
Registration Statement (or the most recent
post-effective amendment thereof) which,
individually or in the
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aggregate, represent a fundamental change in
the information set forth in the Registration
Statement;
(iii) To include any material information with
respect to the plan of distribution not
previously disclosed in the Registration
Statement or any material change to such
information in the Registration Statement;
(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 Section
15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing
of an employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(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 as described above, 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
Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, 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 Act and will
be governed by the final adjudication of such issue.
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-8 and has duly caused this
registration statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Rockville, State of Maryland, on the 23rd day of
April, 1997.
HUMAN GENOME SCIENCES, INC.
By: /s/ William A. Haseltine, Ph.D.
---------------------------------
William A. Haseltine, Ph.D.
Chairman and Chief Executive
Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below under the heading "Signature" constitutes and appoints William A.
Haseltine, Ph.D. and Melvin D. Booth, his true and lawful attorney-in-fact and
agent with full power of substitution and resubstitution, for him and in his
name, place and stead, in any and all capacities to sign any or all amendments
to this registration statement, and to file the same, with all exhibits thereto
and other documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, each acting alone,
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 for all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, each acting alone, or his
substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
- --------- ----- ----
/s/ William A. Haseltine, Ph.D. Chairman of the Board April 23, 1997
- --------------------------------- and Chief Executive
William A. Haseltine, Ph.D. Officer (principal
executive officer)
/s/ Melvin D. Booth President and Chief April 23, 1997
- --------------------------------- Operating Officer and
Melvin D. Booth Director
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/s/ Craig A. Rosen, Ph.D. Senior Vice President April 23, 1997
- --------------------------------- -- Research and
Craig A. Rosen, Ph.D. Development and
Director
/s/ Bradley G. Lorimier Senior Vice President April 23, 1997
- --------------------------------- -- Business Development
Bradley G. Lorimier and Director
/s/ Steven Mayer Senior Vice President and April 23, 1997
- --------------------------------- Chief Financial Officer
Steven Mayer (principal financial
and accounting officer)
/s/ Robert A. Armitage Director April 23, 1997
- ---------------------------------
Robert A. Armitage
Director ________, 1997
- ---------------------------------
James H. Cavanaugh, Ph.D.
/s/ Beverly Sills Greenough Director April 23, 1997
- ---------------------------------
Beverly Sills Greenough
/s/ Donald D. Johnston Director April 23, 1997
- ----------------------------------
Donald D. Johnston
/s/ Max Link, Ph.D. Director April 23, 1997
- ---------------------------------
Max Link, Ph.D.
- --------------------------------- Director ________, 1997
Joshua Ruch
/s/ Robert Hormats Director April 23, 1997
- ---------------------------------
Robert Hormats
/s/ James B. Wyngaarden, M.D. Director April 23, 1997
- ---------------------------------
James B. Wyngaarden, M.D.
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1994 STOCK OPTION PLAN OF HUMAN GENOME SCIENCES, INC.
(AS AMENDED)
I. GENERAL PROVISIONS
1.1 PURPOSES OF THE PLAN
Under this 1994 Stock Option Plan of Human Genome Sciences, Inc. (the
"Plan"), Human Genome Sciences, Inc. (the "Company") will grant options to
eligible employees, consultants, and other service providers to purchase shares
of the capital stock of the Company. The Plan is designed to enable the Company
to attract, retain, and motivate its employees and service providers by
providing for or increasing their proprietary interests in the Company. The
options issued pursuant to the Plan are intended to constitute either Incentive
Stock Options or Nonqualified Stock Options as determined by the Committee and
specified in the recipient's option agreement.
1.2 DEFINITIONS
(a) "Board" means the Board of Directors of Human Genome Sciences, Inc.
(b) "Code" means the Internal Revenue Code of 1986, as amended.
(c) "Committee" means the Executive Compensation Committee of the
Board, or such other committee as may be appointed by the Board for purposes of
administering all or a portion of this Plan.
(d) "Common Stock" means the common stock, par value $0.01 per share,
of Human Genome Sciences, Inc.
