Our Board of Directors does not know of any other matters that may come before the meeting. However, if any other matters are properly
presented to the meeting, it is the intention of the person named in the accompanying proxy card to vote, or otherwise act, in accordance with their judgment on such matters.
We will bear the cost of solicitation of proxies. In addition to the solicitation of proxies by mail, our officers and employees may solicit
proxies in person or by telephone. We may reimburse brokers or persons holding stock in their names, or in the names of their nominees, for their expenses in sending proxies and proxy material to beneficial owners.
The Compensation Committee Report and the Audit Committee Report contained in this proxy statement are not deemed filed with the SEC and shall
not be deemed incorporated by reference into any prior or future filings made by us under the Securities Act or the Exchange Act, except to the extent that we specifically incorporate such information by reference.
Keryx Biopharmaceuticals, Inc., a corporation
organized and existing under and by virtue of the Delaware General Corporation Law (the Corporation), does hereby certify:
FIRST: That on
March 31, 2016, the Board of Directors of the Corporation adopted resolutions setting forth a proposed amendment to the Amended and Restated Certificate of Incorporation and declaring its advisability. The proposed amendment is as follows:
RESOLVED, that the Corporations Amended and Restated Certificate of Incorporation be amended by deleting Article FOURTH in its entirety
and by substituting in lieu thereof the following:
FOURTH: The total number of shares of all classes of stock which the Corporation
shall have the authority to issue is 185,000,000, which is divided into 180,000,000 shares of Common Stock and; par value $0.001 per share, and 5,000,000 shares of Preferred Stock; par value $0.001 per share.
SECOND: That said amendment was duly adopted in accordance with the provisions of Section 242 of the Delaware General Corporation Law.
IN WITNESS WHEREOF, the Corporation has caused this certificate to be signed by a duly authorized officer this day of May, 2016.
FORM OF KERYX BIOPHARMACEUTICALS, INC.
AMENDED AND RESTATED 2013
INCENTIVE PLAN
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ARTICLE 1
PURPOSE
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B-4
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1.1
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General
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B-4
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ARTICLE 2
DEFINITIONS
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B-4
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2.1
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Definitions
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B-4
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ARTICLE 3
EFFECTIVE TERM OF PLAN
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B-9
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3.1
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Effective Date
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B-9
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3.2
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Term of Plan
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B-9
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ARTICLE 4
ADMINISTRATION
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B-9
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4.1
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Committee
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B-9
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4.2
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Actions and Interpretations by the Committee
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B-9
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4.3
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Authority of Committee
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B-10
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4.4
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Delegation
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B-10
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4.5
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Indemnification
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B-11
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ARTICLE 5
SHARES SUBJECT TO THE PLAN
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B-11
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5.1
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Number of Shares
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B-11
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5.2
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Share Counting
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B-11
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5.3
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Stock Distributed
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B-12
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5.4
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Limitation on Awards
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B-12
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ARTICLE 6
ELIGIBILITY
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B-13
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6.1
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General
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B-13
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ARTICLE 7
STOCK OPTIONS
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B-13
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7.1
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General
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B-13
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7.2
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Incentive Stock Options
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B-14
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ARTICLE 8
STOCK APPRECIATION RIGHTS
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B-14
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8.1
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Grant of Stock Appreciation Rights
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B-14
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ARTICLE 9
RESTRICTED STOCK, RESTRICTED STOCK UNITS AND DEFERRED STOCK
UNITS
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B-15
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9.1
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Grant of Restricted Stock and Stock Units
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B-15
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9.2
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Issuance and Restrictions
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B-15
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9.3
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Forfeiture
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B-15
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9.4
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Delivery of Restricted Stock
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B-15
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ARTICLE 10
PERFORMANCE AWARDS
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B-15
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10.1
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Grant of Performance Awards
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B-15
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10.2
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Performance Goals
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B-15
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ARTICLE 11
QUALIFIED STOCK-BASED AWARDS
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B-16
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11.1
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Options and Stock Appreciation Rights
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B-16
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11.2
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Other Awards
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B-16
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11.3
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Performance Goals
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B-17
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11.4
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Inclusions and Exclusions from Performance Criteria
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B-17
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11.5
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Certification of Performance Goals
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B-17
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11.6
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Award Limits
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B-18
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ARTICLE 12
DIVIDEND EQUIVALENTS
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B-18
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12.1
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Grant of Dividend Equivalents
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B-18
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ARTICLE 13
STOCK OR OTHER STOCK-BASED AWARDS
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B-18
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13.1
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Grant of Stock or Other Stock-Based Awards
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B-18
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ARTICLE 14
PROVISIONS APPLICABLE TO AWARDS
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B-18
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14.1
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Award Certificates
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B-18
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14.2
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Form of Payment of Awards
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B-18
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B-2
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14.3
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Limits on Transfer
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B-19
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14.4
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Beneficiaries
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B-19
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14.5
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Stock Trading Restrictions
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B-19
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14.6
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Effect of a Change in Control
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B-19
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14.7
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Acceleration for Other Reasons
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B-20
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14.8
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Forfeiture Events
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B-20
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14.9
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Substitute Awards
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B-20
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ARTICLE 15
CHANGES IN CAPITAL STRUCTURE
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B-21
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15.1
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Mandatory Adjustments
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B-21
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15.2
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Discretionary Adjustments
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B-21
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15.3
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General
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B-21
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ARTICLE 16
AMENDMENT, MODIFICATION AND TERMINATION
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B-21
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16.1
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Amendment, Modification and Termination
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B-21
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16.2
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Awards Previously Granted
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B-22
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16.3
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Compliance Amendments
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B-22
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ARTICLE 17
GENERAL PROVISIONS
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B-23
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17.1
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Rights of Participants
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B-23
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17.2
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Withholding
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B-23
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17.3
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Special Provisions Related to Section 409A of the Code
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B-23
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17.4
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Unfunded Status of Awards
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B-25
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17.5
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Relationship to Other Benefits
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B-25
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17.6
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Expenses
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B-25
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17.7
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Titles and Headings
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B-25
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17.8
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Gender and Number
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B-25
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17.9
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Fractional Shares
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B-25
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17.10
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Government and Other Regulations
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B-25
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17.11
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Governing Law
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B-26
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17.12
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Severability
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B-26
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17.13
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No Limitations on Rights of Company
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B-26
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B-3
KERYX BIOPHARMACEUTICALS, INC.
AMENDED AND RESTATED 2013 INCENTIVE
PLAN
ARTICLE 1
PURPOSE
1.1. GENERAL. The purpose of the
Keryx Biopharmaceuticals, Inc. Amended and Restated 2013 Incentive Plan (the Plan) is to promote the success, and enhance the value, of Keryx Biopharmaceuticals, Inc. (the Company), by linking the personal interests of
employees, officers, directors, and consultants of the Company or any Affiliate (as defined below) to those of Company stockholders and by providing such persons with an incentive for outstanding performance. The Plan is further intended to provide
flexibility to the Company in its ability to motivate, attract, and retain the services of employees, officers, directors and consultants upon whose judgment, interest, and special effort the successful conduct of the Companys operation is
largely dependent. Accordingly, the Plan permits the grant of incentive awards from time to time to selected employees, officers, directors, and consultants of the Company and its Affiliates.
ARTICLE 2
DEFINITIONS
2.1. DEFINITIONS. When a word or phrase appears in this Plan with the initial letter capitalized, and the word or phrase does not commence a
sentence, the word or phrase shall generally be given the meaning ascribed to it in this Section or in Section 1.1 unless a clearly different meaning is required by the context. The following words and phrases shall have the following meanings:
(a) Affiliate means (i) any Subsidiary or Parent, or (ii) an entity that directly or through one or more intermediaries controls, is
controlled by or is under common control with, the Company, as determined by the Committee.
(b) Award means an award of Options, Stock
Appreciation Rights, Restricted Stock, Restricted Stock Units, Deferred Stock Units, Performance Awards, Dividend Equivalents, Other Stock-Based Awards, or any other right or interest relating to Stock or cash, granted to a Participant under the
Plan.
(c) Award Certificate means a written document, in such form as the Committee prescribes from time to time, setting forth the terms and
conditions of an Award. Award Certificates may be in the form of individual award agreements or certificates or a program document describing the terms and provisions of an Award or series of Awards under the Plan. The Committee may provide for the
use of electronic, internet or other non-paper Award Certificates, and the use of electronic, internet or other non-paper means for the acceptance thereof and actions thereunder by a Participant.
(d) Board means the Board of Directors of the Company.
(e) Cause as a reason for a Participants termination of employment shall have the meaning assigned such term in the employment, severance or
similar agreement, if any, between such Participant and the Company or an Affiliate, provided, however that if there is no such employment, severance or similar agreement in which such term is defined, and unless otherwise defined in the applicable
Award Certificate, Cause shall mean any of the following acts by the Participant, as determined by the Committee: (a) a material breach of the terms of a Participants Proprietary Information and Inventions Agreement or any
provisions relating to non-competition or non-solicitation in any employment or other agreement; (b) a material breach by the Participant of any other provision of his or her employment arrangement, which is not cured by the Participant within
fifteen (15) days after receiving notice thereof from the Company containing a description of the breach or breaches alleged to have occurred; (c) the habitual neglect or gross failure by a Participant to adequately perform the duties of
his or her position;
B-4
(d) any act of moral turpitude or criminal action connected to a Participants employment with the Company
or his or her place of employment; or (e) a Participants repetitive refusal to comply with or his or her violation of lawful instructions of the Chief Executive Officer, Chief Financial Officer or the Board of Directors, unless cured
within fifteen (15) days after receiving notice thereof.
