UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
______________
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
August 24, 2015
Titan Pharmaceuticals, Inc.
(Exact Name of Registrant as Specified in
Charter)
Delaware |
0-27436 |
94-3171940 |
(State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
400
Oyster Point Blvd., Suite 505, South San Francisco, CA |
94080 |
(Address of Principal Executive Offices) |
(Zip Code) |
Registrant’s telephone number, including
area code: 650-244-4990
(Former Name
or Former Address, if Changed Since Last Report)
Check the appropriate box below if the
Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions
(see General Instruction A.2. below):
¨
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 5.07. Submission of Matters to a Vote of Security
Holders.
On August 24, 2015, Titan Pharmaceuticals, Inc. (the “Company”
or “Titan”) held its annual meeting of stockholders. The following matters were considered:
Stockholders elected
all of the Company’s nominees for director for one-year terms expiring on the next annual meeting of stockholders. The voting
results were as follows:
| |
FOR | | |
AGAINST | | |
BROKER NON-VOTE | |
Joseph A. Akers | |
| 40,817,347 | | |
| 1,751,051 | | |
| 50,614,501 | |
Victor J. Bauer | |
| 40,837,286 | | |
| 1,731,112 | | |
| 50,614,501 | |
Sunil Bhonsle | |
| 39,367,907 | | |
| 3,200,491 | | |
| 50,614,501 | |
Eurelio M. Cavalier | |
| 40,808,562 | | |
| 1,759,836 | | |
| 50,614,501 | |
M. David MacFarlane | |
| 40,829,079 | | |
| 1,739,319 | | |
| 50,614,501 | |
James McNab, Jr. | |
| 40,831,802 | | |
| 1,736,596 | | |
| 50,614,501 | |
Marc Rubin | |
| 40,358,822 | | |
| 2,209,576 | | |
| 50,614,501 | |
Ley S. Smith | |
| 40,816,579 | | |
| 1,751,819 | | |
| 50,614,501 | |
| 2. | Adoption of the 2015 Omnibus Incentive Plan |
Stockholders approved
the Titan Pharmaceuticals, Inc. 2015 Omnibus Equity Incentive Plan pursuant to which 7,500,000 shares of common stock have been
reserved for issuance as or under awards. The voting results were as follows:
FOR | | |
AGAINST | | |
ABSTAIN | | |
BROKER NON-VOTES | |
| 33,819,511 | | |
| 5,586,212 | | |
| 3,162,675 | | |
| 50,614,501 | |
| 3. | Approval of the Reverse Split |
Stockholders approved
an amendment to the Company’s certificate of incorporation to effect a reverse split of the common stock within a range of
one-for-three and one-for-eight, with the exact ratio to be determined by the board of directors at the appropriate time. The voting
results were as follows:
FOR | | |
AGAINST | | |
ABSTAIN | |
| 66,876,118 | | |
| 25,404,267 | | |
| 902,514 | |
| 4. | Approval and Ratification of Auditors |
Stockholders approved
and ratified the reappointment of OUM & Co. LLP to serve as the Company’s independent auditors for the fiscal year ending
December 31, 2015. The voting results were as follows:
FOR | | |
AGAINST | | |
ABSTAIN | |
| 87,391,719 | | |
| 3,298,470 | | |
| 2,492,710 | |
| 5. | Approval of Executive Compensation |
Stockholders approved
the compensation of the Company’s executive officers. The voting results were as follows:
FOR | | |
AGAINST | | |
ABSTAIN | | |
BROKER NON-VOTES | |
| 33,220,475 | | |
| 6,526,641 | | |
| 2,821,282 | | |
| 50,614.501 | |
| 6. | Frequency of Say-on-Pay |
Stockholders adopted
a resolution stating that an advisory vote to approve executive compensation (“say-on-pay”) be submitted to stockholders
every two years. The voting results were as follows:
ONE YEAR | | |
TWO YEARS | | |
THREE YEARS | | |
ABSTAIN | | |
BROKER NON-VOTES | |
| 5,672,970 | | |
| 32,602,863 | | |
| 671,737 | | |
| 3,620,828 | | |
| 50,614,501 | |
In light of the voting results
with respect to the frequency of say-on-pay, Titan’s board of directors has determined that say-on-pay votes should be held
every two years.
Item 9.01. Financial
Statements and Exhibits.
(d) Exhibits
Exhibit No. |
Description |
|
|
10.31 |
Titan Pharmaceuticals, Inc. 2015 Omnibus Equity Incentive Plan |
SIGNATURE
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.
Dated: August 25, 2015 |
TITAN PHARMACEUTICALS, INC. |
|
|
|
By: |
/s/ Sunil Bhonsle |
|
Name: |
Sunil Bhonsle |
|
Title: |
President |
Exhibit Index
Exhibit No. |
Description |
|
|
10.31 |
Titan Pharmaceuticals, Inc. 2015 Omnibus Equity Incentive Plan |
Exhibit 10.31
TITAN PHARMACEUTICALS, INC.
2015 OMNIBUS EQUITY INCENTIVE PLAN
TITAN PHARMACEUTICALS, INC.
2015 OMNIBUS EQUITY INCENTIVE PLAN
Article
I
PURPOSE
The purpose of this Titan Pharmaceuticals,
Inc. 2015 Omnibus Equity Incentive Plan (the “Plan”) is to benefit Titan Pharmaceuticals, Inc., a Delaware corporation
(the “Company”) and its stockholders, by assisting the Company to attract, retain and provide incentives to
key employees and directors of, and consultants to, the Company and its Affiliates, and to align the interests of such service
providers with those of the Company’s stockholders. Accordingly, the Plan provides for the granting of Non-qualified Stock
Options, Incentive Stock Options, Restricted Stock Awards, Restricted Stock Unit Awards, Stock Appreciation Rights, Performance
Stock Awards, Performance Unit Awards, Unrestricted Stock Awards, Distribution Equivalent Rights or any combination of the foregoing.
Article
II
DEFINITIONS
The following definitions shall be applicable
throughout the Plan unless the context otherwise requires:
2.1 “Affiliate”
shall mean any corporation which, with respect to the Company, is a “subsidiary corporation” within the meaning of
Section 424(f) of the Code or other entity in which the Company has a controlling interest in such entity or another entity which
is part of a chain of entities in which the Company or each entity has a controlling interest in another entity in the unbroken
chain of entities ending with the applicable entity.
2.2 “Award”
shall mean, individually or collectively, any Option, Restricted Stock Award, Restricted Stock Unit Award, Performance Stock Award,
Performance Unit Award, Stock Appreciation Right, Distribution Equivalent Right or Unrestricted Stock Award.
2.3 “Award
Agreement” shall mean a written agreement between the Company and the Holder with respect to an Award, setting forth
the terms and conditions of the Award.
2.4 “Board”
shall mean the Board of Directors of the Company.
2.5 “Base
Value” shall have the meaning given to such term in Section 14.2.
2.6 “Cause”
shall mean (i) if the Holder is a party to an employment or service agreement with the Company or an Affiliate which agreement
defines “Cause” (or a similar term), “Cause” shall have the same meaning as provided for in such
agreement, or (ii) for a Holder who is not a party to such an agreement, “Cause” shall mean termination by the
Company or an Affiliate of the employment (or other service relationship) of the Holder by reason of the Holder’s (A) intentional
failure to perform reasonably assigned duties, (B) dishonesty or willful misconduct in the performance of the Holder’s duties,
(C) involvement in a transaction which is materially adverse to the Company or an Affiliate, (D) breach of fiduciary duty involving
personal profit, (E) willful violation of any law, rule, regulation or court order (other than misdemeanor traffic violations and
misdemeanors not involving misuse or misappropriation of money or property), (F) commission of an act of fraud or intentional misappropriation
or conversion of any asset or opportunity of the Company or an Affiliate, or (G) material breach of any provision of the Plan or
the Holder’s Award Agreement or any other written agreement between the Holder and the Company or an Affiliate, in each case
as determined in good faith by the Board, the determination of which shall be final, conclusive and binding on all parties.
