þ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware
(State or other jurisdiction of incorporation or organization) |
90-0136863
(IRS Employer Identification No.) |
|
100 Saw Mill Road
Danbury, Connecticut (Address of principal executive offices) |
06810
(Zip code) |
Large accelerated filer o | Accelerated filer þ | Non-accelerated filer o | Smaller reporting company o | |||
(Do not check if a smaller
reporting company) |
1
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9
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22
23
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25
(A Development Stage Company)
(in thousands, except share and per share amounts)
Table of Contents
(A Development Stage Company)
(in thousands, except share and per share amounts)
(unaudited)
December 3,
2003
Three Months Ended
Six Months Ended
(inception) to
March 31,
March 31,
March 31,
2009
2010
2009
2010
2010
$
$
$
$
$
8,361
7,014
16,396
15,768
105,819
3,435
3,377
5,716
5,793
42,438
11,796
10,391
22,112
21,561
148,257
(78
)
(2
)
(320
)
(7
)
(5,496
)
78
627
(11,718
)
(10,389
)
(21,792
)
(21,554
)
(143,466
)
(89
)
20
(139
)
3
(505
)
(11,629
)
(10,409
)
(21,653
)
(21,557
)
(142,961
)
(603
)
(4,457
)
$
(11,629
)
$
(10,409
)
$
(21,653
)
$
(21,557
)
$
(148,201
)
$
(0.49
)
$
(0.44
)
$
(0.91
)
$
(0.90
)
23,717,800
23,885,856
23,698,558
23,867,152
Table of Contents
(A Development Stage Company)
(in thousands, except share and per share amounts)
Deficit
Accumulated
Accumulated
Common Stock
Series A Preferred stock
Series B Preferred stock
Additional
Other
During the
Total
$01 Par Value
$.01 Par Value
$.01 Par Value
Paid in
Comprehensive
Development
Stockholders
Shares
Amount
Shares
Amount
Shares
Amount
Capital
Income (loss)
Stage
Equity
732,504
$
7
$
$
$
(7
)
$
$
$
4,581,240
46
1,308
1,354
(774
)
(774
)
5,313,744
53
1,301
(774
)
580
514
514
353
353
42,656
1
60
61
569,000
6
2,460
2,466
63
63
(3,383
)
(3,383
)
5,356,400
54
569,000
6
4,751
(4,157
)
654
1,132
1,132
5,380,711
54
19,351
19,405
817,468
8
3,194
3,202
4,030
23
23
603
(603
)
(8,068
)
(8,068
)
5,360,430
54
569,000
6
6,198,179
62
29,054
(12,828
)
16,348
Table of Contents
(A Development Stage Company)
Condensed Statements of Stockholders Equity
(in thousands, except share and per share amounts)
Deficit
Series A Preferred
Accumulated
Accumulated
Common Stock
stock
Series B Preferred stock
Additional
Other
During the
Total
$01 Par Value
$.01 Par Value
$.01 Par Value
Paid in
Comprehensive
Development
Stockholders
Shares
Amount
Shares
Amount
Shares
Amount
Capital
Income (loss)
Stage
Equity
5,750,000
58
78,697
78,755
6,407,008
64
(569,000
)
(6
)
(6,198,179
)
(62
)
4
4,224
4,224
2,949
16
16
3,542
5
5
2,636,907
26
397
423
4,457
(4,457
)
(22,548
)
(22,548
)
20,160,836
202
116,854
(39,833
)
77,223
3,260,000
32
46,785
46,817
9,714
172
172
6,503
6,503
174,410
1
901
902
79,210
1
111
112
(62
)
(62
)
14,388
1
180
181
(43,361
)
(43,361
)
23,698,558
237
171,506
(62
)
(83,194
)
88,487
Table of Contents
(A Development Stage Company)
Condensed Statements of Stockholders Equity
(in thousands, except share and per share amounts)
Deficit
Series A Preferred
Accumulated
Accumulated
Common Stock
stock
Series B Preferred stock
Additional
Other
During the
Total
$01 Par Value
$.01 Par Value
$.01 Par Value
Paid in
Comprehensive
Development
Stockholders'
Shares
Amount
Shares
Amount
Shares
Amount
Capital
Income (loss)
Stage
Equity
5,064
5,064
17,661
25
25
62
62
87,453
1
169
170
(43,270
)
(43,270
)
23,803,672
238
176,764
(126,464
)
50,538
2,609
2,609
6,000
10
10
79,940
1
154
155
(21,557
)
(21,557
)
23,889,612
$
239
$
$
$
179,537
$
$
(148,021
)
$
31,755
Table of Contents
(A Development Stage Company)
(in thousands, except share and per share amounts)
(unaudited)
December 3,
2003
Six months ended
(inception) to
March 31,
March 31,
2009
2010
2010
$
(21,653
)
$
(21,557
)
$
(142,961
)
420
487
2,636
271
2,525
2,633
17,837
90
(24
)
2,301
627
41
208
(157
)
(14
)
(766
)
(1,406
)
(1,406
)
375
(346
)
(828
)
(202
)
1,906
2,913
104
(12
)
153
235
(3,710
)
4,423
3,390
(486
)
28,410
(18,263
)
(22,043
)
(114,551
)
(77
)
(46
)
(5,855
)
(25,614
)
13,595
25,614
(298
)
(41
)
13,518
(46
)
(6,194
)
12
10
942
535
27
155
506
(1,458
)
1,660
2,466
127,030
2,575
19,205
39
165
153,461
(4,706
)
(21,924
)
32,716
64,731
54,640
$
60,025
$
32,716
$
32,716
Table of Contents
(A Development Stage Company)
Condensed Statements of Cash Flows
(in thousands, except share and per share amounts)
(unaudited)
December 3,
2003
Six months ended
(inception) to
March 31,
March 31,
2009
2010
2010
$
$
$
9
85
30
276
$
$
$
3,202
150
4,457
603
68
Table of Contents
(A Development Stage Company)
(in thousands, except share and per share amounts)
(unaudited)
Table of Contents
(A Development Stage Company)
Notes to Condensed Financial Statements
(in thousands, except share and per share amounts)
(unaudited)
Table of Contents
(A Development Stage Company)
Notes to Condensed Financial Statements
(in thousands, except share and per share amounts)
(unaudited)
Weighted
Weighted
Average
Average
Remaining
Aggregate
Exercise
Contractual
Intrinsic
Number
Price
Life in Years
Value
3,407,633
$
11.81
$
1,590
1,252,500
4.09
$
231
6,000
1.70
$
15
34,896
14.40
4,619,237
$
9.71
6
$
1,821
2,463,243
$
10.65
5
$
1,288
Three Months Ended
Six Months Ended
March 31,
March 31,
2009
2010
2009
2010
5.25
3.77-5.25
5.25
3.77-5.25
61%-62
%
65
%
59-62
%
64-76%
%
0
%
0
%
0
%
0
%
1.51 1.99
%
2.30 2.55
%
1.00-1.99
%
1.38-2.69
%
$
3.75
$
2.30
$
2.69
$
2.30
Three Months Ended
Six Months Ended
March 31,
March 31,
2009
2010
2009
2010
$
$
61
$
$
82
Table of Contents
(A Development Stage Company)
Notes to Condensed Financial Statements
(in thousands, except share and per share amounts)
(unaudited)
Weighted
Average
Grant-Date
Fair Value
Shares
Per Share
$
250,000
3.95
(90
)
3.95
249,910
$
3.95
Table of Contents
(A Development Stage Company)
Notes to Condensed Financial Statements
(in thousands, except share and per share amounts)
(unaudited)
Three Months Ended
Six Months Ended
March 31,
March 31,
2009
2010
2009
2010
118,815
118,815
118,815
118,815
3,595,129
4,619,237
3,595,129
4,619,237
249,910
249,910
two times his then current salary, plus two times his target annual bonus for the fiscal
year in which he is terminated, plus the pro rata amount of his target annual bonus for the
fiscal year in which he is terminated;
COBRA benefits until the earlier of the end of the 24th month after the date his
employment with the Company ends or the date his COBRA coverage expires;
24 months of acceleration of his outstanding equity compensation awards; and
full vesting of his outstanding equity compensation awards, if the Company terminates
his employment without cause, or he terminates his employment with the Company for good
reason within 12 months following a change in control, as defined in the agreement.
