Exhibit 10.16
ALLERGAN, INC.
2003 NONEMPLOYEE DIRECTOR EQUITY INCENTIVE PLAN
NON-QUALIFIED STOCK OPTION AWARD AGREEMENT
This Non-qualified Stock Option Agreement ("Agreement") is entered into as
of May __, 200_, (the "Date of Grant") between Allergan, Inc., a Delaware
corporation (the "Company"), and [INSERT NAME OF DIRECTOR], a director of the
Company (the "Director").
The Company has adopted and the stockholders of the Company have approved
the 2003 Nonemployee Director Equity Incentive Plan, as amended (the "Plan").
Pursuant to Section 3.1 of the Plan and in consideration of the services
rendered and to be rendered by the Director, the Company has granted an option
to the Director upon the terms and conditions set forth in the Plan and this
Agreement.
1. NUMBER OF OPTION SHARES. This Agreement evidences the grant by the
Company to the Director of a non-qualified stock option (the "Option") to
purchase, from time to time, an aggregate of 5,700 shares (the "Option Shares")
of the Company's Common Stock, par value $0.01 per share (the "Common Stock"),
under Section 3.1 of the Plan, subject to the terms and conditions and to
adjustment as set forth herein or in the Plan.
2. OPTION PURCHASE PRICE. Upon exercise of vested Option Shares, the
Director shall pay to the Company $______ per Option Share (the "Option Purchase
Price") being exercised.
3. OPTION EXPIRATION DATE. Unless terminated sooner in accordance with the
provisions of the Plan or this Agreement, the right to exercise the Option shall
expire on the close of business on the business day immediately preceding the
tenth (10th) anniversary of the Date of Grant (the "Expiration Date").
4. VESTING RESTRICTIONS. Subject to the provisions of Section 5 of this
Agreement and to adjustment pursuant to Section 4.2 of the Plan, the Option
shall become fully vested and exercisable as to all Option Shares on the date of
the regular annual meeting of stockholders of the Company at which directors are
to be elected following the Date of Grant.
5. EFFECT OF CERTAIN EVENTS ON VESTING AND EXERCISE.
a. TERMINATION OF SERVICE.
(i) General. If the Director ceases to serve as a director of the
Company for any reason other than such Director's death or total disability, any
portion of the Option that has not vested as of such termination of service
shall be forfeited.
(ii) Termination as a Result of Death or Disability. If the
Director ceases to serve as a director of the Company by reason of such
Director's death or total disability, the Option shall vest immediately as to
the entire number of Option Shares.
b. CHANGE OF CONTROL. Upon the occurrence of a Change of Control (as
defined in Section 4.3 of the Plan), the Option shall vest immediately as to the
entire number of Option Shares.
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c. EXERCISE PERIOD FOLLOWING TERMINATION OF SERVICE.
(i) In the event the Director ceases to be a director by reason
of such Director's voluntary resignation or removal for cause, any unexercised
portion of the Option that is vested as of such termination of service may be
exercised by the Director at any time within three (3) months following such
termination of service, but in no event after the Expiration Date.
(ii) In the event the Director ceases to be a director other than
by reason of such Director's voluntary resignation or removal for cause, any
unexercised portion of the Option that is vested as of such termination of
service may be exercised by the Director or by the Director's personal
representative or by the person or persons to whom the Option shall have been
transferred by will or the laws of descent and distribution at any time within
twelve (12) months following such termination of service, but in no event after
the Expiration Date.
6. EXERCISE OF OPTION.
a. All or a portion of the vested Option may be exercised in
accordance with procedures (including requisite holding periods) established
from time to time by the Board.
b. Payment of the aggregate Option Purchase Price for the number of
vested Option Shares for which the Option is being exercised shall be made (i)
in cash or by check, (ii) by delivery of a notice that the Director has placed a
market sell order with a broker with respect to shares of Common Stock then
issuable upon exercise of the Option, and the broker pays a sufficient portion
of the net proceeds of the sale to the Company in satisfaction of the aggregate
Option Purchase Price, provided that the Company shall not deliver such shares
until payment of such proceeds is received by the Company, or (iii) by any
combination of the foregoing. However, the Board of Directors may, in its
discretion, (x) allow payment, in whole or in part, through the delivery of
shares of Common Stock which have been owned by the Director for at least six
(6) months, duly endorsed for transfer to the Company with a Fair Market Value
on the date of delivery equal to the aggregate Option Purchase Price of the
Option or exercised portion thereof, (y) allow payment, in whole or in part,
through the delivery of property of any kind which constitutes good and valuable
consideration, or (z) allow payment through any combination of the foregoing.
c. The Director agrees, with respect to the Option, to pay to the
Company an amount sufficient to satisfy any taxes or other amounts required by
any governmental authority to be withheld and paid over to such authority for
his or her account, or to otherwise make arrangements satisfactory to the Board
for the payment of such amounts.
d. Subject to adjustment pursuant to Section 4.2 of the Plan, a
minimum of six months shall elapse between the Date of Grant and the sale of any
of the Option Shares. No shares of Common Stock shall be issued or transferred
upon exercise of the Option unless and until all legal requirements applicable
to the issuance or transfer of such Common Stock have been complied with to the
satisfaction of the Board.