Titan Pharmaceuticals, Inc, 2015 Omnibus Equity Incentive Plan |
2.7 “Change
of Control” shall mean: (i) for a Holder who is a party to an employment or consulting agreement with the Company
or an Affiliate which agreement defines “Change of Control” (or a similar term), “Change of Control”
shall have the same meaning as provided for in such agreement, or (ii) for a Holder who is not a party to such an agreement, “Change
of Control” shall mean the satisfaction of any one or more of the following conditions (and the “Change of Control”
shall be deemed to have occurred as of the first day that any one or more of the following conditions shall have been satisfied):
(a) Any
person (as such term is used in paragraphs 13(d) and 14(d)(2) of the Exchange Act, hereinafter in this definition, “Person”),
other than the Company or an Affiliate or an employee benefit plan of the Company or an Affiliate, becomes the beneficial owner
(as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing more than
fifty percent (50%) of the combined voting power of the Company’s then outstanding securities;
(b) The
closing of a merger, consolidation or other business combination (a “Business Combination”) other than a Business
Combination in which holders of the Shares immediately prior to the Business Combination have substantially the same proportionate
ownership of the common stock of the surviving corporation immediately after the Business Combination as immediately before;
(c) The
closing of an agreement for the sale or disposition of all or substantially all of the Company’s assets to any entity that
is not an Affiliate;
(d) The
approval by the holders of shares of Shares of a plan of complete liquidation of the Company, other than a merger of the Company
into any subsidiary or a liquidation as a result of which persons who were stockholders of the Company immediately prior to such
liquidation have substantially the same proportionate ownership of shares of common stock of the surviving corporation immediately
after such liquidation as immediately before; or
(e) Within
any twenty-four (24) month period, the Incumbent Directors shall cease to constitute at least a majority of the Board or the board
of directors of any successor to the Company; provided, however, that any director elected to the Board, or nominated
for election, by a majority of the Incumbent Directors then still in office, shall be deemed to be an Incumbent Director for purposes
of this paragraph (e), but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result
of either an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of an individual, entity or “group” other than the Board (including,
but not limited to, any such assumption that results from paragraphs (a), (b), (c), or (d) of this definition).
Titan Pharmaceuticals, Inc, 2015 Omnibus Equity Incentive Plan |
2.8 “Code”
shall mean the Internal Revenue Code of 1986, as amended. Reference in the Plan to any section of the Code shall be deemed to include
any amendments or successor provisions to any section and any regulation under such section.
2.9 “Committee”
shall mean a committee comprised of two (2) or more members of the Board who are selected by the Board as provided in Section 4.1.
2.10
“Company” shall have the meaning given to such term in the introductory paragraph, including any successor thereto.
2.11 “Consultant”
shall mean any non-Employee (individual or entity) advisor to the Company or an Affiliate who or which has contracted directly
with the Company or an Affiliate to render bona fide consulting or advisory services thereto.
2.12 “Director”
shall mean a member of the Board or a member of the board of directors of an Affiliate, in either case, who is not an Employee.
2.13 “Distribution
Equivalent Right” shall mean an Award granted under Article XIII of the Plan which entitles the Holder to receive bookkeeping
credits, cash payments and/or Share distributions equal in amount to the distributions that would have been made to the Holder
had the Holder held a specified number of Shares during the period the Holder held the Distribution Equivalent Right.
2.14 “Distribution
Equivalent Right Award Agreement” shall mean a written agreement between the Company and a Holder with respect to a Distribution
Equivalent Right Award.
2.15
“Effective Date” shall mean August 24, 2015 or such later date that the Plan is approved by the stockholders
of the Company.
2.16 “Employee”
shall mean any employee, including any officer, of the Company or an Affiliate.
2.17 “Exchange
Act” shall mean the Securities Exchange Act of 1934, as amended.
Titan Pharmaceuticals, Inc, 2015 Omnibus Equity Incentive Plan |
2.18 “Fair
Market Value” shall mean, as of any specified date, the closing sales price of the Shares for such date (or, in the event
that the Shares are not traded on such date, on the immediately preceding trading date) on the NASDAQ Stock Market (“NASDAQ”),
as reported by NASDAQ, or such other domestic or foreign national securities exchange on which the Shares may be listed. If the
Shares are not listed on NASDAQ or on a national securities exchange, but are quoted on the OTC Bulletin Board or by the National
Quotation Bureau, the Fair Market Value of the Shares shall be the mean of the highest bid and lowest asked prices per Share for
such date. If the Shares are not quoted or listed as set forth above, Fair Market Value shall be determined by the Board in good
faith by any fair and reasonable means (which means may be set forth with greater specificity in the applicable Award Agreement).
The Fair Market Value of property other than Shares shall be determined by the Board in good faith by any fair and reasonable means
consistent with the requirements of applicable law.
2.19 “Family
Member” of an individual shall mean any child, stepchild, grandchild, parent, stepparent, spouse, former spouse, sibling,
niece, nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law or sister-in-law, including adoptive relationships,
any person sharing the Holder’s household (other than a tenant or employee of the Holder), a trust in which such persons
have more than fifty percent (50%) of the beneficial interest, a foundation in which such persons (or the Holder) control the management
of assets, and any other entity in which such persons (or the Holder) own more than fifty percent (50%) of the voting interests.
2.20 “Holder”
shall mean an Employee, Director or Consultant who has been granted an Award or any such individual’s beneficiary, estate
or representative, who has acquired such Award in accordance with the terms of the Plan, as applicable.
2.21
“Incentive Stock Option” shall mean an Option which is intended by the Committee to constitute an “incentive
stock option” and conforms to the applicable provisions of Section 422 of the Code.
2.22 “Incumbent
Director” shall mean, with respect to any period of time specified under the Plan for purposes of determining whether
or not a Change of Control has occurred, the individuals who were members of the Board at the beginning of such period.
2.23 “Non-qualified
Stock Option” shall mean an Option which is not an Incentive Stock Option or which is designated as an Incentive Stock
Option but does not meet the applicable requirements of Section 422 of the Code.
2.24 “Option”
shall mean an Award granted under Article VII of the Plan of an option to purchase Shares and shall include both Incentive Stock
Options and Non-qualified Stock Options.
2.25 “Option
Agreement” shall mean a written agreement between the Company and a Holder with respect to an Option.
Titan Pharmaceuticals, Inc, 2015 Omnibus Equity Incentive Plan |
2.26 “Performance
Criteria” shall mean the criteria selected by the Committee for purposes of establishing the Performance Goal(s) for
a Holder for a Performance Period.
2.27 “Performance
Goals” shall mean, for a Performance Period, the written goal or goals established by the Committee for the Performance
Period based upon the Performance Criteria, which may be related to the performance of the Holder, the Company or an Affiliate.
2.28 “Performance
Period” shall mean one or more periods of time, which may be of varying and overlapping durations, selected by the Committee,
over which the attainment of the Performance Goals shall be measured for purposes of determining a Holder’s right to, and
the payment of, a Qualified Performance-Based Award.
2.29 “Performance
Stock Award” or “Performance Stock” shall mean an Award granted under Article XII of the Plan under
which, upon the satisfaction of predetermined Performance Goals, Shares are paid to the Holder.
2.30 “Performance
Stock Agreement” shall mean a written agreement between the Company and a Holder with respect to a Performance Stock
Award.
2.31 “Performance
Unit” shall mean a Unit awarded to a Holder pursuant to a Performance Unit Award.
2.32 “Performance
Unit Award” shall mean an Award granted under Article XI of the Plan under which, upon the satisfaction of predetermined
Performance Goals, a cash payment shall be made to the Holder, based on the number of Units awarded to the Holder.
2.33 “Performance
Unit Agreement” shall mean a written agreement between the Company and a Holder with respect to a Performance Unit Award.
2.34 “Plan”
shall mean this Titan Pharmaceuticals 2015 Omnibus Equity Incentive Plan, as amended from time to time, together with each of the
Award Agreements utilized hereunder.
2.35 “Qualified
Performance-Based Award” shall mean an Award that is intended to qualify as “performance-based” compensation
under Section 162(m) of the Code.
2.36 “Restricted
Stock Award” and “Restricted Stock” shall mean an Award granted under Article VIII of the Plan of
Shares, the transferability of which by the Holder is subject to Restrictions.
2.37 “Restricted
Stock Agreement” shall mean a written agreement between the Company and a Holder with respect to a Restricted Stock Award.
Titan Pharmaceuticals, Inc, 2015 Omnibus Equity Incentive Plan |
2.38 “Restricted
Stock Unit Award” and “RSUs” shall refer to an Award granted under Article X of the Plan under which,
upon the satisfaction of predetermined individual service-related vesting requirements, a cash payment shall be made to the Holder,
based on the number of Units awarded to the Holder.
2.39 “Restricted
Stock Unit Agreement” shall mean a written agreement between the Company and a Holder with respect to a Restricted Stock
Award.
2.40
“Restriction Period” shall mean the period of time for which Shares subject to a Restricted Stock Award shall
be subject to Restrictions, as set forth in the applicable Restricted Stock Agreement.
2.41 “Restrictions”
shall mean the forfeiture, transfer and/or other restrictions applicable to Shares awarded to an Employee, Director or Consultant
under the Plan pursuant to a Restricted Stock Award and set forth in a Restricted Stock Agreement.
2.42 “Rule
16b-3” shall mean Rule 16b-3 promulgated by the Securities and Exchange Commission under the Exchange Act, as such may
be amended from time to time, and any successor rule, regulation or statute fulfilling the same or a substantially similar function.
2.43 “Shares”
or “Stock” shall mean the common stock of the Company, par value $0.001 per share.
