Common use of Equity Based Incentive Compensation Clause in Contracts

Equity Based Incentive Compensation. The Executive shall be granted stock options under the Company's stock incentive plans from time to time, which stock options shall be "incentive stock options" (within the meaning of Section 422(b) of the Internal Revenue Code of 1986, as amended (the "Code")), to the maximum extent permissible under Section 422(d) of the Code. The amounts of such grants shall be determined by the Compensation Committee in its sole and absolute discretion; provided, however, that each such stock option shall provide for an exercise price equal to the fair market value at the time of the grant of the underlying shares subject thereto, and the terms of any stock option shall be at least equivalent to the terms of any options granted to the next highest ranking executive of the Company, at the time of any grant to the Executive. Executive's eligibility for participation, and the terms and conditions of any stock options hereunder shall be set forth in separate official stock option plan documents, the terms and conditions of which shall exclusively govern the award, vesting, exercise and all other aspects of the stock options described in this Paragraph. As provided in Paragraph 7(e)(i)(C) or upon the occurrence of a "Change of Control" (as defined below), all then outstanding stock options and all other equity-based or equity-related compensation rights or entitlements theretofore granted or awarded to the Executive by the Company, including but not limited to those stock options granted to the Executive under this Paragraph 5(c), shall automatically and immediately become fully vested and exercisable and relieved of any and all otherwise applicable transfer restrictions, lock-up or performance requirements and other 2 restrictions and/or contingencies of any kind. For purposes hereof, a "Change of Control" shall be deemed to have occurred as of the earliest of any of the following to occur during the Term: (i) The closing of a transaction by the Company or any person (other than the Company, any subsidiary of the Company or any employee benefit plan of the Company or of any subsidiary of the Company) (a "Person"), together with all "affiliates and "associates" (within the meanings of such terms under Rule 12b-2 of the Securities Exchange Act of 1934, as amended) (the "Exchange Act") of such Person, shall be the beneficial owner of thirty percent (30%) or more of the Company's then outstanding voting stock ("Beneficial Ownership"); (ii) A change in the constituency of the Board such that, during any period of thirty-six (36) consecutive months, at least a majority of the entire Board of Directors of the Company shall not consist of Incumbent Directors. For purposes of this paragraph, "Incumbent Directors" shall mean individuals who at the beginning of such thirty-six (36) month period constitute the Board, unless the election or nomination for election by the shareholders of the Company of each such new director was approved by a vote of a majority of the Incumbent Directors;

Equity Based Incentive Compensation. (a) The Executive shall be granted stock options under the Company's stock incentive plans from time to time, which stock options shall be "Company currently has in place an incentive stock options" (within option plan pursuant to the meaning provisions of Section 422(b) 422 of the Internal Revenue Code of 1986, as amended (the "Code") (hereinafter, the "Option Plan")), to the maximum extent permissible under Section 422(d) of the Code. The amounts of such grants shall be determined by Company agrees that Tietx, xx the Compensation Committee in its sole and absolute discretion; provided, however, that each such stock option shall provide for an exercise price equal to the fair market value at the time of the grant of the underlying shares subject thereto, and the terms of any stock option shall be at least equivalent to the terms of any options granted to the next highest ranking executive Chief Executive Officer of the Company, shall participate in the Option Plan, at the time of any grant to the Executive. Executive's eligibility for participation, or times and consistent with the terms and conditions vesting rules generally applicable to other