UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): July 20, 2005
NASTECH PHARMACEUTICAL COMPANY INC.
|
Delaware
(State or Other Jurisdiction of Incorporation) |
000-13789
(Commission File Number) |
11-2658569
(IRS Employer Identification No.) |
|
3450 Monte Villa Parkway
Bothell, Washington (Address of Principal Executive Offices) |
98021
(Zip Code) |
(425) 908-3600
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions ( see General Instruction A.2. below):
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 1.01 Entry into a Material Definitive Agreement
On July 20, 2005, pursuant to the authority delegated by the board of directors (the “Board of Directors”) of Nastech Pharmaceutical Company Inc. (the “Company”), and the Employment Agreement dated June 3, 2005 by and between the Company and Dr. Steven C. Quay, M.D., Ph.D., the Company’s Chairman of the Board, President and Chief Executive Officer, the Compensation Committee of the Board of Directors authorized the Company to:
(a) enter into a restricted stock grant agreement, effective July 20, 2005, with Dr. Quay, pursuant to which Dr. Quay was issued 168,000 shares of restricted common stock of the Company, par value $0.006 per share (the “Common Stock”), under the Company’s 2004 Stock Incentive Plan (the “2004 Plan”) originally effective as of April 14, 2004 and amended on July 20, 2005. The restricted Common Stock will vest in four equal annual installments beginning on July 20, 2006. A Copy of the restricted stock grant agreement is filed as Exhibit 10.1 herewith;
(b) enter into an incentive stock option grant agreement, dated as of July 20, 2005, with Dr. Quay pursuant to which Dr. Quay was issued options to purchase 27,172 shares of Common Stock, under the Company’s 2002 Stock Option Plan originally effective as of May 2, 2002. The options have an exercise price of $14.72 per share and will vest in four equal annual installments beginning on July 20, 2006. A copy of the incentive stock option agreement is filed as Exhibit 10.2 herewith; and
(c) enter into a non-qualified stock option grant agreement, dated as of July 20, 2005, with Dr. Quay pursuant to which Dr. Quay was issued options to purchase 572,828 shares of Common Stock, under the Company’s 2002 Stock Option Plan originally effective as of May 2, 2002. The options have an exercise price of $14.72 per share and will vest in four equal annual installments beginning on July 20, 2006. A copy of the incentive stock option agreement is filed as Exhibit 10.3 herewith.
Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.
On July 20, 2005, the Company filed a Restated Certificate of Incorporation (the “Restated Charter”) with the Department of State of the State of Delaware. The Restated Charter was approved by the vote of the holders of a majority of the outstanding shares of the Company’s capital stock at the Company’s annual meeting of stockholders held on July 20, 2005. The Restated Charter provided for an increase in the number of authorized shares of Common Stock from 25,000,000 to 50,000,000, and included additional amendments to modernize, clarify and otherwise make the Company’s Certificate of Incorporation consistent with the Company’s Amended and Restated Bylaws and Delaware law, which additional amendments are described under proposal number 4 of the Company’s notice of annual meeting and proxy statement dated June 9, 2005, which is incorporated herein by reference. A copy of the Restated Charter is filed as Exhibit 3.1 herewith.
Item 8.01 Other Events.
On July 20, 2005, the Company issued a joint press release with Alnylam Pharmaceuticals, Inc.(“Alnylam”) announcing that Alnylam had granted the Company an exclusive InterfeRx™ license to discover, develop, and commercialize RNAi therapeutics directed against TNF-alpha, a protein associated with inflammatory diseases including rheumatoid arthritis. A copy of the press release is filed as exhibit 99.1 herewith.
Also, on July 20, 2005, an amendment to the 2004 Plan (the “2004 Plan Amendment”) was approved by the vote of the holders of a majority of the Company’s outstanding shares of capital stock that were present and entitled to vote at the Company’s annual meeting of stockholders held on July 20, 2005. The 2004 Plan Amendment increases the number of shares authorized under the 2004 Plan by 750,000 shares from 600,000 to 1,350,000 shares, and also increases the annual limit on the number of shares that may be issued to any one employee under the 2004 Plan by 750,000 shares from 100,000 to 850,000 shares. A copy of the Plan Amendment is filed as Exhibit 10.4 herewith.
Item 9.01 Financial Statements and Exhibits.
(c) Exhibits
Exhibit No.
Description
Restated Certificate of Incorporation of Nastech
Pharmaceutical Company Inc. dated July 20, 2005.
Restricted Stock Grant Agreement effective July 20, 2005 by
and between Nastech Pharmaceutical Company Inc. and Dr.
Steven C. Quay, M.D., Ph.D.
Incentive Stock Option Grant Agreement effective July 20,
2005 by and between Nastech Pharmaceutical Company Inc. and
Dr. Steven C. Quay, M.D., Ph.D.
Non-Qualified Stock Option Grant Agreement effective July 20,
2005 by and between Nastech Pharmaceutical Company Inc. and
Dr. Steven C. Quay, M.D., Ph.D.
Amendment No. 1 to Nastech Pharmaceutical Company Inc. 2004
Stock Incentive Plan.
Press Release of Nastech Pharmaceutical Company Inc. dated
July 20, 2005.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly
caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
NASTECH PHARMACEUTICAL COMPANY INC.
By:
/s/ Gregory L. Weaver
Gregory L. Weaver
Chief Financial Officer and Secretary
Table of Contents
EXHIBIT INDEX
Exhibit No.
Description
Restated Certificate of Incorporation of Nastech
Pharmaceutical Company Inc. dated July 20, 2005.
Restricted Stock Grant Agreement effective July 20, 2005 by
and between Nastech Pharmaceutical Company Inc. and Dr.
Steven C. Quay, M.D., Ph.D.
Incentive Stock Option Grant Agreement effective July 20,
2005 by and between Nastech Pharmaceutical Company Inc. and
Dr. Steven C. Quay, M.D., Ph.D.
Non-Qualified Stock Option Grant Agreement effective July 20,
2005 by and between Nastech Pharmaceutical Company Inc. and
Dr. Steven C. Quay, M.D., Ph.D.
Amendment No. 1 to Nastech Pharmaceutical Company Inc. 2004
Stock Incentive Plan.
Press Release of Nastech Pharmaceutical Company Inc. dated
July 20, 2005.
EXHIBIT 3.1
RESTATED CERTIFICATE OF INCORPORATION
OF
NASTECH PHARMACEUTICAL COMPANY INC.
Nastech Pharmaceutical Company Inc., a corporation organized and existing under the laws of the State of Delaware, hereby certifies as follows:
1. The name of the corporation is Nastech Pharmaceutical Company Inc. (hereinafter called the "Corporation") which is the name under which the Corporation was originally incorporated. The original Certificate of Incorporation of the Corporation was filed with the Secretary of State of the State of Delaware on September 23, 1983.
2. This Restated Certificate of Incorporation restates and further amends the provisions of the Certificate of Incorporation of the Corporation as heretofore amended and was adopted by the Corporation's Board of Directors and authorized by a majority of the holders of the outstanding shares of common stock entitled to vote thereon at an annual meeting of stockholders pursuant to Sections 242 and 245 of the General Corporation Law of the State of Delaware.
3. The Restated Certificate of Incorporation hereby reads in its entirety as follows:
"RESTATED CERTIFICATE OF INCORPORATION
OF
NASTECH PHARMACEUTICAL COMPANY INC.
FIRST: The name of the Corporation is NASTECH PHARMACEUTICAL COMPANY INC.
SECOND: The Corporation's registered office in the State of Delaware is located at Corporation Trust Center, 1209 Orange Street, City of Wilmington, County of New Castle, 19801. Its Registered Agent at such address is The Corporation Trust Company.
