ADDENDUM
TO
STOCK OPTION AGREEMENT
The following provisions are hereby incorporated into, and are
hereby made a part of, that certain Stock Option Agreement dated
__________________ (the "Option Agreement") by and between Atlantic
Pharmaceuticals, Inc. (the "Corporation") and __________________ ("Optionee")
evidencing the stock option granted on such date to Optionee under the terms of
the Corporation's 1995 Stock Option Plan, and such provisions shall be effective
immediately. All capitalized terms in this Addendum, to the extent not otherwise
defined herein, shall have the meanings assigned to them in the Option
Agreement.
INVOLUNTARY TERMINATION FOLLOWING
CHANGE IN CONTROL
1. The exercisability of the option shall not accelerate upon
the occurrence of a Change in Control, and the option shall, over Optionee's
continued period of Service after the Change in Control, continue to become
exercisable for the Option Shares in accordance with the provisions of the
Option Agreement. However, immediately upon an Involuntary Termination of
Optionee's Service within eighteen (18) months following the Change in Control,
the exercisability of this option, to the extent the option is at the time
outstanding but not otherwise fully exercisable, shall automatically accelerate
so that the option shall immediately become fully exercisable for all the Option
Shares at the time subject to the option and may be exercised for any or all of
those shares as fully vested shares of Common Stock at any time prior to the
earlier of (i) the Expiration Date or (ii) the expiration of the one (1)-year
period measured from the date of the Involuntary Termination.
2. For purposes of this Addendum, a Change in Control shall be
deemed to occur in the event of a change in ownership or control of the
Corporation effected through either of the following transactions:
(i) the acquisition, directly or indirectly, by any
person or related group of persons (other than the Corporation or a
person that directly or indirectly controls, is controlled by, or is
under common control with, the Corporation) of beneficial ownership
(within the meaning of Rule 13d-3 of the Securities Exchange Act of
1934, as amended) of securities possessing more than fifty percent
(50%) of the total combined voting power of the Corporation's
outstanding securities pursuant to a tender or exchange offer made
directly to the Corporation's stockholders which the Board does not
recommend such stockholders to accept, or
(ii) a change in the composition of the Board over a
period of thirty-six (36) consecutive months or less such that a
majority of the Board members ceases by reason of one or more contested
elections for Board membership, to be comprised of individuals who
either (A) have been Board members continuously since the beginning of
such period or (B) have been elected or nominated for election as Board
members during such period by at least a majority of the Board members
described in clause (A) who were still in office at the time such
election or nomination was approved by the Board.
3. The provisions of Paragraph 1 of this Addendum shall govern
the period for which the option is to remain exercisable following the
Involuntary Termination of Optionee's Service within eighteen (18) months after
the Change in Control and shall supersede any provisions to the contrary in the
Option Agreement.
IN WITNESS WHEREOF, Atlantic Pharmaceuticals, Inc. has caused
this Addendum to be executed by its duly-authorized officer, and Optionee has
executed this Addendum, all as of the Effective Date specified below.
ATLANTIC PHARMACEUTICALS, INC.
By: ____________________________________
Title: ____________________________________
___________________________________________
OPTIONEE
EFFECTIVE DATE: ____________, 199___
2.
