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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): June 12, 2024
BioCryst Pharmaceuticals, Inc.
(Exact name of registrant as specified in charter)
Delaware |
000-23186 |
62-1413174 |
(State or Other Jurisdiction |
(Commission |
(IRS Employer |
of Incorporation) |
File Number) |
Identification No.) |
4505 Emperor Blvd., Suite 200
Durham, North Carolina 27703
(Address of Principal Executive Offices) (Zip Code)
(919) 859-1302
(Registrant’s telephone number, including area
code)
________________________________________
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following provisions:
|
☐ |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|
☐ |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
|
☐ |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
|
☐ |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
Trading
Symbol(s) |
Name
of each exchange on which registered |
Common
Stock |
BCRX |
Nasdaq Global
Select Market |
Indicate by check mark whether the registrant is an emerging growth company as defined
in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected
not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section
13(a) of the Exchange Act. ☐
Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment
of Certain Officers; Compensatory Arrangements of Certain Officers.
On June 12, 2024, at the 2024 Annual Meeting of Stockholders (the “Annual
Meeting”) of BioCryst Pharmaceuticals, Inc. (the “Company”), the Company’s stockholders approved, by the affirmative
vote of a majority of the shares of the Company’s common stock represented in person or by proxy at the Annual Meeting and voting
on the proposal, a proposal to amend and restate the BioCryst Pharmaceuticals, Inc. Stock Incentive Plan (such plan, as amended and restated,
the “Stock Incentive Plan”), increasing the number of shares available for issuance under the Stock Incentive Plan by 7,000,000
shares (the “Incentive Plan Proposal”). A detailed description of the Stock Incentive Plan is included in the Company’s
Definitive Proxy Statement for the Annual Meeting. The description of the Stock Incentive Plan in this report does not purport to be complete
and is qualified in its entirety by reference to the full text of the Stock Incentive Plan, a copy of which is filed as Exhibit 10.1 hereto
and is incorporated herein by reference.
Item 5.07. Submission of Matters to a Vote of Security Holders.
The Annual Meeting was held on June 12, 2024 for the purpose of (1) electing
three directors to serve for a term ending at the Company’s 2027 annual meeting of stockholders and until a successor is duly elected
and qualified; (2) ratifying the selection of Ernst & Young LLP as the Company’s independent registered public accountants for
2024; (3) holding an advisory vote approving the Company’s executive compensation; and (4) approving the Incentive Plan Proposal
described in Item 5.02 above.
The nominees for director were elected by the following votes:
|
|
FOR |
|
WITHHELD |
Nancy J. Hutson, Ph.D. |
|
|
124,478,890 |
|
|
|
20,918,007 |
|
Vincent J. Milano |
|
|
141,143,460 |
|
|
|
4,253,437 |
|
A. Machelle Sanders |
|
|
141,189,098 |
|
|
|
4,207,799 |
|
In addition, there were 26,962,524 broker non-votes for each director.
The proposed ratification of the selection of Ernst & Young LLP as
the Company’s independent registered public accountants for 2024 was approved by the following votes:
FOR |
|
|
167,496,029 |
|
AGAINST |
|
|
3,932,954 |
|
ABSTAIN |
|
|
930,438 |
|
The proposed advisory resolution regarding executive compensation was approved
by the following votes:
FOR |
|
|
138,402,008 |
|
AGAINST |
|
|
6,410,647 |
|
ABSTAIN |
|
|
584,242 |
|
BROKER NON-VOTES |
|
|
26,962,524 |
|
The Incentive Plan Proposal was approved by the following votes:
FOR |
|
|
101,846,368 |
|
AGAINST |
|
|
43,055,807 |
|
ABSTAIN |
|
|
494,722 |
|
BROKER NON-VOTES |
|
|
26,962,524 |
|
There was no other business voted upon at the Annual Meeting.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: June 13, 2024 |
|
BioCryst Pharmaceuticals, Inc. |
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|
|
|
|
By: |
/s/ Alane Barnes |
|
|
|
Alane Barnes |
|
|
|
Chief Legal Officer |
Exhibit 10.1
BIOCRYST PHARMACEUTICALS, INC.
STOCK INCENTIVE PLAN
(AS AMENDED AND RESTATED AS OF APRIL 22, 2024)
Article One
GENERAL PROVISIONS
I.
PURPOSES OF THE PLAN
A.
This Stock Incentive Plan (the “Plan”), formerly the “BioCryst Pharmaceuticals, Inc. 1991 Stock Option Plan,”
is intended to promote the interests of BioCryst Pharmaceuticals, Inc., a Delaware corporation (the “Company”), by providing
a method whereby (i) employees (including officers and directors) of the Company (or its parent or subsidiary corporations), (ii) non-employee
members of the board of directors of the Company (the “Board”) (or of any parent or subsidiary corporations) and (iii) consultants
and other independent contractors who provide valuable services to the Company (or any parent or subsidiary corporations) may be offered
the opportunity to acquire a proprietary interest, or otherwise increase their proprietary interest, in the Company as an incentive for
them to remain in the service of the Company (or any parent or subsidiary corporations).
B.
For purposes of the Plan, the following provisions shall be applicable in determining the parent and subsidiary corporations of the Company:
(i) Any corporation
(other than the Company) in an unbroken chain of corporations ending with the Company shall be considered to be a parent corporation
of the Company, provided each such corporation in the unbroken chain (other than the Company) owns, at the time of the determination,
stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other corporations
in such chain.
(ii) Each
corporation (other than the Company) in an unbroken chain of corporations beginning with the Company shall be considered to be a subsidiary
of the Company, provided each such corporation (other than the last corporation) in the unbroken chain owns, at the time of the determination,
stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other corporations
in such chain.
C.
The Plan, as amended and restated, was approved and adopted by the Board, effective on April 22, 2024, in order to increase by 7,000,000
the number of shares of the Company’s common stock, par value $0.01 per share (the “Common Stock”), available for issuance
under the Plan, subject to approval by the Company’s stockholders at the Company’s Annual Meeting of Stockholders on June
12, 2024, and to make certain other changes.
II.
STRUCTURE OF THE PLAN
A.
The Plan shall be divided into three separate equity programs:
(i) the
Discretionary Option Grant Program specified in Article Two, pursuant to which eligible persons may, at the discretion of the Plan Administrator,
be granted options to purchase shares of Common Stock,
(ii) the
Stock Issuance Program specified in Article Three, pursuant to which eligible persons may, at the discretion of the Plan Administrator,
be issued shares of Common Stock directly or through the issuance of restricted stock units (“RSUs”) that provide for the
issuance of shares of Common Stock if the applicable vesting criteria are satisfied, and
(iii) the Director Grant Program specified in Article Four, pursuant to which non-employee members of the Board may receive grants of awards.
B. Unless the context clearly indicates otherwise, the provisions of Articles One and Five of the Plan shall apply to all equity programs
under the Plan and shall accordingly govern the interests of all individuals under the Plan.
III.
