AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 16, 2001
REGISTRATION NO. 333-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
NEUROCRINE BIOSCIENCES, INC.
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(Exact name of Registrant as specified in its charter)
DELAWARE 33-0525145
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(State of incorporation) (I.R.S. Employer Identification No.)
10555 SCIENCE CENTER DRIVE
SAN DIEGO, CALIFORNIA 92121
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(Address, including zip code, of principal executive offices)
NEUROCRINE BIOSCIENCES, INC. 1992 INCENTIVE STOCK PLAN, AS AMENDED
NEUROCRINE BIOSCIENCES, INC. 1996 EMPLOYEE STOCK PURCHASE PLAN, AS AMENDED
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(Full title of the plan)
GARY A. LYONS
PRESIDENT, CHIEF EXECUTIVE OFFICER
AND DIRECTOR
10555 SCIENCE CENTER DRIVE
SAN DIEGO, CALIFORNIA 92121
(858) 658-7600
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(Name, address, and telephone number, including area code, of agent for service)
COPIES TO:
SCOTT N. WOLFE, ESQ.
LATHAM & WATKINS
12636 HIGH BLUFF DRIVE, SUITE 300
SAN DIEGO, CA 92130
(858) 523-5400
CALCULATION OF REGISTRATION FEE
================================================================================
PROPOSED PROPOSED
MAXIMUM MAXIMUM
TITLE AMOUNT OFFERING AGGREGATE AMOUNT OF
OF SECURITIES TO TO BE PRICE OFFERING REGISTRATION
BE REGISTERED REGISTERED(1) PER SHARE(2) PRICE FEE
- ------------------- -------------- -------------- --------------- --------------
Common Stock
$0.001 par value 850,000 $ 35.14-36.13 $ 30,482,800 $ 7,621
=================== ============== ============== =============== ==============
(1) A maximum of 6,800,000 shares of common stock were reserved for issuance
under the Neurocrine Biosciences, Inc. 1992 Incentive Stock Plan (the "1992
Plan"), 6,050,000 shares of which were previously registered under the
Securities Act of 1933, as amended (the "Securities Act"), pursuant to
Registration Statements on Forms S-8 (File Nos. 333-14589, 333-31791,
333-57875, 333-87127 and 333-44012). A maximum of 525,000 shares of common
stock were reserved for issuance under the Neurocrine Biosciences, Inc.
1996 Employee Stock Purchase Plan (the "1996 Plan"), 425,000 shares of
which were previously registered under the Securities Act, pursuant to
Registration Statements on Forms S-8 (File Nos. 333-14589 and 333-44012).
All shares reserved for issuance under the 1992 Plan and the 1996 Plan that
were not previously registered are being registered hereunder. Pursuant to
Rule 416(a), this Registration Statement shall also cover any additional
shares of the Registrant's common stock that become issuable under the
plans by reason of any stock dividend, stock split, recapitalization or
other similar transaction effected without receipt of consideration that
increases the number of the Registrant's outstanding shares of common
stock.
(2) This estimate is made pursuant to Rule 457(h) solely for purposes of
calculating the registration fee, and is determined according to the
following offering price information: Of the 850,000 shares of common stock
being registered hereunder, (i) 230,000 shares of common stock are subject
to outstanding options with an exercise price of $35.14 per share and (ii)
620,000 shares of common stock are reserved for issuance upon exercise of
options to be granted in the future. Pursuant to Rule 457(h), for all
shares of common stock being registered hereunder with an exercise price
which cannot be presently determined (620,000 shares of common stock), the
Proposed Maximum Offering Price Per Share, is $36.13 per share, which is
the average of the high and low sales prices of the Registrant's common
stock as reported on the Nasdaq National Market on July 13, 2001.
PART I
INFORMATION REQUIRED IN THE SECTION 10 (A) PROSPECTUS
ITEM 1. PLAN INFORMATION.
Not required to be filed with this Registration Statement.
ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION.
Not required to be filed with this Registration Statement.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed with the Securities and Exchange Commission
(the "SEC") by Neurocrine Biosciences, Inc. (the "Company"), are incorporated by
reference in this Registration Statement.
(a) The Company's Annual Report on Form 10-K for the year ended December
31, 2000, filed March 30, 2001;
(b) The Company's Quarterly Report on Form 10-Q for the three months ended
March 31, 2001, filed May 4, 2001;
(c) All other reports filed by the Company with the SEC since December 31,
2000 pursuant to Sections 13(a) or 15(d) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act");
(d) The Company's definitive proxy statement dated April 12, 2001 filed in
connection with its May 24, 2001 Annual Meeting of Stockholders; and
(e) The description of the Company's Common Stock contained the
Registration Statement on Form 8-A filed on June 16, 1997.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act after the date of this Registration Statement and
prior to the filing of a post-effective amendment which indicates that all
securities offered have been sold or which deregisters all securities then
remaining unsold, are incorporated by reference in this Registration Statement
and are a part hereof from the date of filing such documents. Any statement
contained in a document incorporated or deemed to be incorporated by reference
herein shall be deemed to be modified or superseded for purposes of this
Registration Statement to the extent that a statement contained herein or in any
other subsequently filed document which also is or is deemed to be incorporated
by reference herein modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Registration Statement.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the Delaware General Corporation Law generally allows the
Company to indemnify directors and officers for all expenses, judgments, fines
and amounts in settlement actually paid and reasonably incurred in connection
with any proceedings so long as such party acted in good faith and in a manner
reasonably believed to be in or not opposed to the Company's best interests and,
with respect to any criminal proceedings, if such party had no reasonable cause
to believe his or her conduct to be unlawful. Indemnification may only be made
by the Company if the applicable standard of conduct set forth in Section 145
has been met by the indemnified party upon a determination made (i) by the Board
of Directors by a majority vote of the directors who are not parties to such
proceedings, even though less than a quorum, (ii) if there are no such
directors, or if such directors so direct, by independent legal counsel in a
written opinion or (iii) by the stockholders.
Article VII of the Company's Certificate of Incorporation and Article VI,
Sections 6.1, 6.2 and 6.3 of the Company's Bylaws provide for indemnification of
its directors and officers, and permit indemnification of employees and other
agents to the maximum extent permitted by the Delaware General Corporation Law.
In addition, the Company has entered into indemnification agreements with its
officers and directors.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
The following is a list of exhibits filed as part of this Registration
Statement, which are incorporated herein:
Exhibit
Number Document
4.1(1) Form of Common Stock Certificate
4.2* Neurocrine Biosciences, Inc. 1992 Incentive Stock Option Plan,
as amended
4.3* Neurocrine Biosciences, Inc. 1996 Employee Stock Purchase Plan,
as amended
5.1* Opinion of Latham & Watkins
23.1* Consent of Ernst & Young LLP, Independent Auditors
23.2* Consent of Latham & Watkins (contained in Exhibit 5.1)
24.1* Power of Attorney (included in the signature page of this
Registration Statement)
- -----------
* Filed herewith.
(1) Incorporated by reference to the Company's Registration Statement filed on
April 3, 1996 on Form S-1, as amended (File No. 333-03172).
ITEM 9. UNDERTAKINGS.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement;
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of this Registration Statement (or
the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in this Registration
Statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high
and of the estimated maximum offering range may be reflected
in the form of prospectus filed with the SEC pursuant to
Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than 20 percent change in the
maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective
Registration Statement;
(iii)To include any material information with respect to the plan
of distribution not previously disclosed in this
Registration Statement or any material change to such
information in this Registration Statement; provided,
however, that the undertakings set forth in paragraphs
(a)(1)(i) and (a)(1)(ii) above do not apply if the
Registration Statement is on Form S-3, Form S-8 or Form F-3,
and the information required to be included in a
post-effective amendment by those paragraphs is contained in
periodic reports filed with or furnished to the SEC by the
Registrant pursuant to Section 13 or 15(d) of the Exchange
Act that are incorporated by reference in this Registration
Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be
deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or 15(d) of the
Exchange Act (and, where applicable, each filing of an employee
benefit plan's annual report pursuant to Section 15(d) of the Exchange
Act) that is incorporated by reference in this Registration Statement
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering
thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or
otherwise, the Registrant has been advised that in the opinion of the
SEC such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by a director,
officer or controlling person of the Registrant in the successful
defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the
securities being registered, the Registrant will, unless in the
opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question
whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final
adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act, the Company certifies
that it has reasonable grounds to believe that it meets all of the requirements
for filing on Form S-8 and has duly caused this Registration Statement to be
signed on its behalf by the undersigned, thereunto duly authorized, in the City
of San Diego, State of California, on this 16 day of July 2001.
NEUROCRINE BIOSCIENCES, INC.
