Exhibit 10.34
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NONTRANSFERABLE
NONQUALIFIED STOCK OPTION AGREEMENT
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THIS AGREEMENT, dated as of the 26th day of November, 2001, is by and
between SYNAPTIC PHARMACEUTICAL CORPORATION, a Delaware corporation (the
"Company"), and Xxxxxxxx X. Xxxxxxxx (the "Optionee," which term as used herein
shall be deemed to include any successor to the Optionee by will or by the laws
of descent and distribution, unless the context shall otherwise require).
W I T N E S S E T H:
WHEREAS, the Company and the Optionee are parties to a Separation Agreement
dated as of November 26, 2001 ("Separation Agreement");
WHEREAS, the Separation Agreement provides for the grant of an option to
acquire 150,000 shares of the Company's common stock on the terms provided
herein; and
WHEREAS, pursuant to the Synaptic Pharmaceutical Corporation 1996 Incentive
Plan (the "Plan"), the Company, acting through the Compensation Committee (the
"Committee") of its Board of Directors (the "Board"), on November 26, 2001 (the
"Start Date"), granted to the Optionee an option to purchase up to an aggregate
of 150,000 shares of Common Stock, $0.01 par value, of the Company (the "Common
Stock"), at the price of $5.52 per share, such option to be for the term and
upon the terms and conditions hereinafter stated.
NOW, THEREFORE, in consideration of the mutual premises and undertakings
hereinafter set forth, the parties hereto agree as follows:
1. Option; Option Price. Pursuant to said action of the Committee, the
Company has granted to the Optionee the option (the "Option") to purchase, upon
and subject to the terms and conditions of this Agreement and the terms and
conditions of the Plan (which are hereby incorporated by reference herein),
150,000 shares (the "Option Shares") of Common Stock of the Company at the price
of $5.52 per share (the "Option Price"), which Option is not intended to qualify
for Federal income tax purposes as an "incentive stock option" within the
meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the
"Code").
2. Term. The term (the "Option Term") of the Option shall commence on the
Start Date and expire on the tenth anniversary of the Start Date, unless the
Option shall theretofore have been terminated in accordance with the terms
hereof or of the Plan.
3. Exercisability; Time of Exercise.
(a) General. Unless accelerated in the discretion of the Committee or as
otherwise provided herein, the Option shall become exercisable as to all of the
Option Shares on December 31, 2002 if Optionee is an employee of the Company on
December 31, 2002; provided, however, that if the Successor (as defined in the
Separation Agreement) is appointed prior to December 31, 2002 and (1) the
Optionee has not been terminated under Section 3.1.1 or 3.1.2 of the Separation
Agreement prior to such appointment, (2) the Optionee has not voluntarily
terminated her employment under Section 3.1.5 of the Separation Agreement prior
to such appointment, or (3) the Company has not terminated the Optionee's
employment for Cause under Section 3.1.3 of the Separation Agreement or without
Cause under Section 3.1.4 of the Separation Agreement prior to such appointment,
then the Option shall immediately vest and become exercisable as to all of the
Option Shares on the date of such appointment. If the Optionee's employment is
terminated prior to the appointment of her Successor (i) as a result of her
death or legal or other incapacity under Section 3.1.1 or 3.1.2 of the
Separation Agreement or (ii) by the Company without Cause under Section 3.1.4 of
the Separation Agreement, then the Option shall immediately vest and become
exercisable as to 50% of the Option Shares as of the date of such termination.
If the Optionee's employment is voluntarily terminated by the Optionee under
Section 3.1.5 of the Separation Agreement or is terminated by the Company for
Cause under Section 3.1.3, of the Separation Agreement prior to the appointment
of a Successor, no portion of the Option Shares shall vest or become
exercisable. The Option shall remain exercisable as to all shares as to which it
becomes exercisable pursuant to this Section 3(a) until the expiration of the
Option Term, unless it is terminated earlier as provided in any of the other
paragraphs of this Section 3 or Section 6 or as provided in the Plan.
