Exhibit 99.3
AGOURON PHARMACEUTICALS, INC.
(a California Corporation)
1998 EMPLOYEE NON-STATUTORY STOCK OPTION AGREEMENT
This Option Agreement is entered into between Agouron Pharmaceuticals,
Inc., a California corporation and the Optionee whose name appears on the Notice
of Grant of Stock Option to which this Agreement is an attachment.
1. Recitals.
1.01 The Board of Directors of the Company (or its delegates)
authorized the granting of this Option to Optionee pursuant to the Agouron
Pharmaceuticals, Inc. 1998 Employee Stock Option Plan.
1.02 This Option Agreement is intended to constitute a non-statutory
stock option, meaning an option that is not an "incentive stock option" within
the meaning of Section 422 of Internal Revenue Code of 1986, as amended from
time to time.
2. Definitions.
In addition to those words and phrases defined above and unless
otherwise required by the context in which they appear, words and phrases having
their initial letters capitalized shall have the following meanings:
2.01 Act. "Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time.
2.02 Affiliate. "Affiliate" shall mean any corporation defined as a
"parent corporation" or a "subsidiary corporation" by Code Section 424(e) and
(f), respectively.
2.03 Agreement. "Agreement" shall mean this 1998 Employee Non-Statutory
Stock Option Agreement (including any schedules, attachments and documents
incorporated by reference, or modifications agreed to in writing by the Company
and Optionee), which sets forth the Optionee's and the Company's rights and
obligations with respect to the Option granted Optionee by the Board (or its
delegates) as described on the Notice of Grant.
2.04 Board. "Board" shall mean the Board of Directors of the Company.
2.05 Code. "Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time.
2.06 Company. "Company" shall mean Agouron Pharmaceuticals, Inc., a
California corporation, and any successors or assigns.
2.07 Date of Grant. "Date of Grant" shall mean the Date of Grant set
forth on the Notice of Grant.
2.08 Disability. "Disability" or "Disabled" shall mean the condition of
being "disabled" within the meaning of Section 422(c)(6) of the Code or any
successor provision.
2.09 Employee. "Employee" shall mean any employee of the Company or
its Affiliates who is not an officer of the Company or its Affiliates on the
Date of Grant.
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2.10 Expiration Date. "Expiration Date" shall mean the Expiration
Date set forth on the Notice of Grant.
2.11 Fair Market Value. "Fair Market Value" of Stock on a given date
shall mean an amount per share, as determined by the Board (or its delegates) by
applying any reasonable valuation method determined without regard to any
restriction, other than a restriction that, by its terms, will never lapse.
Notwithstanding the preceding, if the Stock is traded upon an established stock
exchange, then the "Fair Market Value" of Stock on a given date shall be deemed
to be the average of the highest and lowest selling price per share of the Stock
on the principal stock exchange on which the Stock is then trading or, if there
was no trading of the Stock on that day, on the next preceding day on which
there was such trading; if the Stock is not traded upon an established stock
exchange but is quoted on a quotation system, the "Fair Market Value" of Stock
on a given date shall be deemed to be the mean between the closing
representative "bid" and "ask" prices per share of the Stock on such date as
reported by such quotation system or, if there was no trading of the Stock on
that day, on the next preceding day on which there was such trading.
2.12 Notice of Grant of Stock Option. "Notice of Grant of Stock Option"
or "Notice of Grant" shall mean the Notice of Grant executed by the Company and
the Optionee to which this Agreement is an attachment.
2.13 Option. "Option" shall mean the right of Optionee to purchase the
number of shares of Stock set forth on the Notice of Grant in accordance with
the terms and conditions of this Agreement.
2.14 Optionee. "Optionee" shall mean the person whose name is set
forth on the Notice of Grant.
2.15 Option Price. "Option Price" shall mean the price per share
of Stock to be paid by the Optionee upon exercise of the Option, which amount
is set forth on the Notice of Grant.
2.16 Option Stock. "Option Stock" shall mean the total number of shares
of Stock the Optionee shall be entitled to purchase pursuant to this Agreement,
which number of shares is set forth on the Notice of Grant.
2.17 Plan. "Plan" shall mean the Agouron Pharmaceuticals, Inc. 1998
Employee Stock Option Plan, as amended from time to time.