2.44 “Stock
Appreciation Right” or “SAR” shall mean an Award granted under Article XIV of the Plan of a right,
granted alone or in connection with a related Option, to receive a payment equal to the increase in value of a specified number
of Shares between the date of Award and the date of exercise.
2.45 “Stock
Appreciation Right Agreement” shall mean a written agreement between the Company and a Holder with respect to a Stock
Appreciation Right.
2.46 “Tandem
Stock Appreciation Right” shall mean a Stock Appreciation Right granted in connection with a related Option, the exercise
of some or all of which results in termination of the entitlement to purchase some or all of the Shares under the related Option,
all as set forth in Article XIV.
2.47
“Ten Percent Stockholder” shall mean an Employee who, at the time an Option is granted to him or her, owns shares
possessing more than ten percent (10%) of the total combined voting power of all classes of shares of the Company or of any parent
corporation or subsidiary corporation thereof (both as defined in Section 424 of the Code), within the meaning of Section 422(b)(6)
of the Code.
2.48 “Termination
of Service” shall mean a termination of a Holder’s employment with, or status as a Director or Consultant of, the
Company or an Affiliate, as applicable, for any reason, including, without limitation, Total and Permanent Disability or death,
except as provided in Section 6.4. In the event Termination of Service shall constitute a payment event with respect to any Award
subject to Code Section 409A, Termination of Service shall only be deemed to occur upon a “separation from service”
as such term is defined under Code Section 409A and applicable authorities.
Titan Pharmaceuticals, Inc, 2015 Omnibus Equity Incentive Plan |
2.49 “Total
and Permanent Disability” of an individual shall mean the inability of such individual to engage in any substantial gainful
activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which
has lasted or can be expected to last for a continuous period of not less than twelve (12) months, within the meaning of Section
22(e)(3) of the Code.
2.50 “Unit”
shall mean a bookkeeping unit, which represents such monetary amount as shall be designated by the Committee in each Performance
Unit Agreement, or represents one Share for purposes of each Restricted Stock Unit Award.
2.51 “Unrestricted
Stock Award” shall mean an Award granted under Article IX of the Plan of Shares which are not subject to Restrictions.
2.52 “Unrestricted
Stock Agreement” shall mean a written agreement between the Company and a Holder with respect to an Unrestricted Stock
Award.
Article
III
EFFECTIVE DATE OF PLAN
The Plan shall be effective as of the Effective
Date.
Article
IV
ADMINISTRATION
4.1 Composition
of Committee. The Plan shall be administered by the Committee, which shall be appointed by the Board. If necessary, in the
Board’s discretion, to comply with Rule 16b-3 under the Exchange Act and Section 162(m) of the Code, the Committee shall
consist solely of two (2) or more Directors who are each (i) “outside directors” within the meaning of Section 162(m)
of the Code (“Outside Directors”), (ii) “non-employee directors” within the meaning of Rule 16b-3
(“Non-Employee Directors”) and (iii) “independent” for purposes of any applicable listing requirements;
provided, however, that the Board or the Committee may delegate to a committee of one or more members of the Board
who are not (x) Outside Directors, the authority to grant Awards to eligible persons who are not (A) then “covered employees”
within the meaning of Section 162(m) of the Code and are not expected to be “covered employees” at the time of recognition
of income resulting from such Award, or (B) persons with respect to whom the Company wishes to comply with the requirements of
Section 162(m) of the Code, and/or (y) Non-Employee Directors, the authority to grant Awards to eligible persons who are not then
subject to the requirements of Section 16 of the Exchange Act. If a member of the Committee shall be eligible to receive an Award
under the Plan, such Committee member shall have no authority hereunder with respect to his or her own Award.
Titan Pharmaceuticals, Inc, 2015 Omnibus Equity Incentive Plan |
4.2 Powers.
Subject to the other provisions of the Plan, the Committee shall have the sole authority, in its discretion, to make all determinations
under the Plan, including but not limited to (i) determining which Employees, Directors or Consultants shall receive an Award,
(ii) the time or times when an Award shall be made (the date of grant of an Award shall be the date on which the Award is awarded
by the Committee), (iii) what type of Award shall be granted, (iv) the term of an Award, (v) the date or dates on which an Award
vests (including acceleration of vesting), (vi) the form of any payment to be made pursuant to an Award, (vii) the terms and conditions
of an Award (including the forfeiture of the Award, and/or any financial gain, if the Holder of the Award violates any applicable
restrictive covenant thereof), (viii) the Restrictions under a Restricted Stock Award, (ix) the number of Shares which may be issued
under an Award, (x) Performance Goals applicable to any Award and certification of the achievement of such goals, and (xi) the
waiver of any Restrictions or Performance Goals, subject in all cases to compliance with applicable laws. In making such determinations
the Committee may take into account the nature of the services rendered by the respective Employees, Directors and Consultants,
their present and potential contribution to the Company’s (or the Affiliate’s) success and such other factors as the
Committee in its discretion may deem relevant.
4.3 Additional
Powers. The Committee shall have such additional powers as are delegated to it under the other provisions of the Plan. Subject
to the express provisions of the Plan, the Committee is authorized to construe the Plan and the respective Award Agreements executed
hereunder, to prescribe such rules and regulations relating to the Plan as it may deem advisable to carry out the intent of the
Plan, to determine the terms, restrictions and provisions of each Award and to make all other determinations necessary or advisable
for administering the Plan. The Committee may correct any defect or supply any omission or reconcile any inconsistency in any Award
Agreement in the manner and to the extent the Committee shall deem necessary, appropriate or expedient to carry it into effect.
The determinations of the Committee on the matters referred to in this Article IV shall be conclusive and binding on the Company
and all Holders.
4.4 Committee
Action. Subject to compliance with all applicable laws, action by the Committee shall require the consent of a majority of
the members of the Committee, expressed either orally at a meeting of the Committee or in writing in the absence of a meeting.
No member of the Committee shall have any liability for any good faith action, inaction or determination in connection with the
Plan.
Article
V
SHARES SUBJECT TO PLAN AND LIMITATIONS THEREON
5.1 Authorized
Shares and Award Limits. The Committee may from time to time grant Awards to one or more Employees, Directors and/or Consultants
determined by it to be eligible for participation in the Plan in accordance with the provisions of Article VI. Subject to
Article XV, the aggregate number of Shares that may be issued under the Plan shall not exceed Seven Million Five Hundred Thousand
(7,500,000) Shares. Shares shall be deemed to have been issued under the Plan solely to the extent actually issued and delivered
pursuant to an Award. To the extent that an Award lapses, expires, is canceled, is terminated unexercised or ceases to be exercisable
for any reason, or the rights of its Holder terminate, any Shares subject to such Award shall again be available for the grant
of a new Award. Notwithstanding any provision in the Plan to the contrary, the maximum number of Shares that may be subject to
Awards of Options under Article VII and/or Stock Appreciation Rights under Article XIV, in either or both cases granted to any
one person during any calendar year, shall be Five Hundred Thousand (500,000) Shares (subject to adjustment in the same manner
as provided in Article XV with respect to Shares subject to Awards then outstanding). The limitation set forth in the preceding
sentence shall be applied in a manner which shall permit compensation generated in connection with the exercise of Options or Stock
Appreciation Rights to constitute “performance-based” compensation for purposes of Section 162(m) of the Code, including,
but not limited to, counting against such maximum number of Shares, to the extent required under Section 162(m) of the Code, any
Shares subject to Options or Stock Appreciation Rights that are canceled or re-priced.
Titan Pharmaceuticals, Inc, 2015 Omnibus Equity Incentive Plan |
5.2 Types
of Shares . The Shares to be issued pursuant to the grant or exercise of an Award may consist of authorized but unissued Shares,
Shares purchased on the open market or Shares previously issued and outstanding and reacquired by the Company.
Article
VI
ELIGIBILITY AND TERMINATION OF SERVICE
6.1 Eligibility.
Awards made under the Plan may be granted solely to individuals or entities who, at the time of grant, are Employees, Directors
or Consultants. An Award may be granted on more than one occasion to the same Employee, Director or Consultant, and, subject to
the limitations set forth in the Plan, such Award may include, a Non-qualified Stock Option, a Restricted Stock Award, a Restricted
Stock Unit Award, an Unrestricted Stock Award, a Distribution Equivalent Right Award, a Performance Stock Award, a Performance
Unit Award, a Stock Appreciation Right, a Tandem Stock Appreciation Right, or any combination thereof, and solely for Employees,
an Incentive Stock Option.
6.2 Termination
of Service. Except to the extent inconsistent with the terms of the applicable Award Agreement and/or the provisions of Section
6.3 or 6.4, the following terms and conditions shall apply with respect to a Holder’s Termination of Service with the Company
or an Affiliate, as applicable:
(a) The
Holder’s rights, if any, to exercise any then exercisable Options and/or Stock Appreciation Rights shall terminate:
(i) If
such termination is for a reason other than the Holder’s Total and Permanent Disability or death, ninety (90) days after
the date of such Termination of Service;
(ii) If
such termination is on account of the Holder’s Total and Permanent Disability, one (1) year after the date of such Termination
of Service; or
(iii) If
such termination is on account of the Holder’s death, one (1) year after the date of the Holder’s death.