(b) Termination for Cause. If the Optionee shall cease to be an employee of
the Company as a result of a termination by the Company for Cause in accordance
with Section 3.1.3 of the Separation Agreement, the Option shall automatically
terminate on, and the Optionee shall have no further right to exercise the
Option on or after, the date as of which notice of such termination is given to
the Optionee by the Company. In this Agreement, the term "Cause" has the meaning
given to such term in the Separation Agreement.
(c) Termination without Cause. If the Optionee's employment with the
Company terminates for any reason other than Cause pursuant to Section 3.1.3 of
the Separation Agreement, the Optionee's disability pursuant to Section 3.1.1 or
3.1.2 of the Separation Agreement or the Optionee's death pursuant to Section
3.1.1 of the Separation Agreement, the Option shall thereafter be exercisable
only to the extent vested and exercisable pursuant to paragraph (a) of this
Section 3 as of the date of such termination, and the Option shall in any event
terminate upon, and the Optionee shall have no further right to exercise the
Option after, (i) in the case of any such termination pursuant to Section 3.1.4
of the Separation Agreement, the earlier of (A) the expiration of the Option
Term and (B) 120 days after the date of such termination and (ii) in the case of
any such termination pursuant to Section 3.1.5 of the Separation Agreement or
following the completion of the term of the Separation Agreement as contemplated
by Section 1.1 of the Separation Agreement, the earlier of (A) the expiration of
the Option Term and (B) 90 days after the date of such termination.
(d) Termination as a Result of Disability. If the Optionee's employment
with the Company terminates as a result of the Optionee's disability pursuant to
section 3.1.1 or 3.1.2 of the Separation Agreement, the Option shall thereafter
be exercisable only to the extent vested and exercisable pursuant to paragraph
(a) of this Section 3 as of the date of such termination, and the Option shall
in any event terminate upon, and the Optionee shall have no further right to
exercise the Option after, the earlier of (i) the expiration of the Option Term
and (ii) 180 days after the date of such termination.
(e) Termination as a Result of Death. If the Optionee's employment with the
Company terminates as a result of the Optionee's death, the Option shall
thereafter be exercisable by the Optionee's Designated Beneficiary (as defined
in the Plan) or personal representatives, heirs or legatees (as provided in the
Plan), but only to the extent vested and exercisable pursuant to paragraph (a)
of this Section 3 as of the date of such termination, and the Option shall in
any event terminate upon, and the Optionee shall have no further right to
exercise the Option after, the earlier of (i) the expiration of the Option Term
and (ii) one (1) year after the date of death.
(f) Death Following Disability. In the event of the Optionee's death within
180 days following the Optionee's termination of employment as a result of the
Optionee's disability pursuant to Section 3.1.1 or 3.1.2 of the Separation
Agreement, the Option shall thereafter be exercisable by the Optionee's
Designated Beneficiary or personal representatives, heirs or legatees, to the
extent vested and exercisable pursuant to paragraph (a) of this Section 3 as of
the date of such termination, for a period of one (1) year following the date of
death but in no event later than the expiration of the Option Term.
4. Procedure for Exercise. (a) The Option may be exercised, from time to
time, in whole or in part (but for the purchase of whole shares only), by
delivery of a written notice (the "Notice") from the Optionee to the Secretary
of the Company, which Notice shall:
(i) state that the Optionee elects to exercise the Option under this
Agreement;
(ii) state the number of shares with respect to which the Optionee is
exercising the Option (the "Acquired Shares");
(iii) include any representations of the Optionee required under Section
7(b) hereof;
(iv) state the method of payment for the Acquired Shares pursuant to
Section 4(b);
(v) in the event that the Option shall be exercised by any person other
than the Optionee pursuant to Sections 3 and 8, include appropriate proof of the
right of such person to exercise the Option; and
(vi) state the date upon which the Optionee desires to consummate the
purchase of the Acquired Shares (which date must be prior to the termination of
such Option).