THIRD: The purpose of the Corporation is to engage in any lawful act or activity for which a corporation may be organized under the General Corporation Law of the State of Delaware.
FOURTH:
(a) The total number of shares of stock which the Corporation shall have authority to issue is 50,000,000 shares of Common Stock, $0.006 par value per share and 100,000 shares of Preferred Stock, $0.01 par value per share.
(b) The designations and the powers, preferences, rights and the qualifications or restrictions thereof are as follows:
The Board of Directors of the Corporation is authorized subject to limitations prescribed by law and this Article Fourth, from time to time to provide for the issuance, without additional authority from the Corporation's shareholders, all or any part of the above authorized Preferred Stock, par value one cent ($0.01) per share, and in connection therewith by resolution or resolutions providing for the issuance of shares thereof, to divide into series any portion of or all of the Preferred Stock, to fix the number of shares constituting such series, and to fix the stated value, fix or alter the voting rights, dividend rights, dividend rates, conversion rights, powers, preferences, rights and terms of redemption, rights upon dissolution or liquidation, and any other special rights, qualifications, limitations, or restrictions of the shares of Preferred Stock of any such series thereof to the full extent now or hereafter permitted by the laws of the State of Delaware.
(c) Ten thousand (10,000) of the authorized shares of Preferred Stock are hereby designated "Series A Junior Participating Preferred Stock."
(d) The rights, preferences, privileges, restrictions and other matters relating to the Series A Junior Participating Preferred Stock are as follows:
Section 1. Designation and Amount. The shares of such series shall be designated as "Series A Junior Participating Preferred Stock" (the "Series A Preferred Stock") and the number of shares constituting the Series A Preferred Stock shall be 10,000. Such number of shares may be increased or decreased by resolution of the Board of Directors of the Corporation (hereinafter called the "Board of Directors" or the "Board"); provided that no decrease shall reduce the number of shares of Series A Preferred Stock to a number less than the number of shares then outstanding plus the number of shares reserved for issuance upon the exercise of outstanding options, rights or warrants or upon the conversion of any outstanding securities issued by the Corporation convertible into Series A Preferred Stock.
Section 2. Dividends and Distributions.
(A) Subject to the rights of the holders of any shares of any series of Preferred Stock (or any similar stock) ranking prior and superior to the Series A Preferred Stock with respect to dividends, the holders of shares of Series A Preferred Stock, in preference to the holders of Common Stock, $.006 par value per share (the "Common Stock"), of the Corporation, and of any other junior stock, shall be entitled to receive, when, as and if declared by the Board of Directors out of funds legally available for the purpose, quarterly dividends payable in cash on the first day of March, June, September and December in each year (each such date being referred to herein as a "Quarterly Dividend Payment Date"), commencing on the first Quarterly Dividend Payment Date after the first issuance of a share or fraction of a share of Series A Preferred Stock, in an amount per share (rounded to the nearest cent) equal to the greater of (a) $10 or (b) subject to the provision for adjustment hereinafter set forth, 1,000 times the aggregate per share amount of all cash dividends, and 1,000 times the aggregate per share amount (payable in kind) of all non-cash dividends or other distributions, other than a dividend payable in shares of Common Stock or a subdivision of the outstanding shares of Common Stock (by reclassification or otherwise), declared on the Common Stock since the immediately preceding Quarterly Dividend Payment Date or, with respect to the first Quarterly Dividend Payment Date, since the first issuance of any share or fraction of a share of Series A Preferred Stock. In the event the Corporation shall at any time declare or pay any dividend on the Common Stock payable in shares of Common Stock, or effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number of shares of Common Stock, then in each such case the amount to which holders of shares of Series A Preferred Stock were entitled immediately prior to such event under clause (b) of the preceding sentence shall be adjusted by multiplying such amount by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event.
(B) The Corporation shall declare a dividend or distribution on the Series A Preferred Stock as provided in paragraph (A) of this Section immediately after it declares a dividend or distribution on the Common Stock (other than a dividend payable in shares of Common Stock); provided that, in the event no dividend or distribution shall have been declared on the Common Stock during the period between any Quarterly Dividend Payment Date and the next subsequent Quarterly Dividend Payment Date, a dividend of $10 per share on the Series A Preferred Stock shall nevertheless be payable on such subsequent Quarterly Dividend Payment Date.
(C) Dividends shall begin to accrue and be cumulative on outstanding shares of Series A Preferred Stock from the Quarterly Dividend Payment Date next preceding the date of issue of such shares, unless the date of issue of such shares is prior to the record date for the first Quarterly Dividend Payment Date, in which case dividends on such shares shall begin to accrue from the date of issue of such shares, or unless the date of issue is a Quarterly Dividend Payment Date or is a date after the record date for the determination of holders of shares of Series A Preferred Stock entitled to receive a quarterly dividend and before such Quarterly Dividend Payment Date, in either of which events such dividends shall begin to accrue and be cumulative from such Quarterly Dividend Payment Date. Accrued but unpaid dividends shall not bear interest. Dividends paid on the shares of Series A Preferred Stock in an amount less than the total amount of such dividends at the time accrued and payable on such shares shall be allocated pro rata on a share-by-share basis among all such shares at the time outstanding. The Board of Directors may fix a record date for the determination of holders of shares of Series A Preferred Stock entitled to receive payment of a dividend or distribution declared thereon, which record date shall be not more than 60 days prior to the date fixed for the payment thereof.
Section 3. Voting Rights. The holders of shares of Series A Preferred Stock shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set forth, each share of Series A Preferred Stock shall entitle the holder thereof to 1,000 votes on all matters submitted to a vote of the stockholders of the Corporation. In the event the Corporation shall at any time declare or pay any dividend on the Common Stock payable in shares of Common Stock, or effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number of shares of Common Stock, then in each such case the number of votes per share to which holders of shares of Series A Preferred Stock were entitled immediately prior to such event shall be adjusted by multiplying such number by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event.
(B) Except as otherwise provided herein, in any other Designation of Rights, Terms and Preferences creating a series of Preferred Stock or any similar stock, or by law, the holders of shares of Series A Preferred Stock and the holders of shares of Common Stock and any other capital stock of the Corporation having general voting rights shall vote together as one class on all matters submitted to a vote of stockholders of the Corporation.
(C) Except as set forth herein, or as otherwise provided by law, holders of Series A Preferred Stock shall have no special voting rights and their consent shall not be required (except to the extent they are entitled to vote with holders of Common Stock as set forth herein) for taking any corporate action.
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or distributions payable on the Series A Preferred Stock as provided in Section 2 are in arrears, thereafter and until all
accrued and unpaid dividends and distributions, whether or not declared, on shares of Series A Preferred Stock outstanding shall have been paid in full, the Corporation shall not:
(i) declare or pay dividends, or make any other distributions, on any shares of stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series A Preferred Stock;
(ii) declare or pay dividends, or make any other distributions, on any shares of stock ranking on a parity (either as to dividends or upon liquidation, dissolution or winding up) with the Series A Preferred Stock, except dividends paid ratably on the Series A Preferred Stock and all such parity stock on which dividends are payable or in arrears in proportion to the total amounts to which the holders of all such shares are then entitled;
(iii) redeem or purchase or otherwise acquire for consideration shares of any stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series A Preferred Stock, provided that the Corporation may at any time redeem, purchase or otherwise acquire shares of any such junior stock in exchange for shares of any stock of the Corporation ranking junior (either as to dividends or upon dissolution, liquidation or winding up) to the Series A Preferred Stock; or
(iv) redeem or purchase or otherwise acquire for consideration any shares of Series A Preferred Stock, or any shares of stock ranking on a parity with the Series A Preferred Stock, except in accordance with a purchase offer made in writing or by publication (as determined by the Board of Directors) to all holders of such shares upon such terms as the Board of Directors, after consideration of the respective annual dividend rates and other relative rights and preferences of the respective series and classes, shall determine in good faith will result in fair and equitable treatment among the respective series or classes.