Upon such applicable date the Holder (and
such Holder’s estate, designated beneficiary or other legal representative) shall forfeit any rights or interests in or with
respect to any such Options and Stock Appreciation Rights. Notwithstanding the foregoing, the Committee, in its sole discretion,
may provide for a different time period in the Award Agreement, or may extend the time period, following a Termination of Service,
during which the Holder has the right to exercise any vested Non-qualified Stock Option or Stock Appreciation Right, which time
period may not extend beyond the expiration date of the Award term.
Titan Pharmaceuticals, Inc, 2015 Omnibus Equity Incentive Plan |
(b) In
the event of a Holder’s Termination of Service for any reason prior to the actual or deemed satisfaction and/or lapse of
the Restrictions, vesting requirements, terms and conditions applicable to a Restricted Stock Award and/or Restricted Stock Unit
Award, such Restricted Stock and/or RSUs shall immediately be canceled, and the Holder (and such Holder’s estate, designated
beneficiary or other legal representative) shall forfeit any rights or interests in and with respect to any such Restricted Stock
and/or RSUs. Notwithstanding the immediately preceding sentence, the Committee, in its sole discretion, may determine, prior to
or within thirty (30) days after the date of such Termination of Service that all or a portion of any such Holder’s Restricted
Stock and/or RSUs shall not be so canceled and forfeited.
6.3 Special
Termination Rule. Except to the extent inconsistent with the terms of the applicable Award Agreement, and notwithstanding anything
to the contrary contained in this Article VI, if a Holder’s employment with, or status as a Director of, the Company or an
Affiliate shall terminate, and if, within ninety (90) days of such termination, such Holder shall become a Consultant, such Holder’s
rights with respect to any Award or portion thereof granted thereto prior to the date of such termination may be preserved, if
and to the extent determined by the Committee in its sole discretion, as if such Holder had been a Consultant for the entire period
during which such Award or portion thereof had been outstanding. Should the Committee effect such determination with respect to
such Holder, for all purposes of the Plan, such Holder shall not be treated as if his or her employment or Director status had
terminated until such time as his or her Consultant status shall terminate, in which case his or her Award, as it may have been
reduced in connection with the Holder’s becoming a Consultant, shall be treated pursuant to the provisions of Section 6.2,
provided, however, that any such Award which is intended to be an Incentive Stock Option shall, upon the Holder’s no longer
being an Employee, automatically convert to a Non-qualified Stock Option. Should a Holder’s status as a Consultant terminate,
and if, within ninety (90) days of such termination, such Holder shall become an Employee or a Director, such Holder’s rights
with respect to any Award or portion thereof granted thereto prior to the date of such termination may be preserved, if and to
the extent determined by the Committee in its sole discretion, as if such Holder had been an Employee or a Director, as applicable,
for the entire period during which such Award or portion thereof had been outstanding, and, should the Committee effect such determination
with respect to such Holder, for all purposes of the Plan, such Holder shall not be treated as if his or her Consultant status
had terminated until such time as his or her employment with the Company or an Affiliate, or his or her Director status, as applicable,
shall terminate, in which case his or her Award shall be treated pursuant to the provisions of Section 6.2.
Titan Pharmaceuticals, Inc, 2015 Omnibus Equity Incentive Plan |
6.4 Termination
of Service for Cause. Notwithstanding anything in this Article VI or elsewhere in the Plan to the contrary, and unless
a Holder’s Award Agreement specifically provides otherwise, in the event of a Holder’s Termination of Service for Cause,
all of such Holder’s then outstanding Awards shall expire immediately and be forfeited in their entirety upon such Termination
of Service.
Article
VII
OPTIONS
7.1 Option
Period. The term of each Option shall be as specified in the Option Agreement; provided, however, that except
as set forth in Section 7.3, no Option shall be exercisable after the expiration of ten (10) years from the date of its grant.
7.2 Limitations
on Exercise of Option. An Option shall be exercisable in whole or in such installments and at such times as specified in the
Option Agreement.
7.3 Special
Limitations on Incentive Stock Options. To the extent that the aggregate Fair Market Value (determined at the time the respective
Incentive Stock Option is granted) of Shares with respect to which Incentive Stock Options are exercisable for the first time by
an individual during any calendar year under all plans of the Company and any parent corporation or subsidiary corporation thereof
(both as defined in Section 424 of the Code) which provide for the grant of Incentive Stock Options exceeds One Hundred Thousand
Dollars ($100,000) (or such other individual limit as may be in effect under the Code on the date of grant), the portion of such
Incentive Stock Options that exceeds such threshold shall be treated as Non-qualified Stock Options. The Committee shall determine,
in accordance with applicable provisions of the Code, Treasury Regulations and other administrative pronouncements, which of a
Holder’s Options, which were intended by the Committee to be Incentive Stock Options when granted to the Holder, will not
constitute Incentive Stock Options because of such limitation, and shall notify the Holder of such determination as soon as practicable
after such determination. No Incentive Stock Option shall be granted to an Employee if, at the time the Incentive Stock Option
is granted, such Employee is a Ten Percent Stockholder, unless (i) at the time such Incentive Stock Option is granted the Option
price is at least one hundred ten percent (110%) of the Fair Market Value of the Shares subject to the Incentive Stock Option,
and (ii) such Incentive Stock Option by its terms is not exercisable after the expiration of five (5) years from the date of grant.
No Incentive Stock Option shall be granted more than ten (10) years from the Effective Date. The designation by the Committee of
an Option as an Incentive Stock Option shall not guarantee the Holder that the Option will satisfy the applicable requirements
for “incentive stock option” status under Section 422 of the Code.
Titan Pharmaceuticals, Inc, 2015 Omnibus Equity Incentive Plan |
7.4 Option
Agreement. Each Option shall be evidenced by an Option Agreement in such form and containing such provisions not inconsistent
with the other provisions of the Plan as the Committee from time to time shall approve, including, but not limited to, provisions
intended to qualify an Option as an Incentive Stock Option. An Option Agreement may provide for the payment of the Option price,
in whole or in part, by the delivery of a number of Shares (plus cash if necessary) that have been owned by the Holder for at least
six (6) months and having a Fair Market Value equal to such Option price, or such other forms or methods as the Committee may determine
from time to time, in each case, subject to such rules and regulations as may be adopted by the Committee. Each Option Agreement
shall, solely to the extent inconsistent with the provisions of Sections 6.2, 6.3, and 6.4, as applicable, specify the effect of
Termination of Service on the exercisability of the Option. Moreover, without limiting the generality of the foregoing, a Non-qualified
Stock Option Agreement may provide for a “cashless exercise” of the Option, in whole or in part, by (a) establishing
procedures whereby the Holder, by a properly-executed written notice, directs (i) an immediate market sale or margin loan
as to all or a part of Shares to which he is entitled to receive upon exercise of the Option, pursuant to an extension of credit
by the Company to the Holder of the Option price, (ii) the delivery of the Shares from the Company directly to a brokerage
firm and (iii) the delivery of the Option price from sale or margin loan proceeds from the brokerage firm directly to the
Company, or (b) reducing the number of Shares to be issued upon exercise of the Option by the number of such Shares having
an aggregate Fair Market Value equal to the Option price (or portion thereof to be so paid) as of the date of the Option’s
exercise. An Option Agreement may also include provisions relating to: (i) subject to the provisions hereof, accelerated vesting
of Options, including but not limited to, upon the occurrence of a Change of Control, (ii) tax matters (including provisions covering
any applicable Employee wage withholding requirements and requiring additional “gross-up” payments to Holders to meet
any excise taxes or other additional income tax liability imposed as a result of a payment made upon a Change of Control resulting
from the operation of the Plan or of such Option Agreement) and (iii) any other matters not inconsistent with the terms and provisions
of the Plan that the Committee shall in its sole discretion determine. The terms and conditions of the respective Option Agreements
need not be identical.
7.5 Option
Price and Payment. The price at which an Share may be purchased upon exercise of an Option shall be determined by the Committee;
provided, however, that such Option price (i) shall not be less than the Fair Market Value of an Share on the
date such Option is granted (or 110% of Fair Market Value for an Incentive Stock Option held by Ten Percent Stockholder, as provided
in Section 7.3), and (ii) shall be subject to adjustment as provided in Article XV. The Option or portion thereof may be exercised
by delivery of an irrevocable notice of exercise to the Company. The Option price for the Option or portion thereof shall be paid
in full in the manner prescribed by the Committee as set forth in the Plan and the applicable Option Agreement, which manner, with
the consent of the Committee, may include the withholding of Shares otherwise issuable in connection with the exercise of the Option.