senior executives of any the Company under the Option Plan. (b) If there is a generally applicable award of options or restricted shares to senior executives of the Company other than an award of options under the Option Plan, Tietx xxxll participate in such award(s) on terms consistent with the Company's then-current practices with respect to awards made to other senior executives. The Compensation Committee of the Board, in its sole discretion, shall determine whether and to what extent stock options hereunder shall be granted to Tietx xxxer the Option Plan. (c) In accordance with the terms of the Prior Agreement, the Company granted to Tietx xx option (the "Option") to acquire 300,000 shares (the "Option Shares") of the Company's common stock, $2.00 par value, at an exercise price of $4.375 per share, the closing price of the Company" s common stock, as quoted on NASDAQ, as of the close of business on December 11, 1998, the date of grant. The terms of the Option are set forth in a separate official stock option plan documents, Non-Qualified Stock Option Agreement entered into between the terms Company and conditions Tietx. (d) In the event of which shall exclusively govern the award, vesting, exercise and all other aspects an "Equity Change in Control" of the Company, as that term is defined in Exhibit C hereto, then all of Tietx'x xxxrds of stock options described in this Paragraph. As provided in Paragraph 7(e)(i)(C) options, restricted shares or upon the occurrence of a "Change of Control" (as defined below), all then outstanding stock options and all other similar equity-based or equity-related compensation rights or entitlements theretofore granted or awarded to the Executive by the Company, including but interests which have not limited to those stock options granted to the Executive under this Paragraph 5(c), already vested shall automatically and immediately become fully vested and exercisable and relieved of any and all otherwise applicable transfer restrictions, lock-up or performance requirements and other 2 restrictions and/or contingencies of any kind. For purposes hereof, a "Change of Control" shall be deemed to have occurred as of the earliest of any of the following to occur during the Term:vest in full. (ie) The closing of a transaction by the Company or any person (other than the Company, any subsidiary of the Company or any employee benefit plan of the Company or of any CCC is an indirect wholly-owned subsidiary of the Company. CCC serves as the general partner or managing general partner of eleven (11) (a "Person")California limited partnerships organized to own and manage marine cargo containers. Since 1992, together with all "affiliates and "associates" (within Tietx xxx served as President of CCC. Tietx xxxll continue to serve as President of CCC during the meanings of such terms under Rule 12b-2 Term. Under the relevant partnership agreements of the Securities Exchange Act of 1934container partnerships, CCC, as amended) general partner, is entitled to various forms of compensation. The Company agrees to allocate and distribute to Tietx, xx additional incentive compensation, for the term of the container partnerships paying such compensation, three percent (the "Exchange Act"3%) of such Person, the container partnerships" fees and distributions payable and distributable to CCC. The incentive compensation payable to Tietx xxxer the provisions of this subsection (e) shall be the beneficial owner of thirty percent (30%) or more payable to him by CCC quarterly and shall be paid to Tietx xxxardless of the Company's then outstanding voting stock ("Beneficial Ownership"); (ii) A change in termination of this Agreement by either Party prior to the constituency expiration of the Board such that, during any period term of thirty-six (36) consecutive months, at least a majority of the entire Board of Directors of the Company shall not consist of Incumbent Directors. For purposes of this paragraph, "Incumbent Directorscontainer partnerships" shall mean individuals who at the beginning of such thirty-six (36) month period constitute the Board, unless the election or nomination for election by the shareholders of the Company of each such new director was approved by a vote of a majority of the Incumbent Directors;agreements with CCC.