By: /s/ Gary A. Lyons
------------------------------------
Gary A. Lyons
President and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each such person whose
signature appears below constitutes and appoints, jointly and severally, Gary A.
Lyons and Paul W. Hawran his attorneys-in-fact, each with the power of
substitution, for him in any and all capacities, to sign any amendments to this
Registration Statement on Form S-8 (including post-effective amendments), and to
file the same, with all exhibits thereto, and other documents in connection
therewith, with the SEC, hereby ratifying and confirming all that each of said
attorneys-in-fact, or his substitute or substitutes, may do or cause to be done
by virtue hereof.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT, THIS REGISTRATION
STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE CAPACITIES AND ON THE
DATES INDICATED.
SIGNATURE TITLE DATE
/s/ Gary A. Lyons President, Chief Executive Officer July 16, 2001
- ------------------------ and Director (Principal Executive Officer)
Gary A. Lyons
/s/ Paul W. Hawran Chief Financial Officer (Principal July 16, 2001
- ------------------------ Financing and Accounting Officer)
Paul W. Hawran
/s/ Joseph A. Mollica Chairman of the Board of Directors July 16, 2001
- ------------------------
Joseph A. Mollica
/s/ Richard F. Pops Director July 16, 2001
- ------------------------
Richard F. Pops
/s/ Stephen A. Sherwin Director July 16, 2001
- ------------------------
Stephen A. Sherwin
/s/ Lawrence J. Steinman Director July 16, 2001
- ------------------------
Lawrence J. Steinman
/s/ Wylie W. Vale Director July 16, 2001
- ------------------------
Wylie W. Vale
INDEX TO EXHIBITS
Exhibit
Number Document
4.1(1) Form of Common Stock Certificate
4.2* Neurocrine Biosciences, Inc. 1992 Incentive Stock Option Plan,
as amended
4.3* Neurocrine Biosciences, Inc. 1996 Employee Stock Purchase Plan,
as amended
5.1* Opinion of Latham & Watkins
23.1* Consent of Ernst & Young LLP, Independent Auditors
23.2* Consent of Latham & Watkins (contained in Exhibit 5.1)
24.1* Power of Attorney (included in the signature page of this
Registration Statement)
- ----------
* Filed herewith.
(1) Incorporated by reference to the Company's Registration Statement filed on
April 3, 1996 on Form S-1, as amended (File No. 333-03172).
Exhibit 4.2
NEUROCRINE BIOSCIENCES, INC.
AMENDED 1992 INCENTIVE STOCK PLAN
(as amended May 27, 1997, May 27, 1998,
May 21, 1999, May 24, 2000 and May 24, 2001)
1. Purpose of the Plan. The purposes of this Incentive Stock Plan are to
attract and retain the best available personnel, to provide additional
incentive to the employees of Neurocrine Biosciences, Inc. (the "Company")
and to promote the success of the Company's business.
Options granted hereunder may be either Incentive Stock Options or
Nonstatutory Stock Options, at the discretion of the Board and as reflected
in the terms of the written option agreement. The Board also has the
discretion to grant Stock Purchase Rights.
2. Definitions.
(a) "Board" shall mean the Committee, if one has been appointed, or the
Board of Directors of the Company, if no Committee is appointed.
(b) "Code" shall mean the Internal Revenue Code of 1986, as amended.
(c) "Committee" shall mean the Committee appointed by the Board of
Directors in accordance with Section 4(a) of the Plan, if one is
appointed.
(d) "Common Stock" shall mean the Common Stock of the Company.
(e) "Company" shall mean Neurocrine Biosciences, Inc.
(f) "Consultant" shall mean any person who is engaged by the Company or
any Parent or Subsidiary to render consulting services and is
compensated for such consulting services, and any director of the
Company whether compensated for such services or not.
(g) "Continuous Status as an Employee or Consultant" shall mean the
absence of any interruption or termination of service as an Employee
or Consultant, as applicable. Continuous Status as an Employee or
Consultant shall not be considered interrupted in the case of sick
leave, military leave, or any other leave of absence approved by the
Board; provided that such leave is for a period of not more than 90
days or reemployment upon the expiration of such leave is guaranteed
by contract or statute.
(h) "Employee" shall mean any persons, including officers and directors,
employed by the Company or any Parent or Subsidiary of the Company.
The payment of a director's fee by the Company shall not be sufficient
to constitute "employment" by the Company.
(i) "Incentive Stock Option" shall mean an Option intended to qualify as
an incentive stock option within the meaning of Section 422 of the
Code.
(j) "Nonstatutory Stock Option" shall mean an Option not intended to
qualify as an Incentive Stock Option.
(k) "Option" shall mean a stock option granted pursuant to the Plan.
(l) "Optioned Stock" shall mean the Common Stock subject to an Option or
Stock Purchase Right.
(m) "Optionee" shall mean an Employee or Consultant who receives an
Option.
(n) "Parent" shall mean a "parent corporation," whether now or hereafter
existing, as defined in Section 424(e) of the Code.
(o) "Plan" shall mean this 1992 Incentive Stock Plan.
(p) "Purchaser" shall mean an Employee or Consultant who exercises a Stock
Purchase Right.
(q) "Share" shall mean a share of the Common Stock, as adjusted in
accordance with Section 11 of the Plan.
(r) "Stock Purchase Right" shall mean a right to purchase Common Stock
pursuant to the Plan or the right to receive a bonus of Common Stock
for past services.
(s) "Subsidiary" shall mean a "subsidiary corporation," whether now or
hereafter existing, as defined in Section 424(f) of the Code.
3. Stock Subject to the Plan. Subject to the provisions of Section 11 of the
Plan, the maximum aggregate number of shares under the Plan is 6,800,000
shares of Common Stock. The Shares may be authorized but unissued, or
reacquired Common Stock.
If an Option or Stock Purchase Right should expire or become
unexercisable for any reason without having been exercised in full, then
the unpurchased Shares which were subject thereto shall, unless the Plan
shall have been terminated, become available for future grant or sale under
the Plan. Notwithstanding any other provision of the Plan, shares issued
under the Plan and later repurchased by the Company shall not become
available for future grant or sale under the Plan.
4. Administration of the Plan.
(a) Procedure.
(i) Multiple Administrative Bodies. The Plan may be administered by
different Committees with respect to different groups of
Employees and Consultants. (ii) Section 162(m). To the extent
that the Administrator determines it to be desirable to qualify
Options granted hereunder as "performance-based compensation"
within the meaning of Section 162(m) of the Code, the Plan shall
be administered by a Committee of two or more "outside directors"
within the meaning of Section 162(m) of the Code.
(iii)Rule 16b-3. To the extent desirable to qualify transactions
hereunder as exempt under Rule 16b-3, the transactions
contemplated hereunder shall be structured to satisfy the
requirements for exemption under Rule 16b-3.
(iv) Other Administration. Other than as provided above, the Plan
shall be administered by (A) the Board or (B) a Committee, which
committee shall be constituted to satisfy applicable laws.
(b) Powers of the Board. Subject to the provisions of the Plan, the Board
shall have the authority, in its discretion:
(i) to grant Incentive Stock Options, Nonstatutory Stock Options or
Stock Purchase Rights;
(ii) to determine, upon review of relevant information and in
accordance with Section 7 of the Plan, the fair market value of
the Common Stock;
(iii)to determine the exercise price per share of Options or Stock
Purchase Rights, to be granted, which exercise price shall be
determined in accordance with Section 7 of the Plan;
(iv) to determine the Employees or Consultants to whom, and the time
or times at which, Options or Stock Purchase Rights shall be
granted and the number of shares to be represented by each Option
or Stock Purchase Right;
(v) to interpret the Plan;
(vi) to prescribe, amend and rescind rules and regulations relating to
the Plan;
(vii)to determine the terms and provisions of each Option and Stock
Purchase Right granted (which need not be identical) and, with
the consent of the holder thereof, modify or amend any provisions
(including provisions relating to exercise price) of any Option
or Stock Purchase Right;
(viii) to accelerate or defer (with the consent of the Optionee) the
exercise date of any Option, consistent with the provisions of
Section 5 of the Plan;
(ix) to authorize any person to execute on behalf of the Company any
instrument required to effectuate the grant of an Option or Stock
Purchase Right previously granted by the Board;
(x) to allow Optionees to satisfy withholding tax obligations by
electing to have the Company withhold from the Shares to be
issued upon exercise of an Option or Stock Purchase Right that
number of Shares having a Fair Market Value equal to the amount
required to be withheld. The Fair Market Value of the Shares to
be withheld shall be determined on the date that the amount of
tax to be withheld is to be determined. All elections by an
Optionee to have Shares withheld for this purpose shall be made
in such form and under such conditions as the Administrator may
deem necessary or advisable; and
(xi) to make all other determinations deemed necessary or advisable
for the administration of the Plan.
