INVITROGEN CORPORATION RESTRICTED STOCK AGREEMENT
Exhibit 99.1
INVITROGEN CORPORATION
RESTRICTED STOCK AGREEMENT
Invitrogen Corporation (the "Company") has granted to Xxxxxx Xxxxxxxxx (the "Participant") an Award consisting of Shares subject to the terms and conditions set forth in this Restricted Stock Agreement (the "Agreement"). The Award has been granted as an essential and material inducement to the Participant accepting employment with the Company. By signing this Agreement, the Participant: (a) represents that the Participant has read and is familiar with the terms and conditions of the Award and this Agreement, (b) accepts the Award subject to all of the terms and conditions of this Agreement, (c) agrees to accept as binding, conclusive and final all decisions or interpretations of the Board upon any questions arising under this Agreement, and (d) acknowledges receipt of a copy of this Agreement.
1. | DEFINITIONS AND CONSTRUCTION. |
(a) “Date of Grant” means the date of Participant’s first employment with the Company.
(b) “Award” means a total of 25,000 shares of Stock granted to the Participant pursuant to the terms and conditions of this Agreement.
(c) “Board” means the Board of Directors of the Company. If one or more Committees have been appointed by the Board to administer this Agreement, "Board” also means such Committee(s).
(d) “Cause” shall mean (A) repeated violations by the Participant of the Participant’s material responsibilities and material duties, (B) commission of an intentional act of fraud, embezzlement or theft by the Participant in connection with the Participant’s duties or in the course of the Participant’s employment with the Company or its affiliated companies, (C) violation of any law, regulation, or rule applicable to the Company’s business or reputation, including, without limitation securities laws, (D) causing intentional wrongful damage to property of the Company or its affiliated companies, (E) intentionally and wrongfully disclosing secret processes or confidential information of the Company or its affiliated companies, (F) conviction of, or plea of nolo contendere to, a felony, which conviction or plea materially xxxxx the business or reputation of the Company, or (G) participating, without the Company’s express written consent, in the management of any business enterprise which engages in substantial and direct competition with the Company or its affiliated companies.
(e) “Change-in-Control Agreement” means the Change-in-Control Agreement entered into between the Company and the Participant dated as of May 26, 2003.
(f) “Code” means the Internal Revenue Code of 1986, as amended, and any applicable regulations promulgated thereunder.
(g) “Committee” means the Compensation and Organization Committee or other committee of the Board duly appointed to administer the Agreement and having such powers as shall be specified by the Board. If no committee of the Board has been appointed to administer the Agreement, the Board shall exercise all of the powers of the Committee granted herein, and, in any event, the Board may in its discretion exercise any or all of such powers.
(h) “Company” means Invitrogen Corporation, a Delaware corporation, or any successor corporation thereto.
(i) “Exchange Act” means the Securities Exchange Act of 1934, as amended.
(j) “Fair Market Value” means, as of any date, the value of a share of Stock or other property as determined by the Board, in its discretion, or by the Company, in its discretion, if such determination is expressly allocated to the Company herein, subject to the following:
(i) If, on such date, the Stock is listed on a national or regional securities exchange or market system, the Fair Market Value of a share of Stock shall be the closing price of a share of Stock (or the mean of the closing bid and asked prices of a share of Stock if the Stock is so quoted instead) as quoted on the Nasdaq National Market, The Nasdaq SmallCap Market or such other national or regional securities exchange or market system constituting the primary market for the Stock, as reported in The Wall Street Journal or such other source as the Company deems reliable. If the relevant date does not fall on a day on which the Stock has traded on such securities exchange or market system, the date on which the Fair Market Value shall be established shall be the last day on which the Stock was so traded prior to the relevant date, or such other appropriate day as shall be determined by the Board, in its discretion.
(ii) If, on such date, the Stock is not listed on a national or regional securities exchange or market system, the Fair Market Value of a share of Stock shall be as determined by the Board in good faith without regard to any restriction other than a restriction which, by its terms, will never lapse.
(k) “Good Reason” shall mean, without the Participant’s express written consent (and except in consequence of a prior termination of the Participant’s employment), the occurrence of any of the following circumstances:
(i) a substantial diminution in the Participant’s position, authority, duties or responsibilities, excluding non-substantial changes in title or office, and excluding any isolated, insubstantial and inadvertent action not taken in bad faith and which is remedied by the Company promptly after receipt of written notice thereof given by the Participant; or
(ii) any failure of the Company to obtain, prior to the closing of any transaction that results in a Change in Control of the Company (as defined in the Change-In-
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Control Agreement), an agreement from any successor, satisfactory to the Participant in his sole discretion, to assume and agree to perform this Agreement.
(l) “Parent Corporation” means any present or future “parent corporation” of the Company, as defined in Section 424(e) of the Code.