(f) Change in Control means and includes the occurrence of any one of the
following events:
(i) the acquisition by an individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the 1934 Act) (a
Person) of beneficial ownership of any capital stock of the Company if, after such acquisition, such Person beneficially owns (within the meaning of Rule 13d-3 promulgated under the 1934 Act) 30% or more of either (x) the
then-outstanding shares of common stock of the Company (the Outstanding Company Common Stock) or (y) the combined voting power of the
then-
outstanding securities of the Company entitled to
vote generally in the election of directors (the Outstanding Company Voting Securities); provided, however, that for purposes of this subsection (i), the following acquisitions shall not constitute a Change in Control: (A) any
acquisition directly from the Company (excluding an acquisition pursuant to the exercise, conversion or exchange of any security exercisable for, convertible into or exchangeable for common stock or voting securities of the Company, unless the
Person exercising, converting or exchanging such security acquired such security directly from the Company or an underwriter or agent of the Company), (B) any acquisition by any employee benefit plan (or related trust) sponsored or maintained
by the Company or any corporation controlled by the Company, or (C) any acquisition by any corporation pursuant to a Business Combination (as defined below) which complies with clauses (x) and (y) of subsection (iii) of this
definition; or
(ii) such time as the Continuing Directors (as defined below) do not constitute a majority of the Board (or, if applicable, the Board of
Directors of a successor corporation to the Company), where the term Continuing Director means at any date a member of the Board (x) who was a member of the Board on the date of the initial adoption of this Plan by the Board or
(y) who was nominated or elected subsequent to such date by at least a majority of the directors who were Continuing Directors at the time of such nomination or election or whose election to the Board was recommended or endorsed by at least a
majority of the directors who were Continuing Directors at the time of such nomination or election; provided, however, that there shall be excluded from this clause (y) any individual whose initial assumption of office occurred as a result of
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 a person other than the Board; or
(iii) the consummation of a merger, consolidation, reorganization, recapitalization or share exchange involving the Company or a sale or other disposition of
all or substantially all of the assets of the Company (a Business Combination), unless, immediately following such Business Combination, each of the following two conditions is satisfied: (x) all or substantially all of the
individuals and entities who were the beneficial owners of the Outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than 50% of the
then-outstanding shares of common stock and the combined voting power of the then-outstanding securities entitled to vote generally in the election of directors, respectively, of the resulting or acquiring corporation in such Business Combination
(which shall include, without limitation, a corporation which as a result of such transaction owns the Company or substantially all of the Companys assets either directly or through one or more subsidiaries) (such resulting or acquiring
corporation is referred to herein as the Acquiring Corporation) in substantially the same proportions as their ownership of the Outstanding Company Common Stock and Outstanding Company Voting Securities, respectively, immediately prior
to such Business Combination and (y) no Person (excluding Exempt Persons, the Acquiring Corporation or any employee benefit plan (or related trust) maintained or sponsored by the Company or by the Acquiring Corporation) beneficially owns,
directly or indirectly, 30% or more of the then-outstanding shares of common stock of the Acquiring Corporation, or of the combined voting power of the then-outstanding securities of such corporation entitled to vote generally in the election of
directors (except to the extent that such ownership existed prior to the Business Combination).
B-5
(g) Code means the Internal Revenue Code of 1986, as amended from time to time. For purposes of this
Plan, references to sections of the Code shall be deemed to include references to any applicable regulations thereunder and any successor or similar provision.
(h) Committee means the committee of the Board described in Article 4.
(i) Company means Keryx Biopharmaceuticals, Inc., a Delaware corporation, or any successor corporation.
G) Continuous Service means the absence of any interruption or termination of service as an employee, officer, director or consultant of the
Company or any Affiliate, as applicable; provided, however, that for purposes of an Incentive Stock Option Continuous Service means the absence of any interruption or termination of service as an employee of the Company or any Parent or
Subsidiary, as applicable, pursuant to applicable tax regulations. Continuous Service shall not be considered interrupted in the following cases: (i) a Participant transfers employment between the Company and an Affiliate or between Affiliates,
(ii) in the discretion of the Committee as specified at or prior to such occurrence, in the case of a spin-off, sale or disposition of the Participants employer from the Company or any Affiliate, (iii) a Participant transfers from being
an employee of the Company or an Affiliate to being a director of the Company or of an Affiliate, or vice versa, (iv) in the discretion of the Committee as specified at or prior to such occurrence, a Participant transfers from being an employee
of the Company or an Affiliate to being a consultant to the Company or of an Affiliate, or vice versa, or (v) any leave of absence authorized in writing by the Company prior to its commencement; provided, however, that for purposes of Incentive
Stock Options, no such leave may exceed 90 days, unless reemployment upon expiration of such leave is guaranteed by statute or contract. Ifreemployment upon expiration of a leave of absence approved by the Company is not so guaranteed, on the 91st
day of such leave any Incentive Stock Option held by the Participant shall cease to be treated as an Incentive Stock Option and shall be treated for tax purposes as a Nonstatutory Stock Option. Whether military, government or other service or other
leave of absence shall constitute a termination of Continuous Service shall be determined in each case by the Committee at its discretion, and any determination by the Committee shall be final and conclusive; provided, however, that for purposes of
any Award that is subject to Code Section 409A, the determination of a leave of absence must comply with the requirements of a bona fide leave of absence as provided in Treas. Reg. Section 1.409A-1(h).
(k) Covered Employee means a covered employee as defined in Code Section 162(m)(3).
(I) Deferred Stock Unit means a right granted to a Participant under Article 9 to receive Shares (or the equivalent value in cash or other
property if the Committee so provides) at a future time as determined by the Committee, or as determined by the Participant within guidelines established by the Committee in the case of voluntary deferral elections.
(m) Disability of a Participant means that the Participant (i) is unable 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 can be expected to last for a continuous period of not less than 12 months, or (ii) is, by reason of any medically determinable physical or mental
impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than three months under an accident or health plan
covering employees of the Participants employer. If the determination of Disability relates to an Incentive Stock Option, Disability means Permanent and Total Disability as defined in Section 22(e)(3) of the Code. In the event of a
dispute, the determination of whether a Participant has incurred a Disability will be made by the Committee and may be supported by the advice of a physician competent in the area to which such Disability relates.
(n) Dividend Equivalent means a right granted with respect to under an Award pursuant to Article 12.
(o) Effective Date has the meaning assigned such term in Section 3.1.
B-6
(p) Eligible Participant means an employee (including a leased employee), officer, director, or
consultant of the Company or any Affiliate.
(q) Exchange means any national securities exchange on which the Stock may from time to time be
listed or traded.
(r) Fair Market Value, on any date, means (i) if the Stock is listed on a securities exchange, the closing sales price
on the principal such exchange on such date or, in the absence of reported sales on such date, the closing sales price on the immediately preceding date on which sales were reported, or (ii) if the Stock is not listed on a securities exchange,
the mean between the bid and offered prices as quoted by the applicable interdealer quotation system for such date, provided that if the Stock is not quoted on an interdealer quotation system or it is determined that the fair market value is not
properly reflected by such quotations, Fair Market Value will be determined by such other method as the Committee determines in good faith to be reasonable and in compliance with Code Section 409A.
(s) Full-Value Award means an Award other than in the form of an Option or SAR, and which is settled by the issuance of Stock (or at the
discretion of the Committee, settled in cash valued by reference to Stock value).
(t) Good Reason (or a similar term denoting constructive
termination) has the meaning, if any, assigned such term in the employment, consulting, severance or similar agreement, if any, between a Participant and the Company or an Affiliate; provided, however, that if there is no such employment,
consulting, severance or similar agreement in which such term is defined (i) Good Reason shall mean (A) a material diminution in a Participants duties, or the assignment to a Participant of duties materially inconsistent with
his or her authority, responsibilities and reporting requirements, or (B) a material breach by the Company of its obligations to a Participant under any written employment agreement or arrangement, (ii) in the event a Participant elects to
terminate his or her employment for Good Reason, the Participant must provide the Company with thirty (30) days prior written notice of his or her intent to leave the Company and the alleged condition or breach constituting Good Reason, and
(iii) in the event the Company cures such condition or breach within thirty (30) days following receipt of such notice, any such termination based on such alleged breach or condition shall not be considered a termination by the Participant
for Good Reason.
(u) Grant Date of an Award means the first date on which all necessary corporate action has been taken to approve the grant
of the Award as provided in the Plan, or such later date as is determined and specified as part of that authorization process. Notice of the grant shall be provided to the grantee within a reasonable time after the Grant Date.
(v) Incentive Stock Option means an Option that is intended to be an incentive stock option and meets the requirements of Section 422 of the
Code or any successor provision thereto.
(w) Independent Directors means those members of the Board of Directors who qualify at any given
time as (a) an independent director under the applicable rules of each Exchange on which the Shares are listed, (b) a non-employee director under Rule 16b-3 of the 1934 Act, and (c) an outside
director under Section 162(m) of the Code.
(x) Non-Employee Director means a director of the Company who is not a common law employee of
the Company or an Affiliate.
(y) Nonstatutory Stock Option means an Option that is not an Incentive Stock Option.
(z) Option means a right granted to a Participant under Article 7 of the Plan to purchase Stock at a specified price during specified time
periods. An Option may be either an Incentive Stock Option or a Nonstatutory Stock Option.
B-7
(aa) Other Stock-Based Award means a right, granted to a Participant under Article 13, that relates
to or is valued by reference to Stock or other Awards relating to Stock.
(bb) Parent means a corporation, limited liability company,
partnership or other entity which owns or beneficially owns a majority of the outstanding voting stock or voting power of the Company. Notwithstanding the above, with respect to an Incentive Stock Option, Parent shall have the meaning set forth in
Section 424(e) of the Code.
(cc) Participant means a person who, as an employee, officer, director, or consultant of the Company or any
Affiliate, has been granted an Award under the Plan; provided that in the case of the death of a Participant, the term Participant refers to a beneficiary designated pursuant to Section 14.4 or the legal guardian or other legal
representative acting in a fiduciary capacity on behalf of the Participant under applicable state law and court supervision.
(dd) Performance
Award means any award granted under the Plan pursuant to Article 10.
(ee) Person means any individual, entity or group, within the
meaning of Section 3(a)(9) of the 1934 Act and as used in Section 13(d)(3) or 14(d)(2) of the 1934 Act.
(ff) Plan means the Keryx
Biopharmaceuticals, Inc. Amended and Restated 2013 Incentive Plan, as amended from time to time.
(gg) Qualified Performance-Based Award means
an Award that is either (i) intended to qualify for the Section 162(m) Exemption and is made subject to performance goals based on Qualified Business Criteria as set forth in Section 11.2, or (ii) an Option or SAR having an
exercise price equal to or greater than the Fair Market Value of the underlying Stock as of the Grant Date.
(hh) Qualified Business Criteria
means one or more of the Business Criteria listed in Section 11.2 upon which performance goals for certain Qualified Performance-Based Awards may be established by the Committee.
(ii) Restricted Stock means Stock granted to a Participant under Article 9 that is subject to certain restrictions and to risk of forfeiture.
(jj) Restricted Stock Unit means the right granted to a Participant under Article 9 to receive shares of Stock (or the equivalent value in cash or
other property if the Committee so provides) in the future, which right is subject to certain restrictions and to risk of forfeiture.
(kk) Section
162(m) Exemption means the exemption from the limitation on deductibility imposed by Section 162(m) of the Code that is set forth in Section 162(m)(4)(C) of the Code or any successor provision thereto.
(II) Shares means shares of the Companys Stock. If there has been an adjustment or substitution pursuant to Article 15, the term
Shares shall also include any shares of stock or other securities that are substituted for Shares or into which Shares are adjusted pursuant to Article 15.
(mm) Stock means the $0.001 par value common stock of the Company and such other securities of the Company as may be substituted for Stock
pursuant to Article 15.
(nn) Stock Appreciation Right or SAR means a right granted to a Participant under Article 8 to receive a
payment equal to the difference between the Fair Market Value of a Share as of the date of exercise of the SAR over the base price of the SAR, all as determined pursuant to Article 8.