(B) The Corporation shall not permit any subsidiary of the Corporation to purchase or otherwise acquire for consideration any shares of stock of the Corporation unless the Corporation could, under paragraph (A) of this Section 4, purchase or otherwise acquire such shares at such time and in such manner.
Section 5. Reacquired Shares. Any shares of Series A Preferred Stock purchased or otherwise acquired by the Corporation in any manner whatsoever shall be retired and cancelled promptly after the acquisition thereof. All such shares shall upon their cancellation become authorized but unissued shares of Preferred Stock and may be reissued as part of a new series of Preferred Stock subject to the conditions and restrictions on issuance set forth herein, or in any other Designation of Rights, Terms and Preferences creating a series of Preferred Stock or any similar stock or as otherwise required by law.
Section 6. Liquidation, Dissolution or Winding Up. Upon any liquidation, dissolution or winding up of the Corporation, no distribution shall be made (1) to the holders of shares of stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series A Preferred Stock unless, prior thereto, the holders of shares of Series A Preferred Stock shall have received $1,000 per share, plus an amount equal to accrued and unpaid dividends and distributions thereon, whether or not declared, to the date of such payment,
provided that the holders of shares of Series A Preferred Stock shall be
entitled to receive an aggregate amount per share, subject to the provision for
adjustment hereinafter set forth, equal to 1,000 times the aggregate amount to
be distributed per share to holders of shares of Common Stock, or (2) to the
holders of shares of stock ranking on a parity (either as to dividends or upon
liquidation, dissolution or winding up) with the Series A Preferred Stock,
except distributions made ratably on the Series A Preferred Stock and all such
parity stock in proportion to the total amounts to which the holders of all such
shares are entitled upon such liquidation, dissolution or winding up. In the
event the Corporation shall at any time declare or pay any dividend on the
Common Stock payable in shares of Common Stock, or effect a subdivision or
combination or consolidation of the outstanding shares of Common Stock (by
reclassification or otherwise than by payment of a dividend in shares of Common
Stock) into a greater or lesser number of shares of Common Stock, then in each
such case the aggregate amount to which holders of shares of Series A Preferred
Stock were entitled immediately prior to such event under the proviso in clause
(1) of the preceding sentence shall be adjusted by multiplying such amount by a
fraction the numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of which is the
number of shares of Common Stock that were outstanding immediately prior to such
event.
Section 7. Consolidation, Merger, etc. In case the Corporation shall enter into any consolidation, merger, combination or other transaction in which the shares of Common Stock are exchanged for or changed into other stock or securities, cash and/or any other property, then in any such case each share of Series A Preferred Stock shall at the same time be similarly exchanged or changed into an amount per share, subject to the provision for adjustment hereinafter set forth, equal to 1,000 times the aggregate amount of stock, securities, cash and/or any other property (payable in kind), as the case may be, into which or for which each share of Common Stock is changed or exchanged. In the event the Corporation shall at any time declare or pay any dividend on the Common Stock payable in shares of Common Stock, or effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number of shares of Common Stock, then in each such case the amount set forth in the preceding sentence with respect to the exchange or change of shares of Series A Preferred Stock shall be adjusted by multiplying such amount by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event.
Section 8. No Redemption. The shares of Series A Preferred Stock shall not be redeemable.
Section 9. Rank. The Series A Preferred Stock shall rank, with respect to the payment of dividends and the distribution of assets, junior to all series of any other class of the Corporation's Preferred Stock.
Section 10. Amendment. The Restated Certificate of Incorporation of the Corporation shall not be amended in any manner which would materially alter or change the powers, preferences or special rights of the Series A Preferred Stock so as to affect them adversely
without the affirmative vote of the holders of at least two-thirds of the outstanding shares of Series A Preferred Stock, voting together as a single class.
FIFTH: The Board of Directors shall have the power to make and to alter or amend the By-Laws of the Corporation.
SIXTH: Pursuant to, and to the full extent permitted by, Section 145 and any other relevant provisions of the General Corporation Law of the State of Delaware, the Corporation shall, and is hereby obligated to, indemnify any person, or the heirs, executors, or administrators of such person, who was or is a party or is threatened to be made a party to or is otherwise involved in any threatened, pending, or completed action, suit, or proceeding (a "proceeding"), whether civil, criminal, administrative, or investigative, by reason of the fact that such person is or was a director or officer of the Corporation, or is or was serving at the request of the Corporation as a director, officer, employee, or agent of another corporation, partnership, joint venture, trust, or other enterprise, including service with respect to an employee benefit plan. The Corporation shall, and is hereby obligated to indemnify any of said persons in each and every situation where the Corporation is obligated to make such indemnification pursuant to said statutory provisions. The Corporation shall also, and is hereby obligated to, indemnify any of said persons in each and every situation where, under the aforesaid statutory provisions, the Corporation is not obligated, but is nevertheless permitted or empowered, to make such indemnification, it being understood that, prior to making such indemnification, the Corporation shall make, or cause to be made, such determinations or decisions, following such procedures or methods, as are required by said statutes. The Corporation shall be further obligated to provide for advancement of all expenses, including attorneys' fees, incurred by any such director or officer in defending any proceeding upon delivery to the Corporation of an undertaking by or on behalf of such person to repay all amounts so advanced if it shall ultimately be determined by final judicial decision from which there is no further right to appeal that such person is not entitled to be indemnified for such expenses. The Corporation may, to the extent authorized from time to time by the Board, grant rights to indemnification, and rights to have the Corporation pay the expenses incurred in defending any proceeding in advance of its final disposition, to any employee or agent of the Corporation to the fullest extent of the provisions of this Article Sixth with respect to the indemnification and advancement of expenses of directors and officers of the Corporation.
SEVENTH: Pursuant to Title 8, Delaware Code, Section 102 (b)(7), no
director of the Corporation shall be personally liable to the Corporation or its
stockholders for monetary damages for breach of fiduciary duty as a director,
provided, however, that this paragraph shall not eliminate or limit the
liability of a director: (i) for any breach of the director's duty of loyalty to
the Corporation or its stockholders; (ii) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of law;
(iii) under Section 174 of Title 8 of the Delaware Code; or (iv) for any
transaction from which the director derived an improper personal benefit. This
provision shall not eliminate or limit the liability of a director for any act
or omission occurring prior to the date when the provision became effective.
EIGHTH: The election of directors of the Corporation need not be by written ballot."
IN WITNESS WHEREOF, the Corporation has caused this Restated Certificate of Incorporation to be executed in its corporate name by Dr. Steven C. Quay, its authorized officer, this 20th day of July, 2005.
NASTECH PHARMACEUTICAL COMPANY INC.
By: /s/ Steven C. Quay
--------------------------------
Name: Steven C. Quay
Title: Chairman of the Board, President
and Chief Executive Officer
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EXHIBIT 10.1
NASTECH PHARMACEUTICAL COMPANY INC.
2004 STOCK INCENTIVE PLAN
RESTRICTED STOCK GRANT AGREEMENT
This Restricted Stock Grant Agreement (the "Agreement") is entered into this 20th day of July 2005, by and between Nastech Pharmaceutical Company Inc. (the "Company"), a Delaware Corporation, and Dr. Steven C. Quay, M.D., Ph.D. ("Grantee").
ARTICLE I
GRANT OF RESTRICTED STOCK
1.1 Grant of Restricted Stock. Pursuant to, and subject to, the terms and conditions set forth herein and in the Nastech Pharmaceutical Company Inc. 2004 Stock Incentive Plan (the "Plan"), the Company hereby grants to the Grantee 168,000 restricted shares (the "Restricted Stock") of common stock of the Company ("Common Stock").