<PAGE>
(e) "Company" means Human Genome Sciences, Inc., a Delaware
corporation.
(f) "Date of Exercise" means the date the Optionee delivers to the
Secretary of the Company or his office the notice specified in Section
2.6(a)(i).
(g) "Date of Grant" means the date as of which the Committee awards an
Option to an Optionee, as specified in the minutes of the Committee.
(h) "Employee" means any regular full-time common law employee,
including any who are also officers or directors, of the Company or any
successor to such corporation or other business. Solely for purposes of
determining eligibility of persons to be recipients of Nonqualified Stock Option
grants, the term "Employee" shall also include independent contractors and
outside directors of and consultants to the Company.
(i) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
(j) "Exercise Price" means the value of the consideration required
under an Option Agreement to be provided in exchange for one share of Common
Stock.
(k) "Fair Market Value" of a share of Common Stock as of a given date
means (1) the closing price of a share of Common Stock on the principal exchange
on which Common Stock is then trading, if any, on the trading day before such
date, or, if no shares were traded on the trading day before such date, then on
the next preceding trading day during which a sale occurred; or (2) if such
stock is not traded on an exchange but is quoted on NASDAQ or a successor
quotation system, (A) the last sales price (if the stock is then listed as a
National Market Issue under the NASD National Market System) or (B) the mean
between the closing representative bid and asked prices (in all other cases) for
the stock on the trading day before such date as reported by NASDAQ or such
successor quotation system; or (C) if such stock is not publicly traded on an
exchange and not quoted on NASDAQ or a successor quotation system,
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the mean between the closing bid and asked prices for the stock on the trading
day before such date, as determined in good faith by the Committee; or (4) if
Common Stock is not publicly traded, the fair market value established by the
Committee acting in good faith.
(l) "Incentive Stock Option" means an Option that is an "incentive
stock option" within the meaning of Section 422 of the Code.
(m) "Nonqualified Stock Option" means an Option that does not qualify
as an incentive stock option under Section 422 of the Code.
(n) "Option" means a right to purchase Common Stock granted under the
Plan.
(o) "Option Agreement" means a written agreement executed by the
Optionee and the Company that contains the terms and conditions provided in
Article II and such additional terms and conditions, consistent with the Plan,
as the Committee may decide.
(p) "Optionee" means any Employee selected to receive Options pursuant
to Section 2.1 or, where the context requires, a person described in Section
2.4.
(q) "Plan" means the Company's 1994 Stock Option Plan as set forth
herein, as amended from time to time.
(r) "Rule 16b-3" means Rule 16b-3 promulgated under Section 16 of the
Exchange Act.
(s) "Termination of Employment" shall mean the time when the
employer-employee or other service-providing relationship between the Optionee
and the Company terminates for any reason, including death, disability, or
retirement. Notwithstanding the foregoing and unless otherwise provided in the
Option Agreement, "Termination of Employment" for purposes of Nonqualified Stock
Options shall not include instances in which the Company immediately
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rehires a common law employee as an independent contractor or an independent
contractor as an employee. The Committee, in its sole discretion, shall
determine all questions of whether particular terminations or leaves of absence
are Terminations of Employment.
1.3 SHARES OF COMMON STOCK SUBJECT TO THE PLAN
(a) Subject to the provisions of Sections 1.3(c) and 3.1 (pertaining to
corporate changes), the aggregate number of shares of Common Stock that may be
issued pursuant to Options may not exceed 3,450,000 shares.
(b) At the discretion of the Board or the Committee, the Common Stock
to be issued pursuant to Options under the Plan will be made available either
from authorized but unissued shares of Common Stock or from previously issued
shares of Common Stock reacquired by the Company, including shares purchased on
the open market.
(c) If any Option expires, is canceled, or terminates for any reason,
the shares of Common Stock available under such Option shall again be available
for the granting of Options to the extent consistent with Rule 16b-3.
1.4 ADMINISTRATION OF THE PLAN
(a) The Committee, which will administer the Plan, will consist of two
or more members of the Board who are appointed by the Board, who are
"non-employee directors" within the meaning of Rule 16b-3, and who are "outside
directors" for purposes of Section 162(m) of the Code.