Table of Contents
two times his then current salary, plus two times his target annual bonus for the fiscal
year in which he is terminated, plus the pro rata amount of his target annual bonus for the
fiscal year in which he is terminated;
COBRA benefits until the earlier of the end of the 24th month after the date his
employment with the Company ends or the date his COBRA coverage expires;
24 months of acceleration of his outstanding equity compensation awards; and
full vesting of his outstanding equity compensation awards, if the Company terminates
his employment without cause, or he resigns within 12 months following a change in control,
as defined in the agreement.
Table of Contents
Table of Contents
·
our ability to secure approval by the U.S. Food and Drug Administration, or FDA, for our
product candidates under Section 505(b)(2) of the Federal Food, Drug and Cosmetic Act, or
FFDCA;
·
the length of time that will elapse before our NDA for VIAject
®
is fully
reviewed by the FDA;
·
our ability to secure approval by the FDA for VIAject
®
without conducting
additional pivotal clinical trials;
·
our ability to market, commercialize and achieve market acceptance for
VIAject
®
;
·
the progress, timing or success of our product candidates, particularly
VIAject
®
, and that of our research, development and clinical programs, including
any resulting data analyses;
·
our ability to enter into collaboration arrangements for the commercialization of our
product candidates and the success or failure of any such collaborations into which we
enter, or our ability to commercialize our product candidates ourselves;
·
our ability to enforce our patent for VIAject
®
and our ability to secure
additional patents for VIAject
®
and for our other product candidates;
·
our ability to protect our intellectual property and operate our business without
infringing upon the intellectual property rights of others;
·
the degree of clinical utility of our products;
·
the ability of our major suppliers, including suppliers of insulin, to produce our
product or products in our final dosage form;
·
our commercialization, marketing and manufacturing capabilities and strategies; and
·
our ability to accurately estimate anticipated operating losses, future revenues,
capital requirements and our needs for additional financing.
Table of Contents
·
A line of adjustable basal insulins with durations that can be tailored to individual
patients:
Current basal insulins have a duration of activity that varies patient by
patient; what may be an adequate duration for one patient may be too short or too long in
another. We are developing a technology that may shorten or lengthen the duration of a
basal insulin to best suit the individual needs of patients.
·
A smart basal insulin:
We are developing a basal insulin formulation that may
sufficiently react to a patients blood glucose levels to meaningfully lessen the risk of
hyper or hypoglycemia compared to currently available basal insulin products, although we
anticipate that prandial insulin injections would still be necessary in many instances.
·
Stabilized glucagon:
Glucagon is a protein released by the pancreas that signals the
liver to release glucose. Glucagon is currently approved and marketed for use as a rescue
therapy in cases where patients become severely hypoglycemic. It is an unstable protein and
therefore must be stored lyophilized and reconstituted prior to use. We are developing a
more stable formulation of glucagon that may allow it to be stored as a refrigerated
liquid. Such a formulation may offer certain advantages in the rescue market and may also
enable the development of a bi-hormonal pump, which might better mimic the normal function
of the human pancreas.
Table of Contents
·
external research and development expenses incurred under agreements with third-party
contract research organizations and investigative sites, third-party manufacturing
organizations and consultants;
·
employee-related expenses, which include salaries and benefits for the personnel
involved in our preclinical and clinical drug development and manufacturing activities; and
·
facilities, depreciation and other allocated expenses, which include direct and
allocated expenses for rent and maintenance of facilities, depreciation of leasehold
improvements and equipment and laboratory and other supplies.
·
conduct additional clinical trials of VIAject
®
to support our
commercialization efforts and, potentially, FDA approval;
·
purchase recombinant human insulin and other materials to build commercial supply
inventory for VIAject
®
; and
·
continue pre-clinical and limited clinical development of earlier-stage product
candidates.
December 3,
2003
Three Months Ended
Six Months Ended
Inception to
March 31,
March 31,
March 31,
2009
2010
2009
2010
2010
(in thousands)
$
623
$
752
$
1,580
$
1,353
$
13,606
2,652
2,334
5,283
5,151
27,212
5,086
3,928
9,533
9,264
65,001
$
8,361
$
7,014
$
16,396
$
15,768
$
105,819
Table of Contents
·
our ability to secure approval by the FDA for our product candidates under Section
505(b)(2) of the FFDCA;
·
our ability to wait the length of time that will elapse before our NDA is fully reviewed
by the FDA;
·
the costs associated with preparing and submitting our Market Authorization Application
(MAA) for VIAject
®
to the European Medicines Agency (EMEA);
·
our ability to market, commercialize and achieve market acceptance for product
candidates, particularly VIAject
®
;
·
our ability to secure approval by the FDA for VIAject
®
without conducting
additional pivotal clinical trials;
·
the FDAs findings regarding data anomalies observed in India in our Phase 3 clinical
trial of VIAject
®
for patients with Type 1 diabetes and the impact of those
findings on the timing of a regulatory approval;
·
the size, endpoints and duration of additional clinical trials of VIAject
®
to
support our commercialization efforts and, potentially, FDA approval;
·
the cost to fully develop the 100 IU/cc liquid formulation of VIAject
®
;
·
our ability to establish that the 100 IU/cc liquid formulation of VIAject
®
is
well-tolerated in chronic use;
·
the cost to develop and secure approval from the FDA for our disposable pen;
·
the costs of pre-commercialization activities, including increased insulin purchases;
·
the costs associated with qualifying and obtaining regulatory approval of suppliers of
insulin and manufacturers of our product candidates;
·
the costs of preparing, filing and prosecuting patent applications and maintaining,
enforcing and defending intellectual property-related claims;
·
the emergence of competing technologies and products and other adverse market
developments; and
·
our ability to establish and maintain collaborations and the terms and success of the
collaborations, including the timing and amount of payments that we might receive from
potential strategic collaborators.