1.2 Grant Date. The Grant Date of the Restricted Stock is July 20, 2005.
1.3 Incorporation of Plan. All terms, conditions and restrictions of the Plan are incorporated herein and made part hereof as if stated herein. If there is any conflict between the terms and conditions of the Plan and this Agreement, the terms and conditions of the Plan, as interpreted by the Compensation Committee of the Board of Directors of the Company (the "Committee"), shall govern. Except as otherwise provided herein, all capitalized terms used herein shall have the meaning given to such terms in the Plan.
ARTICLE II
VESTING
2.1 Vesting. Subject to the further provision of this Agreement, the Restricted Stock shall vest with respect to a number of whole shares as close as possible to the following percentage of the total number of shares of Restricted Stock granted hereunder on the following dates (each, a "Vesting Date"):
PERCENTAGE OF TOTAL SHARES VESTING DATE
-------------------------- ------------
25% 1st anniversary of Grant Date
25% 2nd anniversary of Grant Date
25% 3rd anniversary of Grant Date
25% 4th anniversary of Grant Date
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ARTICLE III
TERMINATION OF EMPLOYMENT
3.1 Termination of Employment. In the event that the Grantee's
employment (which for purposes of this Agreement shall include service as a
director or consultant) with the Company and all of the Company's subsidiaries
terminates for any reason, all unvested shares of Restricted Stock, together
with any property in respect of such shares held by the custodian pursuant to
Section 4.3 hereof, shall be forfeited as of the date of such termination of
employment and the Grantee promptly shall return to the Company any certificates
evidencing such shares. For purposes of this Agreement, the Grantee shall be
deemed to have terminated employment or incurred a termination of employment
upon (i) the date the Grantee ceases to be employed by, or to provide consulting
services for, the Company and all Company subsidiaries; or (ii) the date the
Grantee ceases to be a Board member, provided, however, that if the Grantee (x)
at the time of reference is both an employee or consultant and a Board member,
or (y) ceases to be engaged as an employee, consultant or Board member and
immediately is engaged in another of such relationships with the Company or any
Company subsidiary, the Grantee shall not be deemed to have a "termination of
employment" until the last of the dates determined pursuant to subparagraphs (i)
and (ii) above. The Committee, in its discretion, may determine whether any
leave of absence constitutes a termination of employment for purposes of this
Agreement.
ARTICLE IV
RESTRICTIONS
4.1 Restrictions on Transferability. Until a share of Restricted Stock vests, such share may not be sold, assigned, transferred, alienated, commuted, anticipated, or otherwise disposed of (except by will or the laws of descent and distribution), or pledged or hypothecated as collateral for a loan or as security for the performance of any obligation, or be otherwise encumbered, and is not subject to attachment, garnishment, execution or other legal or equitable process, and any attempt to do so shall be null and void. If the Grantee attempts to dispose of or encumber the Grantee's unvested shares of Restricted Stock, such shares of Restricted Stock, together with any property in respect of such shares held by the custodian pursuant to Section 4.3 hereof, shall be forfeited as of the date of such attempted transfer and the Grantee promptly shall return to the Company any certificates evidencing such shares.
4.2 Issuance of Certificates.
(a) Reasonably promptly after the Grant Date, the Company shall issue and deliver to the Grantee stock certificates, registered in the name of the Grantee,
evidencing the shares of Restricted Stock. Each such certificate may bear the following legend:
"THE SALE, TRANSFER, ASSIGNMENT, PLEDGE, HYPOTHECATION ENCUMBRANCE OR OTHER DISPOSAL OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS OF THE NASTECH PHARMACEUTICAL COMPANY INC. 2004 STOCK INCENTIVE PLAN AND A RESTRICTED STOCK GRANT AGREEMENT BETWEEN NASTECH PHARMACEUTICAL COMPANY INC. AND THE HOLDER OF RECORD OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE. NO TRANSFER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE IN CONTRAVENTION OF SUCH PLAN AND RESTRICTED STOCK GRANT AGREEMENT SHALL BE VALID OR EFFECTIVE. COPIES OF SUCH AGREEMENT MAY BE OBTAINED BY WRITTEN REQUEST MADE BY THE HOLDER OF RECORD OF THE CERTIFICATE TO THE SECRETARY OF NASTECH PHARMACEUTICAL COMPANY INC."
Such legend shall not be removed from such certificates until such shares of Restricted Stock vest.
(b) Reasonably promptly after any such shares of Restricted Stock vest pursuant to Section 2.1 hereof, in exchange for the surrender to the Company of the certificates evidencing such shares of Restricted Stock delivered to the Grantee under Section 4.2(a) hereof, the Company shall issue and deliver to the Grantee (or the Grantee's legal representative, beneficiary or heir) certificates evidencing such shares of Restricted Stock, free of the legend provided in Section 4.2(a) hereof, together with any property in respect of such shares held by the custodian pursuant to Section 4.3 hereof.
(c) The Company may require as a condition of the delivery of stock certificates pursuant to Section 4.2(b) hereof that the Grantee remit to the Company an amount sufficient in the opinion of the Company to satisfy any federal, state and other governmental tax withholding requirements related to the vesting of the shares represented by such certificate.
(d) The Grantee shall not be deemed for any purpose to be, or have
rights as, a shareholder of the Company by virtue of the grant of Restricted
Stock, except to the extent a stock certificate is issued therefor pursuant to
Section 4.2(a) hereof, and then only from the date such certificate is issued.
Upon the issuance of a stock certificate, the Grantee shall have the rights of a
shareholder with respect to the Restricted Stock, including the right to vote
the shares, subject to the restrictions on transferability, the forfeiture
provisions and the requirement that dividends be held in escrow until the shares
vest, as set forth in this Agreement.
4.3 Dividends, etc. Unless the Committee otherwise determines, any property, including cash dividends, received by a Grantee with respect to a share of
Restricted Stock as a result of any dividend, recapitalization, merger, consolidation, combination, exchange of shares or otherwise and for which the Grant Date occurs prior to such event but which has not vested as of the date of such event, will not vest until such share of Restricted Stock vests, and shall be promptly deposited with the Company or a custodian designated by the Company. The Company shall or shall cause such custodian to issue to the Grantee a receipt evidencing the property held by it in respect of the Restricted Stock.
ARTICLE V
MISCELLANEOUS
5.1 Delays or Omissions. No delay or omission to exercise any right, power or remedy accruing to any party hereto upon any breach or default of any party under this Agreement, shall impair any such right, power or remedy of such party, nor shall it be construed to be a waiver of any such breach or default, or an acquiescence therein, with respect to any similar breach or default thereafter occurring, nor shall any waiver of any single breach or default be deemed a waiver of any other breach or default theretofore or thereafter occurring. Any waiver, permit, consent or approval of any kind or character on the part of any party of any breach or default under this Agreement, or any waiver on the part of any party or any provisions or conditions of this Agreement, must be in a writing signed by such party and shall be effective only to the extent specifically set forth in such writing.
5.2 Right of Discharge Preserved. Nothing in this Agreement shall confer upon the Grantee the right to continue in the employ or other service of the Company or one of the Company's subsidiaries, or affect any right which the Company may have to terminate such employment or service.
5.3 Integration. This Agreement and the Grantee's employment agreement dated as of June 3, 2005 (the "Employment Agreement") contain the entire understanding of the parties with respect to the subject matter of this Agreement. There are no restrictions, agreements, promises, representations, warranties, covenants or undertakings with respect to the subject matter hereof other than those expressly set forth herein. This Agreement is subject to the Employment Agreement. Other than the Employment Agreement, this Agreement, including, without limitation, the Plan, supersedes all prior agreements and understandings between the parties with respect to its subject matter.
5.4 Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
5.5 Governing Law. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Delaware, without regard to the provisions governing conflict of laws.