ADMINISTRATION OF THE PLAN
A. The Plan shall be administered by the Committee who shall be the Compensation Committee of the Board or, in the absence of a Compensation
Committee, a properly constituted committee or the Board itself (the administrator is referred to herein as the “Committee”
or the “Plan Administrator”). Any power of the Committee may also be exercised by the Board, except to the extent that the
grant or exercise of such authority would cause any award or transaction to become subject to (or lose an exemption under) the short-swing
profit recovery provisions of Section 16 of the Securities Exchange Act of 1934, as amended (the “1934 Act”). To the extent
that any permitted action taken by the Board conflicts with action taken by the Committee, the Board action shall control. The Committee
may by resolution authorize one or more officers of the Company to perform any or all things that the Committee is authorized and empowered
to do or perform under the Plan, and for all purposes under this Plan, such officer or officers shall be treated as the Committee; provided,
however, that the resolution so authorizing such officer or officers shall specify the total number of awards (if any) such officer or
officers may award pursuant to such delegated authority, and any such award shall be subject to the form of award agreement theretofore
approved by the Compensation Committee. No such officer shall designate himself or herself as a recipient of any awards granted under
authority delegated to such officer. In addition, the Compensation Committee may delegate any or all aspects of the day-to-day administration
of the Plan to one or more officers or employees of the Company or any subsidiary or affiliate, and/or to one or more agents.
B. Subject to the express provisions of this Plan, the Committee shall be authorized and empowered to do all things that it determines to
be necessary or appropriate in connection with the administration of this Plan, including, without limitation: (i) to prescribe, amend
and rescind rules and regulations relating to this Plan and to define terms not otherwise defined herein; (ii) to determine which persons
are grantees, to which of such grantees, if any, awards shall be granted hereunder and the timing of any such awards; (iii) to grant awards
to grantees and determine the terms and conditions thereof, including the number of shares of Common Stock subject to awards and the exercise
or purchase price of such shares and the circumstances under which awards become exercisable or vested or are forfeited or expire, which
terms may but need not be conditioned upon the passage of time, continued employment, the satisfaction of performance criteria, the occurrence
of certain events (including events which constitute a Change in Control to the extent permitted hereunder), or other factors; (iv) to
establish and verify the extent of satisfaction of any performance goals or other conditions applicable to the grant, issuance, exercisability,
vesting and/or ability to retain any award; (v) to prescribe and amend the terms of the agreements or other documents evidencing awards
made under this Plan (which need not be identical) and the terms of or form of any document or notice required to be delivered to the
Company by grantees under this Plan; (vi) to determine the extent to which adjustments are required pursuant to Article One; (vii) to
interpret and construe this Plan, any rules and regulations under this Plan and the terms and conditions of any award granted hereunder,
and to make exceptions to any such provisions for the benefit of the Company; (viii) to approve corrections in the documentation or administration
of any award; and (ix) to make all other determinations deemed necessary or advisable for the administration of this Plan.
C. All decisions, determinations
and interpretations by the Committee regarding the Plan, any rules and regulations under the Plan and the terms and conditions of or operation
of any award granted hereunder, shall be final and binding on all grantees, beneficiaries, heirs, assigns or other persons holding or
claiming rights under the Plan or any award. The Committee shall consider such factors as it deems relevant, in its sole and absolute
discretion, to making such decisions, determinations and interpretations including, without limitation, the recommendations or advice
of any officer or other employee of the Company and such attorneys, consultants and accountants as it may select.
D. The Committee may delegate all
or a portion of their duties hereunder to one or more individuals or committees. Any reference to the Committee or the Plan Administrator
shall refer to such individual(s) or committee(s) to the extent of such delegation.
IV.
ELIGIBILITY
A.
The persons eligible to participate in the Discretionary Option Grant and Stock Issuance Programs shall be limited to the following:
(i) officers
and other employees of the Company (or its parent or subsidiary corporations);
(ii) individuals
who are consultants or independent advisors and who provide valuable services to the Company (or its parent or subsidiary corporations);
and
(iii) non-employee
members of the Board (or of the board of directors of parent or subsidiary corporations), subject to the limits set forth in Section II.A.
of Article Four.
B.
Only Board members who are not employees of the Company (or any parent or subsidiary) shall be eligible to receive grants pursuant to
the Director Grant Program specified in Article Four.
C.
The Plan Administrator shall, within the scope of its administrative jurisdiction under the Plan, have full power and authority to determine
(i) whether to grant options in accordance with the Discretionary Option Grant Program or to effect stock issuances in accordance with
the Stock Issuance Program, (ii) which eligible persons are to receive option grants under the Discretionary Option Grant Program, the
time or times when such option grants are to be made, the number of shares to be covered by each such grant, the status of the granted
option as either an incentive stock option (“Incentive Option”) which satisfies the requirements of Section 422 of the Internal
Revenue Code of 1986, as amended (the “Code”) or a non-statutory option not intended to meet such requirements, the time or
times when each such option is to become exercisable, the vesting schedule (if any) applicable to the option shares and the maximum term
for which such option is to remain outstanding, and (iii) which eligible persons are to receive stock issuances under the Stock Issuance
Program, the time or times when such issuances are to be made, the number of shares to be issued to each grantee, the vesting schedule
(if any) applicable to the shares and the consideration for such shares.
V.
STOCK SUBJECT TO THE PLAN
A.
Shares of the Company’s Common Stock shall be available for issuance under the Plan and shall be drawn from either the Company’s
authorized but unissued shares of Common Stock or from reacquired shares of Common Stock, including shares repurchased by the Company
on the open market. The maximum number of shares of Common Stock which may be issued over the term of the Plan, as amended and restated,
shall not exceed 70,090,000 shares, subject to adjustment from time to time in accordance with the provisions of this Section V. The total
number of shares available under the Plan, as amended and restated, as of April 22, 2024 is 51,324,525. This amount consists of 39,115,452
shares reserved for awards already issued, 5,209,073 shares of Common Stock available for future issuance under the Plan, and the increase
of 7,000,000 shares of Common Stock authorized by the Board (subject to approval by the Company’s stockholders at the Annual Meeting
of Stockholders on June 12, 2024).
B.
In no event shall the number of shares of Common Stock for which any one individual participating in the Plan may receive options, separately
exercisable stock appreciation rights and direct stock issuances and RSUs exceed 1,500,000 shares of Common Stock in the aggregate in
any calendar year. For purposes of such limitation, however, no stock options granted prior to the date the Common Stock was first registered
under Section 12 of the 1934 Act (the “Section 12(g) Registration Date”) shall be taken into account.
C.
Should an outstanding option under this Plan expire or terminate for any reason prior to exercise in full, the shares subject to the portion
of the option not so exercised shall be available for subsequent option grant or direct stock issuances or RSUs under the Plan. Unvested
shares issued under the Plan and subsequently repurchased by the Company, at the original issue price paid per share, pursuant to the
Company’s repurchase rights under the Plan, or shares underlying terminated RSUs, shall be added back to the number of shares of
Common Stock reserved for issuance under the Plan and shall accordingly be available for reissuance through one or more subsequent option
grants or direct stock issuances or RSUs under the Plan. However, shares subject to an award under the Plan may not again be made available
for issuance under the Plan if such shares are: (i) shares that were subject to a stock-settled stock appreciation right and were not
issued upon the net settlement or net exercise of such stock appreciation right, (ii) shares used to pay the exercise price of an option,
(iii) shares delivered to or withheld by the Company to pay the withholding taxes related an award, or (iv) shares repurchased on the
open market with the proceeds of an option exercise. Shares of Common Stock subject to any option surrendered for an appreciation distribution
under Section IV of Article Two or Section II.B.1.(iv) of Article Four shall not be available for subsequent issuance under the Plan.
D.