Equity Based Incentive Compensation. The (a) In order to induce Tietx xx accept the position of Chief Executive shall be granted stock options under Officer of the Company, the Company agrees, effective the Effective Date, to granx Xxxxx xx option (the "Option") to acquire 300,000 shares (the "Option Shares") of the Company's stock incentive plans from time Common Stock, $2.00 par value, at an exercise price equal to timethe closing price of the Company's Common Stock, which stock options as quoted on NASDAQ, as of the close of business on the Effective Date ($4.375 per share). The Company agrees to submit the Option for the approval of the shareholders of the Company by no later than the next regularly-scheduled annual meeting of the shareholders of the Company. The effectiveness of the Option shall not, however, be conditional upon approval thereof by the shareholders of the Company. Tietx' xxght to purchase the Option Shares shall vest in full as of the Effective Date. The Company agrees that the Option granted E123 6 to Tietx xxx the Option Shares shall be exercisable for ten (10) years from the date of grant. (b) The Company currently has in place its Management Equity Investment Plan (the "MEIP"), but the Company is in the process of terminating the MEIP. As soon as practicable, the Company agrees to adopt an incentive stock options" (within option plan pursuant to the meaning provisions of Section 422(b) 422 of the Internal Revenue Code of 1986, as amended (hereinafter, the "CodeOption Plan")), to the maximum extent permissible under Section 422(d) of the Code. The amounts Company agrees to submit the Option Plan for approval of such grants shall be determined by the Compensation Committee in its sole and absolute discretion; provided, however, that each such stock option shall provide for an exercise price equal to the fair market value at the time of the grant of the underlying shares subject thereto, and the terms of any stock option shall be at least equivalent to the terms of any options granted to the next highest ranking executive of the Company, at the time of any grant to the Executive. Executive's eligibility for participation, and the terms and conditions of any stock options hereunder shall be set forth in separate official stock option plan documents, the terms and conditions of which shall exclusively govern the award, vesting, exercise and all other aspects of the stock options described in this Paragraph. As provided in Paragraph 7(e)(i)(C) or upon the occurrence of a "Change of Control" (as defined below), all then outstanding stock options and all other equity-based or equity-related compensation rights or entitlements theretofore granted or awarded to the Executive by the Company, including but not limited to those stock options granted to the Executive under this Paragraph 5(c), shall automatically and immediately become fully vested and exercisable and relieved of any and all otherwise applicable transfer restrictions, lock-up or performance requirements and other 2 restrictions and/or contingencies of any kind. For purposes hereof, a "Change of Control" shall be deemed to have occurred as of the earliest of any of the following to occur during the Term: (i) The closing of a transaction by the Company or any person (other than the Company, any subsidiary of the Company or any employee benefit plan of the Company or of any subsidiary of the Company) (a "Person"), together with all "affiliates and "associates" (within the meanings of such terms under Rule 12b-2 of the Securities Exchange Act of 1934, as amended) (the "Exchange Act") of such Person, shall be the beneficial owner of thirty percent (30%) or more of the Company's then outstanding voting stock ("Beneficial Ownership"); (ii) A change in the constituency of the Board such that, during any period of thirty-six (36) consecutive months, at least a majority of the entire Board of Directors of the Company shall not consist of Incumbent Directors. For purposes of this paragraph, "Incumbent Directors" shall mean individuals who at the beginning of such thirty-six (36) month period constitute the Board, unless the election or nomination for election by the shareholders of the Company within twelve (12) months of each the date the Option Plan is adopted by the Board. The Company agrees that Tietx, xx the Chief Executive Officer of the Company, shall participate in the Option Plan, at the time or times and consistent with the terms and vesting rules generally applicable to other senior executives of the Company under the Option Plan. (c) If there is a generally applicable award of options or restricted shares to senior executives of the Company other than an award of options under the Option Plan, Tietx xxxll participate in such new director was approved by a vote award(s) on terms consistent with the Company's then-current practices with respect to awards made to other senior executives. (d) In the event of a majority "Change in Control" of the Incumbent Directors;Company, as that term is defined in the Severance Agreement entered into by and between the Company and Tietx xxxcurrently with this Agreement, then all of Tietx' xxards of stock options, restricted shares or similar equity-based interests which have not already vested shall immediately vest in full.