Separate share certificates shall be issued by the Company for those Shares acquired pursuant to the exercise of an Incentive Stock
Option and for those Shares acquired pursuant to the exercise of a Non-qualified Stock Option.
Titan Pharmaceuticals, Inc, 2015 Omnibus Equity Incentive Plan |
7.6 Stockholder
Rights and Privileges. The Holder of an Option shall be entitled to all the privileges and rights of a stockholder of the Company
solely with respect to such Shares as have been purchased under the Option and for which share certificates have been registered
in the Holder’s name.
7.7 Options
and Rights in Substitution for Stock or Options Granted by Other Corporations. Options may be granted under the Plan from time
to time in substitution for stock options held by individuals employed by entities who become Employees, Directors or Consultants
as a result of a merger or consolidation of the employing entity with the Company or any Affiliate, or the acquisition by the Company
or an Affiliate of the assets of the employing entity, or the acquisition by the Company or an Affiliate of stock or shares of
the employing entity with the result that such employing entity becomes an Affiliate.
7.8 Prohibition
Against Re-Pricing. Except to the extent (i) approved in advance by holders of a majority of the shares of the Company
entitled to vote generally in the election of directors, or (ii) as a result of any Change of Control or any adjustment as
provided in Article XV, the Committee shall not have the power or authority to reduce, whether through amendment or otherwise,
the exercise price under any outstanding Option or Stock Appreciation Right, or to grant any new Award or make any payment of cash
in substitution for or upon the cancellation of Options and/or Stock Appreciation Rights previously granted.
Article
VIII
RESTRICTED STOCK AWARDS
8.1 Award.
A Restricted Stock Award shall constitute an Award of Shares to the Holder as of the date of the Award which are subject to a “substantial
risk of forfeiture” as defined under Section 83 of the Code during the specified Restriction Period. At the time a Restricted
Stock Award is made, the Committee shall establish the Restriction Period applicable to such Award. Each Restricted Stock Award
may have a different Restriction Period, in the discretion of the Committee. The Restriction Period applicable to a particular
Restricted Stock Award shall not be changed except as permitted by Section 8.2.
8.2 Terms
and Conditions. At the time any Award is made under this Article VIII, the Company and the Holder shall enter into a Restricted
Stock Agreement setting forth each of the matters contemplated thereby and such other matters as the Committee may determine to
be appropriate. Shares awarded pursuant to a Restricted Stock Award shall be represented by a share certificate registered in the
name of the Holder of such Restricted Stock Award. If provided for under the Restricted Stock Agreement, the Holder shall have
the right to vote Shares subject thereto and to enjoy all other stockholder rights, including the entitlement to receive dividends
on the Shares during the Restriction Period, except that (i) the Holder shall not be entitled to delivery of the share certificate
until the Restriction Period shall have expired, (ii) the Company shall retain custody of the share certificate during the
Restriction Period (with a share power endorsed by the Holder in blank), (iii) the Holder may not sell, transfer, pledge,
exchange, hypothecate or otherwise dispose of the Shares during the Restriction Period and (iv) a breach of the terms and conditions
established by the Committee pursuant to the Restricted Stock Agreement shall cause a forfeiture of the Restricted Stock Award.
At the time of such Award, the Committee may, in its sole discretion, prescribe additional terms and conditions or restrictions
relating to Restricted Stock Awards, including, but not limited to, rules pertaining to the effect of Termination of Service prior
to expiration of the Restriction Period. Such additional terms, conditions or restrictions shall, to the extent inconsistent with
the provisions of Sections 6.2, 6.3 and 6.4, as applicable, be set forth in a Restricted Stock Agreement made in conjunction with
the Award. Such Restricted Stock Agreement may also include provisions relating to: (i) subject to the provisions hereof,
accelerated vesting of Awards, including but not limited to accelerated vesting upon the occurrence of a Change of Control, (ii) tax
matters (including provisions covering any applicable Employee wage withholding requirements and requiring additional “gross-up”
payments to Holders to meet any excise taxes or other additional income tax liability imposed as a result of a payment made in
connection with a Change of Control resulting from the operation of the Plan or of such Restricted Stock Agreement) and (iii) any
other matters not inconsistent with the terms and provisions of the Plan that the Committee shall in its sole discretion determine.
The terms and conditions of the respective Restricted Stock Agreements need not be identical. All Shares delivered to a Holder
as part of a Restricted Stock Award shall be delivered and reported by the Company or the Affiliate, as applicable, to the Holder
at the time of vesting.
Titan Pharmaceuticals, Inc, 2015 Omnibus Equity Incentive Plan |
8.3 Payment
for Restricted Stock. The Committee shall determine the amount and form of any payment from a Holder for Shares received pursuant
to a Restricted Stock Award, if any, provided that in the absence of such a determination, a Holder shall not be required to make
any payment for Shares received pursuant to a Restricted Stock Award, except to the extent otherwise required by law.
Article
IX
UNRESTRICTED STOCK AWARDS
9.1 Award.
Shares may be awarded (or sold) to Employees, Directors or Consultants under the Plan which are not subject to Restrictions of
any kind, in consideration for past services rendered thereby to the Company or an Affiliate or for other valid consideration.
9.2 Terms
and Conditions. At the time any Award is made under this Article IX, the Company and the Holder shall enter into an Unrestricted
Stock Agreement setting forth each of the matters contemplated hereby and such other matters as the Committee may determine to
be appropriate.
9.3 Payment
for Unrestricted Stock. The Committee shall determine the amount and form of any payment from a Holder for Shares received
pursuant to an Unrestricted Stock Award, if any, provided that in the absence of such a determination, a Holder shall not be required
to make any payment for Shares received pursuant to an Unrestricted Stock Award, except to the extent otherwise required by law.
Titan Pharmaceuticals, Inc, 2015 Omnibus Equity Incentive Plan |
Article
X
RESTRICTED STOCK UNIT AWARDS
10.1 Award.
A Restricted Stock Unit Award shall constitute a promise to grant Shares (or cash equal to the Fair Market Value of Shares) to
the Holder at the end of a specified Restriction Period. At the time a Restricted Stock Unit Award is made, the Committee shall
establish the Restriction Period applicable to such Award. Each Restricted Stock Unit Award may have a different Restriction Period,
in the discretion of the Committee. A Restricted Stock Unit shall not constitute an equity interest in the Company and shall not
entitle the Holder to voting rights, dividends or any other rights associated with ownership of Shares prior to the time the Holder
shall receive a distribution of Shares pursuant to Section 10.3.
10.2 Terms
and Conditions. At the time any Award is made under this Article X, the Company and the Holder shall enter into a Restricted
Stock Unit Agreement setting forth each of the matters contemplated thereby and such other matters as the Committee may determine
to be appropriate. The Restricted Stock Unit Agreement shall set forth the individual service-based vesting requirement which the
Holder would be required to satisfy before the Holder would become entitled to distribution pursuant to Section 10.3 and the number
of Units awarded to the Holder. Such conditions shall be sufficient to constitute a “substantial risk of forfeiture”
as such term is defined under Section 409A of the Code. At the time of such Award, the Committee may, in its sole discretion, prescribe
additional terms and conditions or restrictions relating to Restricted Stock Unit Awards in the Restricted Stock Unit Agreement,
including, but not limited to, rules pertaining to the effect of Termination of Service prior to expiration of the applicable vesting
period. The terms and conditions of the respective Restricted Stock Unit Agreements need not be identical.
10.3 Distributions
of Shares. The Holder of a Restricted Stock Unit shall be entitled to receive a cash payment equal to the Fair Market Value
of an Share, or one Share, as determined in the sole discretion of the Committee and as set forth in the Restricted Stock Unit
Agreement, for each Restricted Stock Unit subject to such Restricted Stock Unit Award, if the Holder satisfies the applicable vesting
requirement. Such distribution shall be made no later than by the fifteenth (15th) day of the third (3rd)
calendar month next following the end of the calendar year in which the Restricted Stock Unit first becomes vested (i.e., no longer
subject to a “substantial risk of forfeiture”).
Article
XI
PERFORMANCE UNIT AWARDS
11.1 Award.
A Performance Unit Award shall constitute an Award under which, upon the satisfaction of predetermined individual and/or Company
(and/or Affiliate) Performance Goals based on selected Performance Criteria, a cash payment shall be made to the Holder, based
on the number of Units awarded to the Holder. At the time a Performance Unit Award is made, the Committee shall establish the Performance
Period and applicable Performance Goals. Each Performance Unit Award may have different Performance Goals, in the discretion of
the Committee. A Performance Unit Award shall not constitute an equity interest in the Company and shall not entitle the Holder
to voting rights, dividends or any other rights associated with ownership of Shares.