In the event any change is made to the Common Stock issuable under the Plan by reason of any stock split, stock dividend, recapitalization,
combination of shares, exchange of shares or other change affecting the outstanding Common Stock as a class without receipt of consideration,
then appropriate adjustments shall be made to (i) the maximum number and/or class of securities issuable under the Plan, (ii) the maximum
number and/or class of securities for which any one individual participating in the Plan may be granted stock options, separately exercisable
stock appreciation rights, and direct stock issuances and RSUs under the Plan from and after the Section 12(g) Registration Date, (iii)
the number and/or class of securities and price per share in effect under each outstanding option and stock appreciation right under the
Plan, (iv) the number and/or class of securities in effect under each outstanding direct stock issuance and RSU under the Plan, and (v)
the number and/or class of securities for which grants are subsequently to be made per non-employee Board member under the Director Grant
Program. The purpose of such adjustments shall be to preclude the enlargement or dilution of rights and benefits under the Plan.
E.
The fair market value per share of Common Stock on any relevant date under the Plan shall be determined in accordance with the following
provisions:
(i) If the
Common Stock is not at the time listed or admitted to trading on any national securities exchange but is traded in the over-the-counter
market, the fair market value shall be the mean between the highest bid and lowest asked prices (or, if such information is available,
the closing selling price) per share of Common Stock on the date in question in the over-the-counter market, as such prices are reported
on the Nasdaq National Market, the Nasdaq Global Select Market or any successor system. If there are no reported bid and asked prices
(or closing selling price) for the Common Stock on the date in question, then the mean between the highest bid price and lowest asked
price (or the closing selling price) on the last preceding date for which such quotations exist shall be determinative of fair market
value.
(ii) If the
Common Stock is at the time listed or admitted to trading on any national securities exchange, then the fair market value shall be the
closing selling price per share of Common Stock on the date in question on the securities exchange determined by the Plan Administrator
to be the primary market for the Common Stock, as such price is officially quoted in the composite tape of transactions on such exchange.
If there is no reported sale of Common Stock on the exchange on the date in question, then the fair market value shall be the closing
selling price on the exchange on the last preceding date for which such quotation exists.
(iii) If the
Common Stock is at the time neither listed nor admitted to trading on any securities exchange nor traded in the over-the-counter market,
then the fair market value shall be determined by the Plan Administrator after taking into account such factors as the Plan Administrator
shall deem appropriate.
VI. MINIMUM
VESTING
Notwithstanding any other provision of this Plan to the
contrary, in no event shall any award granted pursuant to this Plan vest prior to the twelve (12)-month anniversary of the date of grant,
other than in connection with the grantee’s death or permanent disability or, to the extent permitted hereunder, in connection with
a Change in Control (provided that this limitation shall not apply with respect to up to five percent (5%) of the shares of Common Stock
available for issuance under this Plan following approval of the Plan at the Company’s Annual Meeting of Stockholders on June 12,
2024). The minimum vesting period set forth in this Section VI may not be waived or superseded by any provision in an award or other agreement.
Article Two
DISCRETIONARY OPTION GRANT PROGRAM
I.
TERMS AND CONDITIONS OF OPTIONS
Options granted pursuant to this Article Two shall be
authorized by action of the Plan Administrator and may, at the Plan Administrator’s discretion, be either Incentive Options or non-statutory
options. Individuals who are not Employees may only be granted non-statutory options under this Article Two. Each option granted shall
be evidenced by one or more instruments in the form approved by the Plan Administrator. Each such instrument shall, however, comply with
the terms and conditions specified below, and each instrument evidencing an Incentive Option shall, in addition, be subject to the applicable
provisions of Section II of this Article Two.
A.
Option Price.
1.
The option price per share shall be fixed by the Plan Administrator. In no event, however, shall the option price per share be less than
one hundred percent (100%) of the fair market value per share of Common Stock on the date of the option grant.
2.
The option price shall become immediately due upon exercise of the option and shall, subject to the provisions of Section IV of this Article
Two and the instrument evidencing the grant, be payable through one of the following methods (or a combination thereof):
(i) full payment
in cash or check drawn to the Company’s order;
(ii) full payment
in shares of Common Stock held by the optionee for the requisite period necessary to avoid a charge to the Company’s earnings for
financial reporting purposes and valued at fair market value on the Exercise Date (as such term is defined below);
(iii) full payment
through a combination of shares of Common Stock held by the optionee for the requisite period necessary to avoid a charge to the Company’s
earnings for financial reporting purposes and valued at fair market value on the Exercise Date and cash or cash equivalent;
(iv) full payment
through a broker-dealer sale and remittance procedure pursuant to which the optionee (I) shall provide irrevocable written instructions
to a designated brokerage firm to effect the immediate sale of the purchased shares and remit to the Company, out of the sale proceeds
available on the settlement date, sufficient funds to cover the aggregate option price payable for the purchased shares plus all applicable
Federal and State income and employment taxes required to be withheld by the Company in connection with such purchase and (II) shall provide
written directives to the Company to deliver the certificates for the purchased shares directly to such brokerage firm in order to complete
the sale transaction; or
(v) such other
method as permitted by the Plan Administrator.
For purposes of this subparagraph 2, the Exercise Date
shall be the date on which written notice of the option exercise is delivered to the Company. Except to the extent the sale and remittance
procedure is utilized in connection with the exercise of the option, payment of the option price for the purchased shares must accompany
such notice.
B.
Term and Exercise of Options.
Each option granted under this Article Two shall be
exercisable at such time or times, during such period, and for such number of shares as shall be determined by the Plan Administrator
and set forth in the instrument evidencing the option grant. No such option, however, shall have a maximum term in excess of ten (10)
years from the grant date. During the lifetime of the optionee, the option, together with any stock appreciation rights pertaining to
such option, shall be exercisable only by the optionee and shall not be assignable or transferable by the optionee except for a transfer
of the option by will or by the laws of descent and distribution following the optionee’s death and, for the avoidance of doubt,
may not be transferred to a third party for cash or other value. However, the Plan Administrator shall have the discretion to provide
that a non-statutory option may, in connection with the optionee’s estate plan, be assigned in whole or in part during the optionee’s
lifetime either (i) as a gift to one or more members of optionee’s immediate family, to a trust in which optionee and/or one or
more such family members hold more than fifty percent (50%) of the beneficial interest or an entity in which more than fifty percent (50%)
of the voting interests are owned by optionee and/or one or more such family members, or (ii) pursuant to a domestic relations order.
The assigned portion shall be exercisable only by the person or persons who acquire a proprietary interest in the option pursuant to such
assignment. The terms applicable to the assigned portion shall be the same as those in effect for this option immediately prior to such
assignment and shall be set forth in such documents issued to the assignee as the Plan Administrator may deem appropriate.
C.
Termination of Service.
1.
Except to the extent otherwise provided pursuant to Section V of this Article Two or pursuant to an applicable award agreement, the following
provisions shall govern the exercise period applicable to any options held by the optionee at the time of cessation of Service or death.
(i) Should the
optionee cease to remain in Service for any reason other than death or permanent disability, then the period for which each outstanding
option held by such optionee is to remain exercisable shall be limited to the three (3)-month period following the date of such cessation
of Service. However, should optionee die during the three (3)-month period following his or her cessation of Service, the personal representative
of the optionee’s estate or the person or persons to whom the option is transferred pursuant to the optionee’s will or in
accordance with the laws of descent and distribution shall have a twelve (12)-month period following the date of the optionee’s
death during which to exercise such option.
(ii) In the
event such Service terminates by reason of permanent disability (as defined in Section 22(e)(3) of the Code), then the period for which
each outstanding option held by the optionee is to remain exercisable shall be limited to the twelve (12)-month period following the date
of such cessation of Service.
(iii) Should
the optionee, after completing five (5) full years of Service, die while in Service, then the exercisability of each of his or her outstanding
options shall automatically accelerate so that each such option shall become fully exercisable with respect to the total number of shares
of Common Stock at the time subject to such option and may be exercised for all or any portion of such shares. The personal representative
of the optionee’s estate or the person or persons to whom the option is transferred pursuant to the optionee’s will or in
accordance with the laws of descent and distribution shall have a twelve (12)-month period following the date of the optionee’s
death during which to exercise such option.