5.6 Grantee Acknowledgment. The Grantee hereby acknowledges receipt of a copy of the Plan. The Grantee hereby acknowledges that all decisions, determinations and interpretations of the Committee in respect of the Plan, this Agreement and the Restricted Stock shall be final and conclusive.
IN WITNESS WHEREOF, the Company has caused this Agreement to be duly executed by its duly authorized officer, and the Grantee has hereunto signed this Agreement on his own behalf, thereby representing that he has carefully read and understands this Agreement and the Plan as of the day and year first written above.
NASTECH PHARMACEUTICAL COMPANY INC.
By: /s/ Gregory L. Weaver
---------------------------
Name: Gregory L. Weaver
Title: CFO
|
GRANTEE
/s/ Steven C. Quay ------------------------------- Dr. Steven C. Quay President and Chief Executive Officer |
EXHIBIT 10.2
NASTECH PHARMACEUTICAL COMPANY INC.
2004 STOCK INCENTIVE PLAN
INCENTIVE STOCK OPTION GRANT AGREEMENT
This Grant Agreement (the "Agreement") is entered into this 20th day of July 2005 by and between Nastech Pharmaceutical Company Inc. (the "Corporation"), a Delaware Corporation, and Dr. Steven C. Quay, M.D., Ph.D. ("Grantee").
ARTICLE 1
GRANT OF OPTION
Section 1.1 Grant of Options. Subject to the provisions of the Agreement, and pursuant to the provisions of the Nastech Pharmaceutical Company Inc. 2004 Stock Incentive Plan (the "Plan"), Corporation hereby grants to Grantee, as of the Grant Date specified in Attachment A, an Incentive Stock Option (the "Option") to purchase all or any part of the number and class of shares of Common Stock set forth on Attachment A at the exercise price per share ("Option Price") set forth on Attachment A. It is intended that the entire Option qualify as an "incentive stock option" under Section 422 of the Internal Revenue Code of 1986, as amended (the "Code"), and to the extent that all or any portion of the Option does not so qualify, the Option shall be treated as a non-qualified stock option.
Section 1.2 Term of Options. Unless the Option granted pursuant to Section 1.1 terminates earlier pursuant to other provisions of the Agreement, including the expiration date specified in Attachment A, the Option shall expire on the expiration date set forth on Attachment A hereto, but in no event later than the tenth (10th) anniversary of its Grant Date.
ARTICLE 2
VESTING
Section 2.1 Vesting Schedule. Unless the Option has earlier terminated pursuant to the provisions of the Agreement, Grantee shall become vested on the dates specified on Attachment A in a portion of the Option with respect to a percentage or number of the underlying shares in accordance with the vesting schedule specified on Attachment A; provided that Grantee shall have been in the continuous employ of the Corporation from the Grant Date through any such date.
ARTICLE 3
EXERCISE OF OPTION
Section 3.1 Exercisability of Option. No portion of the Option granted to Grantee shall be exercisable by Grantee prior to the time such portion of the Option has vested.
Section 3.2 Manner of Exercise. The Option may be exercised, in whole or in part, by delivering written notice to the Committee or any designee of the Committee. Such notice shall specify the number of shares of Common Stock subject to the Option as to which the Option is being exercised, and shall be accompanied by full payment of the Option Price of the shares of Common Stock as to which the Option is being exercised. Payment of the Option Price shall be made in cash (or cash equivalents acceptable to the Committee in the Committee's discretion). In the Committee's sole and absolute discretion, the Committee may authorize payment of the Option Price to be made, in whole or in part, by such other means as the Committee may prescribe. The Committee hereby approves the other means of payment set forth in section 6.(g) of Grantee's Employment Agreement dated as of June 3, 2005 (the "Employment Agreement"). The Option may be exercised only in multiples of whole shares and no partial shares shall be issued. Notwithstanding anything to the contrary herein, the minimum number of shares that may be purchased upon an exercise of the Option is the lesser of 100 shares or the number of shares subject to the vested portion of the Option.
Section 3.3 Issuance of Shares and Payment of Cash upon Exercise. Upon exercise of the Option, in whole or in part, in accordance with the terms of the Agreement and upon payment of the Option Price for the shares of Common Stock as to which the Option is exercised, the Corporation shall issue to Grantee or, in the event of Grantee's death, to Grantee's executor, personal representative or the person to whom the Option shall have been transferred by will or the laws of descent and distribution, as the case may be, the number of shares of Common Stock so paid for, in the form of fully paid and nonassessable Common Stock. The stock certificates for any shares of Common Stock issued hereunder shall, unless such shares are registered or an exemption from registration is available under applicable federal and state law, bear a legend restricting transferability of such shares.
ARTICLE 4
TERMINATION OF EMPLOYMENT
Section 4.1 Unvested Portion. Unless the Option has earlier terminated pursuant to the provisions of this Agreement, the unvested portion of the Option shall terminate upon termination of Grantee's employment with the Corporation and all of the Corporation's subsidiaries for any reason.
Section 4.2 Termination of Employment for Good Reason, Involuntarily by the Corporation, For Cause by the Corporation or Voluntarily by Grantee Other Than Termination of Employment by Death or Disability. Unless the Option has earlier terminated pursuant to the provisions of this Agreement, the vested portion of the Option granted to Grantee shall terminate in its entirety, regardless of whether the Option is vested in whole or in part at the end of the stated term of the Option. Grantee may exercise all or any part of the Option that was vested as of the date of termination and after the date of termination but no later than the earlier of ninety (90) days following such date of termination (the "Ninety Day Period") or the end of the stated term of the Option. Failure to exercise the Option within the Ninety Day Period shall render the Option a non-qualified stock option.
Section 4.3 Upon Grantee's Death. Unless the Option has earlier terminated pursuant to the provisions of the Agreement, upon Grantee's death, Grantee's executor, personal representative or the person to whom the Option shall have been transferred by will or the laws of descent and distribution, as the case may be, may exercise all or any part of the Option that was vested as of the date of death no later than the earlier of twelve (12) months following such date of termination (the "Twelve Month Period") or the end of the stated term of the Option. Failure to exercise the Option within the Twelve Month Period shall render the Option a non-qualified stock option.
Section 4.4 Termination of Employment by Reason of Disability. Unless the Option has earlier terminated pursuant to the provisions of the Agreement, in the event that Grantee ceases, by reason of Disability, to be an employee of the Corporation, all or any part of the Option that was vested as of the date of termination of employment may be exercised in whole or in part at any time until the earlier of the end of the Twelve Month Period or the end of the stated term of the Option. For purposes of this Agreement, Disability shall be as defined in Code Section 22(e)(3) and shall be determined by the Committee, with its determination on the matter being final and binding. Failure to exercise the Option within the Twelve Month Period shall render the Option a non-qualified stock option.
ARTICLE 5
MISCELLANEOUS
Section 5.1 Non-Guarantee of Employment. Nothing in the Plan or the Agreement shall be construed as a contract of employment between the Corporation and Grantee, or as a contractual right of Grantee to continue in the employ of the Corporation, or as a limitation of the right of the Corporation to discharge Grantee at any time.
Section 5.2 No Rights of Stockholder. Grantee shall not have any of the rights of a stockholder with respect to the shares of Common Stock that may be issued upon the exercise of the Option until such shares of Common Stock have been issued to him upon the due exercise of the Option.
Section 5.3 Withholding of Taxes. The Corporation shall have the right to deduct from any compensation or any other payment of any kind (including withholding the issuance of shares of Common Stock) due Grantee the amount of any federal, state or local taxes required by law to be withheld as the result of the exercise of the Option; provided, however, that the value of the shares of Common Stock withheld may not exceed the statutory minimum withholding amount required by law. In lieu of such deduction, the Committee may require Grantee to make a cash payment to the Corporation or an affiliate equal to the amount required to be withheld. If Grantee does not make such payment when requested, the Corporation may refuse to issue any Common Stock certificate under the Plan until arrangements satisfactory to the Committee for such payment have been made.