(c) Effect of Board's Decision. All decisions, determinations and
interpretations of the Board shall be final and binding on all
Optionees, Purchasers and any other holders of any Options or Stock
Purchase Rights granted under the Plan.
5. Eligibility.
(a) Options and Stock Purchase Rights may be granted to Employees and
Consultants, provided that Incentive Stock Options may only be granted
to Employees. An Employee or Consultant who has been granted an Option
or Stock Purchase Right may, if such Employee or Consultant is
otherwise eligible, be granted additional Option(s) or Stock Purchase
Right(s).
(b) Each Option shall be designated in the written option agreement as
either an Incentive Stock Option or a Nonstatutory Stock Option.
However, notwithstanding such designation, to the extent that the
aggregate fair market value of the Shares with respect to which
Options designated as Incentive Stock Options are exercisable for the
first time by any Optionee during any calendar year (under all plans
of the Company) exceeds $100,000, such Options shall be treated as
Nonstatutory Stock Options.
(c) For purposes of Section 5(b), Options shall be taken into account in
the order in which they were granted, and the fair market value of the
Shares shall be determined as of the time the Option with respect to
such Shares is granted.
(d) The Plan shall not confer upon any Optionee or holder of a Stock
Purchase Right any right with respect to continuation of employment by
or the rendition of consulting services to the Company, nor shall it
interfere in any way with his or her right or the Company's right to
terminate his or her employment or services at any time, with or
without cause.
(e) The following limitations shall apply to grants of Options to
Employees:
(i) No Employee shall be granted, in any fiscal year of the Company,
Options to purchase more than 250,000 Shares.
(ii) In connection with his or her initial employment, an Employee may
be granted Options to purchase up to an additional 250,000 Shares
which shall not count against the limit set forth in subsection
(i) above.
(iii)The foregoing limitations shall be adjusted proportionately in
connection with any change in the Company's capitalization as
described in Section 11.
(iv) If an Option is canceled in the same fiscal year of the Company
in which it was granted (other than in connection with a
transaction described in Section 12), the canceled Option shall
be counted against the limit set forth in subsection (i) above.
For this purpose, if the exercise price of an Option is reduced,
such reduction will be treated as a cancellation of the Option
and the grant of a new Option.
6. Term of Plan. The Plan shall become effective upon the earlier to occur of
its adoption by the Board of Directors or its approval by vote of holders
of a majority of the outstanding shares of the Company entitled to vote on
the adoption of the Plan. It shall continue in effect for a term of ten
(10) years unless sooner terminated under Section 13 of the Plan.
7. Exercise Price and Consideration.
(a) The per Share exercise price for the Shares to be issued pursuant to
exercise of an Option or Stock Purchase Right shall be such price as
is determined by the Board, but shall be subject to the following:
(i) In the case of an Incentive Stock Option; (A) granted to an
Employee who, at the time of grant of such Incentive Stock
Option, owns stock representing more than ten percent (10%) of
the voting power of all classes of stock of the Company or any
Parent or Subsidiary, the per Share exercise price shall be no
less than 110% of the fair market value per Share on the date of
grant. (B) granted to any other Employee, the per Share exercise
price shall be no less than 100% of the fair market value per
Share on the date of grant.
(ii) In the case of a Nonstatutory Stock Option or a Stock Purchase
Right, the per Share exercise price shall be no less than 85% of
the fair market value per Share on the date of grant. In the case
of a Nonstatutory Stock Option intended to qualify as
"performance-based compensation" within the meaning of Section
162(m) of the Code, the per Share exercise price shall be no less
than 100% of the Fair Market Value per Share on the date of
grant.
(iii)Notwithstanding the foregoing, Options may be granted with a per
Share exercise price of less than 100% of the Fair Market Value
per Share on the date of grant pursuant to a merger or other
corporate transaction.
For purposes of this Section 7(a), in the event that an Option or
Stock Purchase Right is amended to reduce the exercise price, the date
of grant of such Option or Stock Purchase Right shall thereafter be
considered to be the date of such amendment.
(b) The fair market value shall be determined by the Board in its
discretion; provided, however, that where there is a public market for
the Common Stock, the fair market value per Share shall be the mean of
the bid and asked prices (or the closing price per share if the Common
Stock is listed on the National Association of Securities Dealers
Automated Quotation ("NASDAQ") National Market System) of the Common
Stock for the date of grant, as reported in the Wall Street Journal
(or, if not so reported, as otherwise reported by the NASDAQ System)
or, in the event the Common Stock is listed on a stock exchange, the
fair market value per Share shall be the closing price on such
exchange on the date of grant of the Option or Stock Purchase Right,
as reported in the Wall Street Journal.
(c) The consideration to be paid for the Shares to be issued upon exercise
of an Option or Stock Purchase Right, including the method of payment,
shall be determined by the Board (and in the case of an Incentive
Stock Option, shall be determined at the time of grant) and may
consist entirely of cash, check, promissory note, other Shares of
Common Stock which
(i) either have been owned by the Optionee for more than six (6)
months on the date of surrender or were not acquired directly or
indirectly, from the Company, and
(ii) have a fair market value on the date of surrender equal to the
aggregate exercise price of the Shares as to which said Option
shall be exercised, or any combination of such methods of
payment, or such other consideration and method of payment for
the issuance of Shares to the extent permitted under Sections 408
and 409 of the California General Corporation Law. In making its
determination as to the type of consideration to accept, the
Board shall consider if acceptance of such consideration may be
reasonably expected to benefit the Company (Section 315(b) of the
California General Corporation Law).
8. Options.
(a) Term of Option. The term of each Option shall be the term stated in
the Option Agreement; provided, however, that the term shall be no
more than ten (10) years from the date of grant thereof. In the case
of an Incentive Stock Option granted to an Optionee who, at the time
the Option is granted, owns stock representing more than ten percent
(10%) of the voting power of all classes of stock of the Company or
any Parent or Subsidiary, the term of the Option shall be five (5)
years from the date of grant thereof or such shorter term as may be
provided in the Option Agreement.
(b) Exercise of Option.
(i) Procedure for Exercise; Rights as a Shareholder. Any Option
granted hereunder shall be exercisable at such times and under
such conditions as determined by the Board, including performance
criteria with respect to the Company and/or the Optionee, and as
shall be permissible under the terms of the Plan, but in no case
at a rate of less than 20% per year over five (5) years from the
date the Option is granted.
An Option may not be exercised for a fraction of a Share.
An Option shall be deemed to be exercised when written
notice of such exercise has been given to the Company in
accordance with the terms of the Option by the person entitled to
exercise the Option and full payment for the Shares with respect
to which the Option is exercised has been received by the
Company. Full payment may, as authorized by the Board, consist of
any consideration and method of payment allowable under Section 7
of, the Plan. Until the issuance (as evidenced by the appropriate
entry on the books of the Company or of a duly authorized
transfer agent of the Company) of the stock certificate
evidencing such Shares no right to vote or receive dividends or
any other rights as a shareholder shall exist with respect to the
Optioned Sock, notwithstanding the exercise of the Option. The
Company shall issue (or cause to be issued) such stock
certificate promptly upon exercise of the Option. In the event
that the exercise of a Nonstatutory Stock Option pursuant to
Section 5(b), the Company shall issue a separate stock
certificate evidencing the Shares treated as acquired upon
exercise of an Incentive Stock Option and a separate stock
certificate evidencing the Shares treated as acquired upon
exercise of a Nonstatutory Stock Option and shall identify each
such certificate accordingly in its stock transfer records. No
adjustment will be made for a dividend or other right for which
the record date is prior to the date the stock certificate is
issued, except as provided in Section 11 of the Plan.
Exercise of an Option in any manner shall result in a
decrease in the number of Shares which thereafter may be
available, both for purposes of the Plan and for sale under the
Option, by the number of Shares as to which the Option is
exercised.
(ii) Termination of Status as an Employee or Consultant. In the event
of termination of an Optionee's Continuous Status as an Employee
or Consultant (as the case may be), such Optionee may, but only
within such period of time as is determined by the Board, with
such determination in the case of an Incentive Stock Option not
exceeding three (3) months and in the case of Nonstatutory Stock
Option not exceeding six (6) months after the date of
termination, with such determination in the case of an Incentive
Stock Option being made at the time of grant of the Option,
exercise the Option to the extent that such Employee or
Consultant was entitled to exercise it at the date of such
termination (but in no event later than the date of expiration of
the term of such Option as set forth in the Option Agreement). To
the extent that such Employee or Consultant was not entitled to
exercise the Option at the date of such termination, or if such
Employee or Consultant does not exercise such Option (which such
Employee or Consultant was entitled to exercise) within the time
specified herein, the Option shall terminate.