Table of Contents
Table of Contents
Three Months Ended
March 31,
Decrease
2009
2010
$
%
(in thousands)
$
8,361
$
7,014
$
1,347
16.1
%
72
%
67
%
Three Months Ended
March 31,
Decrease
2009
2010
$
%
(in thousands)
$
3,435
$
3,377
$
58
1.7
%
30
%
32
%
Table of Contents
Three Months Ended
March 31,
Decrease
2009
2010
$
%
(in thousands)
$
78
$
2
$
76
97.4
%
1
%
0
%
Three Months Ended
March 31,
Decrease
2009
2010
$
%
(in thousands, except per share amounts)
$
(11,629
)
$
(10,409
)
$
1,220
10.5
%
$
(0.49
)
$
(0.44
)
Six Months Ended
March 31,
Decrease
2009
2010
$
%
(in thousands)
$
16,396
$
15,768
$
628
3.8
%
76
%
73
%
Table of Contents
Six Months Ended
March 31,
Increase
2009
2010
$
%
(in thousands)
$
5,716
$
5,793
$
77
1.4
%
26
%
27
%
Six Months Ended
March 31,
Decrease
2009
2010
$
%
(in thousands)
$
320
$
7
$
313
97.8
%
2
%
0
%
Six Months Ended
March 31,
Decrease
2009
2010
$
%
(in thousands, except per share amounts)
$
(21,653
)
$
(21,557
)
$
96
0.4
%
$
(0.91
)
$
(0.90
)
Table of Contents
·
our ability to secure approval by the FDA for VIAject
®
under
Section 505(b)(2) of the FFDCA;
·
our ability to wait the length of time that will elapse before our NDA is fully reviewed
by the FDA;
·
the costs associated with preparing and submitting our MAA for VIAject
®
to
the EMEA;
·
our ability to market, commercialize and achieve market acceptance for product
candidates, particularly VIAject
®
;
·
our ability to secure approval by the FDA for VIAject
®
without conducting
additional pivotal clinical trials;
·
the FDAs findings regarding data anomalies observed in India in our Phase 3 clinical
trial of VIAject
®
for patients with Type 1 diabetes and the impact of those
findings on the timing of a regulatory approval;
·
the size, endpoints and duration of additional clinical trials of VIAject
®
in
patients with Type 1 diabetes to support our commercialization efforts and, potentially,
FDA approval;
·
the cost to fully develop the 100 IU/cc liquid formulation of VIAject
®
;
·
our ability to establish that the 100 IU/cc liquid formulation of VIAject
®
is
well-tolerated in chronic use;
·
the cost to develop an insulin pen program for use with VIAject
®
;
Table of Contents
·
the cost of purchasing recombinant human insulin and other materials to build commercial
supply inventory for VIAject
®
, taking into account currency exchange rate
fluctuations;
·
the costs of preparing, filing and prosecuting patent applications and maintaining,
enforcing and defending intellectual property-related claims;
·
the cost associated with qualifying and obtaining regulatory approval of suppliers of
insulin and manufacturers of our product candidates; and
·
our ability to establish and maintain collaborations and the terms and success of the
collaborations, including the timing and amount of payments that we might receive from
potential strategic collaborators.
Less
Than
Total
1 Year
1-3 Years
3-5 Years
$
2,490
$
628
$
1,816
$
46
8,688
5,094
3,594
$
11,178
$
5,722
$
5,410
$
46
Table of Contents
Table of Contents
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
·
continue to incur expenses without the ability to generate income for the period during
which our NDA is fully reviewed by the FDA, if not longer;
·
conduct additional clinical trials of VIAject
®
to support our
commercialization efforts and, potentially, FDA approval;
·
produce required validation batches of VIAject
®
vials, cartridges, and
disposable pens to support our NDA for VIAject
®
;
·
purchase recombinant human insulin and other materials to build commercial supply
inventory for VIAject
®
; and
·
conduct additional clinical development of our other product candidates.
·
our ability to secure approval by the FDA for VIAject
®
under
Section 505(b)(2) of the FFDCA;
·
our ability to wait the length of time that will elapse before our NDA is fully reviewed
by the FDA;
·
the costs associated with preparing and submitting our MAA, for VIAject
®
to
the EMEA;
·
our ability to market, commercialize and achieve market acceptance for product
candidates, particularly VIAject
®
;
·
our ability to secure approval by the FDA for VIAject
®
without conducting
additional pivotal clinical trials;
·
the FDAs findings regarding data anomalies observed in India in our Phase 3 clinical
trial of VIAject
®
for patients with Type 1 diabetes and the impact of those
findings on the timing of a regulatory approval;
·
the size, endpoints and duration of additional clinical trials of VIAject
®
in
patients with Type 1 diabetes to support our commercialization efforts and, potentially,
FDA approval;
Table of Contents
·
the cost to fully develop the 100 IU/cc liquid formulation of VIAject
®
;
·
our ability to establish that the 100 IU/cc liquid formulation of VIAject
®
is
well-tolerated in chronic use;
·
the cost to develop an insulin pen program for use with VIAject
®
;
·
the cost of purchasing recombinant human insulin and other materials to build commercial
supply inventory for VIAject
®
, taking into account currency exchange rate
fluctuations;
·
the costs of preparing, filing and prosecuting patent applications and maintaining,
enforcing and defending intellectual property-related claims;
·
the cost associated with qualifying and obtaining regulatory approval of suppliers of
insulin and manufacturers of our product candidates; and
·
our ability to establish and maintain collaborations and the terms and success of the
collaborations, including the timing and amount of payments that we might receive from
potential strategic collaborators.
Table of Contents
·
successful completion of preclinical development and clinical trials;
·
our ability to identify and enroll patients who meet clinical trial eligibility
criteria;
·
receipt of marketing approvals from the FDA and similar regulatory authorities outside
the United States, including for the liquid formulation of VIAject
®
;
·
establishing that our liquid formulation of VIAject
®
is well-tolerated in
chronic use;
·
establishing commercial manufacturing capabilities through arrangements with third-party
manufacturers;
·
launching commercial sales of the products, whether alone or in collaboration with
others;
·
competition from other products; and
·
a continued acceptable safety and tolerability profile of the products following
approval.
·
the number of patients required for our clinical trials may be larger than we
anticipate, enrollment in our clinical trials may be slower than we currently anticipate,
or participants may drop out of our clinical trials at a higher rate than we anticipate,
any of which would result in significant delays;
·
our third-party contractors may fail to comply with regulatory requirements or meet
their contractual obligations to us in a timely manner;
·
we might have to suspend or terminate our clinical trials if the participants are being
exposed to unacceptable health risks;
·
regulators or institutional review boards may require that we hold, suspend or terminate
clinical research for various reasons, including noncompliance with regulatory
requirements;
·
the cost of our clinical trials may be greater than we anticipate;
·
the supply or quality of our product candidates or other materials necessary to conduct
our clinical trials may be insufficient or inadequate; and
·
the effects of our product candidates may not be the desired effects or may include
undesirable side effects or the product candidates may have other unexpected
characteristics.
·
be delayed in obtaining marketing approval for our product candidates;
·
not be able to obtain marketing approval;
·
obtain approval for indications that are not as broad as intended; or
·
have the product removed from the market after obtaining marketing approval.
Table of Contents
·
a change in the labeling statements or withdrawal of FDA or other regulatory approval of
the product;
·
a change in the way the product is administered; or
·
the need to conduct additional clinical trials.