(b) Payment of the Option Price for the Acquired Shares shall, unless
otherwise provided by the Committee, be made in cash or by personal or certified
check.
5. No Rights as a Stockholder. The Optionee shall not have any privileges
of a stockholder with respect to any Option Shares until the date of a stock
certificate representing such Option Shares is issued to the Optionee.
6. Adjustments.
(a) Stock Dividends, Splits, Subdivisions or Combinations. Subject to the
other provisions of this Section 6, if, at any time while the Option is
outstanding, the Common Stock is changed by reason of dividends payable in
Common Stock or splits, subdivisions or combinations of shares of Common Stock,
then the number of shares of Common Stock deliverable upon the exercise
thereafter of the Option shall be increased or decreased proportionately, as the
case may be, without change in the aggregate Option Price.
(b) Cash Mergers. Upon the occurrence of a merger on consolidation of the
Company with another corporation in a transaction in which the stockholders of
the Company receive cash consideration in exchange for their shares of capital
stock of the Company (a "cash merger"), the Option shall automatically
terminate; provided, however, that the Optionee shall be given (i) written
notice of such cash merger at least 20 days prior to its proposed effective date
(as specified in such notice) and (ii) an opportunity, during the period
commencing with delivery of such notice and ending ten (10) days prior to such
proposed effective date, to exercise the Option in full as to all of the Option
Shares, whether or not then vested.
(c) Assumption or Substitution of Options. Notwithstanding anything
contained herein or in the Plan to the contrary, Section 6(b) shall not be
applicable if provision shall be made in connection with such cash merger for
the assumption of the Option by, or the substitution for the Option of a new
option covering the stock of, the surviving, successor or purchasing
corporation, or a parent or subsidiary thereof, with appropriate adjustments as
to the number, kind and option price of shares subject to such option.
(d) Corporate Transactions. Notwithstanding anything contained herein or in
the Plan to the contrary, upon the occurrence of (i) a merger or consolidation
of the Company with another corporation in a transaction (other than a cash
merger) in which the Company shall not survive or in which the Company is the
survivor but its capital stock is exchanged for stock, securities, or property
of another entity or (ii) a sale of all or substantially all of the assets of
the Company (any transaction described in clause (i) or (ii) being referred to
herein as a "corporate transaction"), provision shall be made in connection with
such corporate transaction for the assumption of the Option by, or the
substitution for the Option of a new option covering the stock of, the
surviving, successor or purchasing corporation, or a parent or subsidiary
thereof, with appropriate adjustments as to the number, kind and option price of
shares subject to such option.
(e) Termination within One Year of Cash Merger or Corporate Transaction.
Notwithstanding anything contained herein or in the Plan to the contrary, in the
event the Optionee's employment with the Company or the person which is the
surviving, successor or purchasing corporation in a cash merger to which Section
6(c) applies or a corporate transaction to which Section 6(d) applies, or a
parent or subsidiary thereof, is terminated without Cause and other than as a
result of the Optionee's death or disability, at any time prior to the first
anniversary of such transaction or merger, the Option shall become exercisable
in full as to all Option Shares, whether or not vested, as of the date on which
notice of termination is given to the Optionee, and the Optionee shall have the
right to exercise the Option as to any or all of such shares until the earlier
of (i) the expiration of the Option Term and (ii) the 90th day following the
date of such termination, at which time the Option shall terminate.
7. Additional Provisions Related to Exercise. (a) The Option shall be
exercisable only on such date or dates and during such period and for such
number of shares of Common Stock as are set forth in this Agreement.