(iv) In the
event such Service terminates by reason of death prior to the optionee obtaining five (5) full years of Service, then the period for which
each outstanding vested option held by the optionee at the time of death shall be exercisable by the optionee’s estate or the person
or persons to whom the option is transferred pursuant to the optionee’s will shall be limited to the twelve (12)-month period following
the date of the optionee’s death.
(v) Under no
circumstances, however, shall any such option be exercisable after the specified expiration date of the option term.
(vi) Each such
option shall, during such limited exercise period, be exercisable for any or all of the shares for which the option is exercisable on
the date of the optionee’s cessation of Service. Upon the expiration of such limited exercise period or (if earlier) upon the expiration
of the option term, the option shall terminate and cease to be exercisable. However, each outstanding option shall immediately terminate
and cease to remain outstanding, at the time of the optionee’s cessation of Service, with respect to any shares for which the option
is not otherwise at that time exercisable or in which the optionee is not otherwise vested.
(vii) Should
(i) the optionee’s Service be terminated for misconduct (including, but not limited to, any act of dishonesty, willful misconduct,
fraud or embezzlement) or (ii) the optionee make any unauthorized use or disclosure of confidential information or trade secrets of the
Company or its parent or subsidiary corporations, then in any such event all outstanding options held by the optionee under this Article
Two shall terminate immediately and cease to be exercisable.
2.
The Plan Administrator shall have complete discretion, exercisable either at the time the option is granted or at any time while the option
remains outstanding, to permit one or more options held by the optionee under this Article Two to be exercised, during the limited period
of exercisability provided under subparagraph 1 above, not only with respect to the number of shares for which each such option is exercisable
at the time of the optionee’s cessation of Service but also with respect to one or more subsequent installments of purchasable shares
for which the option would otherwise have become exercisable had such cessation of Service not occurred.
3.
For purposes of the foregoing provisions of this Section I.C (and for all other purposes under the Plan):
(i) The optionee
shall be deemed to remain in the Service of the Company for so long as such individual renders services on a periodic basis to
the Company (or any parent or subsidiary corporation) in the capacity of an Employee, a non-employee member of the board of directors
or an independent consultant or advisor, unless the agreement evidencing the applicable option grant specifically states otherwise.
(ii) The optionee
shall be considered to be an Employee for so long as such individual remains in the employ of the Company or one or more of its
parent or subsidiary corporations, subject to the control and direction of the employer entity not only as to the work to be performed
but also as to the manner and method of performance.
D.
Stockholder Rights.
An optionee shall have no stockholder rights with respect
to any shares covered by the option until such individual shall have exercised the option and paid the option price for the purchased
shares. Without limitation, an optionee shall not have any right to receive dividends with respect to an unexercised option.
E.
No Repricing.
No option or stock appreciation right may be repriced,
regranted through cancellation, including cancellation in exchange for cash or other awards, or otherwise amended to reduce its option
price or exercise price (other than with respect to adjustments made in connection with a transaction or other change in the Company’s
capitalization as permitted under this Plan) without the approval of the stockholders of the Company.
F.
Repurchase Rights.
The shares of Common Stock acquired upon the exercise
of options granted under this Article Two may be subject to repurchase by the Company in accordance with the following provisions:
1. The Plan
Administrator shall have the discretion to grant options which are exercisable for unvested shares of Common Stock under this Article
Two. Should the optionee cease Service while holding such unvested shares, the Company shall have the right to repurchase any or all those
unvested shares at the option price paid per share. The terms and conditions upon which such repurchase right shall be exercisable (including
the period and procedure for exercise and the appropriate vesting schedule for the purchased shares) shall be established by the Plan
Administrator and set forth in the instrument evidencing such repurchase right.
2. All of
the Company’s outstanding repurchase rights shall automatically terminate, and all shares subject to such terminated rights shall
immediately vest in full, upon the occurrence of any Corporate Transaction under Section III of this Article Two, except to the extent:
(i) any such repurchase right is expressly assigned to the successor corporation (or parent thereof) in connection with the Corporate
Transaction or (ii) such termination is precluded by other limitations imposed by the Plan Administrator at the time the repurchase right
is issued.
3. The Plan
Administrator shall have the discretionary authority, exercisable either before or after the optionee’s cessation of Service, to
cancel the Company’s outstanding repurchase rights with respect to one or more shares purchased or purchasable by the optionee under
this Discretionary Option Grant Program and thereby accelerate the vesting of such shares in whole or in part at any time.
II.
INCENTIVE OPTIONS
The terms and conditions specified below shall be applicable
to all Incentive Options granted under this Article Two. Incentive Options may only be granted to individuals who are Employees of the
Company. Options which are specifically designated as “non-statutory” options when issued under the Plan shall not be subject
to such terms and conditions.
A.
Dollar Limitation. The aggregate fair market value (determined as of the respective date or dates of grant) of the Common
Stock for which one or more options granted to any Employee under this Plan (or any other option plan of the Company or its parent or
subsidiary corporations) may for the first time become exercisable as incentive stock options under the Federal tax laws during any one
calendar year shall not exceed the sum of One Hundred Thousand Dollars ($100,000). To the extent the Employee holds two or more such options
which become exercisable for the first time in the same calendar year, the foregoing limitation on the exercisability of such options
as incentive stock options under the Federal tax laws shall be applied on the basis of the order in which such options are granted. Should
the number of shares of Common Stock for which any Incentive Option first becomes exercisable in any calendar year exceed the applicable
One Hundred Thousand Dollar ($100,000) limitation, then that option may nevertheless be exercised in such calendar year for the excess
number of shares as a non-statutory option under the Federal tax laws.
B.
10% Stockholder. If any individual to whom an Incentive Option is granted is the owner of stock (as determined under Section
424(d) of the Code) possessing 10% or more of the total combined voting power of all classes of stock of the Company or any one of its
parent or subsidiary corporations, then the option price per share shall not be less than one hundred and ten percent (110%) of the fair
market value per share of Common Stock on the grant date, and the option term shall not exceed five (5) years, measured from the grant
date.
C.
Termination of Employment. Any portion of an Incentive Option that remains outstanding (by reason of the optionee remaining
in the Service of the Company, pursuant to the Plan Administrator’s exercise of discretion under Section V of this Article Two,
or otherwise) more than 3 months following the date an optionee ceases to be an Employee of the Company shall thereafter be exercisable
as a non-statutory option under federal tax laws.
Except as modified by the preceding provisions of this
Section II, the provisions of Articles One, Two and Five of the Plan shall apply to all Incentive Options granted hereunder.
III.
CORPORATE TRANSACTIONS/CHANGES IN CONTROL
A.
For purposes of this Section III (and for all other purposes under the Plan), a Corporate Transaction shall be deemed to occur in the
event of:
1. a merger
or consolidation in which the Company is not the surviving entity, except for a transaction the principal purpose of which is to change
the State of the Company’s incorporation,
2. the sale,
transfer or other disposition of all or substantially all of the assets of the Company in liquidation or dissolution of the Company, or
3. any reverse
merger in which the Company is the surviving entity but in which securities possessing more than fifty percent (50%) of the total combined
voting power of the Company’s outstanding securities are transferred to a person or persons different from the persons holding those
securities immediately prior to such merger.