·
the willingness and ability of patients and the healthcare community to adopt our
technology;
·
the ability to manufacture our product candidates in sufficient quantities with
acceptable quality and to offer our product candidates for sale at competitive prices;
·
the perception of patients and the healthcare community, including third-party payors,
regarding the safety, efficacy and benefits of our product candidates compared to those of
competing products or therapies;
·
the convenience and ease of administration of our product candidates relative to
existing treatment methods, such as our ability to gain regulatory approval for our liquid
100 IU/cc formulation of VIAject
®
;
·
the label and promotional claims allowed by the FDA, such as, in the case of VIAject
®
,
claims relating to glycemic control, hypoglycemia, weight gain, injection site discomfort,
expiry dating and required handling conditions;
·
the pricing and reimbursement of our product candidates relative to existing treatments;
and
·
marketing and distribution support for our product candidates.
Table of Contents
·
a covered benefit under its health plan;
·
safe, effective and medically necessary;
·
appropriate for the specific patient;
·
cost-effective; and
·
neither experimental nor investigational.
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·
decreased demand for any product candidates or products that we may develop;
·
injury to our reputation;
·
withdrawal of clinical trial participants;
·
costs to defend the related litigation;
·
substantial monetary awards to trial participants or patients;
·
loss of revenue; and
·
the inability to commercialize any products that we may develop.
·
significantly greater financial, technical and human resources than we have and may be
better equipped to discover, develop, manufacture and commercialize product candidates;
·
more extensive experience in preclinical testing and clinical trials, obtaining
regulatory approvals and manufacturing and marketing pharmaceutical products;
·
product candidates that have been approved or are in late-stage clinical development; or
·
collaborative arrangements in our target markets with leading companies and research
institutions.
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·
reliance on the third party for regulatory compliance and quality assurance;
·
the possible breach of the manufacturing agreement by the third party because of factors
beyond our control; and
·
the possible refusal by the third party to support our manufacturing programs, based on
its own business priorities, at a time that is costly or inconvenient for us.
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·
receiving patent protection for our product candidates;
·
maintaining our trade secrets;
·
not infringing on the proprietary rights of others; and
·
preventing others from infringing our proprietary rights.
Table of Contents
Table of Contents
Table of Contents
·
restrictions on such products manufacturers or manufacturing processes;
·
restrictions on the marketing or distribution of a product;
·
warning letters;
·
withdrawal of the products from the market;
·
refusal to approve pending applications or supplements to approved applications that we
submit;
·
recall of products;
·
fines, restitution or disgorgement of profits or revenue;
·
suspension or withdrawal of regulatory approvals;
·
refusal to permit the import or export of our products;
·
product seizure;
·
injunctions; or
·
imposition of civil or criminal penalties.
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·
establish a classified board of directors such that not all members of the board are
elected at one time;
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·
allow the authorized number of our directors to be changed only by resolution of our
board of directors;
·
limit the manner in which stockholders can remove directors from the board;
·
establish advance notice requirements for stockholder proposals that can be acted on at
stockholder meetings and nominations to our board of directors;
·
require that stockholder actions must be effected at a duly called stockholder meeting
and prohibit actions by our stockholders by written consent;
·
limit who may call stockholder meetings;
·
authorize our board of directors to issue preferred stock without stockholder approval,
which could be used to institute a stockholder rights plan or poison pill that would work
to dilute the stock ownership of a potential hostile acquirer, effectively preventing
acquisitions that have not been approved by our board of directors; and
·
require the approval of the holders of at least 75% of the votes that all our
stockholders would be entitled to cast to amend or repeal certain provisions of our charter
or bylaws.
·
results of clinical trials of our product candidates or those of our competitors;
·
regulatory or legal developments in the United States and other countries;
·
variations in our financial results or those of companies that are perceived to be
similar to us;
·
developments or disputes concerning patents or other proprietary rights;
·
the recruitment or departure of key personnel;
·
changes in the structure of healthcare payment systems;
·
market conditions in the pharmaceutical and biotechnology sectors and issuance of new or
changed securities analysts reports or recommendations;
·
general economic, industry and market conditions; and
·
the other factors described in this Risk Factors section.
Table of Contents
Table of Contents
Exhibit No.
Description
2010 Stock Incentive Plan.
2010 Incentive Stock Option Agreement.
2010 Non Statutory Stock Option Agreement
2010 Restricted Stock Unit Agreement.
Chief Executive OfficerCertification pursuant to Rule
13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act
of 1934, as adopted pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
Chief Financial OfficerCertification pursuant to Rule
13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act
of 1934, as adopted pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
Chief Executive Officer and Chief Financial
OfficerCertification pursuant to Rule 13a-14(b) or Rule
15d-14(b) of the Securities Exchange Act of 1934 and 18
U.S.C. Section 1350, as adopted pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002.
Table of Contents
41
42
BIODEL INC.
Dated: May 7, 2010
By:
/s/ Gerard Michel
Gerard Michel, Chief Financial Officer,
VP Corporate Development, and Treasurer
Table of Contents
Exhibit No.
Description
2010 Stock Incentive Plan.
2010 Incentive Stock Option Agreement.
2010 Non Statutory Stock Option Agreement
2010 Restricted Stock Unit Agreement.
Chief Executive OfficerCertification pursuant to Rule
13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act
of 1934, as adopted pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
Chief Financial OfficerCertification pursuant to Rule
13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act
of 1934, as adopted pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.
Chief Executive Officer and Chief Financial
OfficerCertification pursuant to Rule 13a-14(b) or Rule
15d-14(b) of the Securities Exchange Act of 1934 and 18
U.S.C. Section 1350, as adopted pursuant to Section 906 of
the Sarbanes-Oxley Act of 2002.