(iii)Disability of Optionee. Notwithstanding the provisions of
Section 8(b)(ii) above, in the event of termination of an
Optionee's Continuous Status as an Employee or Consultant as a
result of such Employee's or Consultant's total and permanent
disability (as defined in Section 22(e)(3) of the Code), such
Employee or Consultant may, but only within six (6) months (or
such other period of time not exceeding twelve (12) months as in
determined by the Board, with such determination in the case of
an Incentive Stock Option being made at the time of gant of the
Option) from the date of such termination (but in no event later
than the date of expiration of the term of such Option as set
forth in the Option Agreement), exercise the Option to the extent
such Employee or Consultant was entitled to exercise it at the
date of such termination. To the extent that such Employee or
Consultant was not entitled to exercise the Option at the date of
termination, or if such Employee or Consultant does not exercise
such Option (which such Employee or Consultant was entitled to
exercise) within the time specified herein, the Option shall
terminate.
(iv) Death of Optionee. In the event of the death of an Optionee:
(A) during the term of the Option who is at the time of his or
her death an Employee or Consultant of the Company and who
shall have been in Continuous Status as an Employee or
Consultant since the date of grant of the Option, the Option
may be exercised, at any time within six (6) months (but in
no event later than the date of expiration of the term of
such Option as set forth in the Option Agreement), by the
Optionee's estate or by a person who acquired the right to
exercise the Option by bequest or inheritance, but only to
the extent that the right to exercise would have accrued had
the Optionee continued living and remained in Continuous
Status as an Employee or Consultant six (6) months (or such
other period of time as in determined by the Board at the
time of grant of the Option) after the date of death; or
(B) within thirty (30) days (or such other period of time not
exceeding three (3) months as is determined by the Board,
with such determination in the case of an Incentive Stock
Option being made at the time of grant of the Option) after
the termination of Continuous Status as an Employee or
Consultant, the Option may be exercised, at any time within
six (6) months (or such other period of time as is
determined by the Board at the time of grant of the Option)
following the date of death (but in no event later than the
date of expiration of the term of such Option as set forth
in the Option Agreement), by the Optionee's estate or by a
person who acquired the right to exercise the Option by
bequest or inheritance, but only to the extent of the right
to exercise that had accrued at the date of termination.
9. Stock Purchase Rights.
(a) Rights to Purchase. After the Board of Directors determines that it
will offer an Employee or Consultant a Stock Purchase Right, it shall
deliver to the offeree a stock purchase agreement or stock bonus
agreement, as the case may be, setting forth the terms, conditions and
restrictions relating to the offer, including the number of Shares
which such person shall be entitled to purchase, and the time within
which such person must accept such offer, which shall in no event
exceed six (6) months from the date upon which the Board of Directors
or its Committee made the determination to grant the Stock Purchase
Right. The offer shall be accepted by execution of a stock purchase
agreement or stock bonus agreement in the from determined by the Board
of Directors.
(b) Issuance of Shares. Forthwith after payment therefor, the Shares
purchased shall be duly issued; provided, however, that the Board may
require that the Purchaser make adequate provision for any Federal and
State withholding obligations of the Company as a condition to the
Purchaser purchasing such Shares.
(c) Repurchase Option. Unless the Board determines otherwise, the stock
purchase agreement or stock bonus agreement shall grant the Company a
repurchase option exercisable upon the voluntary or involuntary
termination of the Purchaser's employment with the Company for any
reason (including death or disability). If the Board so determines,
the purchase price for shares repurchased may be paid by cancellation
of any indebtedness of the Purchaser to the Company. The repurchase
option shall lapse at such rate as the Board may determine.
(d) Other Provisions. The stock purchase agreement or stock bonus
agreement shall contain such other terms, provisions and conditions
not inconsistent with the Plan as may be determined by the Board of
Directors.
10. Non-Transferability of Options and Stock Purchase Rights. Unless determined
otherwise by the Administrator, an Option or Stock Purchase Right may not
be sold, pledged, assigned, hypothecated, transferred, or disposed of in
any manner other than by will or by the laws of descent or distribution and
may be exercised, during the lifetime of the Optionee, only by the
Optionee. If the Administrator makes an Option or Stock Purchase Right
transferable, such Option or Stock Purchase Right shall contain such
additional terms and conditions as the Administrator deems appropriate.
11. Adjustments upon Changes in Capitalization or Merger.
(a) Changes in Capitalization. Subject to any required action by the
shareholders of the Company, the number of shares of Common Stock
covered by each outstanding Option or Stock Purchase Right, and the
number of shares of Common Stock which have been authorized for
issuance under the Plan but as to which no Options or Stock Purchase
Rights have yet been granted or which have been returned to the Plan
upon cancellation or expiration of an Option or Stock Purchase Right,
as well as the price per share of Common Stock covered by each such
outstanding Option or Stock Purchase Right, shall be proportionately
adjusted for any increase or decrease in the number of issued shares
of Common Stock resulting from a stock split, reverse stock split,
stock dividend, combination or reclassification of the Common Stock,
or any other increase or decrease in the number of issued shares of
Common Stock effected without receipt of consideration by the Company.
The conversion of any convertible securities of the Company shall not
be deemed to have been "effected without receipt of consideration."
Such adjustment shall be made by the Board, whose determination in
that respect shall be final, binding and conclusive. Except as
expressly provided herein, no issuance by the Company of shares of
stock of any class, or securities convertible into shares of stock of
any class, shall affect, and no adjustment by reason thereof shall be
made with respect to, the number or price of shares of Common Stock
subject to an Option or Stock Purchase Right.
(b) Dissolution or Liquidation. In the event of the proposed dissolution
or liquidation of the Company, the Administrator shall notify the
Optionee or Purchaser at least fifteen (15) days prior to such
proposed action. To the extent it has not been previously exercised,
the Option or Stock Purchase Right shall terminate immediately prior
to the consummation of such proposed action.
(c) Merger or Asset Sale. In the event of a merger, sale of all or
substantially all of the assets of the Company, tender offer or other
transaction or series of related transactions resulting in a change of
ownership of more than 50% of the voting securities of the Company
("Change in Control"), approved by the majority of the members of the
Board on the Board prior to the commencement of such Change in
Control, each outstanding Option shall be assumed or an equivalent
option or right substituted by the successor corporation or a Parent
or Subsidiary of the successor corporation; provided however, in the
event that within one year of the date of the completion of the Change
in Control, the successor corporation or a Parent or Subsidiary of the
successor corporation terminates the employment of an Optionee without
Cause (as defined below), such Optionee shall fully vest in and have
the right to exercise the options assumed or substituted for the
Option as to all of the Optioned Stock, including Shares as to which
it would not otherwise be exercisable. In the event that the successor
corporation refuses to assume or substitute for the Option, the
Optionee shall fully vest in and have the right to exercise the Option
as to all of the Optioned Stock, including Shares as to which it would
not otherwise be exercisable. If an Option becomes fully vested and
exercisable in lieu of assumption or substitution in the event of a
Change of Control, the Administrator shall notify the Optionee in
writing or electronically that the Option shall be fully vested and
exercisable for a period of fifteen (15) days from the date of such
notice, and the Option shall terminate upon the expiration of such
period. For the purposes of this paragraph, the Option shall be
considered assumed if, following the Change of Control, the option
confers the right to purchase, for each Share of Optioned Stock
subject to the Option immediately prior to the Change in Control, the
consideration (whether stock, cash, or other securities or property)
received in the Change of Control by holders of Common Stock for each
Share held on the effective date of the transaction (and if holders
were offered a choice of consideration, the type of consideration
chosen by the holders of a majority of the outstanding Shares);
provided, however, that if such consideration received in the Change
of Control is not solely common stock of the successor corporation or
its Parent, the Administrator may, with the consent of the successor
corporation, provide for the consideration to be received upon the
exercise of the Option, for each Share of Optioned Stock subject to
the Option, to be solely common stock of the successor corporation or
its Parent equal in fair market value to the per share consideration
received by holders of Common Stock in the Change of Control. For
purposes of this paragraph, termination shall be for "Cause" in the
event of the occurrence of any of the following: (a) any intentional
action or intentional failure to act by employee which was performed
in bad faith and to the material detriment of the successor
corporation or its Parent or Subsidiary; (b) employee willfully and
habitually neglects the duties of employment; or (c) employee is
convicted of a felony crime involving moral turpitude, provided that
in the event that any of the foregoing events is capable of being
cured, the successor corporation or its Parent or Subsidiary shall
provide written notice to the employee describing the nature of such
event and the employee shall thereafter have five (5) business days to
cure such event.
In the event of a Change in Control which is not approved by the
majority of the members of the Board on the Board prior to the
commencement of a Change in Control, each Optionee shall fully vest in
and have the right to exercise all outstanding Options as to all of
the Optioned Stock, including Shares as to which it would not
otherwise be exercisable.