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(b) Subject to the express provisions of the Plan, the Committee has
and may exercise such powers and authority of the Board as may be necessary or
appropriate for the Committee to carry out its functions as described in the
Plan.
(c) The Committee has the authority to interpret the Plan, to make all
other determinations necessary or advisable for the administration of the Plan,
and to prescribe, amend, and rescind reasonable rules and regulations relating
to the Plan. All Committee interpretations, determinations, and actions will be
final, conclusive, and binding upon all parties. The Committee shall take all
actions in connection with the administration of the Plan pursuant to a majority
vote or by the unanimous written consent of its members.
(d) No member of the Board, the Committee, or the agents thereof will
be liable for any action, inaction, or determination made in good faith with
respect to the Plan or any transaction arising under the Plan.
II. OPTION TERMS AND CONDITIONS
2.1 AUTHORITY TO GRANT OPTIONS
(a) The Committee shall, in its sole discretion, select the Employees
who receive Options and determine the terms of such Options, including the
number of shares of Common Stock subject to an Option, the schedule for
exercisability (including any requirements for satisfying performance criteria
with respect to the Company and/or the Optionee), the time and conditions for
expiration of the Option, and the form of payment due upon exercise. (In
determining the type of payment that may be used, the Committee shall consider
whether the acceptance of that form of payment will likely benefit the Company.)
The Committee may grant more than one Option to an Employee, provided the
Employee is eligible under the terms of the Plan at the time of each succeeding
grant. In its discretion, the Committee may condition the granting of Options
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upon the Employee's cancellation of all or part of a previously granted Option.
The Committee may set the Exercise Price of the Options without regard to any
existing Options.
(b) No more than 500,000 shares of Common Stock may be subject to
Options granted to a single Employee under this Plan within a one calendar year
period. If a portion of an Option is repriced, the number of shares subject to
that portion shall be counted against the foregoing individual limit. Canceled
options shall be counted against the limit for the period during which they were
granted.
(c) No Options shall be granted more than ten (10) years after the date
on which the Board adopts this Plan.
(d) Directors of the Company who are not employees of the Company
("Eligible Directors") will receive an option ("Director Option") to purchase
10,000 shares of Common Stock on the date that such person is first elected or
appointed a director ("Initial Director Option"). Commencing on the day
immediately following the date of the annual meeting of stockholders for the
Company's fiscal year ending December 31, 1996, each Eligible Director will
receive an automatic grant ("Automatic Grant") of a Director Option to purchase
2,000 shares of Common Stock on the day immediately following the date of each
annual meeting of stockholders, as long as such director is a member of the
Board of Directors. The exercise price for each shares subject to a Director
Option shall be equal to the fair market value of the Common Stock on the date
of grant. Initial Director Options shall become exercisable in five equal annual
installments commencing one year from the date the option is granted and
Automatic Grants will become exercisable in full on the first anniversary of the
date of grant or 90 days after the termination of the director's association
with the Company.
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2.2 OPTION AGREEMENT
The terms of each Option shall be contained in an Option Agreement,
signed by the Optionee, that includes such terms and conditions consistent with
the Plan and Rule 16b-3 as the Committee may in its discretion determine
necessary or advisable.
2.3 EXERCISE PRICE
The Committee shall determine the Exercise Price under each Option, but
the Exercise Price may not be less than 100 percent (100%) of the Fair Market
Value on the Date of Grant. If an Option intended to be an Incentive Stock
Option is granted to any Employee who, at the Date of Grant, owns Common Stock
possessing more than 10 percent (10%) of the total combined voting power of all
classes of the Company's stock (or the stock of any "subsidiary" or "parent" of
the Company as those terms are defined in Section 424 of the Code), the Exercise
Price shall be no less than 110 percent (110%) of the Fair Market Value on the
Date of Grant.