2.18 Reporting Person. "Reporting Person" shall mean an Optionee who
is required to file statements relating to his or her beneficial ownership of
Stock with the SEC pursuant to Section 16(a) of the Act.
2.19 SEC. "SEC" shall mean the Securities and Exchange Commission.
2.20 Stock. "Stock" shall mean the no par common stock of the Company.
2.21 Vesting. "Vesting" shall mean the date(s) when all or a portion
of the Option Stock becomes available for exercise.
2.22 Vesting Schedule. "Vesting Schedule" shall mean the Vesting
Schedule set forth on the Notice of Grant that indicates on what dates all or a
portion of the Option Stock becomes available for exercise.
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3. Option.
3.01 Grant. The Company hereby grants to Optionee an Option to purchase
all or any part of the Option Stock on the terms and conditions set forth in
this Agreement. The Date of Grant shall be the Date of Grant set forth on the
Notice of Grant.
3.02 Purchase Price. The purchase price per share of Stock to be paid
upon the exercise of this Option shall be the Option Price set forth on the
Notice of Grant.
3.03 Restrictions on Transfer. This Option may be transferred to a
trust for the benefit of the Optionee or members of his or her immediate family.
Upon any attempt to sell, assign, encumber or otherwise transfer this Option in
violation of this Agreement, or upon the levy of any attachment or similar
process upon this Option, this Option shall immediately become null and void.
3.04 Modifications of Rights. As set forth in Paragraph 6(l) of the
Plan, the Board (or its delegates) may modify (including, lowering the Option
Price), extend or renew this Option (to the extent not previously exercised), or
accept the surrender of this Option (to the extent not previously exercised) and
authorize the granting of a new Stock option in substitution therefor; provided,
however, that no modification of this Option shall, without the consent of the
Optionee, alter or impair any existing rights or obligations of Optionee under
this Option.
3.05 Changes in Company's Equity Structure; Recapitalization of
Company. Upon the occurrence of the capital and/or recapitalization transactions
described in Paragraph 6(j) of the Plan, this Option (to the extent not
previously exercised) shall be adjusted or modified as provided in Paragraph
6(j) of the Plan. Notwithstanding any provision of this Agreement, the Company
reserves the right to:
(a) make or enter into any adjustments, reclassifications,
reorganizations or changes of its capital or business
structure;
(b) merge or consolidate with other entities; or
(c) dissolve, liquidate or sell, or transfer all or any part
of its business or assets.
3.06 Shareholder's Rights. Optionee shall have no rights as a
shareholder with respect to any shares Optionee is entitled to purchase under
this Option until the Option is exercised and Optionee has become a record
holder of the shares underlying this Option. No adjustment shall be made for
dividends (ordinary or extraordinary, whether in cash, securities or other
property) or distributions or other rights for which the record date is prior to
the date of issuance of such certificate, except as provided in this Agreement
or in the Plan.
4. Employment Conditions.
4.01 Employment Status. Optionee shall be considered to be in the
employment of the Company as long as Optionee remains an Employee of the Company
or its Affiliates. The Board (or its delegates) exclusively shall determine:
(a) whether or when there has been a termination of
Optionee's employment;
(b) if there has been a failure to comply with Optionee's
covenant not to compete obligations; and
(c) the cause of such termination,
which determination shall be final.
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4.02 Covenant Not to Compete. Unless otherwise permitted in writing,
Optionee shall devote his or her entire time, energy and skill to the service of
the Company or its Affiliates, subject to vacation, sick leave and other
approved absences. Failure of Optionee to comply with his or her covenant not to
compete obligations within thirty (30) days of written notice of such failure
shall cause, on the thirtieth (30th) day after such written notice, the
cancellation of Optionee's right to purchase Option Stock (to the extent not
previously exercised) without further action by the Company.
4.03 Termination for Cause. Unless otherwise agreed to by the Board (or
its delegates), if Optionee's employment is terminated for cause, the right of
Optionee to purchase Option Stock shall only be exercisable for a period of
thirty (30) days after the date of such termination.
5. Exercise.
5.01 Exercise Amounts. Subject to the earlier termination of the right
to exercise this Option as provided under this Agreement, including Paragraphs
4.02 and 4.03 above, the Optionee shall be entitled to exercise the amounts of
Option Stock, in whole or in part, as set forth in the Vesting Schedule on the
Notice of Grant.