Titan Pharmaceuticals, Inc, 2015 Omnibus Equity Incentive Plan |
11.2 Terms
and Conditions. At the time any Award is made under this Article XI, the Company and the Holder shall enter into a Performance
Unit Agreement setting forth each of the matters contemplated thereby and such other matters as the Committee may determine to
be appropriate. The Committee shall set forth in the applicable Performance Unit Agreement the Performance Period, Performance
Criteria and Performance Goals which the Holder and/or the Company would be required to satisfy before the Holder would become
entitled to payment pursuant to Section 11.3, the number of Units awarded to the Holder and the dollar value or formula assigned
to each such Unit. Such payment shall be subject to a “substantial risk of forfeiture” under Section 409A of the Code.
At the time of such Award, the Committee may, in its sole discretion, prescribe additional terms and conditions or restrictions
relating to Performance Unit Awards, including, but not limited to, rules pertaining to the effect of Termination of Service prior
to expiration of the applicable performance period. The terms and conditions of the respective Performance Unit Agreements need
not be identical.
11.3 Payments.
The Holder of a Performance Unit shall be entitled to receive a cash payment equal to the dollar value assigned to such Unit under
the applicable Performance Unit Agreement if the Holder and/or the Company satisfy (or partially satisfy, if applicable under the
applicable Performance Unit Agreement) the Performance Goals set forth in such Performance Unit Agreement. If necessary to satisfy
the requirements of Code Section 162(m), if applicable, the achievement of such Performance Goals shall be certified in writing
by the Committee prior to any payment. All payments shall be made no later than by the fifteenth (15th) day of the third
(3rd) calendar month next following the end of the Company’s fiscal year to which such performance goals and objectives
relate.
Article
XII
PERFORMANCE STOCK AWARDS
12.1 Award.
A Performance Stock Award shall constitute a promise to grant Shares (or cash equal to the Fair Market Value of Shares) to the
Holder at the end of a specified Performance Period subject to achievement of specified Performance Goals. At the time a Performance
Stock Award is made, the Committee shall establish the Performance Period and applicable Performance Goals based on selected Performance
Criteria. Each Performance Stock Award may have different Performance Goals, in the discretion of the Committee. A Performance
Stock Award shall not constitute an equity interest in the Company and shall not entitle the Holder to voting rights, dividends
or any other rights associated with ownership of Shares unless and until the Holder shall receive a distribution of Shares pursuant
to Section 11.3.
12.2 Terms
and Conditions. At the time any Award is made under this Article XII, the Company and the Holder shall enter into a Performance
Stock Agreement setting forth each of the matters contemplated thereby and such other matters as the Committee may determine to
be appropriate. The Committee shall set forth in the applicable Performance Stock Agreement the Performance Period, selected Performance
Criteria and Performance Goals which the Holder and/or the Company would be required to satisfy before the Holder would become
entitled to the receipt of Shares pursuant to such Holder’s Performance Stock Award and the number of Shares subject to such
Performance Stock Award. Such distribution shall be subject to a “substantial risk of forfeiture” under Section 409A
of the Code. If such Performance Goals are achieved, the distribution of Shares (or the payment of cash, as determined in the sole
discretion of the Committee), shall be made no later than by the fifteenth (15th) day of the third (3rd)
calendar month next following the end of the Company’s fiscal year to which such goals and objectives relate. At the time
of such Award, the Committee may, in its sole discretion, prescribe additional terms and conditions or restrictions relating to
Performance Stock Awards, including, but not limited to, rules pertaining to the effect of the Holder’s Termination of Service
prior to the expiration of the applicable performance period. The terms and conditions of the respective Performance Stock Agreements
need not be identical.
Titan Pharmaceuticals, Inc, 2015 Omnibus Equity Incentive Plan |
12.3 Distributions
of Shares. The Holder of a Performance Stock Award shall be entitled to receive a cash payment equal to the Fair Market Value
of a Share, or one Share, as determined in the sole discretion of the Committee, for each Performance Stock Award subject to such
Performance Stock Agreement, if the Holder satisfies the applicable vesting requirement. If necessary to satisfy the requirements
of Code Section 162(m), if applicable, the achievement of such Performance Goals shall be certified in writing by the Committee
prior to any payment. Such distribution shall be made no later than by the fifteenth (15th) day of the third (3rd)
calendar month next following the end of the Company’s fiscal year to which such performance goals and objectives relate.
Article
XIII
DISTRIBUTION EQUIVALENT RIGHTS
13.1 Award.
A Distribution Equivalent Right shall entitle the Holder to receive bookkeeping credits, cash payments and/or Share distributions
equal in amount to the distributions that would have been made to the Holder had the Holder held a specified number of Shares during
the specified period of the Award.
13.2 Terms
and Conditions. At the time any Award is made under this Article XIII, the Company and the Holder shall enter into a Distribution
Equivalent Rights Award Agreement setting forth each of the matters contemplated thereby and such other matters as the Committee
may determine to be appropriate. The Committee shall set forth in the applicable Distribution Equivalent Rights Award Agreement
the terms and conditions, if any, including whether the Holder is to receive credits currently in cash, is to have such credits
reinvested (at Fair Market Value determined as of the date of reinvestment) in additional Shares or is to be entitled to choose
among such alternatives. Such receipt shall be subject to a “substantial risk of forfeiture” under Section 409A of
the Code and, if such Award becomes vested, the distribution of such cash or Shares shall be made no later than by the fifteenth
(15th) day of the third (3rd) calendar month next following the end of the Company’s fiscal year in
which the Holder’s interest in the Award vests. Distribution Equivalent Rights Awards may be settled in cash or in Shares,
as set forth in the applicable Distribution Equivalent Rights Award Agreement. A Distribution Equivalent Rights Award may, but
need not be, awarded in tandem with another Award (other than an Option or a SAR), whereby, if so awarded, such Distribution Equivalent
Rights Award shall expire, terminate or be forfeited by the Holder, as applicable, under the same conditions as under such other
Award.
Titan Pharmaceuticals, Inc, 2015 Omnibus Equity Incentive Plan |
13.3 Interest
Equivalents. The Distribution Equivalent Rights Award Agreement for a Distribution Equivalent Rights Award may provide for
the crediting of interest on a Distribution Rights Award to be settled in cash at a future date (but in no event later than by
the fifteenth (15th) day of the third (3rd) calendar month next following the end of the Company’s
fiscal year in which such interest is credited and vested), at a rate set forth in the applicable Distribution Equivalent Rights
Award Agreement, on the amount of cash payable thereunder.
Article
XIV
STOCK APPRECIATION RIGHTS
14.1 Award.
A Stock Appreciation Right shall constitute a right, granted alone or in connection with a related Option, to receive a payment
equal to the increase in value of a specified number of Shares between the date of Award and the date of exercise.
14.2 Terms
and Conditions. At the time any Award is made under this Article XIV, the Company and the Holder shall enter into a Stock Appreciation
Right Agreement setting forth each of the matters contemplated thereby and such other matters as the Committee may determine to
be appropriate. The Committee shall set forth in the applicable Stock Appreciation Right Agreement the terms and conditions of
the Stock Appreciation Right, including (i) the base value (the “Base Value”) for the Stock Appreciation Right,
which shall be not less than the Fair Market Value of a Share on the date of grant of the Stock Appreciation Right, (ii) the number
of Shares subject to the Stock Appreciation Right, (iii) the period during which the Stock Appreciation Right may be exercised;
provided, however, that no Stock Appreciation Right shall be exercisable after the expiration of ten (10) years from
the date of its grant, and (iv) any other special rules and/or requirements which the Committee imposes upon the Stock Appreciation
Right. Upon the exercise of some or all of the portion of a Stock Appreciation Right, the Holder shall receive a payment from the
Company, in cash or in the form of Shares having an equivalent Fair Market Value or in a combination of both, as determined in
the sole discretion of the Committee, equal to the product of:
(a) The
excess of (i) the Fair Market Value of an Share on the date of exercise, over (ii) the Base Value, multiplied by,
(b) The
number of Shares with respect to which the Stock Appreciation Right is exercised.
Titan Pharmaceuticals, Inc, 2015 Omnibus Equity Incentive Plan |
14.3 Tandem
Stock Appreciation Rights. If the Committee grants a Stock Appreciation Right which is intended to be a Tandem Stock Appreciation
Right, the Tandem Stock Appreciation Right shall be granted at the same time as the related Option, and the following special rules
shall apply:
(a) The
Base Value shall be equal to or greater than the per Share exercise price under the related Option;
(b) The
Tandem Stock Appreciation Right may be exercised for all or part of the Shares which are subject to the related Option, but solely
upon the surrender by the Holder of the Holder’s right to exercise the equivalent portion of the related Option (and when
a Share is purchased under the related Option, an equivalent portion of the related Tandem Stock Appreciation Right shall be canceled);
(c) The
Tandem Stock Appreciation Right shall expire no later than the date of the expiration of the related Option;
(d) The
value of the payment with respect to the Tandem Stock Appreciation Right may be no more than one hundred percent (100%) of the
difference between the per Share exercise price under the related Option and the Fair Market Value of the Shares subject to the
related Option at the time the Tandem Stock Appreciation Right is exercised, multiplied by the number of the Shares with respect
to which the Tandem Stock Appreciation Right is exercised; and
(e) The
Tandem Stock Appreciation Right may be exercised solely when the Fair Market Value of the Shares subject to the related Option
exceeds the per Share exercise price under the related Option.