12. Date of Granting Options. The date of grant of an Option or Stock Purchase
Right shall, for all purposes, be the date on which the Board makes the
determination granting such Option or stock Purchase Right. Notice of the
determination shall be given to each Employee or Consultant to whom an
Option or Stock Purchase Right is so granted within a reasonable time after
the date of such grant.
13. Amendment and Termination of the Plan.
(a) Amendment and Termination. The Administrator may at any time amend,
alter, suspend or discontinue the Plan, but no amendment, alteration,
suspension or discontinuation shall be made which would impair the
rights of any Optionee under any grant theretofore made, without his
or her consent. In addition, to the extent necessary and desirable to
comply with Section 422 of the Code (or any other Applicable Laws or
regulation, the requirements of the NASD or an established stock
exchange), the Company shall obtain shareholder approval of any Plan
amendment in such a manner and to such a degree as required.
(b) Effect of Amendment or Termination. Any such amendment or termination
of the Plan shall not affect Options or Stock Purchase Rights already
granted, and such Options and Stock Purchase Rights shall remain in
full force and effect as if this Plan had not been amended or
terminated, unless mutually agreed otherwise between the Optionee and
the Administrator, which agreement must be in writing and signed by
the Optionee and the Company.
14. Conditions Upon Issuance of Shares. Shares shall not be issued pursuant to
the exercise of an Option or Stock Purchase Rights unless the exercise of
such Option or Stock Purchase Rights and the issuance and delivery of such
Shares pursuant thereto shall comply with all relevant provisions of law,
including, without limitation, the Securities Act of 1933, as amended, the
Exchange Act, the rules and regulations promulgated thereunder, and the
requirements of any stock exchange upon which the Shares may then be
listed, and shall be further subject to the approval of counsel for the
Company with respect to such compliance.
As a condition to the exercise of an Option or Stock Purchase Right,
the Company may require the person exercising such Option or Stock Purchase
Right to represent and warrant at the time of any such exercise that the
Shares are being purchased only for investment and without any present
intention to sell or distribute such Shares if, in the opinion of counsel
for the Company, such a representation is required by any of the
aforementioned relevant provisions of law.
15. Reservation of Shares. The Company, during the term of this Plan, will at
all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.
The inability of the Company to obtain authority from any regulatory
body having jurisdiction, which authority is deemed by the Company's
counsel to be necessary to the lawful issuance and sale of any Shares
hereunder, shall relieve the Company of any liability in respect of the
failure to issue or sell such Shares as to which such requisite authority
shall not have been obtained.
16. Option, Stock Purchase and Stock Bonus Agreements. Options shall be
evidenced by written option agreements in such form as the Board shall
approve. Upon the exercise of Stock Purchase Rights, the Purchaser shall
sign a stock purchase agreement or stock bonus agreement in such form as
the Board shall approve.
17. Shareholder Approval. Continuance of the Plan shall be subject to approval
by the shareholders of the Company within twelve (12) months before or
after the date the Plan is adopted. Such shareholder approval shall be
obtained in the degree and manner required under Applicable Laws and the
rules of any stock exchange upon which the Common Stock is listed.
18. Information to Optionees and Purchasers. The Company shall provide to each
Optionee and Purchaser, during the period for which such Optionee or
Purchaser has one or more Options to Stock Purchase Rights outstanding, a
balance sheet and an income statement at least annually. The Company shall
not be required to provide such information to key employees whose duties
in connection with the Company assure there access to equivalent
information.
Exhibit 4.3
NEUROCRINE BIOSCIENCES, INC.
1996 EMPLOYEE STOCK PURCHASE PLAN
(AS AMENDED MAY 24, 2000, MAY 24, 2001 AND JUNE 15, 2001)
The following constitute the provisions of the 1996 Employee Stock Purchase
Plan of Neurocrine Biosciences, Inc.
1. Purpose. The purpose of the Plan is to provide employees of the Company and
its Designated Subsidiaries with an opportunity to purchase Common Stock of
the Company through accumulated payroll deductions. It is the intention of
the Company to have the Plan qualify as an "Employee Stock Purchase Plan"
under Section 423 of the Internal Revenue Code of 1986, as amended. The
provisions of the Plan, accordingly, shall be construed so as to extend and
limit participation in a manner consistent with the requirements of that
section of the Code.
2. Definitions.
(a) "Board" shall mean the Board of Directors of the Company.
(b) "Code" shall mean the Internal Revenue Code of 1986, as amended.
(c) "Common Stock" shall mean the Common Stock of the Company.
(d) "Company" shall mean Neurocrine Biosciences, Inc. and any Designated
Subsidiary of the Company.
(e) "Compensation" shall mean all regular straight time gross earnings but
shall exclude variable compensation for field sales personnel,
incentive bonuses, overtime, shift premium, lead pay and automobile
allowances and other compensation.
(f) "Designated Subsidiaries" shall mean the Subsidiaries which have been
designated by the Board from time to time in its sole discretion as
eligible to participate in the Plan.
(g) "Employee" shall mean any individual who is an Employee of the Company
for tax purposes whose customary employment with the Company is at
least twenty (20) hours per week and more than five (5) consecutive
months in any calendar year. For purposes of the Plan, the employment
relationship shall be treated as continuing intact while the
individual is on sick leave or other leave of absence approved by the
Company. Where the period of leave exceeds 90 days and the
individual's right to reemployment is not guaranteed either by statute
or by contract, the employment relationship will be deemed to have
terminated on the 91st day of such leave.
(h) "Enrollment Date" shall mean the first day of each Offering Period.
(i) "Exercise Date" shall mean the last Trading Day of each Purchase
Period. The first Exercise Date shall be the last Trading Day on or
before December 31, 1996.
(j) "Fair Market Value" shall mean, as of any date, the value of Common
Stock determined as follows:
(i) If the Common Stock is listed on any established stock exchange or a
national market system, including without limitation the Nasdaq
National Market of the National Association of Securities Dealers,
Inc. Automated Quotation ("NASDAQ") System, its Fair Market Value
shall be the closing sale price for the Common Stock (or the mean of
the closing bid and asked prices, if no sales were reported), as
quoted on such exchange (or the exchange with the greatest volume of
trading in Common Stock) or system on the date of such determination,
as reported in The Wall Street Journal or such other source as the
Board deems reliable, or; (ii) If the Common Stock is quoted on the
NASDAQ System (but not on the National Market thereof) or is regularly
quoted by a recognized securities dealer but selling prices are not
reported, its Fair Market Value shall be the mean of the closing bid
and asked prices for the Common Stock on the date of such
determination, as reported in The Wall Street Journal or such other
source as the Board deems reliable, or; (iii) In the absence of an
established market for the Common Stock, the Fair Market Value thereof
shall be determined in good faith by the Board. (iv) For purposes of
the Enrollment Date of the first Offering Period, the Fair Market
Value of the Common Stock shall be the Price to Public as set forth in
the final prospectus filed with the Securities and Exchange Commission
pursuant to Rule 424 under the Securities Act of 1933, as amended.
(k) "Offering Period" shall mean the period of approximately twelve (12)
months during which an option granted pursuant to the Plan may be
exercised, commencing on the first Trading Day on or after January 1
and July 1 of each year and terminating on the last Trading Day in the
periods ending up to one-year later (provided however that any
employee with an Offering Period beginning on or before January 1,
2001, shall have an initial Offering Period of up to two-years). The
first day of the first Offering Period shall be the effective date of
the Company's initial public offering of its Common Stock that is
registered with the Securities and Exchange Commission. The duration
and timing of Offering Periods may be changed pursuant to Section 4 of
this Plan.
(l) "Plan" shall mean this Neurocrine Biosciences, Inc. 1996 Employee
Stock Purchase Plan as amended hereby.
(m) "Purchase Price" shall mean an amount equal to 85% of the Fair Market
Value of a share of Common Stock on the Enrollment Date or on the
Exercise Date, whichever is lower.
(n) "Purchase Period" shall mean the approximately six-month period
commencing after one Exercise Date and ending with the next Exercise
Date, except that the first Purchase Period of any Offering Period
shall begin on the Enrollment Date and end with the next Exercise
Date. The first Purchase Period of the first Offering Period shall
begin on the first day of the first Offering Period and shall end on
the first Exercise Date.
(o) "Reserves" shall mean the number of shares of Common Stock covered by
each option under the Plan which have not yet been exercised and the
number of shares of Common Stock which have been authorized for
issuance under the Plan but not yet placed under option.
(p) "Subsidiary" shall mean a corporation, domestic or foreign, of which
not less than 50% of the voting shares are held by the Company or a
Subsidiary, whether or not such corporation now exists or is hereafter
organized or acquired by the Company or a Subsidiary. (q) "Trading
Day" shall mean a day on which national stock exchanges and the
National Association of Securities Dealers Automated Quotation
(NASDAQ) System are open for trading.