The exercisability of each option outstanding under this Article Two that
was granted before April 3, 2017 shall automatically accelerate so that each such option shall, immediately prior to the specified effective
date for the Corporate Transaction, become fully exercisable with respect to the total number of shares of Common Stock at the time subject
to such option and may be exercised for all or any portion of such shares.
B. Immediately after the consummation
of the Corporate Transaction, all outstanding options under this Article Two shall fully vest, terminate and cease to be outstanding,
except to the extent continued or assumed (as applicable) by the Company or the successor corporation or its parent company. The Plan
Administrator shall have complete discretion to provide, on such terms and conditions as it sees fit, for a cash payment to be made to
any optionee on account of any option terminated in accordance with this paragraph, in an amount equal to the excess (if any) of (A) the
fair market value of the shares subject to the option as of the date of the Corporate Transaction, over (B) the aggregate exercise price
of the option.
C. Each outstanding option
under this Article Two which is assumed in connection with the Corporate Transaction or is otherwise to continue in effect shall be appropriately
adjusted, immediately after such Corporate Transaction, to apply and pertain to the number and class of securities which would have been
issued to the option holder, in consummation of such Corporate Transaction, had such person exercised the option immediately prior to
such Corporate Transaction. Appropriate adjustments shall also be made to the option price payable per share, provided the aggregate
option price payable for such securities shall remain the same. In addition, the class and number of securities available for issuance
under the Plan following the consummation of the Corporate Transaction shall be appropriately adjusted. Any such options that are so continued
or assumed in connection with a Corporate Transaction shall be treated as follows: if the grantee’s employment is terminated by
the Company without Cause or the grantee resigns due to a Constructive Termination, in either case within the ninety (90) day period preceding
or the two (2) year period following the Corporate Transaction, the exercisability of such option shall automatically accelerate, and
the Company’s outstanding repurchase rights under this Article Two shall immediately terminate; provided, however, that if the Company,
the acquiror or successor refuses to continue (or, as applicable, assume) the option in connection with the Corporate Transaction, the
exercisability of such option under this Article Two shall automatically accelerate, and the Company’s outstanding repurchase rights
under this Article Two shall immediately terminate upon the occurrence of such Corporate Transaction.
D. The grant of options under this
Article Two shall in no way affect the right of the Company to adjust, reclassify, reorganize or otherwise change its capital or business
structure or to merge, consolidate, dissolve, liquidate or sell or transfer all or any part of its business or assets.
E. In
the event of a Change in Control: (1) options granted under this Article Two prior to May 23, 2016 shall be subject to the provisions
of the Plan as in effect prior to such date, and (2) options granted on or after May 23, 2016 shall be treated as follows: if the grantee’s
employment is terminated by the Company without Cause or the grantee resigns due to a Constructive Termination, in either case within
the ninety (90) day period preceding or the two (2) year period following the Change in Control, the exercisability of such option shall
automatically accelerate, and the Company’s outstanding repurchase rights under this Article Two shall immediately terminate; provided,
however, that if the acquiror or successor refuses to assume the option in connection with the Change in Control, the exercisability of
such option under this Article Two shall automatically accelerate, and the Company’s outstanding repurchase rights under this Article
Two shall immediately terminate upon the occurrence of such Change in Control. In the event that the acquiror or successor refuses to
assume the option in connection with the Change in Control, the Plan Administrator shall have complete discretion to provide, on such
terms and conditions as it sees fit, for a cash payment to be made to any optionee on account of any option terminated in accordance with
this paragraph, in an amount equal to the excess (if any) of (A) the fair market value of the shares subject to the option as of the date
of the Change in Control, over (B) the aggregate exercise price of the option.
F. For purposes of this Section
III (and for all other purposes under the Plan), a Change in Control shall be deemed to occur in the event:
1. any
person or related group of persons (other than the Company or a person that directly or indirectly controls, is controlled by, or is under
common control with, the Company) directly or indirectly acquires beneficial ownership (within the meaning of Rule 13d-3 of the 1934 Act)
of securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities
pursuant to a tender or exchange offer made directly to the Company’s stockholders; or
2. there
is a change in the composition of the Board over a period of twenty-four (24) consecutive months or less such that a majority of the Board
members (rounded up to the next whole number) ceases, by reason of one or more contested elections for Board membership, to be comprised
of individuals who either (A) have been Board members continuously since the beginning of such period or (B) have been elected or nominated
for election as Board members during such period by at least two-thirds of the Board members described in clause (A) who were still in
office at the time such election or nomination was approved by the Board.
G.
All options accelerated in connection with the Corporate Transaction or Change in Control (either at the time of the Corporate Transaction
or Change in Control or as otherwise provided in this Section III) shall remain fully exercisable until the expiration or sooner termination
of the option term.
H.
The portion of any Incentive Option accelerated under this Section III in connection with a Corporate Transaction or Change in Control
shall remain exercisable as an incentive stock option under the Federal tax laws only to the extent the dollar limitation of Section II
of this Article Two is not exceeded. To the extent such dollar limitation is exceeded, the accelerated portion of such option shall be
exercisable as a non-statutory option under the Federal tax laws.
I.
For purposes of this Article Two and for purposes of Article Three:
1.
“Cause” means, unless otherwise provided in the applicable award agreement, the Company’s termination of the grantee’s
employment for any of the following reasons: (i) failure or refusal to comply in any material respect with lawful policies, standards
or regulations of the Company; (ii) a violation of a federal or state law or regulation applicable to the business of the Company; (iii)
conviction or plea of no contest to a felony under the laws of the United States or any State; (iv) fraud or misappropriation of property
belonging to the Company or its affiliates; (v) a breach in any material respect of the terms of any confidentiality, invention assignment
or proprietary information agreement with the Company or with a former employer, (vi) failure to satisfactorily perform the grantee’s
duties after having received written notice of such failure and at least thirty (30) days to cure such failure, or (vii) misconduct or
gross negligence in connection with the performance of the grantee’s duties.
2.
“Constructive Termination” means, unless otherwise provided in the applicable award agreement, the grantee’s resignation
of employment with the Company within ninety (90) days of the occurrence of any of the following: (i) a material reduction in the grantee’s
responsibilities; (ii) a material reduction in the grantee’s base salary; or (iii) a relocation of the grantee’s principal
office to a location more than 50 miles from the location of the grantee’s existing principal office.
IV.
STOCK APPRECIATION RIGHTS
A. Provided and only if the Plan Administrator
determines in its discretion to implement the stock appreciation right provisions of this Section IV, one or more optionees may be granted
the right, exercisable upon such terms and conditions as the Plan Administrator may establish, to surrender all or part of an unexercised
option granted under this Article Two in exchange for a distribution from the Company in an amount equal to the excess of (i) the fair
market value (on the option surrender date) of the number of shares in which the optionee is at the time vested under the surrendered
option (or surrendered portion thereof) over (ii) the aggregate option price payable for such vested shares. The distribution may be made
in shares of Common Stock valued at fair market value on the option surrender date, in cash, or partly in shares and partly in cash, as
the Plan Administrator shall determine in its sole discretion.
B. The shares of Common Stock subject
to any option surrendered for an appreciation distribution pursuant to this Section IV shall not be available for subsequent option grant
under the Plan.
C. Stockholder Rights.
A stock appreciation right holder shall have no stockholder rights with respect to any shares covered by the stock appreciation right
until such individual shall have exercised the stock appreciation right and received the acquired shares. Without limitation, a stock
appreciation right holder shall not have any right to receive dividends with respect to a stock appreciation right.
V.