7. NO ASSIGNABILITY. The Option is not assignable or transferable by the
Director, except by will or by the laws of descent and distribution and shall
not be subject to any encumbrance, pledge or charge of any nature. During the
lifetime of the Director, the Option may be exercised only by the Director or,
if the Director becomes disabled, by the Director's guardian or legal
representative. The restrictions on exercise and transfer shall not be deemed to
prohibit, to the extent permitted by the Board, transfers to any one or more
Permitted Transferees (as defined below), subject to the following terms and
conditions: (i) the Option shall not be assignable or transferable by the
Permitted Transferee other than by will or the laws of descent
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and distribution; (ii) the Option which is transferred to a Permitted Transferee
shall continue to be subject to all the terms and conditions of the Option as
applicable to the Director (other than the ability to further transfer the
Option); and (iii) the Director and the Permitted Transferee shall execute any
and all documents requested by the Board, including, without limitation
documents to (x) confirm the status of the transferee as a Permitted Transferee,
(y) satisfy any requirements for an exemption for the transfer under applicable
federal and state securities laws and (z) evidence the transfer. For purposes of
this Section 7, "Permitted Transferee" shall mean, with respect to a Director,
any child, stepchild, grandchild, parent, stepparent, grandparent, spouse,
former spouse, sibling, niece, nephew, mother-in-law, father-in-law, son-in-law,
daughter-in-law, brother-in-law, or sister-in-law, including adoptive
relationships, any person sharing the Director's household (other than a tenant
or employee), a trust in which these persons (or the Director) control the
management of assets, and any other entity in which these persons (or the
Director) own more than fifty percent of the voting interests, or any other
transferee specifically approved by the Board after taking into account any
state or federal tax or securities laws applicable to transferable non-qualified
stock options.
8. GENERAL TERMS. The Director acknowledges receipt of a copy of the Plan
and the Plan Prospectus. The Option and this Agreement are subject to, and the
Company and the Director agree to be bound by, the provisions of the Plan and
the Plan Prospectus that apply to the Option. Such provisions are incorporated
herein by this reference. In the event of a conflict between the terms of this
Agreement and the Plan, the Plan shall be the controlling document. Capitalized
terms used but not defined herein shall have the respective meanings ascribed to
them in the Plan.
9. OTHER PROVISIONS.
a. Neither the Director nor any other person entitled to exercise the
Option shall have any rights as a stockholder with respect to any Option Shares
until the date the Director or such other person becomes the holder of record of
such Option Shares following exercise of the Option.
b. The Director acknowledges that the Company has the right to amend,
suspend or terminate the Plan in any respect whatsoever at any time (including,
but not limited to, the power to amend the number of shares subject to awards
granted thereunder) except to the extent prohibited by law and except that no
such amendment, suspension or termination may, without the Director's consent,
adversely affect the rights of the Director under the Option.
c. In the event that any provision this Agreement is held to be
invalid, void or unenforceable, the same shall not affect, in any respect
whatsoever, the validity of any other provision of this Agreement.
d. The rights and obligations under this Agreement shall inure to the
benefit of, and shall be binding upon, the Company and its successors and
assignees and the Director and the Director's heirs, executors, administrators,
personal representations, transferees, assignees and successors in interest.
e. Any communication under this Agreement shall be in writing and
addressed to the Company at 0000 Xxxxxx Xxxxx, Xxxxxx, Xxxxxxxxxx 00000,
Attention: General Counsel and to the Director at the address given beneath the
Director's signature, or at such other address as either party may hereafter
designate in writing to the other.
f. The interpretation, performance and enforcement of the Option and
this Agreement shall be governed by the internal laws of the State of
California.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
THE COMPANY:
ALLERGAN, INC.,
a Delaware corporation
By:
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Xxxxx X.X. Xxxxx,
Chairman of the Board and
Chief Executive Officer
DIRECTOR:
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[INSERT NAME OF DIRECTOR]
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