Article
XV
RECAPITALIZATION OR REORGANIZATION
15.1 Adjustments
to Shares. The shares with respect to which Awards may be granted under the Plan are Shares as presently constituted; provided,
however, that if, and whenever, prior to the expiration or distribution to the Holder of Shares underlying an Award theretofore
granted, the Company shall effect a subdivision or consolidation of the Shares or the payment of an Share dividend on Shares without
receipt of consideration by the Company, the number of Shares with respect to which such Award may thereafter be exercised or satisfied,
as applicable, (i) in the event of an increase in the number of outstanding Shares, shall be proportionately increased, and
the purchase price per Share shall be proportionately reduced, and (ii) in the event of a reduction in the number of outstanding
Shares, shall be proportionately reduced, and the purchase price per Share shall be proportionately increased. Notwithstanding
the foregoing or any other provision of this Article XV, any adjustment made with respect to an Award (x) which is an Incentive
Stock Option, shall comply with the requirements of Section 424(a) of the Code, and in no event shall any adjustment be made which
would render any Incentive Stock Option granted under the Plan to be other than an “incentive stock option” for purposes
of Section 422 of the Code, and (y) which is a Non-qualified Stock Option, shall comply with the requirements of Section 409A of
the Code, and in no event shall any adjustment be made which would render any Non-qualified Stock Option granted under the Plan
to become subject to Section 409A of the Code.
Titan Pharmaceuticals, Inc, 2015 Omnibus Equity Incentive Plan |
15.2 Recapitalization.
If the Company recapitalizes or otherwise changes its capital structure, thereafter upon any exercise or satisfaction, as applicable,
of a previously granted Award, the Holder shall be entitled to receive (or entitled to purchase, if applicable) under such Award,
in lieu of the number of Shares then covered by such Award, the number and class of shares and securities to which the Holder would
have been entitled pursuant to the terms of the recapitalization if, immediately prior to such recapitalization, the Holder had
been the holder of record of the number of Shares then covered by such Award.
15.3 Other
Events. In the event of changes to the outstanding Shares by reason of an extraordinary cash dividend, reorganization, merger,
consolidation, combination, split-up, spin-off, exchange or other relevant change in capitalization occurring after the date of
the grant of any Award and not otherwise provided for under this Article XV, any outstanding Awards and any Award Agreements evidencing
such Awards shall be adjusted by the Board in its discretion in such manner as the Board shall deem equitable or appropriate taking
into consideration the applicable accounting and tax consequences, as to the number and price of Shares or other consideration
subject to such Awards. In the event of any adjustment pursuant to Sections 15.1, 15.2 or this Section 15.3, the aggregate number
of Shares available under the Plan pursuant to Section 5.1 (and the Code Section 162(m) limit set forth therein) may be appropriately
adjusted by the Board, the determination of which shall be conclusive. In addition, the Committee may make provision for a cash
payment to a Holder or a person who has an outstanding Award. The number of Shares subject to any Award shall be rounded to the
nearest whole number.
15.4 Powers
Not Affected. The existence of the Plan and the Awards granted hereunder shall not affect in any way the right or power of
the Board or of the stockholders of the Company to make or authorize any adjustment, recapitalization, reorganization or other
change of the Company’s capital structure or business, any merger or consolidation of the Company, any issue of debt or equity
securities ahead of or affecting Shares or the rights thereof, the dissolution or liquidation of the Company or any sale, lease,
exchange or other disposition of all or any part of its assets or business or any other corporate act or proceeding.
15.5 No
Adjustment for Certain Awards. Except as hereinabove expressly provided, the issuance by the Company of shares of any class
or securities convertible into shares of any class, for cash, property, labor or services, upon direct sale, upon the exercise
of rights or warrants to subscribe therefor or upon conversion of shares or obligations of the Company convertible into such shares
or other securities, and in any case whether or not for fair value, shall not affect previously granted Awards, and no adjustment
by reason thereof shall be made with respect to the number of Shares subject to Awards theretofore granted or the purchase price
per Share, if applicable.
Titan Pharmaceuticals, Inc, 2015 Omnibus Equity Incentive Plan |
Article
XVI
AMENDMENT AND TERMINATION OF PLAN
The Plan shall continue in effect, unless
sooner terminated pursuant to this Article XVI, until the tenth (10th) anniversary of the date on which it is adopted
by the Board (except as to Awards outstanding on that date). The Board in its discretion may terminate the Plan at any time with
respect to any shares for which Awards have not theretofore been granted; provided, however, that the Plan’s
termination shall not materially and adversely impair the rights of a Holder with respect to any Award theretofore granted without
the consent of the Holder. The Board shall have the right to alter or amend the Plan or any part hereof from time to time; provided,
however, that without the approval by a majority of the votes cast at a meeting of stockholders at which a quorum representing
a majority of the shares of the Company entitled to vote generally in the election of directors is present in person or by proxy,
no amendment or modification of the Plan may (i) materially increase the benefits accruing to Holders, (ii) except as
otherwise expressly provided in Article XV, materially increase the number of Shares subject to the Plan or the individual Award
Agreements specified in Article V, (iii) materially modify the requirements for participation in the Plan, or (iv) amend,
modify or suspend Section 7.7 (re-pricing prohibitions) or this Article XVI. In addition, no change in any Award theretofore granted
may be made which would materially and adversely impair the rights of a Holder with respect to such Award without the consent of
the Holder (unless such change is required in order to cause the benefits under the Plan to qualify as “performance-based”
compensation within the meaning of Section 162(m) of the Code or to exempt the Plan or any Award from Section 409A of the Code).
Article
XVII
MISCELLANEOUS
17.1 No
Right to Award. Neither the adoption of the Plan by the Company nor any action of the Board or the Committee shall be deemed
to give an Employee, Director or Consultant any right to an Award except as may be evidenced by an Award Agreement duly executed
on behalf of the Company, and then solely to the extent and on the terms and conditions expressly set forth therein.
17.2 No
Rights Conferred. Nothing contained in the Plan shall (i) confer upon any Employee any right with respect to continuation
of employment with the Company or any Affiliate, (ii) interfere in any way with any right of the Company or any Affiliate
to terminate the employment of an Employee at any time, (iii) confer upon any Director any right with respect to continuation
of such Director’s membership on the Board, (iv) interfere in any way with any right of the Company or an Affiliate
to terminate a Director’s membership on the Board at any time, (v) confer upon any Consultant any right with respect
to continuation of his or her consulting engagement with the Company or any Affiliate, or (vi) interfere in any way with any
right of the Company or an Affiliate to terminate a Consultant’s consulting engagement with the Company or an Affiliate at
any time.
Titan Pharmaceuticals, Inc, 2015 Omnibus Equity Incentive Plan |
17.3 Other
Laws; No Fractional Shares; Withholding. The Company shall not be obligated by virtue of any provision of the Plan to recognize
the exercise of any Award or to otherwise sell or issue Shares in violation of any laws, rules or regulations, and any postponement
of the exercise or settlement of any Award under this provision shall not extend the term of such Award. Neither the Company nor
its directors or officers shall have any obligation or liability to a Holder with respect to any Award (or Shares issuable thereunder)
(i) that shall lapse because of such postponement, or (ii) for any failure to comply with the requirements of any applicable
law, rules or regulations, including but not limited to any failure to comply with the requirements of Section 409A of this Code.
No fractional Shares shall be delivered, nor shall any cash in lieu of fractional Shares be paid. The Company shall have the right
to deduct in cash (whether under this Plan or otherwise) in connection with all Awards any taxes required by law to be withheld
and to require any payments required to enable it to satisfy its withholding obligations. In the case of any Award satisfied in
the form of Shares, no Shares shall be issued unless and until arrangements satisfactory to the Company shall have been made to
satisfy any tax withholding obligations applicable with respect to such Award. Subject to such terms and conditions as the Committee
may impose, the Company shall have the right to retain, or the Committee may, subject to such terms and conditions as it may establish
from time to time, permit Holders to elect to tender, Shares (including Shares issuable in respect of an Award) to satisfy, in
whole or in part, the amount required to be withheld.
17.4 No
Restriction on Corporate Action. Nothing contained in the Plan shall be construed to prevent the Company or any Affiliate from
taking any corporate action which is deemed by the Company or such Affiliate to be appropriate or in its best interest, whether
or not such action would have an adverse effect on the Plan or any Award made under the Plan. No Employee, Director, Consultant,
beneficiary or other person shall have any claim against the Company or any Affiliate as a result of any such action.