(m) “Participant” means Xxxxxx Xxxxxxxxx.
(n) “Participating Company” means the Company or any Parent Corporation or Subsidiary Corporation.
(o) “Participating Company Group” means, at any point in time, all corporations collectively which are then Participating Companies.
(p) “Restriction Period” means the period established in accordance with Section 3 during which shares subject the Award are subject to Vesting Conditions.
(q) “Securities Act” means the Securities Act of 1933, as amended.
(r) “Service” means the Participant’s employment or service with the Participating Company Group, whether in the capacity of an Employee, a director or a consultant. The Participant’s Service shall not be deemed to have terminated merely because of a change in the capacity in which the Participant renders service to the Participating Company Group or change in the Participating Company for which the Participant renders Service, provided that there is no interruption or termination of the Participant’s Service. Furthermore, the Participant’s Service with the Participating Company Group shall not be deemed to have terminated if the Participant takes any military leave, sick leave, or other bona fide leave of absence approved by the Company. The Participant’s Service shall be deemed to have terminated either upon an actual termination of Service or upon the corporation for which the Participant performs Service ceasing to be a Participating Company. Subject to the foregoing, the Company, in its sole discretion, shall determine whether the Participant’s Service has terminated and the effective date of such termination.
(s) “Shares” means the shares of Stock granted pursuant to this Agreement and such other or additional securities or property to which the Participant may become entitled pursuant to Section 7.
(t) “Stock” means the common stock of the Company, as adjusted from time to time in accordance with Section 4.2.
(u) “Subsidiary Corporation” means any present or future “subsidiary corporation” of the Company, as defined in Section 424(f) of the Code.
(v) “Vesting Conditions” mean those conditions established in accordance with Section 3 of this Agreement prior to the satisfaction of which shares subject to the Award remain subject to forfeiture or a repurchase option in favor of the Company.
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2. | THE AWARD. |
3. | VESTING CONDITIONS. |
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Service to the Participating Company Group has not terminated prior to such date. The remaining fifty percent (50%) of the Shares granted under this Award shall vest on the fourth anniversary of the Date of Grant, provided that as of that date the Participant has not terminated Service with the Participating Company Group. Except as provided in Section 3.2, no additional Shares will become vested following the Participant’s termination of Service for any reason.
4. | COMPANY REACQUISITION RIGHT. |
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5. | TAX MATTERS. |
5.2 Election Under Section 83(b) of the Code.
(a) The Participant understands that Section 83 of the Code taxes as ordinary income the difference between the amount paid for the Shares, if anything, and the Fair Market Value of the Shares as of the date on which the Shares are “substantially vested,” within the meaning of Section 83. In this context, “substantially vested” means that the right of the Company to reacquire the Shares pursuant to the Company Reacquisition Right has lapsed. The Participant understands that he or she may elect to have his or her taxable income determined at the time he or she acquires the Shares rather than when and as the Company Reacquisition Right lapses by filing an election under Section 83(b) of the Code with the Internal Revenue Service no later than thirty (30) days after the date of acquisition of the Shares. The Participant understands that failure to make a timely filing under Section 83(b) will result in his or her recognition of ordinary income, as the Company Reacquisition Right lapses, on the difference between the purchase price, if anything, and the Fair Market Value of the Shares at the time such restrictions lapse. The Participant further understands, however, that if Shares with respect to which an election under Section 83(b) has been made are forfeited to the Company pursuant to its Company Reacquisition Right, such forfeiture will be treated as a sale on which there is realized a loss equal to the excess (if any) of the amount paid (if any) by the Participant for the forfeited Shares over the amount realized (if any) upon their forfeiture. If the Participant has paid nothing for the forfeited Shares and has received no payment upon their forfeiture, the Participant understands that he or she will be unable to recognize any loss on the forfeiture of the Shares even though the Participant incurred a tax liability by making an election under Section 83(b).
(b) The Participant understands that he or she should consult with his or her tax advisor regarding the advisability of filing with the Internal Revenue Service an election under Section 83(b) of the Code, which must be filed no later than thirty (30) days after the date of the acquisition of the Shares pursuant to this Agreement. Failure to file an election
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under Section 83(b), if appropriate, may result in adverse tax consequences to the Participant. The Participant acknowledges that he or she has been advised to consult with a tax advisor regarding the tax consequences to the Participant of the acquisition of Shares hereunder. ANY ELECTION UNDER SECTION 83(b) THE PARTICIPANT WISHES TO MAKE MUST BE FILED NO LATER THAN 30 DAYS AFTER THE DATE ON WHICH THE PARTICIPANT ACQUIRES THE SHARES. THIS TIME PERIOD CANNOT BE EXTENDED. THE PARTICIPANT ACKNOWLEDGES THAT TIMELY FILING OF A SECTION 83(b) ELECTION IS THE PARTICIPANT’S SOLE RESPONSIBILITY, EVEN IF THE PARTICIPANT REQUESTS THE COMPANY OR ITS REPRESENTATIVE TO FILE SUCH ELECTION ON HIS OR HER BEHALF.