2.4 PERSON WHO MAY EXERCISE OPTIONS
During the lifetime of the Optionee, only the Optionee or his duly
appointed guardian or personal representative may exercise the Options. After
his death, any exercisable portion of an Option may, before such portion becomes
unexercisable under the Plan or the applicable Option Agreement, be exercised by
the personal representative of the Optionee or by any person empowered to do so
under the deceased Optionee's will or under the then applicable laws of descent
and distribution.
2.5 EXERCISABILITY
(a) Options granted pursuant to this Plan shall be exercisable at such
times and under such conditions as shall be determined by the Committee;
provided, however, that no portion of
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an Option shall be exercisable after the expiration of ten (10) years from its
Date of Grant and that no portion of an Incentive Stock Option granted to any
Employee who, at the Date of Grant, owns stock possessing more than 10 percent
(10%) of the total combined voting power for all classes of the Company's stock
(or the stock of any "subsidiary" or "parent" of the Company as those terms are
defined in Section 424 of the Code) shall be exercisable after the expiration of
five (5) years from the Date of Grant.
(b) Subject to the provision of Section 3.7 (relating to shareholder
approval), Options shall become exercisable at such times and in such manner as
the Option Agreement may provide; provided, however, that by a resolution
adopted after an Option Agreement is entered into, the Committee may, on such
terms and conditions as it determines appropriate, and subject to Section 3.7,
accelerate the time at which the Optionee may exercise any portion of an Option.
(c) No portion of an Option that is unexercisable by reason of
Termination of Employment shall thereafter become exercisable, unless the Option
Agreement provides otherwise.
(d) The Company will not issue fractional shares pursuant to the
exercise of an Option, but the Committee may, in its discretion, direct the
Company to make a cash payment instead of issuing fractional shares.
2.6 EXERCISE OF OPTIONS
(a) An Optionee shall exercise any portion of an Option by delivering
the notice described in Paragraph (1) below to the Secretary of the Company or
his office on or before the date such portion of the Option becomes
unexercisable under the applicable Option Agreement or the Plan and making
payment as provided in Paragraph (2) within three (3) business days after such
delivery:
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(1) A written notice of exercise, in a form complying with any
rules the Committee may issue, that is signed by the Optionee and that
specifies the number of shares of Common Stock underlying the portion
of the Option being exercised; and
(2) Full payment by cashier's or certified check of the Exercise
Price for the shares of Common Stock with respect to which the Option
is being exercised.
(b) The Optionee shall also deliver to the Committee such
representations and documents as the Committee, in its sole discretion, may
consider necessary or advisable in order to comply with applicable provisions of
the Securities Act of 1933 and any other Federal or state securities or other
laws or regulations. The Committee may, in its sole discretion, take whatever
additional actions it deems appropriate to so comply including, without
limitation, placing legends on certificates and issuing stop-transfer orders to
transfer agents and registrars.
(c) If someone other than the Employee exercises any portion of an
Option pursuant to Section 2.4, the Committee may request such proof as it may
consider necessary or appropriate of the right of such person to exercise the
Option.
(d) No adjustment will be made for a dividend or other right for which
the record date precedes the Date of Exercise, except as provided in Section
3.1(a).
2.7 TAX WITHHOLDING
The Optionee must deliver to the Company the payment by cashier's or
certified check to the Company of all amounts that the Company must withhold
under Federal, state, or local law in connection with the exercise of the Option
if the Company cannot, or decides not to, satisfy withholding obligations
through additional withholding on salary or wages. Payment of withholding
obligations is due at the same time as is payment of the Exercise Price.
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2.8 EXPIRATION OF OPTIONS
(a) No one may exercise an Option after the expiration of ten (10)
years from the Date of Grant or, if earlier and unless otherwise provided in an
Option Agreement for a Nonqualified Stock Option, the first to occur of the
following events:
(1) Except in the case of any Optionee who is disabled (within
the meaning of Section 22(e)(3) of the Code), the expiration of three
months from the date of the Optionee's Termination of Employment for
any reason other than the Optionee's death unless the Optionee dies
within that three-month period;
(2) In the case of an Optionee who is disabled (within the
meaning of Section 22(e)(3) of the Code), the expiration of one year
from the date of the Optionee's Termination of Employment for any
reason other than such Optionee's death unless the Optionee dies
within that one-year period; or
(3) The expiration of one year from the date of the Optionee's
death.