43
44
45
46
47
48
49
50
51
52
53
54
Option
|
While your Option remains in effect under the Expiration section below, | |
Exercisability
you may exercise any exercisable portions of the Option (and buy the Option Shares)
under the timing rules Schedule I specifies under Option Exercisability Provisions . |
||
|
||
Method of
Exercise and
Payment for
Shares
|
Subject to this Agreement and the Plan, you may exercise an Option only by providing a written notice (or notice through another previously approved method, which could include a web-based or voice- or e-mail system) to the Secretary of the Company or to whomever the Board (or the Committee) designates, that is received on or before the date the Option expires. Each such notice must satisfy whatever procedures then apply to the Option and must contain such representations (statements from you about your situation) as the Company requires. You must, at the same time, pay the Exercise Price using one or more of the following methods: |
Cash/Check
|
cash or by check, payable to the order of the Company; | |
|
||
Cashless
Exercise |
(i) delivery of an irrevocable and unconditional undertaking by a creditworthy broker to deliver promptly to the Company sufficient funds to pay the exercise price and any required tax withholding or (ii) delivery by you to the Company of a copy of irrevocable and unconditional instructions to a creditworthy broker to deliver promptly to the Company cash or a check sufficient to pay the exercise price and any required tax withholding; | |
|
||
Stock
|
delivery (either by actual delivery or attestation) of shares of Common Stock owned by you valued at their Fair Market Value, provided (i) such method of payment is then permitted under applicable law, (ii) such Common Stock, if acquired directly from the Company, was owned by you for such minimum period of time, if any, as may be established by the Board in its discretion and (iii) such Common Stock is not subject to any repurchase, forfeiture, unfulfilled vesting or other similar requirements; or | |
|
||
|
any combination of the above permitted forms of payments. |
55
|
The Board (or the Committee) can approve additional payment methods subject to any prohibitions under applicable law. |
Expiration
|
You cannot exercise an Option that has expired. The Option will expire no later than the close of business on the Term Expiration Date shown on Schedule I. The Option Expiration Rules in Schedule I provide the circumstances under which the Option will terminate before the Term Expiration Date because of, for example, your termination of employment or other service providing relationship. Except as the Board (or the Committee) otherwise determines, the Plan will treat your service-providing relationship (and any further increases in exercisability of the Option) as ending if you are an employee on the Date of Grant and become an independent contractor. The Board (or the Committee) can override the expiration provisions of Schedule I. | |
|
||
Special ISO Rule
|
If you acquire Option Shares by exercising an Incentive Stock Option, you agree to promptly notify the Company if you dispose of those Option Shares within one year after you acquired them or within two years after the Incentive Stock Options Date of Grant. | |
|
||
Substantial
Corporate Change |
If a Reorganization Event or Change in Control Event ( each as defined in the Plan) occurs while you remain employed by the Company, the Option will be treated as provided in the Plan, except as Schedule I may otherwise provide or the Board (or the Committee) otherwise determines. | |
|
||
Compliance
with Law |
You may not exercise an Option if the Companys issuing stock upon such exercise would violate any applicable federal or state securities laws or other laws or regulations. You may not sell or otherwise dispose of the Option Shares in violation of applicable law. As part of this prohibition, you may not use any exercise procedure that includes a sale on the market if the Companys insider trading policy then prohibits you from selling to the market. | |
|
||
Additional
Conditions
to Exercise |
The Company may postpone issuing and delivering any Option Shares for so long as the Company determines to be advisable to satisfy the following: |
|
its completing or amending any securities registration or qualification of the Option Shares or its or your satisfying any exemption from registration under any Federal or state law, rule, or regulation; | |
|
||
|
its receiving proof it considers satisfactory that a person seeking to exercise the Option after your death is entitled to do so; | |
|
||
|
your complying with any requests for representations under the Plan; and | |
|
||
|
its or your complying with any federal, state, or local tax withholding obligations. |
Additional
Representations from You |
If you exercise an Option at a time when the Company does not have a current registration statement (generally on Form S-8) under the Securities Act of 1933 (the Act ) that covers issuances of shares to you, you must comply with the following before the Company will issue the Option Shares to you. You must |
|
represent to the Company, in a manner satisfactory to the Companys counsel, that you are acquiring the Option Shares for your own account and not with a view to reselling or distributing the Option Shares; and |
56
|
agree that you will not sell, transfer, or otherwise dispose of the Option Shares unless: |
|
a registration statement under the Act is effective at the time of disposition with respect to the Option Shares you propose to sell, transfer, or otherwise dispose of; or | |
|
||
|
the Company has received an opinion of counsel or other information and representations it considers satisfactory to the effect that, because of Rule 144 under the Act or otherwise, no registration under the Act is required. |
No Effect on
Employment or Other Relationship |
Nothing in this Agreement restricts the Companys rights or those of any of its affiliates to terminate your employment or other relationship at any time, for any or no reason. The termination of employment or other relationship, whether by the Company or any of its affiliates or otherwise, and regardless of the reason for such termination, has the consequences provided for under the Plan and any applicable employment or severance agreement or plan. | |
|
||
Not a Stockholder
|
You understand and agree that the Company will not consider you a stockholder for any purpose with respect to any of the Option Shares until you have exercised the Option, paid for the shares, and received evidence of ownership. | |
|
||
No Effect on
Running Business |
You understand and agree that the existence of an Option will not affect in any way the right or power of the Company or its stockholders to make or authorize any adjustments, recapitalizations, reorganizations, or other changes in the Companys capital structure or its business, or any merger or consolidation of the Company, or any issuance of bonds, debentures, preferred or other stock, with preference ahead of or convertible into, or otherwise affecting the Companys common stock or the rights thereof, or the dissolution or liquidation of the Company, or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding, whether or not of a similar character to those described above. | |
|
||
Governing Law
|
The laws of the State of Delaware will govern all matters relating to this Agreement, without regard to the principles of conflict of laws. | |
|
||
Notices
|
Any notice you give to the Company must follow the procedures then in effect. If no other procedures apply, you must send your notice in writing by hand or by mail to the office of the Companys Secretary (or to the Chair of the Board (or the Committee) if you are then serving as the sole Secretary). If mailed, you should address it to the Companys Secretary (or the Chair of the Board (or the Committee)) at the Companys then corporate headquarters, unless the Company directs optionees to send notices to another corporate department or to a third party administrator or specifies another method of transmitting notice. The Company and the Board (or the Committee) may address any notices to you using its standard electronic communications methods or at your office or home address as reflected on the Companys personnel or other business records. You and the Company may change the address for notice by like notice to the other, and the Company can also change the address for notice by general announcements to optionees. | |
|
||
Section 409A
|
This Agreement is intended to comply with the requirements of Section 409A of the Internal Revenue Code and must be construed consistently with that section. Neither the Company nor you shall have the right to accelerate or defer the delivery of any such payments or benefits except to the extent specifically permitted or required by Section 409A. In any event, the Company makes no representations or warranty and shall have no liability to you or any other person, if any provisions of or payments under this Agreement are determined to |
57
|
constitute deferred compensation subject to Code Section 409A but not to satisfy the conditions of that section. | |
|
||
Withholding
|
Issuing the Option Shares is contingent on satisfaction of all obligations with respect to required tax or other required withholdings (for example, in the U.S., Federal, state, and local taxes.) The Company may take any action permitted under Section 11(e) of the Plan to satisfy such obligation, including, if the Board (or the Committee) so determines, satisfying the tax obligations by (i) reducing the number of Option Shares to be issued to you in connection with any exercise of the Option by that number of Option Shares (valued at their Fair Market Value on the date of exercise) that would equal all taxes required to be withheld (at their minimum withholding levels), (ii) accepting payment of the withholdings from a broker in connection with a Cashless Exercise of the Option or directly from you, or (iii) taking any other action under Section 11(e). If a fractional share remains after deduction for required withholding, the Company will pay you the value of the fraction in cash. | |
|
||
Plan Governs
|
Wherever a conflict may arise between the terms of this Agreement and the terms of the Plan, the terms of the Plan will control. The Board (or the Committee) may adjust the number of Option Shares and the Exercise Price and other terms of the Option from time to time as the Plan provides. |