3. Eligibility.
(a) Any Employee (as defined in Section 2(g)), who shall be employed by
the Company on a given Enrollment Date shall be eligible to
participate in the Plan.
(b) Any provisions of the Plan to the contrary notwithstanding, no
Employee shall be granted an option under the Plan (i) if, immediately
after the grant, such Employee (or any other person whose stock would
be attributed to such Employee pursuant to Section 424(d) of the Code)
would own capital stock of the Company and/or hold outstanding options
to purchase such stock possessing five percent (5%) or more of the
total combined voting power or value of all classes of the capital
stock of the Company or of any Subsidiary, or (ii) if such option
permits his or her rights to purchase stock under all employee stock
purchase plans of the Company and its subsidiaries to accrue at a rate
which exceeds twenty-five thousand dollars ($25,000) worth of stock
(determined at the fair market value of the shares at the time such
option is granted) for each calendar year in which such option is
outstanding at any time.
4. Offering Periods. The Plan shall be implemented by consecutive, overlapping
Offering Periods with a new Offering Period beginning on the first Trading
Day on or after July 1 and January 1 each year, or on such other date as
the Board shall determine, and continuing thereafter until terminated in
accordance with Section 19 hereof. The first day of the first Offering
Period shall be the effective date of the Company's initial public offering
of its Common Stock that is registered with the Securities and Exchange
Commission. The Board shall have the power to change the duration of
Offering Periods (including the commencement dates thereof) with respect to
future offerings without stockholder approval if such change is announced
at least five (5) days prior to the scheduled beginning of the first
Offering Period to be affected thereafter.
5. Participation.
(a) An eligible Employee may become a participant in the Plan by
completing a subscription agreement authorizing payroll deductions in
the form of Exhibit A to this Plan and filing it with the Company's
payroll office prior to the applicable Enrollment Date.
(b) Payroll deductions for a participant shall commence on the first
payroll date following the Enrollment Date and shall end on the last
payroll date in the Offering Period to which such authorization is
applicable, unless sooner terminated by the participant as provided in
Section 10 hereof.
6. Payroll Deductions.
(a) At the time a participant files his or her subscription agreement, he
or she shall elect to have payroll deductions made on each pay day
during the Offering Period in an amount not exceeding fifteen percent
(15%) of the Compensation which he or she receives on each pay day
during the Offering Period, and the aggregate of such payroll
deductions during the Offering Period shall not exceed fifteen percent
(15%) of the participant's Compensation during said Offering Period.
(b) All payroll deductions made for a participant shall be credited to his
or her account under the Plan and will be withheld in whole
percentages only. A participant may not make any additional payments
into such account.
(c) A participant may discontinue his or her participation in the Plan as
provided in Section 10 hereof, or may increase or decrease the rate of
his or her payroll deductions during the Offering Period by completing
or filing with the Company a new subscription agreement authorizing a
change in payroll deduction rate. The Board may, in its discretion,
limit the number of participation rate changes during any Offering
Period. The change in rate shall be effective with the first full
payroll period following five (5) business days after the Company's
receipt of the new subscription agreement unless the Company elects to
process a given change in participation more quickly. A participant's
subscription agreement shall remain in effect for successive Offering
Periods unless terminated as provided in Section 10 hereof.
(d) Notwithstanding the foregoing, to the extent necessary to comply with
Section 423(b)(8) of the Code and Section 3(b) hereof, a participant's
payroll deductions may be decreased to 0% at such time during any
Purchase Period which is scheduled to end during the current calendar
year (the "Current Purchase Period") that the aggregate of all payroll
deductions which were previously used to purchase stock under the Plan
in a prior Purchase Period which ended during that calendar year plus
all payroll deductions accumulated with respect to the Current
Purchase Period equal $21,250. Payroll deductions shall recommence at
the rate provided in such participant's subscription agreement at the
beginning of the first Purchase Period which is scheduled to end in
the following calendar year, unless terminated by the participant as
provided in Section 10 hereof.
(e) At the time the option is exercised, in whole or in part, or at the
time some or all of the Company's Common Stock issued under the Plan
is disposed of, the participant must make adequate provision for the
Company's federal, state, or other tax withholding obligations, if
any, which arise upon the exercise of the option or the disposition of
the Common Stock. At any time, the Company may, but will not be
obligated to, withhold from the participant's compensation the amount
necessary for the Company to meet applicable withholding obligations,
including any withholding required to make available to the Company
any tax deductions or benefits attributable to sale or early
disposition of Common Stock by the Employee.
7. Grant of Option. On the Enrollment Date of each Offering Period, each
eligible Employee participating in such Offering Period shall be granted an
option to purchase on each Exercise Date during such Offering Period (at
the applicable Purchase Price) up to a number of shares of the Company's
Common Stock determined by dividing such Employee's payroll deductions
accumulated prior to such Exercise Date and retained in the Participant's
account as of the Exercise Date by the applicable Purchase Price; provided
that in no event shall an Employee be permitted to purchase during each
Purchase Period more than a number of Shares determined by dividing $12,500
by the Fair Market Value of a share of the Company's Common Stock on the
Enrollment Date, and provided further that such purchase shall be subject
to the limitations set forth in Sections 3(b) and 12 hereof. Exercise of
the option shall occur as provided in Section 8 hereof, unless the
participant has withdrawn pursuant to Section 10 hereof, and shall expire
on the last day of the Offering Period.
8. Exercise of Option. Unless a participant withdraws from the Plan as
provided in Section 10 hereof, his or her option for the purchase of shares
will be exercised automatically on the Exercise Date, and the maximum
number of full shares subject to option shall be purchased for such
participant at the applicable Purchase Price with the accumulated payroll
deductions in his or her account. No fractional shares will be purchased;
any payroll deductions accumulated in a participant's account which are not
sufficient to purchase a full share shall be retained in the participant's
account for the subsequent Purchase Period or Offering Period, subject to
earlier withdrawal by the participant as provided in Section 10 hereof. Any
other monies left over in a participant's account after the Exercise Date
shall be returned to the participant. During a participant's lifetime, a
participant's option to purchase shares hereunder is exercisable only by
him or her.
9. Delivery. As promptly as practicable after each Exercise Date on which a
purchase of shares occurs, the Company shall arrange the delivery to each
participant, as appropriate, of a certificate representing the shares
purchased upon exercise of his or her option. 10. Withdrawal; Termination
of Employment.
(a) A participant may withdraw all but not less than all the payroll
deductions credited to his or her account and not yet used to exercise
his or her option under the Plan at any time by giving written notice
to the Company in the form of Exhibit B to this Plan. All of the
participant's payroll deductions credited to his or her account will
be paid to such participant promptly after receipt of notice of
withdrawal and such participant's option for the Offering Period will
be automatically terminated, and no further payroll deductions for the
purchase of shares will be made for such Offering Period. If a
participant withdraws from an Offering Period, payroll deductions will
not resume at the beginning of the succeeding Offering Period unless
the participant delivers to the Company a new subscription agreement.
(b) Upon a participant's ceasing to be an Employee (as defined in Section
2(g) hereof), for any reason, he or she will be deemed to have elected
to withdraw from the Plan and the payroll deductions credited to such
participant's account during the Offering Period but not yet used to
exercise the option will be returned to such participant or, in the
case of his or her death, to the person or persons entitled thereto
under Section 14 hereof, and such participant's option will be
automatically terminated. The preceding sentence notwithstanding, a
participant who receives payment in lieu of notice of termination of
employment shall be treated as continuing to be an Employee for the
participant's customary number of hours per week of employment during
the period in which the participant is subject to such payment in lieu
of notice.
11. Interest. No interest shall accrue on the payroll deductions of a
participant in the Plan.
12. Stock.
(a) The maximum number of shares of the Company's Common Stock which shall
be made available for sale under the Plan shall be five hundred and
twenty five thousand (525,000), subject to adjustment upon changes in
capitalization of the Company as provided in Section 18 hereof. If, on
a given Exercise Date, the number of shares with respect to which
options are to be exercised exceeds the number of shares then
available under the Plan, the Company shall make a pro rata allocation
of the shares remaining available for purchase in as uniform a manner
as shall be practicable and as it shall determine to be equitable.
(b) The participant will have no interest or voting right in shares
covered by his option until such option has been exercised. (c) Shares
to be delivered to a participant under the Plan will be registered in
the name of the participant or in the name of the participant and his
or her spouse.
13. Administration.
(a) Administrative Body. The Plan shall be administered by the Board or a
committee of members of the Board appointed by the Board. The Board or
its committee shall have full and exclusive discretionary authority to
construe, interpret and apply the terms of the Plan, to determine
eligibility and to adjudicate all disputed claims filed under the
Plan. Every finding, decision and determination made by the Board or
its committee shall, to the full extent permitted by law, be final and
binding upon all parties.
