1
EXHIBIT 10.50
ADDENDUM
TO
STOCK OPTION AGREEMENT
The following provisions are hereby incorporated into, and are
hereby made a part of, that certain Stock Option Agreement (the "Option
Agreement") by and between CombiChem, Inc. (the "Corporation") and
_____________________________________ ("Optionee") evidencing the stock option
(the "Option") granted on _____________________, 199___ to Optionee under the
terms of the Corporation's 1997 Stock Incentive 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
CORPORATE TRANSACTION/CHANGE IN CONTROL
1. To the extent the Option is, in connection with a
Corporate Transaction, to be assumed in accordance with Paragraph 6 of the
Option Agreement, the Option shall not accelerate upon the occurrence of that
Corporate Transaction, and the Option shall accordingly continue, over
Optionee's period of Service after the Corporate Transaction, to become
exercisable for the Option Shares in one or more installments in accordance
with the provisions of the Option Agreement. However, immediately upon an
Involuntary Termination of Optionee's Service within eighteen (18) months
following such Corporate Transaction, the assumed Option, to the extent
outstanding at the time but not otherwise fully exercisable, shall
automatically accelerate so that the Option shall become immediately
exercisable for all the Option Shares at the time subject to the Option and may
be exercised for any or all of those Option Shares as fully vested shares.
2. The Option shall not accelerate upon the occurrence
of a Change in Control, and the Option shall, over Optionee's period of Service
following such Change in Control, continue to become exercisable for the Option
Shares in one or more installments 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 Option, to the extent outstanding at the time but not otherwise fully
exercisable, shall automatically accelerate so that the Option shall become
immediately exercisable for all the Option Shares at the time subject to the
Option and may be exercised for any or all of those Option Shares as fully
vested shares.
3. The Option as accelerated under Paragraph 1 or 2
shall remain so exercisable until the earlier of (i) the Expiration Date or
(ii) the expiration of the one (1)-year period measured from the date of the
Optionee's Involuntary Termination.
2
4. For purposes of this Addendum the following
definitions shall be in effect:
(i) An INVOLUNTARY TERMINATION shall mean the
termination of Optionee's Service by reason of:
(A) Optionee's involuntary dismissal or
discharge by the Corporation for reasons other than
Misconduct, or
(B) Optionee's voluntary resignation
following (A) a change in Optionee's position with the
Corporation (or Parent or Subsidiary employing Optionee) which
materially reduces Optionee's duties and responsibilities or
the level of management to which Optionee reports, (B) a
reduction in Optionee's level of compensation (including base
salary, fringe benefits and target bonus under any corporate
performance based bonus or incentive programs) by more than
fifteen percent (15%) or (C) a relocation of Optionee's place
of employment by more than fifty (50) miles, provided and only
if such change, reduction or relocation is effected by the
Corporation without Optionee's consent.
(ii) 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:
(A) 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 0000 Xxx) 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, or
(B) 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 (i) have
been Board members continuously since the beginning of such
period or (ii) 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 (i) who were still in office
at the time the Board approved such election or nomination.
2.
3
5. 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 Corporate Transaction or Change in Control and shall supersede any
provisions to the contrary in Paragraph 5 of the Option Agreement.
IN WITNESS WHEREOF, CombiChem, Inc. has caused this Addendum
to be executed by its duly-authorized officer as of the Effective Date
specified below.
COMBICHEM, INC.
By:________________________________
Title:_____________________________
EFFECTIVE DATE: _________________, 199__
3.