Section 5.4 Nontransferability of Option. Except as set forth in section
6.(g) of Grantee's Employment Agreement and other than by will or the laws of
descent and distribution, the Option shall be nontransferable. During any period
Grantee is under a legal disability, Grantee's guardian or legal representative
may exercise all or any portion of the vested Option on behalf of Grantee.
Section 5.5 Notice of Disqualifying Disposition. Grantee agrees to notify the Committee in writing within ten (10) business days after making a Disqualifying Disposition (as defined below) of any Common Stock acquired pursuant to the exercise of the Option granted hereunder. A Disqualifying Disposition is any disposition (including any sale) of the Common Stock acquired upon the exercise of the Option before the later of (i) two (2) years after the date Grantee was granted the Option hereunder or (ii) one year after the date Grantee acquired the Common Stock by exercising the Option granted hereunder. If Grantee dies before such Common Stock is sold, these holding period requirements do not apply and no Disqualifying Disposition can occur thereafter.
Section 5.6 Agreement Subject to Grantee's Employment Agreement and the Corporation's Charter and Bylaws. This Agreement is subject to Grantee's Employment Agreement and the Charter and Bylaws of the Corporation, and any applicable Federal or state laws, rules or regulations, including without limitation, the laws, rules, and regulations of the State of Delaware.
Section 5.7 Gender. As used herein, the masculine shall include the feminine as the circumstances may require.
Section 5.8 Headings. The headings in the Agreement are for reference purposes only and shall not affect the meaning or interpretation of the Agreement.
Section 5.9 Notices. All notices and other communications made or given pursuant to the Agreement shall be in writing and shall be sufficiently made or given if hand delivered or mailed by certified mail, addressed to Grantee at the address contained in the records of the Corporation, or addressed to the Committee, care of the Corporation for the attention of its Secretary at its principal office or, if the receiving party consents in advance, transmitted and received via telecopy or via such other electronic transmission mechanism as may be available to the parties.
Section 5.10 Entire Agreement; Modification. The Agreement and Grantee's Employment Agreement contain the entire agreement between the parties with respect to the subject matter contained herein and may not be modified, except as provided in the Plan, Grantee's Employment Agreement or in a written document signed by each of the parties hereto.
Section 5.11 Conformity with Plan and Grantee's Employment Agreement. This Agreement is intended to conform in all respects with, and is subject to all applicable provisions of, the Plan, which is incorporated herein by reference and Grantee's Employment Agreement. Unless stated otherwise herein, capitalized terms in this Agreement shall have the same meaning as defined in the Plan. Inconsistencies
between this Agreement and the Plan or Grantee's Employment Agreement shall be
resolved in accordance with the terms of the Plan and Grantee's Employment
Agreement provided however that the Option granted pursuant to this Agreement is
not transferable by Grantee other than by will or the laws of descent and
distribution, and the Option is exercisable during Grantee's lifetime only by
Grantee notwithstanding any provision of the Plan or Grantee's Employment
Agreement to the contrary. In the event of any ambiguity in the Agreement which
is not clarified in Grantee's Employment Agreement or any matters as to which
the Agreement is silent, the Plan shall govern including, without limitation,
the provisions thereof pursuant to which the Committee has the power, among
others, to (i) interpret the Plan and Grant Agreements related thereto, (ii)
prescribe, amend and rescind rules and regulations relating to the Plan, and
(iii) make all other determinations deemed necessary or advisable for the
administration of the Plan. Grantee acknowledges by signing this Agreement that
he has received and reviewed a copy of the Plan.
IN WITNESS WHEREOF, the parties have executed the Agreement as of the date first above written.
NASTECH PHARMACEUTICAL COMPANY INC.
By: /s/ Gregory L. Weaver
-------------------------------
Name: Gregory L. Weaver
Title: CFO
|
GRANTEE
/s/ Steven C. Quay ------------------------------- Dr. Steven C. Quay President and Chief Executive Officer |
ATTACHMENT A
Grant Date: July 20, 2005 Number of Options: 27,172 Exercise Price: $14.72 per share |
The exercise price equals the fair market value of the Common Stock on date of grant.
Vesting Schedule:
Percentage of Total Shares Vesting Date
-------------------------- ------------
25% 1st anniversary of Grant Date
25% 2nd anniversary of Grant Date
25% 3rd anniversary of Grant Date
25% 4th anniversary of Grant Date
Expiration Date: July 20, 2015
|
EXHIBIT 10.3
NASTECH PHARMACEUTICAL COMPANY INC.
2004 STOCK INCENTIVE PLAN
NONQUALIFIED STOCK OPTION GRANT AGREEMENT
This Grant Agreement (the "Agreement") is entered into this 20th day of July 2005 by and between Nastech Pharmaceutical Company Inc. (the "Corporation"), a Delaware Corporation, and Dr. Steven C. Quay, M.D., Ph.D. ("Grantee").
ARTICLE 1
GRANT OF OPTION
Section 1.1 Grant of Options. Subject to the provisions of the Agreement, and pursuant to the provisions of the Nastech Pharmaceutical Company Inc. 2004 Stock Incentive Plan (the "Plan"), Corporation hereby grants to Grantee, as of the Grant Date specified in Attachment A, a Nonqualified Stock Option (the "Option") to purchase all or any part of the number and class of shares of Common Stock set forth on Attachment A at the exercise price per share ("Option Price") set forth on Attachment A.
Section 1.2 Term of Options. Unless the Option granted pursuant to Section 1.1 terminates earlier pursuant to other provisions of the Agreement, including the expiration date specified in Attachment A, the Option shall expire on the expiration date set forth on Attachment A hereto, but in no event later than the tenth (10th) anniversary of its Grant Date.
ARTICLE 2
VESTING
Section 2.1 Vesting Schedule. Unless the Option has earlier terminated pursuant to the provisions of the Agreement, Grantee shall become vested on the dates specified on Attachment A in a portion of the Option with respect to a percentage or number of the underlying shares in accordance with the vesting schedule specified on Attachment A; provided that Grantee shall have been in the continuous employ of or affiliation (as a director or consultant) with the Corporation or any of the Corporation's subsidiaries from the Grant Date through any such date.
ARTICLE 3
EXERCISE OF OPTION
Section 3.1 Exercisability of Option. No portion of the Option granted to Grantee shall be exercisable by Grantee prior to the time such portion of the Option has vested.
Section 3.2 Manner of Exercise. The Option may be exercised, in whole or in part, by delivering written notice to the Committee or any designee of the Committee. Such notice shall specify the number of shares of Common Stock subject to the Option
as to which the Option is being exercised, and shall be accompanied by full payment of the Option Price of the shares of Common Stock as to which the Option is being exercised. Payment of the Option Price shall be made in cash (or cash equivalents acceptable to the Committee in the Committee's discretion). In the Committee's sole and absolute discretion, the Committee may authorize payment of the Option Price to be made, in whole or in part, by such other means as the Committee may prescribe. The Committee hereby approves the other means of payment set forth in section 6.(g) of Grantee's Employment Agreement dated as of June 3, 2005 (the "Employment Agreement"). The Option may be exercised only in multiples of whole shares and no partial shares shall be issued. Notwithstanding anything to the contrary herein, the minimum number of shares that may be purchased upon an exercise of the Option is the lesser of 100 shares or the number of shares subject to the vested portion of the Option.