EXTENSION OF EXERCISE PERIOD
The Plan Administrator shall have full power and authority,
exercisable either at the time the option is granted or at any time while the option remains outstanding, to extend the period of time
for which any option granted under this Article Two is to remain exercisable following the optionee’s cessation of Service or death
from the limited period in effect under Section I.C.1 of Article Two to such greater period of time as the Plan Administrator shall deem
appropriate; provided, however, that in no event shall such option be exercisable after the specified expiration date of the option
term.
Article Three
STOCK ISSUANCE PROGRAM
I.
STOCK ISSUANCE TERMS
Shares of Common Stock may be issued under the Stock
Issuance Program through direct and immediate issuances without any intervening option grants. Each such stock issuance shall be evidenced
by a Stock Issuance Agreement which complies with the terms specified below. Shares of Common Stock may also be issued under the Stock
Issuance Program pursuant to RSUs, which are awards granted to eligible individuals that entitle them to shares of Common Stock (or cash
in lieu thereof) in the future following the satisfaction of vesting conditions imposed by the Plan Administrator.
A.
Vesting Provisions.
1. The Plan Administrator may issue
shares of Common Stock under the Stock Issuance Program which are to vest in one or more installments over the grantee’s period
of Service or upon attainment of specified performance objectives. Alternatively, the Plan Administrator may issue RSUs under the Stock
Issuance Program which shall entitle the recipient to receive a specified number of shares of Common Stock upon the attainment of one
or more Service and/or performance goals established by the Plan Administrator. Upon the attainment of such Service and/or performance
goals, fully-vested shares of Common Stock shall be issued in satisfaction of those RSUs.
2. Any new, substituted or additional
securities or other property (including money paid other than as a regular cash dividend) issued by reason of any stock dividend, stock
split, recapitalization, combination of shares, exchange of shares or other change affecting the outstanding Common Stock as a class without
the Company’s receipt of consideration, shall be issued or set aside with respect to the shares of unvested Common Stock granted
to a grantee or subject to a grantee’s RSUs, subject to (i) the same vesting requirements applicable to the grantee’s unvested
shares of Common Stock or RSUs, and (ii) such escrow arrangements as the Plan Administrator shall deem appropriate.
3. The grantee shall have
full stockholder rights with respect to any shares of Common Stock issued to the grantee under the Stock Issuance Program, whether or
not the grantee’s interest in those shares is vested, except that the grantee shall not have dividend rights with respect to such
shares prior to the vesting of such shares. However, the Plan Administrator may provide for a grantee to receive one or more dividend
equivalents with respect to such shares, entitling the grantee to all regular cash dividends payable on such shares of Common Stock, which
amounts shall be (i) subject to the same vesting requirements applicable to the shares of Common Stock granted hereunder, and (ii) payable
upon vesting of the shares to which such dividend equivalents relate.
4. The grantee shall not have any stockholder
rights with respect to any shares of Common Stock subject to an RSU. However, the Plan Administrator may provide for a grantee to receive
one or more dividend equivalents with respect to such shares, entitling the grantee to all regular cash dividends payable on the shares
of Common Stock underlying the RSU, which amounts shall be (i) subject to the same vesting requirements applicable to the shares of Common
Stock underlying the RSU, and (ii) payable upon issuance of the shares to which such dividend equivalents relate.
5. Should the grantee cease to
remain in Service while holding one or more unvested shares of Common Stock issued under the Stock Issuance Program or should the performance
objectives not be attained with respect to one or more such unvested shares of Common Stock, then those shares shall be immediately surrendered
to the Company for cancellation, and the grantee shall have no further stockholder rights with respect to those shares. To the extent
the surrendered shares were previously issued to the grantee for consideration paid in cash, the Company shall repay to the grantee the
cash consideration paid for the surrendered shares.
6. Except as prohibited by the last sentence
of paragraph 1 above, the Plan Administrator may in its discretion waive the surrender and cancellation of one or more unvested shares
of Common Stock which would otherwise occur upon the cessation of the grantee’s Service or the non-attainment of the performance
objectives applicable to those shares. Such waiver shall result in the immediate vesting of the grantee’s interest in the shares
of Common Stock as to which the waiver applies. Such waiver may be effected at any time, whether before or after the grantee’s cessation
of Service or the attainment or non-attainment of the applicable performance objectives.
7. Outstanding RSUs under the
Stock Issuance Program shall automatically terminate, and no shares of Common Stock shall actually be issued in satisfaction of those
awards, if the Service and/or performance goals established for such awards are not attained. The Plan Administrator, however, shall,
except as prohibited by the last sentence of paragraph 1 above, have the discretionary authority to issue shares of Common Stock in satisfaction
of one or more outstanding RSUs as to which the designated Service and/or performance goals are not attained. Such authority may be exercised
at any time, whether before or after the grantee’s cessation of Service or the attainment or non-attainment of the applicable performance
objectives.
II.
CORPORATE TRANSACTION/CHANGE IN CONTROL
A. All of the Company’s outstanding
repurchase rights under the Stock Issuance Program shall terminate automatically, and all the shares of Common Stock subject to those
terminated rights shall immediately vest in full, in the event of any Corporate Transaction, except to the extent (i) those repurchase
rights are to be assigned to the successor corporation (or parent thereof) in connection with such Corporate Transaction, or (ii) such
accelerated vesting is precluded by other limitations imposed in the Stock Issuance Agreement, unless the Plan Administrator determines
to waive such limitations.
B. Each award which is assigned
in connection with (or is otherwise to continue in effect after) a Corporate Transaction shall be appropriately adjusted such that it
shall apply and pertain to the number and class of securities issued to the grantee in consummation of the Corporate Transaction with
respect to the shares granted to grantee under this Article Three.
C. In the event of a Change in Control,
shares of restricted stock and RSUs shall be treated as follows: if the grantee’s employment is terminated by the Company without
Cause or the grantee resigns due to a Constructive Termination, in either case within the ninety (90) day period preceding or the two
(2) year period following the Change in Control, the vesting of such restricted stock and RSUs shall automatically accelerate (and all
of the shares of Common Stock subject to such RSUs shall be issued to grantees), and the Company’s outstanding repurchase rights
under this Article Three shall immediately terminate; provided, however, that if the acquiror or successor refuses to assume the shares
of restricted stock or RSUs or substitute an award of equivalent value (as determined by the Committee in its discretion) in connection
with the Change in Control, the vesting of such restricted stock or RSUs under this Article Three shall automatically accelerate (and
all of the shares of Common Stock subject to such RSUs shall be issued to grantees). To the extent any shares of restricted stock or RSUs
vest in whole or in part based on the achievement of performance criteria, the amount that shall vest in accordance with the proviso to
clause (2) of the immediately-preceding sentence shall vest based on the higher of actual performance goal attainment through the date
of the Change in Control or a prorated amount using target performance and based on the time elapsed in the performance period as of the
date of the Change in Control.
III.
STOCKHOLDER RIGHTS
A. Individuals
who are granted shares of Common Stock pursuant to this Article Three shall be the owners of such shares for all purposes while holding
such Common Stock, and may exercise full voting rights with respect to those shares at all times while held by the individuals. Individuals
who have been granted RSUs shall have no voting rights with respect to Common Stock underlying RSUs unless and until such Common Stock
is reflected as issued and outstanding shares on the Company’s stock ledger.
B. Individuals
who are granted shares of Common Stock pursuant to this Article Three shall not have dividend rights with respect to such shares prior
to the vesting of such shares. However, the Plan Administrator may provide for a grantee to receive one or more dividend equivalents with
respect to such shares, entitling the grantee to all regular cash dividends payable on such shares of Common Stock, which amounts shall
be (i) subject to the same vesting requirements applicable to the shares of Common Stock granted hereunder, and (ii) payable upon vesting
of the shares to which such dividend equivalents relate.