58
Name:
|
||||||||||
|
||||||||||
Signature:
|
||||||||||
|
||||||||||
Option Information : | ||||||||||
|
||||||||||
Option Shares:
|
Exercise Price per Share: | |||||||||
|
|
|
||||||||
Date of Grant:
|
Term Expiration Date: | |||||||||
|
|
|
Option Exercisability Provisions
|
This Option will become exercisable as to ___% of the Option Shares on the ___ anniversary of the Date of Grant and as to an additional ___% of the initial Option Shares on , assuming you remain employed or become and remain a member of the Board, or, to the extent the Board (or the Committee) provides for ongoing credit, otherwise continue your individual service-providing relationship through each relevant date. Any fractional shares that do not become exercisable on such dates will be carried forward to the following year, unless the Board (or the Committee) selects a different treatment. The exercise schedule will cease if you become an independent contractor (other than as a member of the Board), except as the Board (or the Committee) otherwise determines. | |
|
||
Option Expiration Rules
|
If the Option is not fully exercisable when you cease to be employed or become and remain a member of the Board (even if you continue service as an independent contractor), any unexercisable portion will then expire immediately. If any portion of the Option is exercisable, that portion will remain exercisable until the first to occur of the following, each as defined further in the Plan, and then immediately expire: |
| The 90 th day after your employment or other individual-service providing relationship ends due to your retirement (unless another provision applies) | ||
| The 90 th day after your employment or other individual-service providing relationship ends due to any reason other than for your death or Disability (unless another provision applies) | ||
| For Disability, the 12 month anniversary of your termination of employment for Disability | ||
| The first anniversary of your death | ||
| The Term Expiration Date |
59
60
Option
|
While your Option remains in effect under the Expiration section below, | |
Exercisability you may exercise any exercisable portions of the Option (and buy the Option Shares) | ||
|
under the timing rules Schedule I specifies under Option Exercisability Provisions . | |
|
||
Method of
Exercise and Payment for Shares |
Subject to this Agreement and the Plan, you may exercise an Option only by providing a written notice (or notice through another previously approved method, which could include a web-based or voice- or e-mail system) to the Secretary of the Company or to whomever the Board (or the Committee) designates, that is received on or before the date the Option expires. Each such notice must satisfy whatever procedures then apply to the Option and must contain such representations (statements from you about your situation) as the Company requires. You must, at the same time, pay the Exercise Price using one or more of the following methods: |
|
Cash/Check | cash or by check, payable to the order of the Company; | ||
|
||||
|
Cashless
Exercise |
(i) delivery of an irrevocable and unconditional undertaking by a creditworthy broker to deliver promptly to the Company sufficient funds to pay the exercise price and any required tax withholding or (ii) delivery by you to the Company of a copy of irrevocable and unconditional instructions to a creditworthy broker to deliver promptly to the Company cash or a check sufficient to pay the exercise price and any required tax withholding; | ||
|
||||
|
Stock | delivery (either by actual delivery or attestation) of shares of Common Stock owned by you valued at their Fair Market Value, provided (i) such method of payment is then permitted under applicable law, (ii) such Common Stock, if acquired directly from the Company, was owned by you for such minimum period of time, if any, as may be established by the Board in its discretion and (iii) such Common Stock is not subject to any repurchase, forfeiture, unfulfilled vesting or other similar requirements; | ||
|
||||
|
Net Exercise | delivery of a notice of net exercise to the Company, as a result of which you would pay the exercise price for the portion of the Option being exercised by cancelling a portion of the Option for such number of shares as is equal to the exercise price divided by the excess of the Fair |
61
|
Market Value on the date of exercise over the Option exercise price per share; or | |||
|
||||
|
any combination of the above permitted forms of payments. | |||
|
||||
|
The Board (or the Committee) can approve additional payment methods subject to any prohibitions under applicable law. |
Expiration
|
You cannot exercise an Option that has expired. The Option will expire no later than the close of business on the Term Expiration Date shown on Schedule I. The Option Expiration Rules in Schedule I provide the circumstances under which the Option will terminate before the Term Expiration Date because of, for example, your termination of employment or other service providing relationship. Except as the Board (or the Committee) otherwise determines, the Plan will treat your service-providing relationship (and any further increases in exercisability of the Option) as ending if you are an employee or member of the Board of Directors on the Date of Grant and become an independent contractor. The Board (or the Committee) can override the expiration provisions of Schedule I. | |
|
||
Substantial
Corporate Change |
If a Reorganization Event or Change in Control Event (each as defined in the Plan) occurs while you remain employed by the Company, the Option will be treated as provided in the Plan, except as Schedule I may otherwise provide or the Board (or the Committee) otherwise determines. | |
|
||
Compliance
with Law |
You may not exercise an Option if the Companys issuing stock upon such exercise would violate any applicable federal or state securities laws or other laws or regulations. You may not sell or otherwise dispose of the Option Shares in violation of applicable law. As part of this prohibition, you may not use any exercise procedure that includes a sale on the market if the Companys insider trading policy then prohibits you from selling to the market. | |
|
||
Additional
Conditions
to Exercise |
The Company may postpone issuing and delivering any Option Shares for so long as the Company determines to be advisable to satisfy the following: |
|
its completing or amending any securities registration or qualification of the Option Shares or its or your satisfying any exemption from registration under any Federal or state law, rule, or regulation; | |||
|
||||
|
its receiving proof it considers satisfactory that a person seeking to exercise the Option after your death is entitled to do so; | |||
|
||||
|
your complying with any requests for representations under the Plan; and | |||
|
||||
|
its or your complying with any federal, state, or local tax withholding obligations. |
Additional
Representations from You |
If you exercise an Option at a time when the Company does not have a current registration statement (generally on Form S-8) under the Securities Act of 1933 (the Act ) that covers issuances of shares to you, you must comply with the following before the Company will issue the Option Shares to you. You must |
|
represent to the Company, in a manner satisfactory to the Companys counsel, that you are acquiring the Option Shares for your own account and not with a view to reselling or distributing the Option Shares; and |
62
|
agree that you will not sell, transfer, or otherwise dispose of the Option Shares unless: |
No Effect on
Employment or Other Relationship |
Nothing in this Agreement restricts the Companys rights or those of any of its affiliates to terminate your employment or other relationship at any time, for any or no reason. The termination of employment or other relationship, whether by the Company or any of its affiliates or otherwise, and regardless of the reason for such termination, has the consequences provided for under the Plan and any applicable employment or severance agreement or plan. | |
|
||
Not a Stockholder
|
You understand and agree that the Company will not consider you a stockholder for any purpose with respect to any of the Option Shares until you have exercised the Option, paid for the shares, and received evidence of ownership. | |
|
||
No Effect on
Running Business |
You understand and agree that the existence of an Option will not affect in any way the right or power of the Company or its stockholders to make or authorize any adjustments, recapitalizations, reorganizations, or other changes in the Companys capital structure or its business, or any merger or consolidation of the Company, or any issuance of bonds, debentures, preferred or other stock, with preference ahead of or convertible into, or otherwise affecting the Companys common stock or the rights thereof, or the dissolution or liquidation of the Company, or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding, whether or not of a similar character to those described above. | |
|
||
Governing Law
|
The laws of the State of Delaware will govern all matters relating to this Agreement, without regard to the principles of conflict of laws. | |
|
||
Notices
|
Any notice you give to the Company must follow the procedures then in effect. If no other procedures apply, you must send your notice in writing by hand or by mail to the office of the Companys Secretary (or to the Chair of the Board (or the Committee) if you are then serving as the sole Secretary). If mailed, you should address it to the Companys Secretary (or the Chair of the Board (or the Committee)) at the Companys then corporate headquarters, unless the Company directs optionees to send notices to another corporate department or to a third party administrator or specifies another method of transmitting notice. The Company and the Board (or the Committee) may address any notices to you using its standard electronic communications methods or at your office or home address as reflected on the Companys personnel or other business records. You and the Company may change the address for notice by like notice to the other, and the Company can also change the address for notice by general announcements to optionees. | |
|
||
Section 409A
|