Section 3.3 Issuance of Shares and Payment of Cash upon Exercise. Upon exercise of the Option, in whole or in part, in accordance with the terms of the Agreement and upon payment of the Option Price for the shares of Common Stock as to which the Option is exercised, the Corporation shall issue to Grantee or, in the event of Grantee's death, to Grantee's executor, personal representative or the person to whom the Option shall have been transferred by will or the laws of descent and distribution or the person or entity to whom the Options shall have been transferred pursuant to section 6.(g) of Grantee's Employment Agreement, as the case may be, the number of shares of Common Stock so paid for, in the form of fully paid and nonassessable Common Stock. The stock certificates for any shares of Common Stock issued hereunder shall, unless such shares are registered or an exemption from registration is available under applicable federal and state law, bear a legend restricting transferability of such shares.
ARTICLE 4
TERMINATION OF EMPLOYMENT
Section 4.1 Unvested Portion. Unless the Option has earlier terminated pursuant to the provisions of this Agreement, the unvested portion of the Option shall terminate upon termination of Grantee's employment or affiliation (as a director or consultant) with the Corporation and all of the Corporation's subsidiaries for any reason.
Section 4.2 Termination of Employment or Affiliation for Good Reason, Involuntarily by the Corporation, For Cause by the Corporation or Voluntarily by Grantee Other Than Termination of Employment or Affiliations by Death or Disability. Unless the Option has earlier terminated pursuant to the provisions of this Agreement, the vested portion of the Option granted to Grantee shall terminate in its entirety, regardless of whether the Option is vested in whole or in part at the end of the stated term of the Option. Grantee, or the person or entity to whom the Options have been transferred pursuant to section 6.(g) of Grantee's Employment Agreement (or pursuant to Section 4.3 below) may exercise all or any part of the Option that was vested as of the date of termination, after the date of termination but no later than the end of the stated term of the Option.
Section 4.3 Upon Grantee's Death. Unless the Option has earlier terminated
pursuant to the provisions of the Agreement, upon Grantee's death, Grantee's
executor, personal representative or the person to whom the Option shall have
been transferred by will or the laws of descent and distribution or the person
or entity to whom the Options shall have been transferred pursuant to section
6.(g) of Grantee's Employment Agreement, as the case may be, may exercise all or
any part of the Option that was vested as of the date of death no later than the
end of the stated term of the Option.
Section 4.4 Termination of Employment or Affiliation by Reason of Disability. Unless the Option has earlier terminated pursuant to the provisions of the Agreement, in the event that Grantee ceases, by reason of Disability, to be an employee of or affiliated (as a director or consultant) with the Corporation, all or any part of the Option that was vested as of the date of termination of employment or affiliation may be exercised in whole or in part at any time until the end of the stated term of the Option. For purposes of this Agreement, Disability shall be as defined in Code Section 22(e)(3) and shall be determined by the Committee, with its determination on the matter being final and binding.
ARTICLE 5
MISCELLANEOUS
Section 5.1 Non-Guarantee of Employment. Nothing in the Plan or the Agreement shall be construed as a contract of employment between the Corporation (or an affiliate) and Grantee, or as a contractual right of Grantee to continue in the employ of the Corporation or an affiliate, or as a limitation of the right of the Corporation or an affiliate to discharge Grantee at any time.
Section 5.2 No Rights of Stockholder. Grantee shall not have any of the rights of a stockholder with respect to the shares of Common Stock that may be issued upon the exercise of the Option until such shares of Common Stock have been issued to him upon the due exercise of the Option.
Section 5.3 Withholding of Taxes. The Corporation or any affiliate shall have the right to deduct from any compensation or any other payment of any kind (including withholding the issuance of shares of Common Stock) due Grantee the amount of any federal, state or local taxes required by law to be withheld as the result of the exercise of the Option; provided, however, that the value of the shares of Common Stock withheld may not exceed the statutory minimum withholding amount required by law. In lieu of such deduction, the Committee may require Grantee to make a cash payment to the Corporation or an affiliate equal to the amount required to be withheld. If Grantee does not make such payment when requested, the Corporation may refuse to issue any Common Stock certificate under the Plan until arrangements satisfactory to the Committee for such payment have been made.
Section 5.4 Nontransferability of Option. Except as set forth in section
6.(g) of Grantee's Employment Agreement and other than by will or the laws of
descent and distribution, the Option shall be nontransferable. During any period
Grantee is under a
legal disability, Grantee's guardian or legal representative may exercise all or any portion of the vested Option on behalf of Grantee.
Section 5.5 Agreement Subject to Grantee's Employment Agreement and the Corporation's Charter and Bylaws. This Agreement is subject to Grantee's Employment Agreement and the Charter and Bylaws of the Corporation, and any applicable Federal or state laws, rules or regulations, including without limitation, the laws, rules, and regulations of the State of Delaware.
Section 5.6 Gender. As used herein, the masculine shall include the feminine as the circumstances may require.
Section 5.7 Headings. The headings in the Agreement are for reference purposes only and shall not affect the meaning or interpretation of the Agreement.
Section 5.8 Notices. All notices and other communications made or given pursuant to the Agreement shall be in writing and shall be sufficiently made or given if hand delivered or mailed by certified mail, addressed to Grantee at the address contained in the records of the Corporation, or addressed to the Committee, care of the Corporation for the attention of its Secretary at its principal office or, if the receiving party consents in advance, transmitted and received via telecopy or via such other electronic transmission mechanism as may be available to the parties.
Section 5.9 Entire Agreement; Modification. The Agreement and Grantee's Employment Agreement contain the entire agreement between the parties with respect to the subject matter contained herein and may not be modified, except as provided in the Plan, Grantee's Employment Agreement or in a written document signed by each of the parties hereto.
Section 5.10 Conformity with Plan and Grantee's Employment Agreement. This Agreement is intended to conform in all respects with, and is subject to all applicable provisions of, the Plan, which is incorporated herein by reference and Grantee's Employment Agreement. Unless stated otherwise herein, capitalized terms in this Agreement shall have the same meaning as defined in the Plan. Inconsistencies between this Agreement and the Plan or Grantee's Employment Agreement shall be resolved in accordance with the terms of the Plan and Grantee's Employment Agreement. In the event of any ambiguity in the Agreement which is not clarified in Grantee's Employment Agreement or any matters as to which the Agreement is silent, the Plan shall govern including, without limitation, the provisions thereof pursuant to which the Committee has the power, among others, to (i) interpret the Plan and Grant Agreements related thereto, (ii) prescribe, amend and rescind rules and regulations relating to the Plan, and (iii) make all other determinations deemed necessary or advisable for the administration of the Plan. Grantee acknowledges by signing this Agreement that he has received and reviewed a copy of the Plan.
IN WITNESS WHEREOF, the parties have executed the Agreement as of the date first above written.
NASTECH PHARMACEUTICAL COMPANY INC.
By: /s/ Gregory L. Weaver
--------------------------------
Name: Gregory L. Weaver
Title: CFO
|
GRANTEE
/s/ Steven C. Quay ------------------------------------ Dr. Steven C. Quay President and Chief Executive Officer |
ATTACHMENT A
Grant Date: July 20, 2005 Number of Options: 572,828 Exercise Price: $14.72 per share |
Vesting Schedule:
Percentage of Total Shares Vesting Date
-------------------------- ------------
25% 1st anniversary of Grant Date
25% 2nd anniversary of Grant Date
25% 3rd anniversary of Grant Date
25% 4th anniversary of Grant Date
Expiration Date: July 20, 2015
|
EXHIBIT 10.4
AMENDMENT NO. 1
TO
NASTECH PHARMACEUTICAL COMPANY INC.
