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EXHIBIT 10.4S
PENEDERM INCORPORATED
EQUITY INCENTIVE PLAN
PERFORMANCE SHARE AWARD AGREEMENT
This PERFORMANCE SHARE AWARD AGREEMENT (the "Agreement") is made and
entered into effective as of JANUARY 1, 1997 (the "Effective Date") by and
between PENEDERM INCORPORATED, a California corporation (the "Company"), and
___________________________ ("Employee").
THE PARTIES AGREE AS FOLLOWS:
1. Award Grant. The Company hereby grants to Employee pursuant to the
Company's Equity Incentive Plan (the "Plan"), a copy of the prospectus for such
Plan being attached to this Agreement as Exhibit 1, a performance share award
(the "Award") on the terms and conditions set forth in this Agreement and in the
Plan, the terms and conditions of the Plan being hereby incorporated into this
Agreement by reference.
2. Terms of Award. Employee shall be paid, subject to Sections 4, 5 and
11, an amount equal to the product of (a) 35% of Employee's base salary paid by
the Company to Employee during calendar year 1997 multiplied by (b) the sum of
(i) the percentage of achievement of the goals set forth on the attached Exhibit
2A, multiplied by .50, (ii) the percentage of achievement of the goals set forth
on the attached Exhibit 2B multiplied by .50, and (iii) the percentage of
achievement of Employee's 1997 objectives set forth on the attached Exhibit 2C
multiplied by .50. Exhibit 2D sets forth examples illustrating this Award.
3. Award Determinations. The Compensation Committee of the Board of
Directors of the Company, in its discretion, shall determine whether any or all
of the goals set forth on Exhibits 2A and B have been attained, and all such
determinations shall be final, conclusive and binding upon the Company and
Employee. The Chief Executive Officer and President of the Company, in his/their
discretion, shall determine whether any or all of the goals on Schedule 2C have
been attained, and all such determinations shall be final, conclusive and
binding upon the Company and Employee.
4. Employment Condition. Employee must be employed by the Company as of
December 31, 1997, and as of the date of Award payment determined by the Company
so as to be eligible to be paid under the Award. The Award shall be paid on or
before March 31, 1998.
5. Award Payment. The Award shall be paid in cash unless the Board of
Directors of the Company, in its absolute discretion, determines that the Award
shall be paid, in whole or in part, by the issuance to Employee of that number
of shares of Company Common Stock having a value on the date of such
determination equal to the cash payment (or portion thereof) otherwise payable
under the Award.
6. Nonassignability of Award. The Award is not assignable or
transferable by Employee.
7. Market Standoff. Employee hereby agrees that if so requested by the
Company or any representative of the underwriters in connection with any
registration of the offering of the securities of the Company under the
Securities Act of 1933, as amended (the "Act"), Employee shall not sell or
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otherwise transfer any shares of Company Common Stock issued to Employee
pursuant to the Award for a period of 180 days following the effective date of a
Registration Statement filed under the Act; provided, that such restriction
shall apply only to the first Registration Statement to become effective under
the Act after the date of this Agreement that includes securities to be sold on
behalf of the Company in an underwritten offering under the Act. The Company may
impose stop-transfer instructions with respect to such shares subject to the
foregoing restrictions until the end of such 180-day period.
8. Restriction on Issuance of Shares. The Company shall not be
obligated to issue any shares of Company Common Stock pursuant to this Agreement
if such issuance, in the opinion of the Company and the Company's counsel, might
constitute a violation by the Company of any provision of law, including without
limitation the Act. The Company shall not be obligated to take any affirmative
action to the issuance of any shares pursuant hereto to comply with any law.
9. EMPLOYEE'S REPRESENTATION. EMPLOYEE HEREBY REPRESENTS AND WARRANTS
TO THE COMPANY THAT THE COMPANY HAS MADE NO REPRESENTATIONS OR WARRANTIES TO
EMPLOYEE WITH RESPECT TO THE INCOME TAX CONSEQUENCES OF THE AWARD OR AWARD
PAYMENT AND EMPLOYEE IS IN NO MANNER RELYING ON THE COMPANY OR THE COMPANY'S
REPRESENTATIVES FOR AN ASSESSMENT OF SUCH TAX CONSEQUENCES.
10. Withholding. The Company may withhold from Employee's wages, or
require Employee to pay to the Company, any applicable withholding or employment
taxes resulting from the payment of the Award, in cash or by issuance of Company
Common Stock.
11. Amendment; Termination. The Award may be amended or terminated at
any time in the absolute discretion of the Board of Directors of the Company.
12. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of California applicable to contracts
entered into and wholly to be performed within the State of California by
California residents.
13. Notices. All notices and other communications under this Agreement
shall be in writing. Unless and until Employee is notified in writing to the
contrary, all notices, communications and documents directed to the Company and
related to this Agreement, if not delivered by hand, shall be mailed, addressed
as follows:
Penederm Incorporated
000 Xxxxxxxx Xxxxx, Xxxxx X
Xxxxxx Xxxx, Xxxxxxxxxx 00000
Attn: Vice President, Finance and Administration
Unless and until the Company is notified in writing to the contrary, all
notices, communications and documents intended for Employee and related to this
Agreement, if not delivered by hand, shall be mailed to Employee's last known
address as shown on the Company's books. Notices and communications shall be
mailed by first class mail, postage prepaid; documents shall be mailed by
registered mail, return receipt requested, postage prepaid. All mailings and
deliveries related to this Agreement shall be deemed received only when actually
received.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
Effective Date.
PENEDERM INCORPORATED
By: _________________________
Employee Name
Title:
Employee hereby accepts and agrees to be bound by all of the terms and
conditions of this Agreement and the Plan.
__________________________
Employee
Employee's spouse indicates by execution of this Agreement his or her consent to
be bound by the terms hereof as to his or her interests, whether as community
property or otherwise, if any, in the Award granted hereunder and in payment
under the Award.
__________________________
Employee's Spouse
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EXHIBIT 2D
Award Illustration for Variable Award Group
The following examples are presented solely for the purpose of illustrating
awards for the "Variable Award Group":
Example 1. If 90% of the goals set forth on Exhibit 2A and 100% of the
Additional Performance Goal for Variable Award Group on Exhibit 2C are achieved
and Employee achieves 70% of the objectives set forth on Exhibit 2B, Employee
shall receive 32.5% of base salary [.25 x ([.9 x .5] + [1 x .5] + [.7 x .5])].
Example 2. If 30% of the goals set forth on Exhibit 2A and 0% of the
Additional Performance Goal for Variable Award Group on Exhibit 2C are achieved
and Employee achieves 90% of the objectives set forth on Exhibit 2B, Employee
shall receive 15% of base salary [.25 x ([.3 x .5] + [0 x .5] + [.9 x .5])].