B-8
(oo) Subsidiary means any corporation, limited liability company, partnership or other entity,
domestic or foreign, of which a majority of the outstanding voting stock or voting power is beneficially owned directly or indirectly by the Company. Notwithstanding the above, with respect to an Incentive Stock Option, Subsidiary shall have the
meaning set forth in Section 424(f) of the Code.
(pp) 1933 Act means the Securities Act of 1933, as amended from time to time.
(qq) 1934 Act means the Securities Exchange Act of 1934, as amended from time to time.
ARTICLE 3
EFFECTIVE
TERM OF PLAN
3.1. EFFECTIVE DATE. Subject to the approval of the Plan by the Companys stockholders within 12 months after the
Plans adoption by the Board, the Plan will become effective on the date that it is adopted by the Board (the Effective Date).
3.2. TERMINATION OF PLAN. The Plan shall terminate on the tenth anniversary of the Effective Date unless earlier terminated as provided
herein. The termination of the Plan on such date shall not affect the validity of any Award outstanding on the date of termination, which shall continue to be governed by the applicable terms and conditions of this Plan. Notwithstanding the
foregoing, no Incentive Stock Options may be granted more than ten (10) years after the earlier of (a) adoption of this Plan by the Board, or (b) the Effective Date.
ARTICLE 4
ADMINISTRATION
4.1.
COMMITTEE. The Plan shall be administered by a Committee appointed by the Board (which Committee shall consist of at least two directors) or, at the discretion of the Board from time to time, the Plan may be administered by the Board. It is intended
that at least two of the directors appointed to serve on the Committee shall be Independent Directors and that any such members of the Committee who do not so qualify shall abstain from participating in any decision to make or administer Awards that
are made to Eligible Participants who at the time of consideration for such Award (i) are persons subject to the short-swing profit rules of Section 16 of the 1934 Act, or (ii) are reasonably anticipated to become Covered Employees
during the term of the Award. However, the mere fact that a Committee member shall fail to qualify as an Independent Director or shall fail to abstain from such action shall not invalidate any Award made by the Committee which Award is otherwise
validly made under the Plan. The members of the Committee shall be appointed by, and may be changed at any time and from time to time in the discretion of, the Board. Unless and until changed by the Board, the Compensation Committee of the Board is
designated as the Committee to administer the Plan. The Board may reserve to itself any or all of the authority and responsibility of the Committee under the Plan or may act as administrator of the Plan for any and all purposes. To the extent the
Board has reserved any authority and responsibility or during any time that the Board is acting as administrator of the Plan, it shall have all the powers and protections of the Committee hereunder, and any reference herein to the Committee (other
than in this Section 4.1) shall include the Board. To the extent any action of the Board under the Plan conflicts with actions taken by the Committee, the actions of the Board shall control.
4.2. ACTION AND INTERPRETATIONS BY THE COMMITTEE. For purposes of administering the Plan, the Committee may from time to time adopt rules,
regulations, guidelines and procedures for carrying out the provisions and purposes of the Plan and make such other determinations, not inconsistent with the Plan, as the Committee may deem appropriate. The Committee may correct any defect, supply
any omission or reconcile any inconsistency in the Plan or in any Award in the manner and to the extent it deems necessary to carry out the intent of the Plan. The Committees interpretation of the Plan, any Awards granted under the Plan, any
Award
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Certificate and all decisions and determinations by the Committee with respect to the Plan are final, binding, and conclusive on all parties. Each member of the Committee is entitled, in good
faith, to rely or act upon any report or other information furnished to that member by any officer or other employee of the Company or any Affiliate, the Companys or an Affiliates independent certified public accountants, Company counsel
or any executive compensation consultant or other professional retained by the Company or the Committee to assist in the administration of the Plan. No member of the Committee will be liable for any good faith determination, act or omission in
connection with the Plan or any Award.
4.3. AUTHORITY OF COMMITTEE. Except as provided in Section 4.1 and 4.4 hereof, the Committee
has the exclusive power, authority and discretion to:
(a) Grant Awards;
(b) Designate Participants;
(c) Determine the type or types of
Awards to be granted to each Participant;
(d) Determine the number of Awards to be granted and the number of Shares or dollar amount to which an Award
will relate;
(e) Determine the terms and conditions of any Award granted under the Plan;
(f) Prescribe the form of each Award Certificate, which need not be identical for each Participant;
(g) Decide all other matters that must be determined in connection with an Award;
(h) Establish, adopt or revise any plan, program, or policy for the grant of Awards as it may deem necessary or advisable, including but not limited to
short-term incentive programs, and any special Plan documents;
(i) Establish, adopt or revise any rules, regulations, guidelines or procedures as it may
deem necessary or advisable to administer the Plan;
(j) Make all other decisions and determinations that may be required under the Plan or as the
Committee deems necessary or advisable to administer the Plan;
(k) Amend the Plan or any Award Certificate as provided herein; and
(I) Adopt such modifications, procedures, and subplans as may be necessary or desirable to comply with provisions of the laws of the United States or any
non-U.S. jurisdictions in which the Company or any Affiliate may operate, in order to assure the viability of the benefits of Awards granted to participants located in the United States or any such other jurisdictions and to further the objectives
of the Plan.
Notwithstanding any of the foregoing, grants of Awards to Non-Employee Directors hereunder shall (i) be subject to the applicable award
limits set forth in Section 5.4 hereof, and (ii) be made only in accordance with the terms, conditions and parameters of a plan, program or policy for the compensation of Non-Employee Directors as in effect from time to time that is
approved and administered by a committee of the Board consisting solely of Independent Directors. The Committee may not make other discretionary grants hereunder to Non-Employee Directors.
4.4. DELEGATION.
(a) Administrative Duties. The Committee may
delegate to one or more of its members or to one or more officers of the Company or an Affiliate or to one or more agents or advisors such administrative duties or powers as it
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may deem advisable, and the Committee or any individuals to whom it has delegated duties or powers as aforesaid may employ one or more individuals to render advice with respect to any
responsibility the Committee or such individuals may have under this Plan.
(b) Special Committee. Subject to Delaware law as in effect from time to time,
the Board may, by resolution, expressly delegate to a special committee, consisting of one or more directors who may but need not be officers of the Company, the authority, within specified parameters as to the number and terms of Awards, to
(i) designate officers and/or employees of the Company or any of its Affiliates to be recipients of Awards under the Plan, and (ii) to determine the number of such Awards to be received by any such Participants; provided, however, that
such delegation of duties and responsibilities to an officer of the Company may not be made with respect to the grant of Awards to eligible participants (a) who are subject to Section 16(a) of the 1934 Act at the Grant Date, or
(b) who as of the Grant Date are reasonably anticipated to be become Covered Employees during the term of the Award. The acts of such delegates shall be treated hereunder as acts of the Board and such delegates shall report regularly to the
Board and the Compensation Committee regarding the delegated duties and responsibilities and any Awards so granted.
4.5. INDEMNIFICATION. Each person who
is or shall have been a member of the Committee, or of the Board, or an officer of the Company to whom authority was delegated in accordance with this Article 4 shall be indemnified and held harmless by the Company against and from any Joss, cost,
liability, or expense that may be imposed upon or reasonably incurred by him or her in connection with or resulting from any claim, action, suit, or proceeding to which he or she may be a party or in which he or she 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 by him or her in settlement thereof, with the Companys approval, or paid by him or her in satisfaction of any judgment in any such action, suit, or
proceeding against him or her, provided he or she 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, unless such Joss, cost,
liability, or expense is a result of his or her own willful misconduct or except as expressly provided by statute. The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such persons may be
entitled under the Companys charter or bylaws, as a matter of law, or otherwise, or any power that the Company may have to indemnify them or hold them harmless.
ARTICLE S
SHARES
SUBJECT TO THE PLAN
5.1. NUMBER OF SHARES. Subject to adjustment as provided in Sections 5.2 and Section 15.1, the aggregate
number of Shares reserved and available for issuance pursuant to Awards granted under the Plan shall be 18,000,000. The maximum number of Shares that may be issued upon exercise of Incentive Stock Options granted under the Plan shall be 18,000,000.
5.2. SHARE COUNTING. The maximum number of Shares covered by an Award shall be subtracted from the Plan share reserve as of the date of grant, but shall
be added back to the Plan share reserve in accordance with this Section 5.2.
(a) To the extent that an Award is canceled, terminates, expires, is
forfeited or lapses for any reason, any unissued or forfeited Shares subject to the Award will be added back to the Plan share reserve and again be available for issuance pursuant to other Awards granted under the Plan.
(b) To the extent that an Award may be settled solely in cash, the Award will not reduce the number of Shares available for issuance under the Plan. In
addition, to the extent than an Award initially may be settled in stock but ultimately is settled in cash, the Shares subject to such Award will again be available for issuance pursuant to other Awards granted under the Plan.
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(c) If outstanding Shares (including shares issued on the date of grant of a Restricted Stock Award) are tendered
to the Company (by either actual delivery or by attestation), or are withheld from the Award, to satisfy the exercise price or tax liability resulting from an Award, such tendered or withheld Shares shall be deemed to have been delivered to the
Participant for purposes of determining the maximum number of Shares available for delivery under the Plan (and such Shares shall not be added back to the available share pool under the Plan).
(d) The number of Shares deemed to have been delivered to a Participant upon exercise of a SAR for purposes of determining the maximum number of Shares
available for delivery under the Plan shall be the greater of (i) the number of Shares covered by the SAR (excluding for this purpose any Shares covered by the SAR which are unissued or forfeited pursuant to Section 4.4(a), and
(ii) the number of Shares actually delivered to the Participant upon exercise of the SAR.
(e) Substitute Awards granted pursuant to
Section 14.9 of the Plan shall not count against the Shares otherwise available for issuance under the Plan under Section 5.1.
5.3. STOCK DISTRIBUTED. Any Stock distributed pursuant to an Award may consist, in whole or in part, of authorized and unissued Stock,
treasury Stock or Stock purchased on the open market.
5.4. LIMITATION ON AWARDS. Notwithstanding any provision in the Plan to the contrary (but subject
to adjustment as provided in Article 15):
(a) Options. The maximum number of Options granted under the Plan in any 12-month period to any one Participant
shall be for 3,500,000 Shares.
(b) SARs. The maximum number of Stock Appreciation Rights granted under the Plan in any 12- month period to any one
Participant shall be with respect to 1,000,000 Shares.
(c) Restricted Stock or Restricted Stock Units. The maximum aggregate number of Shares underlying
of Awards of Restricted Stock or Restricted Stock Units under the Plan in any 12-month period to any one Participant shall be 1,000,000 Shares.
(d) Other
Stock-Based Awards. The maximum aggregate grant with respect to Other Stock-Based Awards under the Plan in any 12-month period to any one Participant shall be 1,000,000 Shares.