2004 STOCK INCENTIVE PLAN
Pursuant to the resolutions adopted by the Board of Directors of Nastech Pharmaceutical Company Inc. (the "Company") on March 9, 2005, as ratified by the affirmative vote of the holders of a majority of the outstanding shares of the Company's capital stock present and entitled to vote at the Company's annual meeting of stockholders held on July 20, 2005, the following amendments to the Nastech Pharmaceutical Company Inc. 2004 Stock Incentive Plan are hereby adopted effective as of July 20, 2005:
1. The first sentence of Section 1.5, paragraph (a), is hereby deleted in its entirety and replaced with the following:
"The total number of shares of common stock of the Company ("Common Stock") with respect to which awards may be granted pursuant to the Plan shall not exceed 1,350,000 shares."
2. The second sentence of Section 1.5, paragraph (d), is hereby deleted in its entirety and replaced with the following:
"Subject to adjustment as provided in Section 3.7(a), the total number of shares of Common Stock with respect to which awards may be granted to any one employee of the Company or a subsidiary during any one calendar year shall not exceed 850,000 shares."
EXHIBIT 99.1
[ALNYLAM PHARMACEUTICALS LOGO] [NASTECH PHARMACEUTICALS COMPANY
INC. LOGO]
CONTACTS:
ALNYLAM PHARMACEUTICALS, INC. NASTECH PHARMACEUTICAL COMPANY INC.
INVESTOR CONTACT: INVESTOR CONTACT:
Lilian Stern Matthew Haines
Stern Investor Relations, Inc. Noonan Russo
212-362-1200 212-845-4235
MEDIA CONTACT: MEDIA CONTACT:
Kathryn Morris Carney Duntsch
KMorrisPR Burns McClellan
845-635-9828 212-213-0006
|
ALNYLAM GRANTS NASTECH A LICENSE TO DEVELOP RNAi THERAPEUTICS AGAINST TNF-
ALPHA
LICENSE FOR RNAi INTELLECTUAL PROPERTY GRANTED UNDER ALNYLAM
INTERFERX(TM) PROGRAM
CAMBRIDGE, MASS. AND BOTHELL, WASH., JULY 20, 2005 - Alnylam Pharmaceuticals, Inc. (Nasdaq: ALNY), a leading RNAi therapeutics company, announced today that it has granted Nastech Pharmaceutical Company Inc. (Nasdaq: NSTK), a leader in molecular biology-based drug delivery technologies, an exclusive InterfeRx(TM) license to discover, develop, and commercialize RNAi therapeutics directed against TNF-alpha, a protein associated with inflammatory diseases including rheumatoid arthritis. Detailed financial terms were not disclosed, but include upfront, annual and milestone payments, and royalties on sales of any products covered by the licensing agreement.
"Alnylam is extremely pleased to be working with Nastech and aiding efforts toward the commercialization of RNAi therapeutics," said John Maraganore, Ph.D., President and Chief Executive Officer of Alnylam Pharmaceuticals. "Nastech is the third company to participate in our InterfeRx program, which is an important part of our overall strategy to create value today by leveraging our intellectual property portfolio in RNAi through partnerships."
"Nastech is committed to advancing breakthrough products, including RNAi therapeutics, in markets with significant commercial potential," said Steven C. Quay, M.D., Ph.D., Chairman, President and Chief Executive Officer of Nastech. "Nastech's proprietary delivery technologies are a promising approach to achieve therapeutic levels of this exciting new class of compounds. This was recently demonstrated through our successful in vivo use of RNAi to suppress rheumatoid arthritis in mice. The InterfeRx license from Alnylam is important for our efforts to develop, partner, and commercialize RNAi therapies."
"Nastech's innovative approach to the treatment of major inflammatory diseases, including rheumatoid arthritis, through an RNAi therapeutic could offer significant clinical benefits for patients," stated Dr. Philip J. Mease, M.D., Chief, Rheumatology Clinical Research, Swedish Medical Center and Clinical Professor, University of Washington School of Medicine, Seattle, WA. "The opportunity for Nastech to advance this program through access to Alnylam's patent portfolio in the area of RNAi therapeutics is excellent news."
With the recognized potential of RNAi to become the basis for a broad new class of drugs to treat multiple diseases, Alnylam has built a leading portfolio of issued and pending patents covering compositions and uses of RNAi therapeutics. Alnylam created the InterfeRx program to grant licenses under this intellectual property to biotechnology and pharmaceutical companies wishing to pursue RNAi therapeutics against specific targets outside Alnylam's core strategic interests.
ABOUT RNA INTERFERENCE (RNAi)
RNA interference, or RNAi, is a naturally occurring mechanism within cells for selectively silencing and regulating specific genes. Since many diseases are caused by the inappropriate activity of specific genes, the ability to silence and regulate such genes selectively through RNAi could provide a means to treat a wide range of human diseases. The discovery of RNAi has been heralded by many as a major breakthrough, and the journal Science named RNAi the top scientific achievement of 2002, as well as one of the top 10 scientific advances of 2003.
ABOUT ALNYLAM
Alnylam is a biopharmaceutical company seeking to develop and commercialize novel therapeutics based on RNA interference, or RNAi. Growing from its foundation as the world's first company focused on RNAi therapeutics, the company's leadership in the field of RNAi is supported by its preeminent founders and advisors and its strengths in fundamental patents, technology, and know-how that underlie the commercialization of RNAi therapeutics. Alnylam is developing a pipeline of RNAi products using Direct RNAi(TM) to treat ocular, central nervous system, and respiratory diseases and Systemic RNAi(TM) to treat a broad range of diseases, including oncology, metabolic, and autoimmune diseases. The company's global headquarters are in Cambridge, Massachusetts. For additional information, please visit www.alnylam.com.
ABOUT NASTECH
Nastech is a pharmaceutical company developing innovative products based on proprietary molecular biology-based drug delivery technologies. Nastech and its collaboration partners are developing products for multiple therapeutic areas including inflammatory conditions, obesity and osteoporosis. For additional information about Nastech, please visit www.nastech.com.
ALNYLAM FORWARD-LOOKING STATEMENTS
Various statements in this release concerning our future expectations, plans, prospects and future operating results constitute forward-looking statements for the purposes of the safe harbor provisions under The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including risks related to: our approach to discover and develop novel drugs, which is unproven and may never lead to marketable products; our ability to obtain additional funding to support our business activities; our dependence on third parties for development, manufacture, marketing, sales and distribution of our products; the successful development of products, all of which are in early stages of development; obtaining regulatory approval for products; competition from others using technology similar to ours and others developing products for similar uses; obtaining, maintaining and protecting intellectual property utilized by our products; and our short operating history; as well as those risks more fully discussed in the "Certain Factors That May Affect Future Results" section of our most recent Form 10-Q filed with the Securities and Exchange Commission. In addition, any forward-looking statements represent our views only as of today and should not be relied upon as representing our views as of any subsequent date. We do not assume any obligation to update any forward-looking statements.
NASTECH FORWARD LOOKING STATEMENTS
Statements made in this press release may be forward-looking statements within
the meaning of Federal Securities laws that are subject to certain risks and
uncertainties and involve factors that may cause actual results to differ
materially from those projected or suggested. Factors that could cause actual
results to differ materially from those in forward-looking statements include,
but are not limited to: (i) the ability of Nastech to obtain additional funding;
(ii) the ability of Nastech to attract and/or maintain manufacturing, research,
development and commercialization partners; (iii) Nastech's and/or a partner's
ability to successfully complete product research and development, including
preclinical and clinical studies and commercialization; (iv) Nastech's and/or a
partner's ability to obtain required governmental approvals; and (v) Nastech's
and/or a partner's ability to develop and commercialize products that can
compete favorably with those of competitors. Additional factors that could cause
actual results to differ materially from those projected or suggested in any
forward-looking statements are
contained in Nastech's most recent periodic reports on Form 10-K and Form 10-Q that are filed with the Securities and Exchange Commission. Nastech assumes no obligation to update and supplement forward-looking statements because of subsequent events.
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