(b) Rule 16b-3 Limitations. Notwithstanding the provisions of Subsection
(a) of this Section 13, in the event that Rule 16b-3 promulgated under
the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
or any successor provision ("Rule 16b-3") provides specific
requirements for the administrators of plans of this type, the Plan
shall be only administered by such a body and in such a manner as
shall comply with the applicable requirements of Rule 16b-3. Unless
permitted by Rule 16b-3, no discretion concerning decisions regarding
the Plan shall be afforded to any committee or person that is not
"disinterested" as that term is used in Rule 16b-3.
14. Designation of Beneficiary.
(a) A participant may file a written designation of a beneficiary who is
to receive any shares and cash, if any, from the participant's account
under the Plan in the event of such participant's death subsequent to
an Exercise Date on which the option is exercised but prior to
delivery to such participant of such shares and cash. In addition, a
participant may file a written designation of a beneficiary who is to
receive any cash from the participant's account under the Plan in the
event of such participant's death prior to exercise of the option. If
a participant is married and the designated beneficiary is not the
spouse, spousal consent shall be required for such designation to be
effective.
(b) Such designation of beneficiary may be changed by the participant at
any time by written notice. In the event of the death of a participant
and in the absence of a beneficiary validly designated under the Plan
who is living at the time of such participant's death, the Company
shall deliver such shares and/or cash to the executor or administrator
of the estate of the participant, or if no such executor or
administrator has been appointed (to the knowledge of the Company),
the Company, in its discretion, may deliver such shares and/or cash to
the spouse or to any one or more dependents or relatives of the
participant, or if no spouse, dependent or relative is known to the
Company, then to such other person as the Company may designate.
15. Transferability. Neither payroll deductions credited to a participant's
account nor any rights with regard to the exercise of an option or to
receive shares under the Plan may be assigned, transferred, pledged or
otherwise disposed of in any way (other than by will, the laws of descent
and distribution or as provided in Section 14 hereof) by the participant.
Any such attempt at assignment, transfer, pledge or other disposition shall
be without effect, except that the Company may treat such act as an
election to withdraw funds from an Offering Period in accordance with
Section 10 hereof.
16. Use of Funds. All payroll deductions received or held by the Company under
the Plan may be used by the Company for any corporate purpose, and the
Company shall not be obligated to segregate such payroll deductions.
17. Reports. Individual accounts will be maintained for each participant in the
Plan. Statements of account will be given to participating Employees at
least annually, which statements will set forth the amounts of payroll
deductions, the Purchase Price, the number of shares purchased and the
remaining cash balance, if any.
18. Adjustments Upon Changes in Capitalization, Dissolution, Liquidation,
Merger or Asset Sale.
a) Changes in Capitalization. Subject to any required action by the
stockholders of the Company, the Reserves as well as the price per
share of Common Stock covered by each option under the Plan which has
not yet been exercised shall be proportionately adjusted for any
increase or decrease in the number of issued shares of Common Stock
resulting from a stock split, reverse stock split, stock dividend,
combination or reclassification of the Common Stock, or any other
increase or decrease in the number of shares of Common Stock effected
without receipt of consideration by the Company; provided, however,
that conversion of any convertible securities of the Company shall not
be deemed to have been "effected without receipt of consideration".
Such adjustment shall be made by the Board, whose determination in
that respect shall be final, binding and conclusive. Except as
expressly provided herein, no issuance by the Company of shares of
stock of any class, or securities convertible into shares of stock of
any class, shall affect, and no adjustment by reason thereof shall be
made with respect to, the number or price of shares of Common Stock
subject to an option.
(b) Dissolution or Liquidation. In the event of the proposed dissolution
or liquidation of the Company, the Offering Periods will terminate
immediately prior to the consummation of such proposed action, unless
otherwise provided by the Board.
(c) Merger or Asset Sale. In the event of a proposed sale of all or
substantially all of the assets of the Company, or the merger of the
Company with or into another corporation, each option under the Plan
shall be assumed or an equivalent option shall be substituted by such
successor corporation or a parent or subsidiary of such successor
corporation, unless the Board determines, in the exercise of its sole
discretion and in lieu of such assumption or substitution, to shorten
the Offering Periods then in progress by setting a new Exercise Date
(the "New Exercise Date"). If the Board shortens the Offering Periods
then in progress in lieu of assumption or substitution in the event of
a merger or sale of assets, the Board shall notify each participant in
writing, at least ten (10) business days prior to the New Exercise
Date, that the Exercise Date for his option has been changed to the
New Exercise Date and that his option will be exercised automatically
on the New Exercise Date, unless prior to such date he has withdrawn
from the Offering Period as provided in Section 10 hereof. For
purposes of this paragraph, an option granted under the Plan shall be
deemed to be assumed if, following the sale of assets or merger, the
option confers the right to purchase, for each share of option stock
subject to the option immediately prior to the sale of assets or
merger, the consideration (whether stock, cash or other securities or
property) received in the sale of assets or merger by holders of
Common Stock for each share of Common Stock held on the effective date
of the transaction (and if such holders were offered a choice of
consideration, the type of consideration chosen by the holders of a
majority of the outstanding shares of Common Stock); provided,
however, that if such consideration received in the sale of assets or
merger was not solely common stock of the successor corporation or its
parent (as defined in Section 424(e) of the Code), the Board may, with
the consent of the successor corporation, provide for the
consideration to be received upon exercise of the option to be solely
common stock of the successor corporation or its parent equal in fair
market value to the per share consideration received by holders of
Common Stock and the sale of assets or merger.
19. Amendment or Termination.
(a) The Board of Directors of the Company may at any time and for any
reason terminate or amend the Plan. Except as provided in Section 18
hereof, no such termination can affect options previously granted,
provided that an Offering Period may be terminated by the Board of
Directors on any Exercise Date if the Board determines that the
termination of the Plan is in the best interests of the Company and
its stockholders. Except as provided in Section 18 hereof, no
amendment may make any change in any option theretofore granted which
adversely affects the rights of any participant. To the extent
necessary to comply with Rule 16b-3 or under Section 423 of the Code
(or any successor rule or provision or any other applicable law or
regulation), the Company shall obtain stockholder approval in such a
manner and to such a degree as required.
(b) Without stockholder consent and without regard to whether any
participant rights may be considered to have been "adversely
affected," the Board (or its committee) shall be entitled to change
the Offering Periods, limit the frequency and/or number of changes in
the amount withheld during an Offering Period, establish the exchange
ratio applicable to amounts withheld in a currency other than U.S.
dollars, permit payroll withholding in excess of the amount designated
by a participant in order to adjust for delays or mistakes in the
Company's processing of properly completed withholding elections,
establish reasonable waiting and adjustment periods and/or accounting
and crediting procedures to ensure that amounts applied toward the
purchase of Common Stock for each participant properly correspond with
amounts withheld from the participant's Compensation, and establish
such other limitations or procedures as the Board (or its committee)
determines in its sole discretion advisable which are consistent with
the Plan.
20. Notices. All notices or other communications by a participant to the
Company under or in connection with the Plan shall be deemed to have been
duly given when received in the form specified by the Company at the
location, or by the person, designated by the Company for the receipt
thereof.
21. Conditions Upon Issuance of Shares. Shares shall not be issued with respect
to an option unless the exercise of such option and the issuance and
delivery of such shares pursuant thereto shall comply with all applicable
provisions of law, domestic or foreign, including, without limitation, the
Securities Act of 1933, as amended, the Securities Exchange Act of 1934, as
amended, the rules and regulations promulgated thereunder, and the
requirements of any stock exchange upon which the shares may then be
listed, and shall be further subject to the approval of counsel for the
Company with respect to such compliance.
As a condition to the exercise of an option, the Company may require the
person exercising such option to represent and warrant at the time of any
such exercise that the shares are being purchased only for investment and
without any present intention to sell or distribute such shares if, in the
opinion of counsel for the Company, such a representation is required by
any of the aforementioned applicable provisions of law.
22. Term of Plan. The Plan shall become effective upon the earlier to occur of
its adoption by the Board of Directors or its approval by the stockholders
of the Company. It shall continue in effect for a term of ten (10) years
unless sooner terminated under Section 19 hereof.
23. Automatic Transfer to Low Price Offering Period. To the extent permitted by
Rule 16b-3 of the Exchange Act, if the Fair Market Value of the Common
Stock on any Exercise Date in an Offering Period is lower than the Fair
Market Value of the Common Stock on the Enrollment Date of such Offering
Period, then all participants in such Offering Period shall be
automatically withdrawn from such Offering Period immediately after the
exercise of their option on such Exercise Date and automatically
re-enrolled in the immediately following Offering Period as of the first
day thereof.