(e) Cash-Based Awards. The maximum aggregate amount that may be paid with respect to
cash-
based Awards under the Plan
to any one Participant in any in any 12-month period to any one Participant shall be $10,000,000.
(f) Awards to Non-Employee Directors. The maximum
grant-date fair value of stock-based Awards granted under the Plan in any 12-month period to any one Non-Employee Director shall be $600,000, in each case computed in accordance with FASB ASC Topic 718 (or any successor provision). The foregoing
limit related to Non-Employee Directors shall not apply to any Award or Shares granted pursuant to a Non-Employee Directors election to receive an Award or Shares in lieu of cash retainers or other fees (to the extent such Award or Shares have
a fair value equal to the value of such cash retainers or other fees).
5.5 CLAWBACK/RECOUPMENT. Notwithstanding anything to the contrary contained in
this Plan, the Company may recover from a Participant any compensation received from any Award (whether or not settled) or cause a Participant to forfeit any Award (whether or not vested) in the event that the Companys clawback/recoupment
policy then in effect is triggered.
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ARTICLE 6
ELIGIBILIY
6.1. GENERAL.
Awards may be granted only to Eligible Participants. Incentive Stock Options may be granted only to Eligible Participants who are employees of the Company or a Parent or Subsidiary as defined in Section 424(e) and (f) of the Code. Eligible
Participants who are service providers to an Affiliate may be granted Options or SARs under this Plan only if the Affiliate qualifies as an eligible issuer of service recipient stock within the meaning of §1.409A-1(b)(5)(iii)(E) of
the final regulations under Code Section 409A.
ARTICLE 7
STOCK
OPTIONS
7.1. GENERAL. The Committee is authorized to grant Options to Participants on the following terms and conditions:
(a) Exercise Price. The exercise price per Share under an Option shall be determined by the Committee, provided that the exercise price for any Option (other
than an Option issued as a substitute Award pursuant to Section 14.9) shall not be Jess than the Fair Market Value as of the Grant Date.
(b)
Prohibition on Repricing. Except as otherwise provided in Section 15.1, without the prior approval of stockholders of the Company: (i) the exercise price of an Option may not be reduced, directly or indirectly, (ii) an Option may not
be cancelled in exchange for cash, other Awards, or Options or SARs with an exercise or base price that is less than the exercise price of the original Option, or otherwise, and (iii) the Company may not repurchase an Option for value (in cash or
otherwise) from a Participant if the current Fair Market Value of the Shares underlying the Option is lower than the exercise price per share of the Option.
(c) Time and Conditions of Exercise. The Committee shall determine the time or times at which an Option may be exercised in whole or in part, subject to
Section 7. l (e), and may include in the Award Certificate a provision that an Option that is otherwise exercisable and has an exercise price that is less than the Fair Market Value of the Stock on the last day of its term will be automatically
exercised on such final date of the term by means of a net exercise, thus entitling the optionee to Shares equal to the intrinsic value of the Option on such exercise date, less the number of Shares required for tax withholding. The
Committee shall also determine the performance or other conditions, if any, that must be satisfied before all or part of an Option may be exercised or vested.
(d) Payment. The Committee shall determine the methods by which the exercise price of an Option may be paid, the form of payment, and the methods by which
Shares shall be delivered or deemed to be delivered to Participants. As determined by the Committee at or after the Grant Date, payment of the exercise price of an Option may be made, in whole or in part, in the form of (i) cash or cash
equivalents, (ii) delivery (by either actual delivery or attestation) of previously-acquired Shares based on the Fair Market Value of the Shares on the date the Option is exercised, (iii) withholding of Shares from the Option based on the Fair
Market Value of the Shares on the date the Option is exercised,
(iv) broker-
assisted market sales, or (iv) any other cashless exercise arrangement.
(e) Exercise Term. Except for Nonstatutory Options granted to Participants outside the United States, no Option granted under the Plan shall be
exercisable for more than ten years from the Grant Date.
(f) No Deferral Feature. No Option shall provide for any feature for the deferral of
compensation other than the deferral of recognition of income until the exercise or disposition of the Option.
(g) No Dividend Equivalents. No Option
shall provide for Dividend Equivalents.
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7.2. INCENTIVE STOCK OPTIONS. The terms of any Incentive Stock Options granted under the Plan must comply with
the requirements of Section 422 of the Code. Without limiting the foregoing, any Incentive Stock Option granted to a Participant who at the Grant Date owns more than 10% of the voting power of all classes of shares of the Company must have an
exercise price per Share of not less than 110% of the Fair Market Value per Share on the Grant Date and an Option term of not more than five years. If all of the requirements of Section 422 of the Code (including the above) are not met, the
Option shall automatically become a Nonstatutory Stock Option.
ARTICLE 8
STOCK APPRECIATION RIGHTS
8.1. GRANT OF STOCK APPRECIATION RIGHTS. The Committee is authorized to grant Stock Appreciation Rights to Participants on the following terms
and conditions:
(a) Right to Payment. Upon the exercise of a SAR, the Participant has the right to receive, for each Share with respect to which the SAR
is being exercised, the excess, if any, of:
(1)
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The Fair Market Value of one Share on the date of exercise; over
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(2) The base price of the SAR as determined
by the Committee and set forth in the Award Certificate, which shall not be less than the Fair Market Value of one Share on the Grant Date.
(b)
Prohibition on Repricing. Except as otherwise provided in Section 15.1, without the prior approval of stockholders of the Company: (i) the base price of a SAR may not be reduced, directly or indirectly , (ii) a SAR may not be
cancelled in exchange for cash, other Awards, or Options or SARs with an exercise or base price that is less than the base price of the original SAR, or otherwise, and (iii) the Company may not repurchase a SAR for value (in cash or otherwise)
from a Participant if the current Fair Market Value of the Shares underlying the SAR is lower than the base price per share of the SAR.
(c) Time and
Conditions of Exercise. The Committee shall determine the time or times at which a SAR may be exercised in whole or in part and may include in the Award Certificate a provision that a SAR that is otherwise exercisable and has a base price that is
less than the Fair Market Value of the Stock on the last day of its term will be automatically exercised on such final date of the term, thus entitling the holder to cash or Shares equal to the intrinsic value of the SAR on such exercise date, less
the cash or number of Shares required for tax withholding. Except for SARs granted to Participants outside the United States, no SAR shall be exercisable for more than ten years from the Grant Date.
(d) No Deferral Feature. No SAR shall provide for any feature for the deferral of compensation other than the deferral of recognition of income until the
exercise or disposition of the SAR.
(e) No Dividend Equivalents. No SAR shall provide for Dividend Equivalents.
(f) Other Terms. All SARs shall be evidenced by an Award Certificate. Subject to the limitations of this Article 8, the terms, methods of exercise,
methods of settlement, form of consideration payable in settlement (e.g., cash, Shares or other property), and any other terms and conditions of the SAR shall be determined by the Committee at the time of the grant and shall be reflected in the
Award Certificate.
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ARTICLE 9
RESTRICTED STOCK, RESTRICTED STOCK UNITS, AND DEFERRED STOCK UNITS
9.1. GRANT OF RESTRICTED STOCK AND STOCK UNITS. The Committee is authorized to make Awards of Restricted Stock, Restricted Stock Units or
Deferred Stock Units to Participants in such amounts and subject to such terms and conditions as may be selected by the Committee. An Award of Restricted Stock, Restricted Stock Units or Deferred Stock Units shall be evidenced by an Award
Certificate setting forth the terms, conditions, and restrictions applicable to the Award.
9.2. ISSUANCE AND RESTRICTIONS. Restricted
Stock, Restricted Stock Units or Deferred Stock Units shall be subject to such restrictions on transferability and other restrictions as the Committee may impose (including, for example, limitations on the right to vote Restricted Stock or the right
to receive dividends on the Restricted Stock). These restrictions may lapse separately or in combination at such times, under such circumstances, in such installments, upon the satisfaction of performance goals or otherwise, as the Committee
determines at the time of the grant of the Award or thereafter. Except as otherwise provided in an Award Certificate or any special Plan document governing an Award, a Participant shall have all of the rights of a stockholder with respect to
Restricted Stock, but none of the rights of a stockholder with respect to Restricted Stock Units or Deferred Stock Units until such time as Shares of Stock are paid in settlement of such Awards. Unless otherwise provided in the applicable Award
Certificate, Restricted Stock will be entitled to full dividend rights, and any dividends paid thereon will be paid or distributed to the holder no later than the end of the calendar year in which the dividends are paid to stockholders or, if later,
the 15th day of the third month following the date the dividends are paid to stockholders.
9.3. FORFEITURE. Subject to the terms of the
Award Certificate and except as otherwise determined by the Committee at the time of the grant of the Award or thereafter, upon termination of Continuous Service during the applicable restriction period or upon failure to satisfy a performance goal
during the applicable restriction period, Restricted Stock or Restricted Stock Units that are at that time subject to restrictions shall be forfeited.
9.4. DELIVERY OF RESTRICTED STOCK. Shares of Restricted Stock shall be delivered to the Participant at the Grant Date either by book-entry
registration or by delivering to the Participant, or a custodian or escrow agent (including, without limitation, the Company or one or more of its employees) designated by the Committee, a stock certificate or certificates registered in the name of
the Participant. If physical certificates representing shares of Restricted Stock are registered in the name of the Participant, such certificates must bear an appropriate legend referring to the terms, conditions, and restrictions applicable to
such Restricted Stock.
ARTICLE 10
PERFORMANCE AWARDS
10.1.
GRANT OF PERFORMANCE AWARDS. The Committee is authorized to grant any Award under this Plan, including cash-based Awards, with performance-based vesting criteria, on such terms and conditions as may be selected by the Committee. Any such Awards with
performance-based vesting criteria are referred to herein as Performance Awards, and may be referred to by any other appropriate descriptive name in the Award Certificate. The Committee shall have the complete discretion to determine the number of
Performance Awards granted to each Participant, subject to Section 5.4, and to designate the provisions of such Performance Awards as provided in Section 4.3. All Performance Awards shall be evidenced by an Award Certificate or a written
program established by the Committee, pursuant to which Performance Awards are awarded under the Plan under uniform terms, conditions and restrictions set forth in such written program.