5.02 Additional Adjustments. Notwithstanding the terms of Paragraph
5.01 of this Agreement, the Board (or its delegates) in its sole and exclusive
discretion may modify (including lowering the Option Price), extend or renew
this Option (to the extent not previously exercised) and authorize the granting
of a new Option in substitution therefor; provided, however, that the Board (or
its delegates) shall only make modifications that may adversely affect any
rights or obligations under this Option as provided for in the Plan or with the
consent of Optionee.
5.03 Cumulative Exercise Rights. If the Optionee does not exercise in
any one (1) year period the full number of shares to which he or she is then
entitled to exercise, Optionee may exercise those shares in any subsequent year
prior to the Expiration Date of this Option as set forth on the Notice of Grant,
or such later date subsequently approved by the Board (or its delegates).
5.04 Expiration of Exercise Rights. Subject to the provisions of
Paragraph 5.08, in no event shall this Option be exercisable after the
Expiration Date or such later date subsequently approved by the Board (or its
delegates).
5.05 Fractional Shares. This Option shall not be exercisable with
respect to any fractional shares of the Stock.
5.06 Exercise Procedure. This Option shall be exercised by the giving
of written notice of exercise to the Company that specifies the number of shares
of Stock to be purchased, accompanied by payment (in accordance with the terms
of Paragraph 6(d) of the Plan) of the aggregate Option Price for the shares of
Stock being purchased, such payment to be made in any combination of:
(a) United States cash currency;
(b) a cashier's or certified check to the order of the Company;
(c) a personal check acceptable to the Company;
(d) to the extent permitted by the Board, shares of Stock
(including previously owned Stock or Stock issuable in
connection with the Option exercise),
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properly endorsed to the Company, whose Fair Market Value
on the date of exercise equals the aggregate Option Price
of the Option being exercised; or
(e) to the extent agreed to by the Board, the Optionee's
entering into an agreement with the Company whereby a
portion of the Optionee's Options are terminated and
where the "built-in gain" on any Options that are
terminated as part of such agreement equals the
aggregate Option Price of the Option being exercised.
"Built-in gain" means the excess of the aggregate
Fair Market Value of any Stock otherwise issuable on
exercise of a terminated Option, over the aggregate
Option Price otherwise due the Company on such
exercise.
In accordance with the terms of Paragraph 6(d) of the Plan, the Board (or its
delegates) may provide such assistance to the Optionee to facilitate the
exercise of this Option as it deems appropriate; provided, however, that the
Board (or its delegates), as a prerequisite to providing such assistance, may
require satisfaction of any rules or conditions it deems appropriate. Shares of
Stock used to pay the Option Price shall be valued at their Fair Market Value on
the date of exercise. The Optionee's notice of exercise shall also be
accompanied by payment (in accordance with the terms of Paragraph 6(p) of the
Plan) of the amount of federal and state income and employment taxes that the
Company is required to collect from Optionee because of the exercise of the
Option.
5.07 Exercise During Life. Subject to the provisions of Paragraphs
4.02, 4.03 and 5.08, during Optionee's lifetime, this Option shall be
exercisable only by Optionee either:
(a) while Optionee is employed by the Company or its
Affiliates;
(b) within three (3) months after the date on which
Optionee's employment terminates for reasons other
than "termination for cause" as provided in Paragraph
4.03 of this Agreement; or
(c) within one (1) year after the date on which the
Optionee's employment terminates due to a Disability;
provided, however, that in no event shall the period of exercise be extended
beyond the Expiration Date or such later date subsequently approved by the Board
(or its delegates). Unless the Board (or its delegates) otherwise agree, if
Optionee is entitled to purchase shares of Stock after the termination of
Optionee's employment, the number of shares of Stock Optionee may so purchase
shall be limited to the number of shares of Stock Optionee was entitled to
purchase as of such date of termination.
5.08 Exercise After Death. If Optionee dies while employed by the
Company or its Affiliates or within a period of three (3) months after the date
such employment terminates but prior to the complete exercise of this Option,
the Option may be exercised within one (1) year from the date of Optionee's
death but:
(a) only by a personal representative of Optionee, or by
any person or persons who shall have acquired the
Option directly from the Optionee by bequest or
inheritance; and
(b) only as to the number of shares of Stock that
Optionee was entitled to purchase under this Option
on the date of Optionee's death .