(b) Subject to the provisions of Section 2.8(a), the Committee may
provide in the terms of an Option Agreement that any portion of the Option,
whether then exercisable or not, expires immediately upon a Termination of
Employment or that any portion of the Option shall become exercisable in the
event of a Termination of Employment because of the Optionee's retirement,
death, or disability.
2.9 TRANSFER RESTRICTIONS
Unless otherwise approved in writing by the Committee, no one may sell,
assign, pledge, encumber, or otherwise transfer shares acquired upon exercise of
any Option until at least six months have elapsed from (but excluding) the Date
of Grant. (Solely for purposes of this
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Section, the Date of Grant occurs upon the later of the Date of Grant (as
defined in Section 1.2(g)) or the date as of which the shareholders of the
Company approve the Plan pursuant to Section 3.7.) The Committee, in its
absolute discretion, may impose such other restrictions on the transferability
of the shares purchasable upon the exercise of an Option as it deems
appropriate. The Option Agreement shall set forth any such other restriction,
and the certificates evidencing such shares may refer to such restrictions.
2.10 $100,000 LIMIT FOR INCENTIVE STOCK OPTIONS
No portion of an Option granted to an Optionee shall be treated as an
Incentive Stock Option to the extent such portion of an Option would cause the
aggregate Fair Market Value of all shares with respect to which Incentive Stock
Options are exercisable by such Optionee for the first time during any calendar
year to exceed $100,000. For purposes of determining whether an Incentive Stock
Option would cause such aggregate Fair Market Value to exceed the $100,000
limitation, all such Incentive Stock Options shall be taken into account in the
order granted and the Fair Market Value for each share under an option shall be
determined as of that option's date of grant. For purposes of this section,
Incentive Stock Options include all incentive stock options under all plans of
the Company that are "incentive stock option plans" within the meaning of
Section 422 of the Code.
2.11 NO EXERCISE OF OUT-OF-THE-MONEY OPTIONS
An Optionee may not exercise any portion of an Option while that
portion of the Option is out-of-the-money, i.e., while the exercise price for a
share of Common Stock underlying that portion of the Option exceeds the Fair
Market Value of a share of Common Stock.
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III. OTHER PROVISIONS
3.1 ADJUSTMENT PROVISIONS
(a) Subject to any required action by the Company (which shall be
promptly taken) or its shareholders, and subject to the provisions of the
Delaware General Corporation Law, if the outstanding Common Stock are increased
or decreased or changed into or exchanged for a different number or kind of
security by reason of any recapitalization, reclassification, stock split,
reverse stock split, combination of shares, exchange of shares, stock dividend,
or other distribution payable in capital stock, or other increase or decrease in
such Common Stock is effected without receipt of consideration by the Company
occurring after the Date of Grant of an Option, a proportionate and appropriate
adjustment shall be made in the number of shares of Common Stock underlying the
Option, so that the proportionate interest of the Optionee immediately following
such event shall, to the extent practicable, be the same as immediately before
such event. A commensurate change will be made in the maximum number and kind of
shares provided in Section 1.3(a) and 2.1(b). Any such adjustment in an Option
shall not change the total price with respect to shares of Common Stock
underlying the unexercised portion of the Option but shall include a
corresponding proportionate adjustment in the Option's Exercise Price.
(b) In addition to the adjustments covered under Section 3.1(a) above,
any Option grant may contain provisions to the effect that upon the occurrence
of certain events, including a change in control of the Company (as defined by
the Committee in the Optionee's Option Agreement), any outstanding Options not
theretofore exercisable or free from restrictions, as the case may be, shall
either immediately, or upon a further determination made by the Committee at the
time of the event, become fully exercisable or free from restrictions.
(c) The Committee will make adjustments and determinations under
Sections 3.1(a) and 3.1(b), and its determination will be final, binding, and
conclusive.