I 0.2. PERFORMANCE GOALS. The Committee may establish performance goals for Performance Awards which may be based on any criteria selected by
the Committee. Such performance goals may be described in terms of Company-wide objectives or in terms of objectives that relate to the performance of the Participant, an Affiliate or a division, region, department or function within the Company or
an Affiliate. If the
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Committee determines that a change in the business, operations, corporate structure or capital structure of the Company or the manner in which the Company or an Affiliate conducts its business,
or other events or circumstances render performance goals to be unsuitable, the Committee may modify such performance goals in whole or in part, as the Committee deems appropriate. If a Participant is promoted, demoted or transferred to a different
business unit or function during a performance period, the Committee may determine that the performance goals or performance period are no longer appropriate and may (i) adjust, change or eliminate the performance goals or the applicable
performance period as it deems appropriate to make such goals and period comparable to the initial goals and period, or (ii) make a cash payment to the participant in an amount determined by the Committee. The foregoing two sentences shall not
apply with respect to a Performance Award that is intended to be a Qualified Performance-Based Award if the recipient of such award (a) was a Covered Employee on the date of the proposed modification, adjustment, change or elimination of the
performance goals or performance period, or (b) in the reasonable judgment of the Committee, may be a Covered Employee on the date the Performance Award is expected to be paid.
ARTICLE 11
QUALIFIED
PERFORMANCE-BASED AWARDS
11.1. OPTIONS AND STOCK APPRECIATION RIGHTS. The provisions of the Plan are intended to ensure that all Options and Stock
Appreciation Rights granted hereunder to any Covered Employee shall qualify for the Section 162(m) Exemption.
11.2. OTHER AW ARDS. When granting any
other Award, including cash-based Awards the Committee may designate such Award as a Qualified Performance-Based Award, based upon a determination that the recipient is or may be a Covered Employee with respect to such Award, and the Committee
wishes such Award to qualify for the Section 162(m) Exemption. If an Award is so designated, the Committee shall establish performance goals for such Award within the time period prescribed by Section 162(m) of the Code based on one or
more of the following Qualified Business Criteria, which performance goals may be expressed in terms of Company-wide objectives or in terms of objectives that relate to the performance of an Affiliate or a division, region, department or function
within the Company or an Affiliate:
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Revenue (premium revenue, total revenue or other revenue measures)
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Profit (net profit, gross profit, operating profit, economic profit, profit margins or other corporate profit measures)
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Earnings (EBIT, EBITDA, earnings per share, or other corporate earnings measures)
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Net income (before or after taxes, operating income or other income measures)
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Cash (cash flow, cash generation or other cash measures)
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Stock price or performance
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Total stockholder return (stock price appreciation plus reinvested dividends divided by beginning share price)
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Return measures (including, but not limited to, return on assets, capital, equity, investments or sales, and cash flow return on assets, capital, equity, or sales);
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Improvements in capital structure
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Expenses (expense management, expense ratio, expense efficiency ratios or other expense measures)
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Business expansion or consolidation (acquisitions, divestitures, in licensing, or product acquisitions)
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Clinical and regulatory milestones
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Corporate financing activities
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Supply, production, and manufacturing milestones
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Corporate partnerships or strategic alliances
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Performance goals with respect to the foregoing Qualified
Business Criteria may be specified in absolute terms, in percentages, or in terms of growth from period to period or growth rates over time, as well as measured relative to the performance of a group of comparator companies, or a published or
special index, or a stock market index, that the Committee deems appropriate. Any member of a comparator group or an index that ceases to exist during a measurement period shall be disregarded for the entire measurement period. Performance Goals
need not be based upon an increase or positive result under a business criterion and could include, for example, the maintenance of the status quo or the limitation of economic losses (measured, in each case, by reference to a specific business
criterion).
ll.3. PERFORMANCE GOALS. Each Qualified Performance-Based Award (other than a
market-
priced Option
or SAR) shall be earned, vested and payable (as applicable) only upon the achievement of performance goals established by the Committee based upon one or more of the Qualified Business Criteria, together with the satisfaction of any other
conditions, such as continued employment, as the Committee may determine to be appropriate; provided, however, that the Committee may provide, either in connection with the grant thereof or by amendment thereafter, that achievement of such
performance goals will be waived, in whole or in part, upon (i) the termination of employment of a Participant by reason of death or Disability, or (ii) the occurrence of a Change in Control. Performance periods established by the
Committee for any such Qualified Performance-Based Award may be as short as three months and may be any longer period. In addition, the Committee has the right, in connection with the grant of a Qualified Performance-Based Award, to exercise
negative discretion to determine that the portion of such Award actually earned, vested and/or payable (as applicable) shall be Jess than the portion that would be earned, vested and/or payable based solely upon application of the applicable
performance goals.
11.4. INCLUSIONS AND EXCLUSIONS FROM PERFORMANCE CRITERIA. The Committee may provide in any Qualified Performance-Based Award, at the
time the performance goals are established, that any evaluation of performance shall exclude or otherwise objectively adjust for any specified circumstance or event that occurs during a performance period, including by way of example but without
limitation the following: (a) asset write-downs or impairment charges; (b) litigation or claim judgments or settlements; (c) the effect of changes in tax laws, accounting principles or other laws or provisions affecting reported
results; (d) accruals for reorganization and restructuring programs; (e) extraordinary nonrecurring items as described in then-current accounting principles; (f) extraordinary nonrecurring items as described in managements
discussion and analysis of financial condition and results of operations appearing in the Companys annual report to stockholders for the applicable year; (g) acquisitions or divestitures; (h) share buy-back programs, and
(i) foreign exchange gains and losses. To the extent such inclusions or exclusions affect Awards to Covered Employees, they shall be prescribed in a form that meets the requirements of Code Section 162(m) for deductibility.
1 1.5. CERTIFICATION OF PERFORMANCE GOALS. Any payment of a Qualified
Performance-
Based Award granted with
performance goals pursuant to Section 11.3 above shall be conditioned on the written certification of the Committee in each case that the performance goals and any other material conditions were satisfied. Except as specifically provided in
Section 11.3, no Qualified
Performance-
Based Award held by a Covered Employee or by an employee who in the reasonable judgment of the Committee may be a Covered Employee on the date of payment, may be
amended, nor may the Committee exercise any discretionary authority
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it may otherwise have under the Plan with respect to a Qualified Performance-Based Award under the Plan, in any manner to waive the achievement of the applicable performance goal based on
Qualified Business Criteria or to increase the amount payable pursuant thereto or the value thereof, or otherwise in a manner that would cause the Qualified Performance-Based Award to cease to qualify for the Section 162(m) Exemption.
11.6. A WARD LIMITS. Section 5.4 sets forth (i) the maximum number of Shares that may be granted in any one-year period to a Participant in
designated forms of stock-based Awards, and (ii) the maximum aggregate dollar amount that may be paid with respect to cash-based Awards under the Plan to any one Participant in any fiscal year of the Company.
ARTICLE 12
DIVIDEND
EQUIVALENTS
12.1. GRANT OF DIVIDEND EQUIVALENTS. The Committee is authorized to grant Dividend Equivalents with respect to Full-Value Awards granted
hereunder, subject to such terms and conditions as may be selected by the Committee. Dividend Equivalents shall entitle the Participant to receive payments equal to ordinary cash dividends or distributions with respect to all or a portion of the
number of Shares subject to a Full-Value Award, as determined by the Committee. The Committee may provide that Dividend Equivalents be paid or distributed when accrued or be deemed to have been reinvested in additional Shares or otherwise
reinvested. Unless otherwise provided in the applicable Award Certificate, Dividend Equivalents will be paid or distributed to the Participant no later than the 15th day of the 3rd month following the later of (A) the calendar year in which the
corresponding dividends were paid to stockholders, or (B) the first calendar year in which the Participants right to such Dividends Equivalents is no longer subject to a substantial risk of forfeiture.
ARTICLE 13
STOCK OR
OTHER STOCK-BASED AWARDS
13.1. GRANT OF STOCK OR OTHER STOCK-BASED AWARDS. The Committee is authorized, subject to limitations under
applicable law, to grant to Participants such other Awards that are payable in, valued in whole or in part by reference to, or otherwise based on or related to Shares, as deemed by the Committee to be consistent with the purposes of the Plan,
including without limitation Shares awarded purely as a bonus and not subject to any restrictions or conditions, convertible or exchangeable debt securities, other rights convertible or exchangeable into Shares, and Awards valued by
reference to book value of Shares or the value of securities of or the performance of specified Parents or Subsidiaries. The Committee shall determine the terms and conditions of such Awards.
ARTICLE 14
PROVISIONS
APPLICABLE TO AWARDS
14.1. AWARD CERTIFICATES. Each Award shall be evidenced by an Award Certificate. Each Award Certificate shall include such
provisions, not inconsistent with the Plan, as may be specified by the Committee.
14.2. FORM OF PAYMENT FOR AWARDS. At the discretion of
the Committee, payment of Awards may be made in cash, Stock, a combination of cash and Stock, or any other form of property as the Committee shall determine. In addition, payment of Awards may include such terms, conditions, restrictions and/or
limitations, if any, as the Committee deems appropriate, including, in the case of Awards paid in the form of Stock, restrictions on transfer and forfeiture provisions. Further, payment of Awards may be made in the form of a lump sum, or in
installments, as determined by the Committee; provided, however, that no payment of Awards shall be made earlier than the first date that such payment may be made without causing the assessment of an additional tax under Section 409A of the
Code.
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14.3. LIMITS ON TRANSFER. No right or interest of a Participant in any unexercised or restricted
Award may be pledged, encumbered, or hypothecated to or in favor of any party other than the Company or an Affiliate, or shall be subject to any lien, obligation, or liability of such Participant to any other party other than the Company or an
Affiliate. No unexercised or restricted Award shall be assignable or transferable by a Participant other than by will or the laws of descent and distribution; provided, however, that the Committee may (but need not) permit other transfers (other
than transfers for value) where the Committee concludes that such transferability (i) does not result in accelerated taxation, (ii) does not cause any Option intended to be an Incentive Stock Option to fail to be described in Code
Section 422(b), and (iii) is otherwise appropriate and desirable, taking into account any factors deemed relevant, including without limitation, state or federal tax or securities laws applicable to transferable Awards.
14.4. BENEFICIARIES. Notwithstanding Section 14.3, a Participant may, in the manner determined by the Committee, designate a beneficiary
to exercise the rights of the Participant and to receive any distribution with respect to any Award upon the Participants death. A beneficiary, legal guardian, legal representative, or other person claiming any rights under the Plan is subject
to all terms and conditions of the Plan and any Award Certificate applicable to the Participant, except to the extent the Plan and Award Certificate otherwise provide, and to any additional restrictions deemed necessary or appropriate by the
Committee. If no beneficiary has been designated or survives the Participant, any payment due to the Participant shall be made to the Participants estate. Subject to the foregoing, a beneficiary designation may be changed or revoked by a
Participant, in the manner provided by the Company, at any time provided the change or revocation is filed with the Committee.
14.5.
STOCK TRADING RESTRICTIONS. All Stock issuable under the Plan is subject to any stop-transfer orders and other restrictions as the Committee deems necessary or advisable to comply with federal or state securities laws, rules and regulations and the
rules of any national securities exchange or automated quotation system on which the Stock is listed, quoted, or traded. The Committee may place legends on any Stock certificate or issue instructions to the transfer agent to reference restrictions
applicable to the Stock.