Equity Based Incentive Compensation. (a) The Executive shall be granted stock options under the Company's stock incentive plans from time to time, which stock options shall be "Company currently has in place an incentive stock options" (within option plan pursuant to the meaning provisions of Section 422(b) 422 of the Internal Revenue Code of 1986, as amended (the "Code") (hereinafter, the "Option Plan")), to the maximum extent permissible under Section 422(d) of the Code. The amounts of such grants shall be determined by Company agrees that Txxxx, as the Compensation Committee in its sole and absolute discretion; provided, however, that each such stock option shall provide for an exercise price equal to the fair market value at the time of the grant of the underlying shares subject thereto, and the terms of any stock option shall be at least equivalent to the terms of any options granted to the next highest ranking executive Chief Executive Officer of the Company, shall participate in the Option Plan, at the time of any grant to the Executive. Executive's eligibility for participation, or times and consistent with the terms and conditions vesting rules generally applicable to other senior executives of any the Company under the Option Plan. (b) If there is a generally applicable award of options or restricted shares to senior executives of the Company other than an award of options under the Option Plan, Txxxx shall participate in such award(s) on terms consistent with the Company's then-current practices with respect to awards made to other senior executives. The Compensation Committee of the Board, in its sole discretion, shall determine whether and to what extent stock options hereunder shall be granted to Txxxx under the Option Plan. (c) In accordance with the terms of the 1998 Employment Agreement, the Company granted to Txxxx an option (the "Option") to acquire 300,000 shares (the "Option Shares") of the Company's common stock, $2.00 par value, at an exercise price of $4.375 per share, the closing price of the Company" s common stock, as quoted on NASDAQ, as of the close of business on December 11, 1998, the date of grant. The terms of the Option are set forth in a separate official stock option plan documents, Non-Qualified Stock Option Agreement entered into between the terms Company and conditions Txxxx. (d) In the event of which shall exclusively govern the award, vesting, exercise and all other aspects an "Equity Change in Control" of the Company, as that term is defined in Exhibit C hereto, then all of Txxxx'x awards of stock options described in this Paragraph. As provided in Paragraph 7(e)(i)(C) options, restricted shares or upon the occurrence of a "Change of Control" (as defined below), all then outstanding stock options and all other similar equity-based or equity-related compensation rights or entitlements theretofore granted or awarded to the Executive by the Company, including but interests which have not limited to those stock options granted to the Executive under this Paragraph 5(c), already vested shall automatically and immediately become fully vested and exercisable and relieved of any and all otherwise applicable transfer restrictions, lock-up or performance requirements and other 2 restrictions and/or contingencies of any kind. For purposes hereof, a "Change of Control" shall be deemed to have occurred as of the earliest of any of the following to occur during the Term:vest in full. (ie) The closing of a transaction by the Company or any person (other than the Company, any subsidiary of the Company or any employee benefit plan of the Company or of any CCC is an indirect wholly-owned subsidiary of the Company) . CCC serves as the general partner or managing general partner of eight (a "Person")8) California limited partnerships organized to own and manage marine cargo containers. Since 1992, together with all "affiliates and "associates" (within Txxxx has served as President of CCC. Txxxx shall continue to serve as President of CCC during the meanings of such terms under Rule 12b-2 Term. Under the relevant partnership agreements of the Securities Exchange Act of 1934container partnerships, CCC, as amended) general partner, is entitled to various forms of compensation. The Company agrees to allocate and distribute to Txxxx, as additional incentive compensation, for the term of the container partnerships paying such compensation, three percent (the "Exchange Act"3%) of such Person, the container partnerships" fees and distributions payable and distributable to CCC. The incentive compensation payable to Txxxx under the provisions of this subsection (e) shall be the beneficial owner of thirty percent (30%) or more payable to him by CCC quarterly and shall be paid to Txxxx regardless of the Company's then outstanding voting stock ("Beneficial Ownership"); (ii) A change in termination of this Agreement by either Party prior to the constituency expiration of the Board such that, during any period term of thirty-six (36) consecutive months, at least a majority of the entire Board of Directors of the Company shall not consist of Incumbent Directors. For purposes of this paragraph, "Incumbent Directorscontainer partnerships" shall mean individuals who at the beginning of such thirty-six (36) month period constitute the Board, unless the election or nomination for election by the shareholders of the Company of each such new director was approved by a vote of a majority of the Incumbent Directors;agreements with CCC.