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<PAGE>
(d) Upon the dissolution or liquidation of the Company, or upon a
reorganization, merger, or consolidation of the Company as a result of which the
outstanding securities of the class of securities then subject to the Options
are changed into or exchanged for cash or property or securities not of the
Company's issue, or any combination thereof, or upon a sale of substantially all
the property of the Company to, or the acquisition of shares of Common Stock
representing more than eighty percent (80%) of the voting power of the shares of
Common Stock then outstanding by, another corporation or person, the Options
shall terminate, unless provision be made in writing in connection with such
transaction for the assumption of Options theretofore granted under the Plan, or
the substitution for such options of any options covering the stock or
securities of a successor employer corporation, or a parent or subsidiary
thereof, with appropriate adjustments as to the number and kind of shares of
stock and prices, in which event the Options shall continue in the manner and
under the terms so provided. If an Option would otherwise terminate pursuant to
the foregoing sentence, the Optionee shall have the right, at such time before
the consummation of the transaction causing such termination as the Company
shall reasonably designate, to exercise the unexercised portions of the Option,
including the portions thereof that would, but for this subsection, not yet be
exercisable.
3.2 CONTINUATION OF EMPLOYMENT OR SERVICE
Nothing in the Plan or in any instrument executed pursuant to the Plan
will confer upon any Optionee any right to continue in the employ or service of
the Company or affect the right of the Company to terminate the employment or
service of any Optionee at any time with or without cause, subject to any
contrary terms in a written employment agreement or contract for services with
the Optionee.
3.3 COMPLIANCE WITH GOVERNMENT REGULATIONS
No shares of Common Stock will be issued pursuant to an Option until
all applicable requirements imposed by Federal and state securities and other
laws, rules, and regulations, and
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<PAGE>
by any regulatory agencies having jurisdiction, and by any stock exchanges upon
which the Common Stock may be listed have been fully met. As a condition
precedent to the issuance of shares of Common Stock pursuant to an Option, the
Company may require the Optionee to take any reasonable action to comply with
such requirements.
3.4 PRIVILEGES OF STOCK OWNERSHIP
No Optionee and no beneficiary or other person claiming under or
through such Optionee will have any right, title, or interest in or to any
shares of Common Stock allocated or reserved under the Plan or subject to any
Option except as to such shares of Common Stock, if any, that have been issued
to such Optionee.
3.5 NONTRANSFERABILITY OF OPTIONS AND COMMON STOCK
Unless otherwise approved in writing by the Committee, an Option may
not be assigned, transferred, pledged, hypothecated, or disposed of in any way,
whether by operation of law or otherwise or through any legal or equitable
proceedings (including bankruptcy), to any person by the Optionee, except by
will or by operation of applicable laws of descent and distribution. Unless
otherwise approved in advance in writing by the Committee, the Optionee may not
sell, assign, pledge, encumber, or otherwise transfer shares of Common Stock
acquired upon exercise of an Option until at least six (6) months have elapsed
from (but excluding) the Date of Grant. The Committee, in its sole discretion,
may impose such other restrictions on the transferability of Options, as it
deems appropriate. The Option Agreement shall set forth any such other
restrictions, and the certificates evidencing such shares of Common Stock may
refer to such restrictions.
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<PAGE>
3.6 AMENDMENT AND TERMINATION OF PLAN; AMENDMENT OF OPTION
(a) The Board will have the power, in its sole discretion, to amend,
suspend, or terminate the Plan at any time; provided, however, that the Board
may not amend the Plan without approval of the shareholders of the Company if
Rule 16b-3 requires such approval. The Board is specifically authorized to adopt
any amendment to this Plan deemed by the Board to be necessary or advisable to
ensure that the Incentive Stock Options or Nonqualified Stock Options available
under the Plan continue to be treated as such, respectively, under all
applicable laws.
(b) Except as otherwise provided by the applicable Option Agreement or
by Section 1.4, 3.1, or 3.8, the Committee may not, without the consent of an
Optionee, make modifications in the terms and conditions of an Option that
adversely affect the Optionee. No Incentive Stock Option may be modified,
extended, or renewed, without the consent of an Optionee, if such action would
cause it to cease to be an incentive stock option within the meaning of Section
422 of the Code.