This Agreement is intended to comply with the requirements of Section 409A of the Internal Revenue Code and must be construed consistently with that section. Neither the Company nor you shall have the right to accelerate or defer the delivery of any such payments or benefits except to the extent specifically permitted or required by Section 409A. In any event, the Company makes no representations or warranty and shall have no liability to you or any other person, if any provisions of or payments under this Agreement are determined to |
63
|
constitute deferred compensation subject to Code Section 409A but not to satisfy the conditions of that section. | |
|
||
Withholding
|
Issuing the Option Shares is contingent on satisfaction of all obligations with respect to required tax or other required withholdings (for example, in the U.S., Federal, state, and local taxes.) The Company may take any action permitted under Section 11(e) of the Plan to satisfy such obligation, including, if the Board (or the Committee) so determines, satisfying the tax obligations by (i) reducing the number of Option Shares to be issued to you in connection with any exercise of the Option by that number of Option Shares (valued at their Fair Market Value on the date of exercise) that would equal all taxes required to be withheld (at their minimum withholding levels), (ii) accepting payment of the withholdings from a broker in connection with a Cashless Exercise of the Option or directly from you, or (iii) taking any other action under Section 11(e). If a fractional share remains after deduction for required withholding, the Company will pay you the value of the fraction in cash. | |
|
||
Plan Governs
|
Wherever a conflict may arise between the terms of this Agreement and the terms of the Plan, the terms of the Plan will control. The Board (or the Committee) may adjust the number of Option Shares and the Exercise Price and other terms of the Option from time to time as the Plan provides. |
64
65
Name:
|
||||
Signature:
|
|
|||
|
|
Option Shares:
|
Exercise Price per Share: | |||||
|
||||||
Date of Grant:
|
Term Expiration Date: |
Option Expiration Rules
|
If the Option is not fully exercisable when you cease to be employed or a member of the Board of Directors (even if you continue service as an independent contractor), any unexercisable portion will then expire immediately. If any portion of the Option is exercisable, that portion will remain exercisable until the first to occur of the following, each as defined further in the Plan if not otherwise defined below, and then immediately expire: | |
|
||
|
The 90
th
day after your employment or
other individual-service providing relationship ends due
to your retirement (unless another provision applies)
|
|
|
||
|
The 90
th
day after your employment or
other individual-service providing relationship ends due
to any reason other than for your death or Disability
(unless another provision applies)
|
|
|
||
|
For Disability, the 12 month anniversary of your
termination of employment for Disability
|
|
|
||
|
The first anniversary of your death
|
|
|
||
|
The Term Expiration Date
|
66
67
Vesting Schedule
|
The Grant becomes nonforfeitable ( Vested ) as to some or all of the RSUs only as provided on Exhibit A. | |
|
||
Distribution Date
|
You will receive a distribution of shares (the Shares ) of Company common stock ( Common Stock ) equivalent to your Vested RSUs on the date determined under Exhibit A (the Distribution Date ), subject to any overriding provisions in the Plan. | |
|
||
Limited Status
|
You understand and agree that the Company will not consider you a shareholder for any purpose with respect to the Shares, unless and until the Shares have been issued to you on the Distribution Date. You will receive dividend equivalents with respect to the RSUs, measured using the Shares they represent and beginning as the RSUs become Vested, with the amounts payable with or promptly after payment to shareholders of the dividends, but, in any event, no later than March 15 of the year following the year in which such dividends are declared. | |
|
||
Voting
|
RSUs cannot be voted. You may not vote the Shares unless and until the Shares are distributed to you. | |
|
||
Restrictions
and Forfeiture |
You may not sell, assign, pledge, encumber, or otherwise transfer any interest ( Transfer ) in the Shares until the Shares are distributed to you. Any attempted Transfer that precedes the Distribution Date is invalid. | |
|
||
|
Unless the Administrator determines otherwise at any time or Exhibit A provides otherwise, if your service with the Company terminates for any reason before all of your RSUs are Vested, then you will forfeit such unvested RSUs (and the Shares to which they relate) to the extent that such RSUs do not otherwise Vest as a result of the termination. The forfeited RSUs will then immediately revert to the Company. You will receive no payment for RSUs that you forfeit. | |
|
||
Additional
Conditions |
The Company may postpone issuing and delivering any Shares for so long as the Company determines to be advisable to satisfy the following: | |
to Receipt
|
|
its completing or amending any securities registration or qualification of the Shares or its or your satisfying any exemption from registration under any Federal or state law, rule, or regulation; |
68
|
its receiving proof it considers satisfactory that a person or entity seeking to receive the Shares after your death is entitled to do so; | |||
|
||||
|
your complying with any requests for representations under the Grant and the Plan; and | |||
|
||||
|
its or your complying with any federal, state, or local tax withholding obligations. |
Taxes and
Withholding
|
The RSUs provide tax deferral, meaning that they are not taxable to you until you actually receive Shares on or around the Distribution Date. You will then owe taxes at ordinary income tax rates as of the Distribution Date at the Shares value. | |
|
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The Company is required to withhold (in cash from salary or other amounts owed you) the applicable percentage of the value of the Shares on the Distribution Date, regardless of whether you sell them. If the Company does not choose to do so, you agree to arrange for payment of the withholding taxes and/or confirm that the Company is arranging for appropriate withholding. | |
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Representations
from You |
If the Vesting provisions of your RSU grant are satisfied and you receive Shares at a time when the Company does not have a current registration statement (generally on Form S-8) under the Act that covers issuances of Shares to you, you must comply with the following before the Company will release the Shares to you. You must: |
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represent to the Company, in a manner satisfactory to the Companys counsel, that you are acquiring the Shares for your own account and not with a view to reselling or distributing the Shares; and | |||
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agree that you will not sell, transfer, or otherwise dispose of the Shares unless: |
Additional
Restriction |
You will not receive the Shares if issuing the Shares would violate any applicable federal or state securities laws or other laws or regulations. | |
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No Effect on
Employment or Other Relationship |
Nothing in this Agreement restricts the Companys rights or those of any of its affiliates to terminate your employment or other relationship at any time, with or without cause. The termination of your relationship, whether by the Company or any of its affiliates or otherwise, and regardless of the reason for such termination, has the consequences provided for under the Plan and any applicable employment or severance agreement or plan. | |
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No Effect on
Running Business |
You understand and agree that the existence of the RSU will not affect in any way the right or power of the Company or its stockholders to make or authorize any adjustments, recapitalizations, reorganizations, or other changes in the Companys capital structure or its business, or any merger or consolidation of the Company, or any issuance of bonds, debentures, preferred or other stock, with preference ahead of or convertible into, or otherwise affecting the Companys common stock or the rights thereof, or the dissolution or liquidation of |
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the Company, or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding, whether or not of a similar character to those described above. | |
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Section 409A
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This Agreement is intended to comply with the requirements of Section 409A of the Internal Revenue Code and must be construed consistently with that section. Notwithstanding anything in the Plan or this Agreement to the contrary, if the Vested portion is increased in connection with your separation from service within the meaning of Section 409A, as determined by the Company), other than due to death , and if (x) you are then a specified employee within the meaning of Section 409A at the time of such separation from service (as determined by the Company, by which determination you agree you are bound) and (y) the payment under such accelerated RSUs will result in the imposition of additional tax under Section 409A if paid to you within the six month period following your separation from service, then the payment under such accelerated RSUs will not be made until the earlier of (i) the date six months and one day following the date of your separation from service or (ii) the 10 th day after your date of death. Neither the Company nor you shall have the right to accelerate or defer the delivery of any such payments or benefits except to the extent specifically permitted or required by Section 409A. In any event, the Company makes no representation or warranty and shall have no liability to you or any other person, if any provisions of or payments under this Agreement are determined to constitute deferred compensation subject to Code Section 409A but not to satisfy the conditions of that section. | |
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Unsecured
Creditor |