24. Stockholder Approval. Continuance of the Plan shall be subject to approval
by the stockholders of the Company within twelve (12) months before or
after the date the Plan is adopted. Such stockholder approval shall be
obtained in the degree and manner required under applicable state and
federal law. 25. Financial Reports. The Company shall provide to each
Optionee, not less frequently than annually during the period such Optionee
has one or more Options outstanding, copies of annual financial statements.
The Company shall not be required to provide such statements to key
employees whose duties in connection with the Company assure their access
to equivalent information.
EXHIBIT A
NEUROCRINE BIOSCIENCES, INC.
1996 EMPLOYEE STOCK PURCHASE PLAN
SUBSCRIPTION AGREEMENT
_____ Original Application Enrollment Date: ___________
_____ Change in Payroll Deduction Rate
_____ Change of Beneficiary(ies)
1. ___________________ hereby elects to participate in the Neurocrine
Biosciences, Inc. 1996 Employee Stock Purchase Plan (the "Employee Stock
Purchase Plan") and subscribes to purchase shares of the Company's Common
Stock in accordance with this Subscription Agreement and the Employee Stock
Purchase Plan.
2. I hereby authorize payroll deductions from each paycheck in the amount of
____% of my Compensation on each payday (1-15%) during the Offering Period
in accordance with the Employee Stock Purchase Plan. (Please note that no
fractional percentages are permitted.)
3. I understand that said payroll deductions shall be accumulated for the
purchase of shares of Common Stock at the applicable Purchase Price
determined in accordance with the Employee Stock Purchase Plan. I
understand that if I do not withdraw from an Offering Period, any
accumulated payroll deductions will be used to automatically exercise my
option.
4. I have received a copy of the complete "Neurocrine Biosciences, Inc. 1996
Employee Stock Purchase Plan." I understand that my participation in the
Employee Stock Purchase Plan is in all respects subject to the terms of the
Plan. I understand that my ability to exercise the option under this
Subscription Agreement is subject to obtaining stockholder approval of the
Employee Stock Purchase Plan.
5. Shares purchased for me under the Employee Stock Purchase Plan should be
issued in the name(s) of (Employee or Employee and spouse only):
______________________________.
6. I understand that if I dispose of any shares received by me pursuant to the
Plan within 2 years after the Enrollment Date (the first day of the
Offering Period during which I purchased such shares) or one year after the
Exercise Date, I will be treated for federal income tax purposes as having
received ordinary income at the time of such disposition in an amount equal
to the excess of the fair market value of the shares at the time such
shares were purchased over the price which I paid for the shares.
I HEREBY AGREE TO NOTIFY THE COMPANY IN WRITING WITHIN 30 DAYS AFTER
THE DATE OF ANY DISPOSITION OF MY SHARES AND I WILL MAKE ADEQUATE PROVISION
FOR FEDERAL, STATE OR OTHER TAX WITHHOLDING OBLIGATIONS, IF ANY, WHICH
ARISE UPON THE DISPOSITION OF THE COMMON STOCK.
The Company may, but will not be obligated to, withhold from my
compensation the amount necessary to meet any applicable withholding
obligation including any withholding necessary to make available to the
Company any tax deductions or benefits attributable to sale or early
disposition of Common Stock by me. If I dispose of such shares at any time
after the expiration of the 2-year and 1-year holding periods, I understand
that I will be treated for federal income tax purposes as having received
income only at the time of such disposition, and that such income will be
taxed as ordinary income only to the extent of an amount equal to the
lesser of (1) the excess of the fair market value of the shares at the time
of such disposition over the purchase price which I paid for the shares, or
(2) 15% of the fair market value of the shares on the first day of the
Offering Period. The remainder of the gain, if any, recognized on such
disposition will be taxed as capital gain.
7. I hereby agree to be bound by the terms of the Employee Stock Purchase
Plan. The effectiveness of this Subscription Agreement is dependent upon my
eligibility to participate in the Employee Stock Purchase Plan.
8. In the event of my death, I hereby designate the following as my
beneficiary(ies) to receive all payments and shares due me under the
Employee Stock Purchase Plan:
NAME: (Please print) ----------------------------------------------
(First) (Middle) (Last)
----------------------------------------------
Relationship
----------------------------------------------
----------------------------------------------
(Address)
Employee's Social ----------------------------------------------
Security Number: ----------------------------------------------
Employee's Address: ----------------------------------------------
----------------------------------------------
I UNDERSTAND THAT THIS SUBSCRIPTION AGREEMENT SHALL REMAIN IN EFFECT
THROUGHOUT SUCCESSIVE OFFERING PERIODS UNLESS TERMINATED BY ME.
Dated:
------------------ ----------------------------------------------
Signature of Employee
----------------------------------------------
Spouse's Signature
(If beneficiary other than spouse)
EXHIBIT B
NEUROCRINE BIOSCIENCES, INC.
1996 EMPLOYEE STOCK PURCHASE PLAN
NOTICE OF WITHDRAWAL
The undersigned participant in the Offering Period of the Neurocrine
Biosciences, Inc. 1996 Employee Stock Purchase Plan which began on ____________,
19____ (the "Enrollment Date") hereby notifies the Company that he or she hereby
withdraws from the Offering Period. He or she hereby directs the Company to pay
to the undersigned as promptly as practicable all the payroll deductions
credited to his or her account with respect to such Offering Period. The
undersigned understands and agrees that his or her option for such Offering
Period will be automatically terminated. The undersigned understands further
that no further payroll deductions will be made for the purchase of shares in
the current Offering Period and the undersigned shall be eligible to participate
in succeeding Offering Periods only by delivering to the Company a new
Subscription Agreement.
Name and Address of Participant:
-----------------------------------------------
-----------------------------------------------
-----------------------------------------------
-----------------------------------------------
Signature
------------------------------------------------
Date
Exhibit 5.1
LATHAM & WATKINS
12626 HIGH BLUFF DRIVE, SUITE 300
SAN DIEGO, CALIFORNIA 92130
(858) 523-5400
July 16, 2001
Neurocrine Biosciences, Inc.
10555 Science Center Drive
San Diego, California 92121
Re: Form S-8 Registration Statement
Ladies and Gentlemen:
In connection with the registration by Neurocrine Biosciences, Inc., a
Delaware corporation (the "Company"), and aggregate of of 850,000 shares of
common stock, par value $0.001 per share (the "Shares"), of the Company to be
issued pursuant to the Neurocrine Biosciences, Inc. 1992 Incentive Stock Plan,
as amended, and the Neurocrine Biosciences, Inc. 1996 Employee Stock Purchase
Plan, as amended (collectively the "Plans"), under the Securities Act of 1933,
as amended (the "Act"), on a Registration Statement on Form S-8 filed with the
Securities and Exchange Commission on July 16, 2001 (as amended from time to
time, the "Registration Statement"), you have requested our opinion with respect
to the matters set forth below.
In our capacity as your counsel in connection with such registration, we
are familiar with the proceedings taken and proposed to be taken by the Company
in connection with the authorization, issuance and sale of the Shares, and for
the purposes of this opinion, have assumed such proceedings will be timely
completed in the manner presently proposed. In addition, we have made such legal
and factual examinations and inquiries, including an examination of originals or
copies certified or otherwise identified to our satisfaction of such documents,
corporate records and instruments, as we have deemed necessary or appropriate
for purposes of this opinion.
In our examination, we have assumed the genuineness of all signatures, the
authenticity of all documents submitted to us as originals, and the conformity
to authentic original documents of all documents submitted to us as copies.
We are opining herein as to the effect on the subject transaction only of
the General Corporation Law of the State of Delaware, and we express no opinion
with respect to the applicability thereto, or the effect thereon, of any other
laws, or as to any matters of municipal law or the laws of any other local
agencies within the state.
Subject to the foregoing, it is our opinion that as of the date hereof, the
Shares have been duly authorized, and, upon the issuance of and payment for the
Shares in accordance with the terms set forth in the Plans, the Shares will be
validly issued, fully paid and nonassessable.
We consent to your filing this opinion as an exhibit to the Registration
Statement.
Very truly yours,
/s/ LATHAM & WATKINS
Exhibit 23.1
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the incorporation by reference in this Registration Statement
on Form S-8 pertaining to the Neurocrine Biosciences, Inc. 1992 Incentive Stock
Plan, as amended, and the Neurocrine Biosciences, Inc. 1996 Employee Stock
Purchase Plan, as amended, of our report dated January 29, 2001, with respect to
the financial statements of Neurocrine Biosciences, Inc. included in its Annual
Report Form 10-K for the year ended December 31, 2000, filed with the Securities
and Exchange Commission.
/s/ERNST & YOUNG LLP
San Diego, California
July 13, 2001