(c) No amendment, suspension, or termination of the Plan will, without
the consent of the Optionee, alter, terminate, impair, or adversely affect any
right or obligations under any Option previously granted under the Plan.
3.7 APPROVAL OF PLAN BY STOCKHOLDERS
The Company will submit this Plan for the approval of the Company's
shareholders. The Committee may grant Options before such shareholder approval,
but the Optionee cannot exercise Options before the shareholders approve the
Plan. Moreover, if the shareholders do not approve the Plan within 12 months
after the Board's initial adoption of the Plan, all Options previously granted
under the Plan shall thereupon be canceled and become void. The Company shall
take such actions regarding the Plan as may be necessary to satisfy the
requirements of Rule 16b-3(b).
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<PAGE>
3.8 CONFORMITY TO SECURITIES LAW
The Plan is intended to conform to the extent necessary with all
provisions of the Securities Act of 1933 and the Exchange Act and all
regulations and rules promulgated by the Securities and Exchange Commission
thereunder, including without limitation Rule 16b-3. Notwithstanding anything
herein to the contrary, the Committee shall administer the Plan, and Options
shall be granted and may be exercised, only in such a manner as to conform to
such laws, rules, and regulations. To the extent permitted by applicable law,
the Plan and Options granted hereunder shall be deemed amended to the extent
necessary to conform to such laws, rules, and regulations. To the extent any
provision of the Plan or action by the Committee fails to comply with Rule 16b-3
(as in effect with respect to the Plan on the date such action is taken), the
provision or action shall be deemed null and void, to the extent permitted by
law and deemed advisable by the Committee.
3.9 APPLICABLE LAW
This Plan shall be governed by and construed in accordance with the
laws of the State of Delaware.
IV. DURATION OF PLAN
Unless sooner terminated by the Board, the Plan will terminate on March
14, 2004.
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Exhibit 5
April 25, 1997
Human Genome Sciences, Inc.
9410 Key West Avenue
Rockville, Maryland 20850-3338
RE: REGISTRATION STATEMENT ON FORM S-8
----------------------------------
Ladies and Gentlemen:
We have served as your counsel in connection with the
preparation of your Registration Statement on Form S-8 to be filed with the
Securities and Exchange Commission under the Securities Act of 1933, as amended,
representing the offering and issuance to certain persons under the Human Genome
Sciences, Inc. 1994 Stock Option Plan, as amended (the "Plan") of an aggregate
of 2,500,000 shares of your Common Stock, $.01 par value (the "Common Stock").
We have examined such corporate records, documents and matters
of law as we have considered appropriate for the purposes of this opinion.
Based upon such examination and our participation in the
preparation of the Registration Statement, is it our opinion that the Common
Stock, when issued in the manner described in the Plan, will be validly issued,
fully paid and non-assessable.
We consent to the reference made to our firm in the
Registration Statement and to the filing of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
/s/ Bachner, Tally, Polevoy &
Misher LLP
BACHNER, TALLY, POLEVOY
& MISHER LLP
-7-
Exhibit 23.1
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement (Form
S-8 No. 333-_____) pertaining to the Human Genome Sciences, Inc. 1994 Stock
Option Plan of our report dated February 14, 1997, with respect to the financial
statements of Human Genome Sciences, Inc. included in the Annual Report (Form
10-K) for the year ended December 31, 1996, filed with the Securities and
Exchange Commission.
Vienna, Virginia
April 24, 1997 /s/ Ernst & Young LLP
EXHIBIT 23.3
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in this Registration Statement
on Form S-8 of our report dated February 14, 1995 on the financial statements of
Human Genome Sciences, Inc. (the "Company") for the year ended December 31,
1994, included in the Company's Annual Report on Form 10-K for the year ended
December 31, 1996.
/s/ Richard A. Eisner & Company LLP
New York, New York
April 24, 1997