Equity Based Incentive Compensation. (a) Upon commencement of employment, Executive will be granted a ten-year stock option under the Company's 1999 Stock Option Plan (the "Plan") to purchase 1,500,000 shares of the Company's common stock, which option will vest as to 25,000 shares on each of the first sixty (60) monthly anniversaries of Executive's date of commencement of employment with the Company (the "Option"). To the extent permitted by applicable law, a portion of the Option will be treated as an incentive stock option ("ISO") pursuant to Section 422 of the Internal Revenue Code (the "Code"). The exercise price for the Option will be equal to the closing price reported by Nasdaq National Market on the date Executive countersigns this Agreement; provided, however, the exercise price with respect to the portion of the Option that is treated as an ISO cannot be less than the closing Nasdaq National Market price on the date of commencement of employment, and the exercise price of the portion of the Option that is not an ISO cannot be less than eighty-five (85%) of the closing Nasdaq National Market price on the date of commencement of employment. In the event of termination of Executive's employment by the Company without Cause (as defined in Exhibit A) or by Executive for Good Reason (as defined in Exhibit A), the Option will fully vest and be exercisable over the next two years, subject to early termination in accordance with Section 11.2(a) of the Plan. When the Company or its affiliate, Lilly ICOS LLC, receives FDA approval of an NDA, the last 300,000 shares to vest under the Option will accelerate in vesting as of the date of approval. If such approval occurs before June 30, 2002, an additional stock option for 300,000 shares will be granted as of such approval under the Plan or any other Company stock option plan then in effect, such option to have an exercise price equal to the closing price on the date of grant and to vest in equal monthly amounts over a forty-eight-month (48) period. The Plan Administrator of the Plan will permit Executive to pay the exercise price for the Option by surrendering other common stock of the Company in accordance with Section 7.5(b) of the Plan and to pay any withholding taxes in connection with the exercise of the Option by surrendering other common stock of the Company or having the Company withhold shares issuable upon the exercise, in accordance with Section 9 of the Plan. (b) The Option will include a provision that, in the event the exercise price for the Option or any taxes due on its exercise are paid by the surrender of other common stock of the Company or, for the payment of withholding taxes, by withholding of shares, Executive will be granted an option (a "Replacement Option") under the Plan to purchase a number of shares of common stock of the Company equal to the number of shares surrendered and/or withheld, provided the then fair market value of the Company's common stock is at least twenty-five percent (25%) higher than the exercise price of the Option. The exercise price of the Replacement Option will be the closing Nasdaq National Market price as of the grant date of the Replacement Option. The Replacement Option will be a nonqualified stock option which will first be exercisable six (6) months after the grant date, will have a term equal to the remainder of the term of the original Option and will have such other terms as are similar to the terms used by Xxxxxx Laboratories in its replacement options so long as not inconsistent with the Company's Plan. An additional Replacement Option will not be granted upon the exercise of a previously issued Replacement Option if that previously granted Replacement Option is exercised in the same calendar year that it was granted. (c) Executive shall be granted eligible to receive future grants of stock options pursuant to the Company's Management Incentive Program or similar stock-based bonus program consistent with awards granted to other senior executives of the Company. (d) Executive shall be eligible to receive future periodic (i.e., non- bonus-related) grants under the Company's stock incentive plans from time programs consistent with competitive pay practices generally and with awards made to time, which stock options shall be "incentive stock options" (within the meaning of Section 422(b) of the Internal Revenue Code of 1986, as amended (the "Code")), to the maximum extent permissible under Section 422(d) of the Code. The amounts of such grants shall be determined by the Compensation Committee in its sole and absolute discretion; provided, however, that each such stock option shall provide for an exercise price equal to the fair market value at the time of the grant of the underlying shares subject thereto, and the terms of any stock option shall be at least equivalent to the terms of any options granted to the next highest ranking executive other senior executives of the Company, at the time of any grant to the Executive. Executive's eligibility for participation, and the terms and conditions of any stock options hereunder shall be set forth in separate official stock option