IV.
SHARE ESCROW / LEGENDS
Unvested shares may, in the Plan Administrator’s
discretion, be held in escrow by the Company until the grantee’s interest in such shares vests or may be issued directly to the
grantee with restrictive legends on the certificates evidencing those unvested shares.
Article Four
DIRECTOR GRANT PROGRAM
I.
ELIGIBILITY
The individuals eligible to receive grants pursuant to
the provisions of this Article Four shall be (i) those individuals who, after the effective date of this amendment and restatement, first
become non-employee Board members, whether through appointment by the Board, election by the Company’s stockholders, or by continuing
to serve as a Board member after ceasing to be employed by the Company, and (ii) those individuals already serving as non-employee Board
members on the effective date of this amendment and restatement. As used herein, a “non-employee” Board member is any Board
member who is not employed by the Company on the date in question.
II.
TERMS AND CONDITIONS OF DIRECTOR GRANTS
A.
Grants. Grants under this Article Four shall be made pursuant to a Director Compensation Policy adopted by the Board (the
“Director Compensation Policy”) and may be in the form of non-statutory options, RSUs, shares of Common Stock, other awards
issuable under the Plan or a combination thereof, as determined by the Committee. In no event shall the aggregate grant date fair value
(calculated in accordance with FASB ASC Topic 718 ) of all awards granted under the Plan during any calendar year to any non-employee
Board member (excluding any awards granted at the election of a non-employee Board member in lieu of all or any portion of cash retainers
or fees otherwise payable to non-employee Board members in cash), together with the amount of any cash fees or retainers paid to such
non-employee Board members during such calendar year with respect to such individual’s service as a non-employee Board member, exceed
$750,000 (or, for a non-employee Board member who first joins the Board, $1,000,000).
B.
Terms and Conditions of Grants.
1. Options.
(i)
Term. Each option granted under this Article Four shall be exercisable at such time or times, during such period, and for
such number of shares as shall be set forth in the Director Compensation Policy or as otherwise determined by the Plan Administrator and
set forth in the instrument evidencing the option grant. No such option, however, shall have a maximum term in excess of ten (10) years
from the grant date.
(ii)
Option Price. The option price per share shall be fixed by the Plan Administrator. In no event, however, shall the option
price per share be less than one hundred percent (100%) of the fair market value per share of Common Stock on the date of the option grant.
The option price shall become immediately due upon exercise of the option and shall, subject to Section II.B.1.(iv) of this Article Four
and the instrument evidencing the grant, be payable in any manner set forth in Section I.A.2 of Article Two.
(iii)
Non-Transferability. During the lifetime of the optionee, each option grant, together with any limited stock appreciation
right pertaining to such option, shall be exercisable only by the optionee and shall not be assignable or transferable by the optionee,
except to the extent such option or the limited stock appreciation right is assigned or transferred (i) by will or by the laws of descent
and distribution following the optionee’s death, or (ii) during optionee’s lifetime either (A) as a gift in connection with
the optionee’s estate plan to one or more members of optionee’s immediate family, to a trust in which optionee and/or one
or more such family members hold more than fifty percent (50%) of the beneficial interest or to an entity in which more than fifty percent
(50%) of the voting interests are owned by optionee and/or one or more such family members, or (B) pursuant to a domestic relations order.
The portion of any option assigned or transferred during optionee’s lifetime shall be exercisable only by the person or persons
who acquire a proprietary interest in the option pursuant to such assignment. The terms applicable to the assigned portion shall be the
same as those in effect for this option immediately prior to such assignment and shall be set forth in such documents issued to the assignee
as the Plan Administrator may deem appropriate.
(iv)
Stock Appreciation Rights. With respect to each option granted under this Article Four, each optionee shall have the right
to surrender all or part of the option (to the extent not then exercised) in exchange for a distribution from the Company in an amount
equal to the excess of (i) the fair market value (on the option surrender date) of the number of shares in which the grantee is at the
time vested under the surrendered option (or surrendered portion thereof) over (ii) the aggregate option price payable for such vested
shares. The distribution shall be made in shares of Common Stock valued at fair market value on the option surrender date.
(v)
No Repricing. No option or stock appreciation right may be repriced, regranted through cancellation, including cancellation
in exchange for cash or other awards, or otherwise amended to reduce its option price or exercise price (other than with respect to adjustments
made in connection with a transaction or other change in the Company’s capitalization as permitted under this Plan) without the
approval of the stockholders of the Company.
2. Grants
Generally.
(i)
Stockholder Rights. The holder of an option grant under this Article Four shall have none of the rights of a stockholder
with respect to any shares subject to such option until such individual shall have exercised the option and paid the exercise price for
the purchased shares, and the holder of RSUs granted under this Article Four shall have none of the rights of a stockholder with respect
to any shares subject to such RSUs until shares have been delivered in settlement thereof. Without limitation, a grantee shall not have
any right to receive dividends with respect to an unexercised option or unsettled RSUs.
(ii)
Corporate Transactions/Changes in Control. In connection with a Corporate Transaction or a Change in Control, grants under
this Article Four shall be treated in the manner specified in Article Two (with respect to options) or Article Three (with respect to
shares of Common Stock and RSUs), as applicable.
(iii)
Subject to the terms of the Plan, the terms and conditions of the grants under this Article Four shall be determined by the Plan
Administrator consistent with the Director Compensation Policy.
Article Five
PERFORMANCE GOALS
I.
GENERAL
The Plan Administrator may establish performance criteria
and level of achievement versus such criteria that shall determine the number of shares of Common Stock or RSUs to be granted, retained,
vested, issued or issuable under or in settlement of or the amount payable pursuant to an award hereunder. In addition, the Plan Administrator
may specify that an award or a portion of an award shall be subject to measures based on one or more performance criteria selected by
the Committee and specified at the time the award is granted. The Committee shall certify the extent to which any performance criteria
have been satisfied, and the amount payable as a result thereof, prior to payment, settlement or vesting of any award subject thereto.
Notwithstanding satisfaction of any performance goals, the number of shares of Common Stock issued under or the amount paid under an award
may, to the extent specified in the applicable award agreement, be reduced by the Committee on the basis of such further considerations
as the Committee in its sole discretion shall determine.
II.
PERFORMANCE CRITERIA
For purposes of this Plan, performance criteria may include,
among others, any one or more of the following performance criteria, either individually, alternatively or in any combination, applied
to either the Company as a whole or to a business unit or subsidiary, either individually, alternatively or in any combination, and measured
either quarterly, annually or cumulatively over a period of years, on an absolute basis or relative to a pre-established target, to previous
years’ results or to a designated comparison group, in each case as specified by the Committee: (i) revenue growth; (ii) earnings
before interest, taxes, depreciation and amortization; (iii) earnings before interest, taxes and amortization; (iv) operating income;
(v) pre- or after-tax income; (vi) cash flow; (vii) cash flow per share; (viii) net income; (ix) earnings per share; (x) return on equity;
(xi) return on invested capital; (xii) return on assets; (xiii) economic value added (or an equivalent metric); (xiv) share price performance;
(xv) total shareholder return; (xvi) improvement in or attainment of expense levels; (xvii) improvement in or attainment of working capital
levels; (xviii) debt reduction; (xix) progress for advancing drug discovery and/or drug development programs; or (xx) implementation,
completion or attainment of measurable objectives with respect to research, development, manufacturing, commercialization, products or
projects, or production volume levels. The Committee (A) shall appropriately adjust any evaluation of performance under applicable performance
criteria to eliminate the effects of charges for restructurings, discontinued operations, extraordinary items and all items of gain, loss
or expense determined to be extraordinary or unusual in nature or related to the acquisition or disposal of a segment of a business or
related to a change in accounting principle all as determined in accordance with standards established by opinion No. 30 of the Accounting
Principles Board (APB Opinion No. 30) or other applicable or successor accounting provisions, as well as the cumulative effect of accounting
changes, in each case as determined in accordance with generally accepted accounting principles or identified in the Company’s financial
statements or notes to the financial statements, and (B) may appropriately adjust any evaluation of performance under applicable performance
criteria to exclude any of the following events that occurs during a performance period: (i) asset write-downs, (ii) litigation, claims,
judgments or settlements, (iii) the effect of changes in tax law or other such laws or provisions affecting reported results, (iv) the
adverse effect of work stoppages or slowdowns, (v) accruals for reorganization and restructuring programs and (vi) accruals of any amounts
for payment under this Plan or any other compensation arrangement maintained by the Company.