(c) The Participant will notify the Company in writing if the Participant files an election pursuant to Section 83(b) of the Code. The Company intends, in the event it does not receive from the Participant evidence of such filing, to claim a tax deduction for any amount which would otherwise be taxable to the Participant in the absence of such an election.
6. | ESCROW. |
7. | ADJUSTMENTS FOR CHANGES IN CAPITAL STRUCTURE. |
In the event of any stock dividend, stock split, reverse stock split, recapitalization, merger, combination, exchange of shares, reclassification, or similar change in the capital structure of the Company, appropriate adjustments shall be made in the number and class of shares subject to this Agreement. Any and all new, substituted or additional securities or other property to which Participant is entitled by reason of his or her ownership of the Shares will be
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immediately subject to the provisions of this Agreement and the Escrow on the same basis as all Shares originally acquired hereunder and will be included in the terms “Shares” and “Stock” for all purposes of this Agreement and the Escrow with the same force and effect as the Shares presently subject thereto. The adjustments determined by the Board pursuant to this Section 7 shall be final, binding and conclusive.
8. | CHANGE IN CONTROL. |
In the event of a Change in Control, any Unvested Shares may also become vested to the extent provided by the Change-in-Control Agreement.
9. | LEGENDS. |
The Company may at any time place legends referencing the Company Reacquisition Right and any applicable federal, state or foreign securities law restrictions on all certificates representing the Shares. The Participant shall, at the request of the Company, promptly present to the Company any and all certificates representing the Shares in the possession of the Participant in order to carry out the provisions of this Section.
10. | TRANSFERS IN VIOLATION OF AGREEMENT. |
No Shares may be sold, exchanged, transferred (including, without limitation, any transfer to a nominee or agent of the Participant), assigned, pledged, hypothecated or otherwise disposed of, including by operation of law, in any manner which violates any of the provisions of this Agreement and, except pursuant to a “Change in Control” as defined in the Change-in-Control Agreement, until the date on which such shares become Vested Shares, and any such attempted disposition shall be void. The Company shall not be required (a) to transfer on its books any Shares which will have been transferred in violation of any of the provisions set forth in this Agreement or (b) to treat as owner of such Shares or to accord the right to vote as such owner or to pay dividends to any transferee to whom such Shares will have been so transferred. In order to enforce its rights under this Section, the Company shall be authorized to give a stop transfer instruction with respect to the Shares to the Company’s transfer agent.
11. | RIGHTS AS A STOCKHOLDER. |
The Participant shall have no rights as a stockholder with respect to any Shares subject to the Award until the date of the issuance of a certificate for such Shares (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company). No adjustment shall be made for dividends, distributions or other rights for which the record date is prior to the date such certificate is issued, except as provided in Section 7. Subject to the provisions of this Agreement, the Participant shall be entitled to all rights and privileges of a stockholder of the Company with respect to Shares deposited in the Escrow pursuant to Section 6.
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12. | RIGHT TO CONTINUED SERVICE WITH THE COMPANY. |
Nothing in this Agreement shall confer upon the Participant any right to continue in the Service of the Company or interfere in any way with any right of the Company to terminate the Participant’s Service at any time.
13. | MISCELLANEOUS PROVISIONS. |
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warranties among the Participant and the Participating Company Group with respect to such subject matter other than those as set forth or provided for herein or therein.
13.8 Applicable Law. The Agreement shall be governed by the laws of the State of California as such laws are applied to agreements between California residents entered into and to be performed entirely within the State of California.
By their signatures below, the Company and the Participant agree that the Award is governed by the provisions of this Agreement. The Participant acknowledges receipt of a copy of this Agreement, and represents that the Participant has read and is familiar with the provisions of the Agreement, and hereby accepts the Award subject to all applicable terms and conditions.
INVITROGEN CORPORATION | PARTICIPANT | |||
By: /s/ C. Xxxx Xxxxxx
C. Xxxx Xxxxxx Its: Chief Financial Officer Date: September 2, 2003 |
/s/ Xxxxxx Xxxxxxxxx
Xxxxxx Xxxxxxxxx Date: September 2, 2003 |
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Address: |
Invitrogen Corporation ATTN: General Counsel and Chief Financial Officer 0000 Xxxxxxx Xxxxxx Xxxxxxxx, XX 00000 |
Address: 0000 Xxxxxxx Xxxxxx Xxxxxxxx, XX 00000 |
ATTACHMENTS: | Joint Escrow Instructions and Assignment Separate from Certificate |
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