5.09 Exercise of Option Prior to Vesting. The Board (or its delegates),
in its sole and exclusive discretion, may permit the Optionee to exercise this
Option prior to the date this Option is otherwise exercisable, provided the
Stock issued on such exercise is subject to repurchase rights that expire pro
rata as the Option would otherwise have become exercisable.
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5.10 Non-Sequential Exercise Permitted. Subject to the exercise
limitations set forth herein, this Option shall be exercisable notwithstanding
the fact that there is an outstanding incentive stock option or non-statutory
stock option for the purchase of Stock of the Company that was granted before
this Option was granted, and no subsequently granted incentive stock option
shall fail to be exercisable solely because this Option remains outstanding.
5.11 Legends. Certificates for shares of Stock acquired upon exercise
of this Option may contain such legends and transfer restrictions as the Company
shall deem reasonably necessary or desirable to:
(a) assure the satisfaction of any liability that the
Company may or will have incurred for withholding of
any federal and state income and employment taxes;
(b) facilitate compliance by the Company with any federal
or state laws or regulations, including, without
limitation, legends restricting transfer of the Stock
until there has been compliance with federal and
state securities laws;
(c) assure notice of the Company's repurchase rights
under Paragraph 5.09 of this Agreement; or
(d) assure notice of such other restrictions as may be imposed
on the Stock under the terms of this Agreement.
6. Conflict Between Plan and Agreement.
This Agreement, including the Option and Optionee's rights hereunder,
is subject to and governed by the Plan. Any conflict between the terms and
provisions of this Agreement and the terms and provisions of the Plan shall be
governed by the terms and provisions of the Plan.
7. Investment Intent.
This Option is granted on the condition that Optionee's purchase of
Stock shall be for investment purposes for Optionee's own account and not with a
view to resale or distribution. The Company shall not, upon the exercise of this
Option, be required to issue or deliver shares of Stock or certificates therefor
if, in the opinion of counsel for the Company, such issuance or delivery would
be in violation of, or would not comply with, any applicable state or federal
securities law, regulation or rule.
8. Notices.
8.01 In Writing. All notices, demands, requests, declarations, service
of process, or other communications permitted or required under this Agreement
or applicable law shall be in writing.
8.02 Delivery. All such communications may be served personally or may
be sent by registered or certified mail, return receipt requested, postage
prepaid and addressed to either Optionee or the Company at the addresses
appearing at the top of the Notice of Grant, or at such other address as either
party shall have communicated to the other pursuant to this Paragraph 8.02. All
such communications shall be deemed effectively delivered upon personal service
or three (3) days after deposit in the United States Mail.
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9. Miscellaneous.
9.01 Successors and Assigns. Except as otherwise provided in this
Agreement, this Agreement shall inure to the benefit of only the Company,
Optionee and their respective successors or assigns.
9.02 Status. Nothing contained in this Agreement shall be construed as
giving Optionee any right to be retained as an Employee of the Company.
9.03 Severability. If any provision or provisions of this Agreement are
adjudged to be, for any reason, unenforceable, illegal or void, the remainder of
the provisions shall remain in full force and effect.
9.04 Integration. This Agreement and the Notice of Grant to which this
Agreement is an attachment constitute the entire understanding of the parties
concerning this Option. Except as otherwise provided, any changes,
modifications, variations, or subordinations pertaining to this Agreement and
the Notice of Grant are invalid, unless stated in writing and executed by the
Company and Optionee.
9.05 Governing Law. This Agreement and the Option granted hereby
shall be governed by the laws of the State of California.
9.06 Attorneys' Fees. If either party brings an action or seeks to
enforce or interpret any of the terms or provisions of this Agreement, the
prevailing party shall be entitled to recover its reasonable attorneys' fees and
costs, in addition to any other remedy it may be awarded.
9.07 Counterparts. This Agreement may be executed in counterparts and
the counterparts shall constitute the whole instrument.
9.08 Titles for Convenience; Gender; and Plurals. Titles of articles
and paragraph headings are for convenience only and shall not affect the
construction or interpretation of this Agreement, or any portion thereof.
Whenever required by the context hereof, the singular shall include the plural
and vice versa; the masculine gender shall include the feminine and neuter and
vice versa.