14.6. EFFECT OF A CHANGE IN CONTROL. The provisions of this Section 14.6 shall apply in the case of a Change in
Control, unless otherwise provided in the Award Certificate or any special Plan document or separate agreement with a Participant governing an Award.
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(a)
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Awards not Assumed or Substituted by Surviving Entity. Upon the occurrence of a Change in Control, and except with respect to any Awards assumed by the Surviving Entity or otherwise equitably converted or substituted in
connection with the Change in Control in a manner approved by the Committee or the Board: (i) outstanding Options or SARs shall become fully exercisable, (ii) time-based vesting restrictions on outstanding Awards shall lapse, and
(iii) the target payout opportunities attainable under outstanding
performance-
based Awards shall be deemed to have been fully earned as of the effective date of the Change in Control based upon
(A) an assumed achievement of all relevant performance goals at the target level if the Change in Control occurs during the first half of the applicable performance period, or (B) the actual level of achievement of all relevant
performance goals against target measured as of the date of the Change in Control, if the Change in Control occurs during the second half of the applicable performance period, and, in either such case, there shall be a prorata payout to Participants
within sixty (60) days following the Change in Control (unless a later date is required by Section 17.3 hereof), based upon the length of time within the performance period that has elapsed prior to the Change in Control. Any Options or
SARs shall thereafter continue or lapse in accordance with the other provisions of the Plan and the Award Certificate. To the extent that this provision causes Incentive Stock Options to exceed the dollar limitation set forth in Code
Section 422(d), the excess Options shall be deemed to be Nonstatutory Stock Options.
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(b)
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Awards Assumed or Substituted by Surviving Entity. With respect to Awards assumed by the Surviving Entity or
otherwise equitably converted or substituted in connection with a Change in Control: if within one year after the effective date of the Change in Control, a Participants employment is terminated without Cause or the Participant resigns for
Good Reason, then (i) all of that Participants outstanding
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Options or SARs shall become fully exercisable, (ii) all time-based vesting restrictions on the his or her outstanding Awards shall lapse, and (iii) the payout level under all of that
Participants performance-based Awards that were outstanding immediately prior to effective time of the Change in Control shall be determined and deemed to have been earned as of the date of termination based upon (A) an assumed
achievement of all relevant performance goals at the target level if the date of termination occurs during the first half of the applicable performance period, or (B) the actual level of achievement of all relevant performance goals
against target (measured as of the end of the calendar quarter immediately preceding the date of termination), if the date of termination occurs during the second half of the applicable performance period, and, in either such case, there shall be a
prorata payout to such Participant within sixty (60) days following the date of termination of employment (unless a later date is required by Section 17.3 hereof), based upon the length of time within the performance period that has
elapsed prior to the date of termination of employment. With regard to each Award, a Participant shall not be considered to have resigned for Good Reason unless either (i) the Award Certificate includes such provision or (ii) the
Participant is party to an employment, consulting, severance or similar agreement with the Company or an Affiliate that includes provisions in which the Participant is permitted to resign for Good Reason. Any Options or SARs shall thereafter
continue or lapse in accordance with the other provisions of the Plan and the Award Certificate. To the extent that this provision causes Incentive Stock Options to exceed the dollar limitation set forth in Code Section 422(d), the excess
Options shall be deemed to be Nonstatutory Stock Options.
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14.7. ACCELERATION FOR OTHER REASONS. Regardless of whether an
event has occurred as described in Section 14.6 above, and subject to Article 11 as to Qualified Performance-Based Awards, the Committee may in its sole discretion at any time determine that, upon the termination of service of a Participant for
any reason, or the occurrence of a Change in Control, all or a portion of such Participants Options or SARs shall become fully or partially exercisable, that all or a part of the restrictions on all or a portion of the Participants
outstanding Awards shall lapse, and/or that any performance-based criteria with respect to any Awards held by that Participant shall be deemed to be wholly or partially satisfied, in each case, as of such date as the Committee may, in its sole
discretion, declare. The Committee may discriminate among Participants and among Awards granted to a Participant in exercising its discretion pursuant to this Section 14.7.
14.8. FORFEITURE EVENTS. Awards under the Plan shall be subject to any compensation recoupment policy that the Company may adopt from time to time that is
applicable by its terms to the Participant. In addition, the Committee may specify in an Award Certificate that the Participants rights, payments and benefits with respect to an Award shall be subject to reduction, cancellation, forfeiture or
recoupment upon the occurrence of certain specified events, in addition to any otherwise applicable vesting or performance conditions of an Award. Such events may include, but shall not be limited to, (i) termination of employment for cause,
(ii) violation of material Company or Affiliate policies, (iii) breach of noncompetition, confidentiality or other restrictive covenants that may apply to the Participant, (iv) other conduct by the Participant that is detrimental to
the business or reputation of the Company or any Affiliate, or (v) a later determination that the vesting of, or amount realized from, a Performance Award was based on materially inaccurate financial statements or any other materially
inaccurate performance metric criteria, whether or not the Participant caused or contributed to such material inaccuracy.
14.9. SUBSTITUTE AWARDS. The
Committee may grant Awards under the Plan in substitution for stock and stock-based awards held by employees of another entity who become employees of the Company or an Affiliate as a result of a merger or consolidation of the former employing
entity with the Company or an Affiliate or the acquisition by the Company or an Affiliate of property or stock of the former employing corporation. The Committee may direct that the substitute awards be granted on such terms and conditions as the
Committee considers appropriate in the circumstances.
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ARTICLE 15
CHANGES IN CAPITAL STRUCTURE
15.1. MANDATORY ADJUSTMENTS. In the event of a nonreciprocal transaction between the Company and its stockholders that causes the per-share
value of the Stock to change (including, without limitation, any stock dividend, stock split, spin-off, rights offering, or large nonrecurring cash dividend), the authorization limits under Section 5.1 and 5.4 shall be adjusted proportionately,
and the Committee shall make such adjustments to the Plan and Awards as it deems necessary, in its sole discretion, to prevent dilution or enlargement of rights immediately resulting from such transaction. Action by the Committee may include:
(i) adjustment of the number and kind of shares that may be delivered under the Plan; (ii) adjustment of the number and kind of shares subject to outstanding Awards; (iii) adjustment of the exercise price of outstanding Awards or the
measure to be used to determine the amount of the benefit payable on an Award; and (iv) any other adjustments that the Committee determines to be equitable. Notwithstanding the foregoing, the Committee shall not make any adjustments to
outstanding Options or SARs that would constitute a modification or substitution of the stock right under Treas. Reg. Sections l.409A- l (b)(5)(v) that would be treated as the grant of a new stock right or change in the form of payment for purposes
of Code Section 409A. Without limiting the foregoing, in the event of a subdivision of the outstanding Stock (stock-split), a declaration of a dividend payable in Shares, or a combination or consolidation of the outstanding Stock into a lesser
number of Shares, the authorization limits under Section 5.1 and 5.4 shall automatically be adjusted proportionately, and the Shares then subject to each Award shall automatically, without the necessity for any additional action by the
Committee, be adjusted proportionately without any change in the aggregate purchase price therefor.
15.2 DISCRETIONARY ADJUSTMENTS. Upon the occurrence
or in anticipation of any corporate event or transaction involving the Company (including, without limitation, any merger, reorganization, recapitalization, combination or exchange of shares, or any transaction described in Section 15.1), the
Committee may, in its sole discretion, provide (i) that Awards will be settled in cash rather than Stock, (ii) that Awards will become immediately vested and non-forfeitable and exercisable (in whole or in part) and will expire after a
designated period of time to the extent not then exercised, (iii) that Awards will be assumed by another party to a transaction or otherwise be equitably converted or substituted in connection with such transaction, (iv) that outstanding
Awards may be settled by payment in cash or cash equivalents equal to the excess of the Fair Market Value of the underlying Stock, as of a specified date associated with the transaction, over the exercise or base price of the Award, (v) that
performance targets and performance periods for Performance Awards will be modified, consistent with Code Section 162(m) where applicable, or (vi) any combination of the foregoing. The Committees determination need not be uniform and
may be different for different Participants whether or not such Participants are similarly situated.
15.3 GENERAL. Any discretionary adjustments made
pursuant to this Article 15 shall be subject to the provisions of Section 16.2. To the extent that any adjustments made pursuant to this Article 15 cause Incentive Stock Options to cease to qualify as Incentive Stock Options, such Options shall
be deemed to be Nonstatutory Stock Options.
ARTICLE 16
AMENDMENT, MODIFICATION AND TERMINATION
16.1. AMENDMENT, MODIFICATION AND TERMINATION. The Board or the Committee may, at any time and from time to time, amend, modify or terminate
the Plan without stockholder approval; provided, however, that if an amendment to the Plan would, in the reasonable opinion of the Board or the Committee, either (i) materially increase the number of Shares available under the Plan,
(ii) expand the types of awards under the Plan, (iii) materially expand the class of participants eligible to participate in the Plan, (iv) materially extend the term of the Plan, or (v) otherwise constitute a material change
requiring stockholder approval under applicable laws, policies or regulations or the applicable listing or other requirements of an Exchange, then such
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amendment shall be subject to stockholder approval; and provided, further, that the Board or Committee may condition any other amendment or modification on the approval of stockholders of the
Company for any reason, including by reason of such approval being necessary or deemed advisable (i) to comply with the listing or other requirements of an Exchange, or (ii) to satisfy any other tax, securities or other applicable laws,
policies or regulations. Without the prior approval of the stockholders of the Company, the Plan may not be amended to permit: (i) the exercise price or base price of an Option or SAR to be reduced, directly or indirectly, (ii) an Option
or SAR to be cancelled in exchange for cash, other Awards, or Options or SARs with an exercise or base price that is less than the exercise price or base price of the original Option or SAR, or otherwise, or (iii) the Company to repurchase an
Option or SAR for value (in cash or otherwise) from a Participant if the current Fair Market Value of the Shares underlying the Option or SAR is lower than the exercise price or base price per share of the Option or SAR.