Article Six
MISCELLANEOUS
I.
AMENDMENT OF THE PLAN
The Board shall have complete and exclusive power and
authority to amend or modify the Plan in any or all respects whatsoever. However, no such amendment or modification shall, without the
consent of the holders, adversely affect rights and obligations with respect to options at the time outstanding under the Plan. In addition,
certain amendments may require stockholder approval pursuant to applicable laws or regulations.
II.
TAX WITHHOLDING
A. The Company’s obligation to deliver shares or cash upon the exercise of stock options or stock appreciation rights or upon the grant
or vesting of direct stock issuances or RSUs under the Plan shall be subject to the satisfaction of all applicable Federal, State and
local income and employment tax withholding requirements.
B.
The Plan Administrator may, in its discretion and upon such terms and conditions as it may deem appropriate, provide any or all
holders of outstanding options or stock issuances under the Plan (other than the grants under Article Four) with the election to have
the Company withhold, from the shares of Common Stock otherwise issuable upon the exercise or vesting of such awards, a whole number of
such shares with an aggregate fair market value equal to the minimum amount necessary (or, if determined by the Plan Administrator in
its discretion and to the extent adverse accounting treatment does not result, at the maximum applicable individual statutory tax rates)
to satisfy the Federal, State and local income and employment tax withholdings (the “Taxes”) incurred in connection with the
acquisition or vesting of such shares. In lieu of such direct withholding, one or more grantees may also be granted the right to deliver
whole shares of Common Stock to the Company in satisfaction of such Taxes. Any withheld or delivered shares shall be valued at their fair
market value on the applicable determination date for such Taxes.
III.
EFFECTIVE DATE AND TERM OF PLAN
A. The Plan, as amended and restated,
shall be effective on the date specified in the Board of Directors resolution adopting the Plan. Except as provided below, each option
issued and outstanding under the Plan immediately prior to such effective date shall continue to be governed solely by the terms and conditions
of the agreement evidencing such grant, and nothing in this restatement of the Plan shall be deemed to affect or otherwise modify the
rights or obligations of the holders of such options with respect to their acquisition of shares of Common Stock thereunder. The Plan
Administrator shall, however, have full power and authority, under such circumstances as the Plan Administrator may deem appropriate (but
in accordance with Section I of this Article Five), to extend one or more features of this amendment and restatement to any options outstanding
on the effective date.
B. Unless sooner terminated
in accordance with the other provisions of this Plan, the Plan shall terminate upon the earlier of (i) ten (10) years following
the date this amendment and restatement of the Plan is approved by the Board or (ii) the date on which all shares available for issuance
under the Plan shall have been issued or cancelled pursuant to the exercise, surrender or cash-out of the options granted hereunder. If
the date of termination is determined under clause (i) above, then any options or stock issuances outstanding on such date shall continue
to have force and effect in accordance with the provisions of the agreements evidencing those awards.
C. Options may be granted with respect
to a number of shares of Common Stock in excess of the number of shares at the time available for issuance under the Plan, provided
each granted option is not to become exercisable, in whole or in part, at any time prior to stockholder approval of an amendment authorizing
a sufficient increase in the number of shares issuable under the Plan.
IV.
USE OF PROCEEDS
Any cash proceeds received by the Company from the sale
of shares pursuant to options or stock issuances granted under the Plan shall be used for general corporate purposes.
V.
REGULATORY APPROVALS
A.
The implementation of the Plan, the granting of any option hereunder, and the issuance of stock (i) upon the exercise
or surrender of any option or (ii) under the Stock Issuance Program shall be subject to the procurement by the Company of all approvals
and permits required by regulatory authorities having jurisdiction over the Plan, the options granted under it and the stock issued pursuant
to it.
B.
No shares of Common Stock or other assets shall be issued or delivered under the Plan unless and until there
shall have been compliance with all applicable requirements of Federal and state securities laws, including (to the extent required) the
filing and effectiveness of the Form S-8 registration statement for the shares of Common Stock issuable under the Plan, and all applicable
listing requirements of any stock exchange (or the Nasdaq National Market, the Nasdaq Global Select Market or any successor system, if
applicable) on which Common Stock is then trading.
VI.
NO EMPLOYMENT/SERVICE RIGHTS
Neither the action of the Company in establishing or
restating the Plan, nor any action taken by the Plan Administrator hereunder, nor any provision of the Plan shall be construed so as to
grant any individual the right to remain in the employ or service of the Company (or any parent or subsidiary corporation) for any period
of specific duration, and the Company (or any parent or subsidiary corporation retaining the services of such individual) may terminate
such individual’s employment or service at any time and for any reason, with or without cause.
VII.
MISCELLANEOUS PROVISIONS
A. Except to the extent otherwise
expressly provided in the Plan, the right to acquire Common Stock or other awards under the Plan may not be assigned, encumbered or otherwise
transferred by any grantee.
B. Awards issued under the Plan shall
be subject to any clawback policy of the Company as in effect from time-to-time. No recovery of compensation under any such policy will
be an event giving rise to a right to resign for “good reason” or be deemed a “constructive termination” (or any
similar term) as such terms are used in any agreement between any grantee and the Company.
C. The provisions of the Plan relating to the
exercise of options and the issuance and/or vesting of shares shall be governed by the laws of the State of Delaware without resort to
that state’s conflict-of-laws provisions, as such laws are applied to contracts entered into and performed in such State.
D. The Plan is intended to be an
unfunded plan. Grantees are and shall at all times be general creditors of the Company with respect to their awards. If the Committee
or the Company chooses to set aside funds in a trust or otherwise for the payment of awards under the Plan, such funds shall at all times
be subject to the claims of the creditors of the Company in the event of its bankruptcy or insolvency.
E. Awards
to Non-U.S. Employees. The Committee shall have the power and authority to determine which subsidiary corporations shall be covered
by this Plan and which employees outside the United States shall be eligible to participate in the Plan. The Committee may adopt, amend,
or rescind rules, procedures, or sub-plans relating to the operation and administration of the Plan to accommodate the specific requirements
of local laws, procedures, and practices. Without limiting the generality of the foregoing, the Committee is specifically authorized to
adopt rules, procedures, and sub-plans with provisions that limit or modify rights on death, disability, or retirement or on termination
of employment; available methods of exercise or settlement of an award; payment of income, social insurance contributions and payroll
taxes; the withholding procedures and handling of any stock certificates or other indicia of ownership which vary with local requirements.
The Committee may also adopt rules, procedures or sub-plans applicable to particular subsidiary corporations or locations.
23
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