plan documents, the terms and conditions of which shall exclusively govern the award, vesting, exercise and all other aspects of the stock options described in this Paragraph. As provided in Paragraph 7(e)(i)(C) or upon the occurrence of a "Change of Control" (as defined below), all then outstanding stock options and all other equity-based or equity-related compensation rights or entitlements theretofore granted or awarded to the Executive by the Company, including but not limited to those stock options granted to the Executive under this Paragraph 5(c), shall automatically and immediately become fully vested and exercisable and relieved of any and all otherwise applicable transfer restrictions, lock-up or performance requirements and other 2 restrictions and/or contingencies of any kind. For purposes hereof, a "Change of Control" shall be deemed to have occurred as of the earliest of any of the following to occur during the Term: (i) The closing of a transaction by the Company or any person (other than the Company, any subsidiary of the Company or any employee benefit plan of the Company or of any subsidiary of the Company) (a "Person"), together with all "affiliates and "associates" (within the meanings of such terms under Rule 12b-2 of the Securities Exchange Act of 1934, as amended) (the "Exchange Act") of such Person, shall be the beneficial owner of thirty percent (30%) or more of the Company's then outstanding voting stock ("Beneficial Ownership"); (ii) A change in the constituency of the Board such that, during any period of thirty-six (36) consecutive months, at least a majority of the entire Board of Directors of the Company shall not consist of Incumbent Directors. For purposes of this paragraph, "Incumbent Directors" shall mean individuals who at the beginning of such thirty-six (36) month period constitute the Board, unless the election or nomination for election by the shareholders of the Company of each such new director was approved by a vote of a majority of the Incumbent Directors;.

Equity Based Incentive Compensation. The Executive shall be granted stock options under the Company's stock incentive plans from time to time, which stock options shall be "incentive stock options" (within the meaning of Section 422(b) of the Internal Revenue Code of 1986, as amended (the "Code")), to the maximum extent permissible under Section 422(d) of the Code. The amounts of such grants shall be determined by the Compensation Committee in its sole and absolute discretion; provided, however, that each such stock option shall provide for an exercise price equal to the fair market value at the time of the grant of the underlying shares subject thereto, and the terms of any stock option shall be at least equivalent to the terms of any options granted to the next highest ranking executive of the Company, at the time of any grant to the Executive. The Executive's eligibility for participation, and the terms and conditions of any stock options hereunder shall be set forth in separate official stock option plan documents, the terms and conditions of which shall exclusively govern the award, vesting, exercise and all other aspects of the stock options described in this ParagraphParagraph 5(c). As provided in Paragraph 7(e)(i)(CParagraphs 7(e)(iii)(E) or 7(f)(ii)(E), as applicable, or upon the occurrence of a "Change of Control" (as defined below), all then outstanding stock options and all other equity-based or equity-related compensation rights or entitlements theretofore granted or awarded to the Executive by the Company, including but not limited to those stock options granted to the Executive under this Paragraph 5(c), shall automatically and immediately become fully vested and exercisable and relieved of any and all otherwise applicable transfer restrictions, lock-up or performance requirements and other 2 restrictions and/or contingencies of any kind. For purposes hereof, a "Change of Control" shall be deemed to have occurred as of the earliest of any of the following to occur during the Term: (i) The closing of a transaction by the Company or any person (other than the Company, any subsidiary of the Company or any employee benefit plan of the Company or of any subsidiary of the Company) (a "Person"), together with all "affiliates and "associates" (within the meanings of such terms under Rule 12b-2 of the Securities Exchange Act of 1934, as amended) (the "Exchange Act") of such Person, shall be the beneficial owner of thirty percent (30%) or more of the Company's then outstanding voting stock ("Beneficial Ownership"); (ii) A change in the constituency of the Board such that, during any period of thirty-six (36) consecutive months, at least a majority of the entire Board of Directors of the Company shall not consist of Incumbent Directors. For purposes of this paragraphParagraph 5(c)(ii), "Incumbent Directors" shall mean individuals who at the beginning of such thirty-six (36) month period constitute the Board, unless the election or nomination for election by the shareholders of the Company of each such new director was approved by a vote of a majority of the Incumbent Directors;