16.2. AW ARDS PREVIOUSLY GRANTED. At any time and from time to time, the Committee may amend, modify or terminate any outstanding Award
without approval of the Participant; provided, however:
(a) Subject to the terms of the applicable Award Certificate, such amendment, modification or
termination shall not, without the Participants consent, reduce or diminish the value of such Award as of the date of such action determined as if the Award had been exercised, vested, cashed in or otherwise settled on the date of such
amendment or termination (with the per-share value of an Option or SAR for this purpose being calculated as the excess, if any, of the Fair Market Value as of the date of such amendment or termination over the exercise or base price of such Award);
(b) The original term of an Option or SAR may not be extended without the prior approval of the stockholders of the Company;
(c) Except as otherwise provided in Section 15.1, without the prior approval of the stockholders of the Company: (i) the exercise price or base
price of an Option or SAR may not be reduced, directly or indirectly, (ii) an Option or SAR may not be cancelled in exchange for cash, other Awards, or Options or SARs with an exercise or base price that is less than the exercise price or base
price of the original Option or SAR, or otherwise, and (iii) the Company may not repurchase an Option or SAR for value (in cash or otherwise) from a Participant if the current Fair Market Value of the Shares underlying the Option or SAR is
lower than the exercise price or base price per share of the Option or SAR; and
(d) No termination, amendment, or modification of the Plan shall
adversely affect any Award previously granted under the Plan, without the written consent of the Participant affected thereby. An outstanding Award shall not be deemed to be adversely affected by a Plan amendment if such amendment would
not reduce or diminish the value of such Award determined as if the Award had been exercised, vested, cashed in or otherwise settled on the date of such amendment (with the per-share value of an Option or SAR for this purpose being calculated as the
excess, if any, of the Fair Market Value as of the date of such amendment over the exercise or base price of such Award).
16.3. COMPLIANCE AMENDMENTS.
Notwithstanding anything in the Plan or in any Award Certificate to the contrary, the Board may amend the Plan or an Award Certificate, to take effect retroactively or otherwise, as deemed necessary or advisable for the purpose of conforming the
Plan or Award Certificate to any present or future law relating to plans of this or similar nature (including, but not limited to, Section 409A of the Code), and to the administrative regulations and rulings promulgated thereunder. By accepting
an Award under this Plan, a Participant agrees to any amendment made pursuant to this Section 16.3 to any Award granted under the Plan without further consideration or action.
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ARTICLE 17
GENERAL PROVISIONS
17.1.
RIGHTS OF PARTICIPANTS.
(a) No Participant or any Eligible Participant shall have any claim to be granted any Award under the Plan. Neither the Company,
its Affiliates nor the Committee is obligated to treat Participants or Eligible Participants uniformly, and determinations made under the Plan may be made by the Committee selectively among Eligible Participants who receive, or are eligible to
receive, Awards (whether or not such Eligible Participants are similarly situated).
(b) Nothing in the Plan, any Award Certificate or any other document
or statement made with respect to the Plan, shall interfere with or limit in any way the right of the Company or any Affiliate to terminate any Participants employment or status as an officer, or any Participants service as a director or
consultant, at any time, nor confer upon any Participant any right to continue as an employee, officer, director or consultant of the Company or any Affiliate, whether for the duration of a Participants Award or otherwise.
(c) Neither an Award nor any benefits arising under this Plan shall constitute an employment contract with the Company or any Affiliate and, accordingly,
subject to Article 16, this Plan and the benefits hereunder may be terminated at any time in the sole and exclusive discretion of the Committee without giving rise to any liability on the part of the Company or an of its Affiliates.
(d) No Award gives a Participant any of the rights of a stockholder of the Company unless and until Shares are in fact issued to such person in connection
with such Award.
17.2. WITHHOLDING. The Company or any Affiliate shall have the authority and the right to deduct or withhold, or require
a Participant to remit to the Company or such Affiliate, an amount sufficient to satisfy federal, state, and local taxes (including the Participants FICA obligation) required by law to be withheld with respect to any exercise, lapse of
restriction or other taxable event arising as a result of the Plan. The obligations of the Company under the Plan will be conditioned on such payment or arrangements and the Company or such Affiliate will, to the extent permitted by law, have the
right to deduct any such taxes from any payment of any kind otherwise due to the Participant. Unless otherwise determined by the Committee at the time the Award is granted or thereafter, any such withholding requirement may be satisfied, in whole or
in part, by withholding from the Award Shares having a Fair Market Value on the date of withholding equal to the minimum amount (and not any greater amount) required to be withheld for tax purposes, all in accordance with such procedures as the
Committee establishes. All such elections shall be subject to any restrictions or limitations that the Committee, in its sole discretion, deems appropriate.
17.3. SPECIAL PROVISIONS RELATED TO SECTION 409A OF THE CODE.
(a) General. It is intended that the payments and benefits provided under the Plan and any Award shall either be exempt from the application of, or comply
with, the requirements of Section 409A of the Code. The Plan and all Award Certificates shall be construed in a manner that effects such intent. Nevertheless, the tax treatment of the benefits provided under the Plan or any Award is not
warranted or guaranteed. Neither the Company, its Affiliates nor their respective directors, officers, employees or advisers (other than in his or her capacity as a Participant) shall be held liable for any taxes, interest, penalties or other
monetary amounts owed by any Participant or other taxpayer as a result of the Plan or any Award.
(b) Definitional Restrictions. Notwithstanding anything
in the Plan or in any Award Certificate to the contrary, to the extent that any amount or benefit that would constitute non-exempt deferred compensation for purposes of Section 409A of the Code (Non-Exempt Deferred
Compensation) would otherwise be payable or distributable, or a different form of payment (e.g., lump sum or installment) of such Non-Exempt Deferred Compensation
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would be effected, under the Plan or any Award Certificate by reason of the occurrence of a Change in Control, or the Participants Disability or separation from service, such Non-Exempt
Deferred Compensation will not be payable or distributable to the Participant, and/or such different form of payment will not be effected, by reason of such circumstance unless the circumstances giving rise to such Change in Control, Disability or
separation from service meet any description or definition of change in control event, disability or separation from service, as the case may be, in Section 409A of the Code and applicable regulations
(without giving effect to any elective provisions that may be available under such definition). This provision does not affect the dollar amount or prohibit the vesting of any Non-Exempt Deferred Compensation upon a Change in Control, Disability or
termination of employment, however defined. If this provision prevents the payment or distribution of any Non-Exempt Deferred Compensation, or the application of a different form of payment, such payment or distribution shall be made at the time and
in the form that would have applied absent the non-409A-conforming event.
(c) Allocation among Possible Exemptions. If any one or more Awards granted
under the Plan to a Participant could qualify for any separation pay exemption described in Treas. Reg. Section l
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l (b)(9), but such Awards in the aggregate exceed the dollar limit permitted for the
separation pay exemptions, the Company (acting through the Committee or the Chief Financial Officer) shall determine which Awards or portions thereof will be subject to such exemptions.
(d) Six-Month Delay in Certain Circumstances. Notwithstanding anything in the Plan or in any Award Certificate to the contrary, if any amount or benefit that
would constitute Non-Exempt Deferred Compensation would otherwise be payable or distributable under this Plan or any Award Certificate by reason of a Participants separation from service during a period in which the Participant is a Specified
Employee (as defined below), then, subject to any permissible acceleration of payment by the Committee under Treas. Reg. Section l.409A-3(j)(4)(ii) (domestic relations order), (j)(4)(iii) (conflicts of interest), or U)(4)(vi) (payment of employment
taxes):
(i) the amount of such Non-Exempt Deferred Compensation that would otherwise be payable during the six-month period immediately following the
Participants separation from service will be accumulated through and paid or provided on the first day of the seventh month following the Participants separation from service (or, if the Participant dies during such period, within 30
days after the Participants death) (in either case, the Required Delay Period); and
(ii) the normal payment or distribution schedule
for any remaining payments or distributions will resume at the end of the Required Delay Period.
For purposes of this Plan, the term Specified
Employee has the meaning given such term in Code Section 409A and the final regulations thereunder; provided, however, that, as permitted in such final regulations, the Companys Specified Employees and its application of the
six-month delay rule of Code Section 409A(a)(2)(B)(i) shall be determined in accordance with rules adopted by the Board or any committee of the Board, which shall be applied consistently with respect to all nonqualified deferred compensation
arrangements of the Company, including this Plan.
(e) Installment Payments. If, pursuant to an Award, a Participant is entitled to a series of
installment payments, such Participants right to the series of installment payments shall be treated as a right to a series of separate payments and not to a single payment. For purposes of the preceding sentence, the term series of
installment payments has the meaning provided in Treas. Reg. Section l .409A-2(b)(2)(iii) (or any successor thereto).
(f) Timing of Release of
Claims. Whenever an Award conditions a payment or benefit on the Participants execution and non-revocation of a release of claims, such release must be executed and all revocation periods shall have expired within 60 days after the date of
termination of the Participants employment; failing which such payment or benefit shall be forfeited. If such payment or benefit is exempt from Section 409A of the Code,
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the Company may elect to make or commence payment at any time during such 60-day period. If such payment or benefit constitutes Non-Exempt Deferred Compensation, then, subject to subsection
(c) above, (i) if such 60-day period begins and ends in a single calendar year, the Company may make or commence payment at any time during such period at its discretion, and (ii) if such 60-day period begins in one calendar year and
ends in the next calendar year, the payment shall be made or commence during the second such calendar year (or any later date specified for such payment under the applicable Award), even if such signing and non-revocation of the release occur during
the first such calendar year included within such 60-day period. In other words, a Participant is not permitted to influence the calendar year of payment based on the timing of signing the release.
(g) Permitted Acceleration. The Company shall have the sole authority to make any accelerated distribution permissible under Treas. Reg. section l.409A-3U)(4)
to Participants of deferred amounts, provided that such distribution(s) meets the requirements of Treas. Reg. section 1.409A-3U)(4).
17.4. UNFUNDED
STATUS OF AWARDS. The Plan is intended to be an unfunded plan for incentive and deferred compensation. With respect to any payments not yet made to a Participant pursuant to an Award, nothing contained in the Plan or any Award
Certificate shall give the Participant any rights that are greater than those of a general creditor of the Company or any Affiliate. In its sole discretion, the Committee may authorize the creation of grantor trusts or other arrangements to meet the
obligations created under the Plan to deliver Shares or payments in lieu of Shares or with respect to Awards. This Plan is not intended to be subject to ERISA.
17.5. RELATIONSHIP TO OTHER BENEFITS. No payment under the Plan shall be taken into account in determining any benefits under any pension,
retirement, savings, profit sharing, group insurance, welfare or benefit plan of the Company or any Affiliate unless provided otherwise in such other plan. Nothing contained in the Plan will prevent the Company from adopting other or additional
compensation arrangements, subject to stockholder approval if such approval is required; and such arrangements may be either generally applicable or applicable only in specific cases.
17.6. EXPENSES. The expenses of administering the Plan shall be borne by the Company and its Affiliates.
17.7. TITLES AND HEADINGS. The titles and headings of the Sections in the Plan are for convenience of reference only, and in the event of any
conflict, the text of the Plan, rather than such titles or headings, shall control.
17.8. GENDER AND NUMBER. Except where otherwise
indicated by the context, any masculine term used herein also shall include the feminine; the plural shall include the singular and the singular shall include the plural.
17.9. FRACTIONAL SHARES. No fractional Shares shall be issued and the Committee shall determine, in its discretion, whether cash shall be
given in lieu of fractional Shares or whether such fractional Shares shall be eliminated by rounding up or down.