This Agreement creates a contractual obligation on the part of the Company to make payment under the RSUs credited to your account at the time provided for in this Agreement. Neither you nor any other party claiming an interest in deferred compensation hereunder shall have any interest whatsoever in any specific assets of the Company. Your right to receive payments hereunder is that of an unsecured general creditor of Company. | |
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Governing Law
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The laws of the State of Delaware will govern all matters relating to this Agreement, without regard to the principles of conflict of laws. | |
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Notices
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Any notice you give to the Company must follow the procedures then in effect. If no other procedures apply, you must send your notice in writing by hand or by mail to the office of the Companys Secretary. If mailed, you should address it to the Companys Secretary at the Companys then corporate headquarters, unless the Company directs participants to send notices to another corporate department or to a third party administrator or specifies another method of transmitting notice. The Company and the Administrator will address any notices to you at your office or home address as reflected on the Companys personnel or other business records. You and the Company may change the address for notice by like notice to the other, and the Company can also change the address for notice by general announcements to participants. | |
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Plan Governs
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Wherever a conflict may arise between the terms of this Agreement and the terms of the Plan, the terms of the Plan will control. |
Biodel Inc. | ||||||
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Date:
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Name: | |||||||
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Name:
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Signature: X
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RSUs:
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Date of Grant: | |||||
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Vesting Schedule
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The Grant is Vested as to of the RSUs on each of the next anniversaries of the Date of Grant (each a Vesting Date ), assuming you remain a service provider to the Company through those dates. | |
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Any RSUs that would have Vested in the 12 months following your death or Disability will Vest instead upon your death or Disability. | |
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If a Change of Control occurs before at least 50% of your original number of RSUs have Vested, an additional number of RSUs will Vest upon closing of the Change of Control such that you will be Vested, cumulatively, in 50% of your RSUs, with payment of any such additional RSUs subject to the Section 409A provisions in the agreement to which this Exhibit is attached. In addition, if your employment ends on or within 12 months following the closing of a Change of Control because (i) the Company terminates your employment without Cause (as defined below and not on death or Disability) or (ii) you resign for Good Reason (as defined below), any then unvested RSUs will Vest on your cessation of employment. | |
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Grant Expiration Rules
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You will forfeit any unvested portions of the Grant immediately when you cease to be employed by (or a member of the Board of) the Company. | |
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Distribution Date
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Your Distribution Date for any then Vested RSUs will be the earliest of the following: |
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Your Separation from Service (as defined under Code Section 409A), | |||
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A Change in Control (subject to the provisions on Section 409A in the agreement), or | |||
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a date to be determined by the Company between January 1 and March 15 of the year following the year in which portions of the RSUs Vest. |
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Any RSUs that Vest after the Distribution Date (and have not been forfeited on termination of employment) will have a Distribution Date as soon as practicable after each Vesting Date but, in any event, no later than 30 days thereafter. The Distribution Date may be revised as provided in the Plan in the event of certain events involving the ownership of the Company. |
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Cause
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For purposes solely of this Grant, termination of your employment will be for Cause if it is for any of the following: | |
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(a) Your refusal to carry out any of
your material lawful duties or any directions or instructions of
the Board or senior management of the Company that are
reasonably consistent with those duties;
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(b) Your failure to perform
satisfactorily any of your lawful duties that are consistent
with duties for any similarly situated individual or any
directions or instructions of the Board or senior management
that are consistent with those duties, as long as you have been
given notice and have failed to correct any such failure within
10 days thereafter (unless any such correction by its nature
cannot be done in 10 days, in which event you will have a
reasonable time to correct the failure) and provided further
that the Company shall have no such obligation to give notice
and you will have no such opportunity to correct failures more
than two times in any 12 calendar month period;
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(c) Your violation of a local, state
or federal law involving the commission of a crime, other than
minor traffic violations, or any other criminal act involving
moral turpitude;
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(d) Your gross negligence, willful
misconduct, or breach of your duty to the Company involving
self-dealing or personal profit;
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(e) Your current abuse of alcohol or
controlled substances; deception, fraud, misrepresentation or
dishonesty; or any incident materially compromising your
reputation or ability to represent the Company with investors,
customers or the public; or
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(f) Your other material violation of
any provision of any employment, retention, severance, or change
in control agreement covering you not described in (a) or (b)
above, subject to the same notice and opportunity-to-correct
provisions as are set forth in (b) above.
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Disability
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For the purposes solely of this Grant, Disability means your inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than 12 months. You shall not be deemed to have a Disability until proof of the existence thereof shall have been furnished to the Board of Directors in such form and manner, and at such times, as the Board of Directors may require. Any determination by the Board of Directors that you do or do not have a Disability shall be final and binding upon you and the Company. | |
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Good Reason
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For purposes solely of this Grant, your resignation will be for Good Reason if it is for any of the following without your consent: | |
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(a) A material reduction of your
annual base salary, regardless of any change in your duties or
responsibilities;
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(b) Any material diminution in your
position, authority, duties or responsibilities or any other
action by the Company that results in a material diminution in
such position, authority, duties or responsibilities, excluding
for this purpose an isolated and inadvertent action not taken in
bad faith and that is remedied by the Company within 10 days
after the Company has received notice of such action from you,
provided that this clause (b) will only apply to you if a
substantially comparable provision also
exists in an employment, retention, severance, or change in
control agreement covering you;
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(c) The Companys requiring you to be
based at any office or location more than 50 miles from the
location of your then assigned worksite; or
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(d) Any other material violation by
the Company of any provision of an employment agreement or other
agreement under which you are providing services to the Company.
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Notwithstanding the foregoing, no basis for a termination for Good Reason will be deemed to exist unless you notify the Company in writing of any event in (a) through (d) above within 90 days of the first occurrence of such event and the Company or its successor fails to cure any such event within 30 days after receipt of the notice. Furthermore, your termination of employment for Good Reason must occur no later than one year following the initial existence of such condition. |
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Dated: May 7, 2010 | /s/ Errol B. De Souza | |||
Errol B. De Souza, President and | ||||
Chief Executive Officer | ||||
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Dated: May 7, 2010 | /s/ Gerard Michel | |||
Gerard Michel, Chief Financial Officer, | ||||
VP Corporate Development, and Treasurer | ||||
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Dated: May 7, 2010 | /s/ Errol B. De Souza | |||
Errol B. De Souza, President and | ||||
Chief Executive Officer | ||||
Dated: May 7, 2010 | /s/ Gerard Michel | |||
Gerard Chief Financial Officer, | ||||
VP Corporate Development, and Treasurer | ||||
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