17.5 Restrictions
on Transfer. No Award under the Plan or any Award Agreement and no rights or interests herein or therein, shall or may be assigned,
transferred, sold, exchanged, encumbered, pledged or otherwise hypothecated or disposed of by a Holder except by will or by
the laws of descent and distribution. An Award may be exercisable during the lifetime of the Holder only by such Holder or by the
Holder’s guardian or legal representative.
17.6 Beneficiary
Designations. Each Holder may, from time to time, name a beneficiary or beneficiaries (who may be contingent or successive
beneficiaries) for purposes of receiving any amount which is payable in connection with an Award under the Plan upon or subsequent
to the Holder’s death. Each such beneficiary designation shall serve to revoke all prior beneficiary designations, be in
a form prescribed by the Company and be effective solely when filed by the Holder in writing with the Company during the Holder’s
lifetime. In the absence of any such written beneficiary designation, for purposes of the Plan, a Holder’s beneficiary shall
be the Holder’s estate.
Titan Pharmaceuticals, Inc, 2015 Omnibus Equity Incentive Plan |
17.7 Rule
16b-3. It is intended that the Plan and any Award made to a person subject to Section 16 of the Exchange Act shall meet all
of the requirements of Rule 16b-3. If any provision of the Plan or of any such Award would disqualify the Plan or such Award
under, or would otherwise not comply with the requirements of, Rule 16b-3, such provision or Award shall be construed or deemed
to have been amended as necessary to conform to the requirements of Rule 16b-3.
17.8 Section
162(m). The following conditions shall apply if it is intended that the requirements of Section 162(m) of the Code be satisfied
such that Awards under the Plan which are made to Holders who are “covered employees” (as defined in Section 162(m)
of the Code) shall constitute “performance-based” compensation within the meaning of Section 162(m) of the Code: Any
Performance Goal(s) applicable to Qualified Performance-Based Awards shall be objective, shall be established not later than ninety
(90) days after the beginning of any applicable Performance Period (or at such other date as may be required or permitted for “performance-based”
compensation under Section 162(m) of the Code) and shall otherwise meet the requirements of Section 162(m) of the Code, including
the requirement that the outcome of the Performance Goal or Goals be substantially uncertain (as defined in the regulations under
Section 162(m) of the Code) at the time established. The Performance Criteria to be utilized under the Plan to establish Performance
Goals shall consist of objective tests based on one or more of the following: earnings or earnings per share, cash flow or cash
flow per share, operating cash flow or operating cash flow per share revenue growth, product revenue growth, financial return ratios
(such as return on equity, return on investment and/or return on assets), share price performance, stockholder return, equity and/or
value, operating income, operating margins, earnings before interest, taxes, depreciation and amortization, earnings, pre- or post-tax
income, economic value added (or an equivalent metric), profit returns and margins, credit quality, sales growth, market share,
working capital levels, comparisons with various share market indices, year-end cash, debt reduction, assets under management,
operating efficiencies, strategic partnerships or transactions (including co-development, co-marketing, profit sharing, joint venture
or other similar arrangements), and/or financing and other capital raising transaction. Performance criteria may be established
on a Company-wide basis or with respect to one or more Company business units or divisions or subsidiaries; and either in absolute
terms, relative to the performance of one or more similarly situated companies, or relative to the performance of an index covering
a peer group of companies. When establishing Performance Goals for the applicable Performance Period, the Committee may exclude
any or all “extraordinary items” as determined under U.S. generally accepted accounting principles including, without
limitation, the charges or costs associated with restructurings of the Company, discontinued operations, other unusual or non-recurring
items, and the cumulative effects of accounting changes, and as identified in the Company’s financial statements, notes to
the Company’s financial statements or management’s discussion and analysis of financial condition and results of operations
contained in the Company’s most recent annual report filed with the U.S. Securities and Exchange Commission pursuant to the
Exchange Act. Holders who are “covered employees” (as defined in Section 162(m) of the Code) shall be eligible
to receive payment under a Qualified Performance-Based Award which is subject to achievement of a Performance Goal or Goals only
if the applicable Performance Goal or Goals are achieved within the applicable Performance Period, as determined by the Committee.
If any provision of the Plan would disqualify the Plan or would not otherwise permit the Plan to comply with Section 162(m)
of the Code as so intended, such provision shall be construed or deemed amended to conform to the requirements or provisions of
Section 162(m) of the Code. The Committee may postpone the exercising of Awards, the issuance or delivery of Shares under any Award
or any action permitted under the Plan to prevent the Company or any subsidiary from being denied a federal income tax deduction,
provided that such deferral satisfies the requirements of Section 409A of the Code. For purposes of the requirements of Treasury
Regulation Section 1.162-27(e)(4)(i), the maximum aggregate amount that may be paid in cash during any calendar year to any
one person (measured from the date of any payment) with respect to one or more Awards payable in cash shall be Ten Million Dollars
($10,000,000)].
Titan Pharmaceuticals, Inc, 2015 Omnibus Equity Incentive Plan |
17.9 Section
409A. Notwithstanding any other provision of the Plan, the Committee shall have no authority to issue an Award under the Plan
with terms and/or conditions which would cause such Award to constitute non-qualified “deferred compensation” under
Section 409A of the Code unless such Award shall be structured to be exempt from or comply with all requirements of Code Section
409A. The Plan and all Award Agreements are intended to comply with the requirements of Section 409A of the Code (or to be
exempt therefrom) and shall be so interpreted and construed and no amount shall be paid or distributed from the Plan unless and
until such payment complies with all requirements of Code Section 409A. It is the intent of the Company that the provisions of
this Agreement and all other plans and programs sponsored by the Company be interpreted to comply in all respects with Code Section
409A, however, the Company shall have no liability to the Holder, or any successor or beneficiary thereof, in the event taxes,
penalties or excise taxes may ultimately be determined to be applicable to any payment or benefit received by the Holder or any
successor or beneficiary thereof.
17.10 Indemnification.
Each person who is or shall have been a member of the Committee or of the Board shall be indemnified and held harmless by the Company
against and from any loss, cost, liability, or expense that may be imposed upon or reasonably incurred thereby in connection with
or resulting from any claim, action, suit, or proceeding to which such person may be made a party or may be involved by reason
of any action taken or failure to act under the Plan and against and from any and all amounts paid thereby in settlement thereof,
with the Company’s approval, or paid thereby in satisfaction of any judgment in any such action, suit, or proceeding against
such person; provided, however, that such person shall give the Company an opportunity, at its own expense, to handle
and defend the same before he or she undertakes to handle and defend it on his or her own behalf. The foregoing right of indemnification
shall not be exclusive and shall be independent of any other rights of indemnification to which such persons may be entitled under
the Company’s Articles of Incorporation or By-laws, by contract, as a matter of law, or otherwise.
17.11 Other
Benefit Plans. No Award, payment or amount received hereunder shall be taken into account in computing an Employee’s
salary or compensation for the purposes of determining any benefits under any pension, retirement, life insurance or other benefit
plan of the Company or any Affiliate, unless such other plan specifically provides for the inclusion of such Award, payment or
amount received. Nothing in the Plan shall be construed to limit the right of the Company to establish other plans or to pay compensation
to its employees, in cash or property, in a manner which is not expressly authorized under the Plan.
Titan Pharmaceuticals, Inc, 2015 Omnibus Equity Incentive Plan |
17.12 Limits
of Liability. Any liability of the Company with respect to an Award shall be based solely upon the contractual obligations
created under the Plan and the Award Agreement. None of the Company, any member of the Board nor any member of the Committee shall
have any liability to any party for any action taken or not taken, in good faith, in connection with or under the Plan.
17.13 Governing
Law. Except as otherwise provided herein, the Plan shall be construed in accordance with the laws of the State of Delaware,
without regard to principles of conflicts of law.
17.14 Severability
of Provisions. If any provision of the Plan is held invalid or unenforceable, such invalidity or unenforceability shall not
affect any other provision of the Plan, and the Plan shall be construed and enforced as if such invalid or unenforceable provision
had not been included in the Plan.
17.15 No
Funding. The Plan shall be unfunded. The Company shall not be required to establish any special or separate fund or to make
any other segregation of funds or assets to ensure the payment of any Award. Prior to receipt of Shares or a cash distribution
pursuant to the terms of an Award, such Award shall represent an unfunded unsecured contractual obligation of the Company and the
Holder shall have no greater claim to the Shares underlying such Award or any other assets of the Company or Affiliate than any
other unsecured general creditor.
17.16 Headings.
Headings used throughout the Plan are for convenience only and shall not be given legal significance.
Titan Pharmaceuticals (NASDAQ:TTNP)
Historical Stock Chart
From Mar 2024 to Apr 2024
Titan Pharmaceuticals (NASDAQ:TTNP)
Historical Stock Chart
From Apr 2023 to Apr 2024