17.10. GOVERNMENT AND
OTHER REGULATIONS.
(a) Notwithstanding any other provision of the Plan, no Participant who acquires Shares pursuant to the Plan may, during any period of
time that such Participant is an affiliate of the Company (within the meaning of the rules and regulations of the Securities and Exchange Commission under the 1933 Act), sell such Shares, unless such offer and sale is made (i) pursuant to an
effective registration statement under the 1933 Act, which is current and includes the Shares to be sold, or (ii) pursuant to an appropriate exemption from the registration requirement of the 1933 Act, such as that set forth in Rule 144
promulgated under the 1933 Act.
(b) Notwithstanding any other provision of the Plan, if at any time the Committee shall determine that the registration,
listing or qualification of the Shares covered by an Award upon any Exchange or under any foreign,
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federal, state or local law or practice, or the consent or approval of any governmental regulatory body, is necessary or desirable as a condition of, or in connection with, the granting of such
Award or the purchase or receipt of Shares thereunder, no Shares may be purchased, delivered or received pursuant to such Award unless and until such registration, listing, qualification, consent or approval shall have been effected or obtained free
of any condition not acceptable to the Committee. Any Participant receiving or purchasing Shares pursuant to an Award shall make such representations and agreements and furnish such information as the Committee may request to assure compliance with
the foregoing or any other applicable legal requirements. The Company shall not be required to issue or deliver any certificate or certificates for Shares under the Plan prior to the Committees determination that all related requirements have
been fulfilled. The Company shall in no event be obligated to register any securities pursuant to the 1933 Act or applicable state or foreign law or to take any other action in order to cause the issuance and delivery of such certificates to comply
with any such law, regulation or requirement.
17.11. GOVERNING LAW. To the extent not governed by federal law, the Plan and all Award
Certificates shall be construed in accordance with and governed by the laws of the State of Delaware.
17.12. SEVERABILITY. In the event
that any provision of this Plan is found to be invalid or otherwise unenforceable under any applicable law, such invalidity or unenforceability will not be construed as rendering any other provisions contained herein as invalid or unenforceable, and
all such other provisions will be given full force and effect to the same extent as though the invalid or unenforceable provision was not contained herein.
17.13. NO LIMITATIONS ON RIGHTS OF COMPANY. The grant of any Award shall not in any way affect the right or power of the Company to make adjustments,
reclassification or changes in its capital or business structure or to merge, consolidate, dissolve, liquidate, sell or transfer all or any part of its business or assets. The Plan shall not restrict the authority of the Company, for proper
corporate purposes, to draft or assume awards, other than under the Plan, to or with respect to any person. If the Committee so directs, the Company may issue or transfer Shares to an Affiliate, for such lawful consideration as the Committee may
specify, upon the condition or understanding that the Affiliate will transfer such Shares to a Participant in accordance with the terms of an Award granted to such Participant and specified by the Committee pursuant to the provisions of the Plan.
The foregoing is hereby acknowledged as being the Keryx Biopharmaceuticals, Inc. Amended and Restated 2013 Incentive Plan as adopted by the Board on
March 31, 2016 and by the stockholders on May 25, 2016.
By:
Its:
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*** Exercise Your
Right
to Vote ***
Important Notice Regarding the Availability of Proxy Materials for the
Shareholder Meeting to Be Held on May 25, 2016
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KERYX BIOPHARMACEUTICALS, INC.
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Meeting Information
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Meeting Type:
Annual Meeting
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For holders as of:
March 31, 2016
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Date:
May 25,
2016
Time:
10:00 AM EST
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Location:
Mintz Levin
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1 Financial Center
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Boston, MA 02111
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You are receiving this communication because you hold shares in the above named company.
This is not a ballot. You cannot use this notice to vote these shares.
This communication presents only an overview of the more complete proxy materials that are available to you on the Internet. You may view the proxy materials online at
www.proxyvote.com
or easily request a paper copy (see reverse side).
We encourage you to access and review all of the important information
contained in the proxy materials before voting.
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See the reverse side of this notice to obtain proxy materials and voting instructions.
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Before You Vote
How to Access the Proxy Materials
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Proxy Materials
Available to VIEW or RECEIVE:
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1. Notice & Proxy Statement and Annual Report
How to View Online:
Have the information that is printed in the box marked by the arrow
(located on the following page) and visit:
www.proxyvote.com.
How to Request and Receive a PAPER or E-MAIL Copy:
If you want to receive a paper or e-mail copy of these documents, you must request one. There is NO charge for requesting a copy. Please choose one of the
following methods to make your request:
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1)
BY INTERNET
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www.proxyvote.com
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2)
BY TELEPHONE
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1-800-579-1639
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3)
BY E-MAIL*
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sendmaterial@proxyvote.com
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* If
requesting materials by e-mail, please send a blank e-mail with the information that is printed in the box marked by the arrow
(located on the following page) in the subject line.
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Requests,
instructions and other inquiries sent to this e-mail address will NOT be forwarded to your investment advisor. Please make the request as instructed above on or before May 11, 2016 to facilitate timely delivery.
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How To Vote
Please Choose One of the Following Voting Methods
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Vote In Person:
If you choose to vote these shares in person at the meeting, you
must request a
legal proxy.
To do so, please follow the instructions at
www.proxyvote.com
or request a paper copy of the materials, which will contain the appropriate instructions. Many shareholder meetings have attendance
requirements including, but not limited to, the possession of an attendance ticket issued by the entity holding the meeting. Please check the meeting materials for any special requirements for meeting attendance.
Vote By Internet:
To vote now by Internet, go to
www.proxyvote.com.
Have the
information that is printed in the box marked by the arrow
available and follow the instructions.
Vote By Mail:
You can vote by mail by requesting a paper copy of the materials, which will include a voting instruction form.
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The Board of Directors recommends that you
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vote FOR the following:
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1.
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Election of Directors
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Nominees
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01
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Kevin J. Cameron
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02
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John P. Butler
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03
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Steven C. Gilman
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04
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Gregory P. Madison
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05
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Daniel P. Regan
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06
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Michael Rogers
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The Board of Directors recommends you vote FOR the following proposal(s):
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2.
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The ratification of appointment of UHY LLP as independent registered public accounting firm for the year ending December 31, 2016.
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3.
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The approval of the compensation of our named executive officers as disclosed in our proxy statement.
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4.
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The approval of an amendment to our Certificate of Incorporation to increase our authorized share capital by 50,000,000 shares of common stock.
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5.
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The approval of our Amended and Restated 2013 Incentive Plan to increase the number of authorized shares issuable thereunder
from 9,500,000 to 18,000,000 and to institute a cap on director equity compensation.
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NOTE:
Such other business as may properly come
before the meeting or any adjournment thereof.
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KERYX BIOPHARMACEUTICALS, INC.
ATTN: BRIAN ADAMS
ONE MARINA PARK DRIVE, 12TH FLOOR
BOSTON, MA 02210
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VOTE BY INTERNET
-
www.proxyvote.com
Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 P.M. Eastern Time the day before the cut-off
date or meeting date. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form.
ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS
If you would like to reduce the costs incurred by our company in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards
and annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy materials
electronically in future years.
VOTE BY PHONE - 1-800-690-6903
Use any touch-tone telephone to transmit your voting instructions up until 11:59 P.M. Eastern Time the day before the cut-off date or meeting date. Have your
proxy card in hand when you call and then follow the instructions.
VOTE BY
MAIL
Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51
Mercedes Way, Edgewood, NY 11717.
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TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:
KEEP THIS PORTION FOR YOUR RECORDS
DETACH AND RETURN THIS PORTION ONLY
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
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The Board of Directors recommends you vote
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For
All
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Withhold
All
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For All Except
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To withhold authority to vote for any individual nominee(s), mark For
All Except and write the number(s) of the nominee(s) on the line below.
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FOR the following:
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¨
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¨
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¨
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1.
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Election of Directors
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Nominees
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01 Kevin J.
Cameron 02 John P. Butler 03 Steven
C. Gilman 04 Gregory P.
Madison 05 Daniel P. Regan
06 Michael Rogers
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The Board of Directors recommends you vote FOR
proposals 2., 3., 4. and 5.
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For
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Against
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Abstain
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2.
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The ratification of appointment of UHY LLP as independent registered public accounting firm for the year ending December 31,
2016.
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¨
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¨
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¨
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3.
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The approval of the compensation of our named executive officers as disclosed in our proxy statement.
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¨
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¨
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¨
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4.
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The approval of an amendment to our Certificate of Incorporation to increase our authorized share capital by 50,000,000 shares of
common stock.
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¨
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¨
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¨
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5.
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The approval of our Amended and Restated 2013 Incentive Plan to increase the number of authorized shares issuable thereunder from
9,500,000 to 18,000,000 and to institute a cap on director equity compensation.
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¨
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¨
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¨
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NOTE:
Such other business as may properly come before the meeting or any adjournment thereof.
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For address change/comments, mark here.
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¨
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(see reverse for instructions)
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Yes
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No
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Please indicate if you plan to attend this meeting
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¨
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¨
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Please sign exactly as your name(s) appear(s) hereon.
When signing as attorney, executor, administrator, or other fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership
name, by authorized officer.
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Signature [PLEASE SIGN WITHIN BOX]
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Date
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Signature (Joint Owners)
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Date
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Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:
The Notice & Proxy Statement and Annual
Report are available at
www.proxyvote.com
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KERYX BIOPHARMACEUTICALS, INC.
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
ANNUAL MEETING OF STOCKHOLDERS
MAY 25, 2016
The undersigned stockholder of Keryx Biopharmaceuticals, Inc. hereby appoints Gregory P. Madison, our Chief Executive Officer and Brian
Adams, our General Counsel and Corporate Secretary, with the power of substitution, as proxies to vote the shares of our common stock that the undersigned could vote if personally present at the Annual Meeting of Stockholders of Keryx
Biopharmaceuticals, Inc. to be held at the offices of our legal counsel, Mintz Levin, at 1 Financial Center, Boston, MA 02111, and any adjournment or postponement thereof.
Our Board of Directors hopes that stockholders will attend the 2016 Annual Meeting of Stockholders. Whether or not you plan to attend,
you are urged to complete, date, sign and return the enclosed proxy card in the accompanying envelope. A prompt response will greatly facilitate arrangements for the Annual Meeting and your cooperation will be appreciated. Stockholders who attend
the Annual Meeting may vote their stock personally, even though they have sent in their proxy card.
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Address change/comments:
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_______________________________________________________________________________________
_______________________________________________________________________________________
_______________________________________________________________________________________
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(If you noted any Address Changes and/or Comments above, please mark
corresponding box on the reverse side.)
Continued and to be signed on reverse side
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Keryx Biopharmaceuticals, Inc. (delisted) (NASDAQ:KERX)
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