(b) To exercise the Option, the Optionee shall follow the procedures set
forth in Section 4 hereof. Upon the exercise of the Option at a time when there
is not in effect a registration statement under the Securities Act of 1933, as
amended, relating to the shares of Common Stock issuable upon exercise of the
Option, the Optionee shall provide the Company with such representations and
warranties as may be required by the Committee to the effect that the Acquired
Shares are being acquired for investment and not with a view to the distribution
thereof. Anything contained herein to the contrary notwithstanding, in the event
the Board shall determine, in its sole and subjective discretion, that the
registration, qualification or listing of the Option Shares upon a securities
exchange or under any state or Federal law, or the consent or approval or any
government or regulatory body, is necessary or desirable as a condition of or in
connection with the exercise of the Option, the Option may not be exercised, in
whole or in part, unless and until such registration, qualification, listing,
consent or approval shall have been effected or obtained free of any conditions
not acceptable to the Board.
(c) The Option shall not be affected by any change of duties or position of
the Optionee (including transfer to or from a subsidiary), so long as the
Optionee continues to be an employee of the Company or one of its subsidiaries.
Nothing in the Option granted hereunder shall confer upon the Optionee any right
to continue in the employ of the Company or any of its subsidiaries or interfere
in any way with the right of the Company or its subsidiaries or the stockholders
of the Company, as the case may be, to terminate the Optionee's employment or to
increase or decrease the Optionee's compensation at any time.
8. Restriction on Transfer. The Option may not be transferred, pledged,
assigned, hypothecated (whether by operation of law or otherwise), sold or
otherwise disposed of in any way by the Optionee, except by will or by the laws
of descent and distribution, and may be exercised during the lifetime of the
Optionee only by the Optionee. If the Optionee dies, the Option shall thereafter
be exercisable, during the applicable period specified in Section 3, by the
Optionee's Designated Beneficiary or personal representatives, heirs or legatees
(as provided in the Plan) to the full extent to which the Option was exercisable
by the Optionee at the time of the Optionee's death as provided herein. The
Option shall not be subject to execution, attachment or similar process. Any
attempted transfer, pledge, assignment, hypothecation, sale or other disposition
of the Option contrary to the provisions hereof, and the levy of any execution,
attachment or similar process upon the Option, shall be null and void and
without effect.
9. Restrictive Legends. In order to reflect certain restrictions on
disposition of the shares acquired upon exercise of the Option (the "Restricted
Shares"), all stock certificates representing the Restricted Shares issued shall
have affixed thereto any legends determined by the Company to be appropriate.
10. Notices. All notices or other communications which are required or
permitted hereunder shall be in writing and sufficient if (i) personally
delivered or sent by telecopier, (ii) sent by nationally-recognized overnight
courier or (iii) sent by registered or certified mail, postage prepaid, return
receipt requested, addressed as follows:
if to the Optionee, to:
Xxxxxxxx X. Xxxxxxxx
000 Xxxx 00xx Xxxxxx, X00X
Xxx Xxxx, Xxx Xxxx 00000-0000
with a copy to:
Xxxxxx X. Xxxxxx, Esq.
Xxxxxxx Xxxxxx Xxxxx & Xxxxxx L.L.P.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
if to the Corporation, to:
Synaptic Pharmaceutical Corporation
000 Xxxxxxx Xxxx
Xxxxxxx, Xxx Xxxxxx 00000
Telecopier: 201-261-0623
Attention: Company Secretary
With a copy to:
Xxxxxx X. Xxxxxx, Xx., Esq.
Xxxxx Xxxxx L.L.P.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Xxxxxxx X. Xxxxxxxxxx, Esq.
Dechert
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, XX 00000
or to such other address as the party to whom notice is to be given may have
furnished to each other party in writing in accordance herewith. Any such
communication shall be deemed to have been given (i) when delivered, if
personally delivered, sent by telecopier or sent by nationally-recognized
overnight courier and (ii) on the third Business Day (as hereinafter defined)
following the date on which the piece of mail containing such communication is
posted, if sent by mail. As used herein, "Business Day" means a day that is not
a Saturday, Sunday or a day on which banking institutions in the city to which
the notice or communication is to be sent are not required to be open.
11. No Waiver. No waiver of any breach or condition of this Agreement shall
be deemed to be a waiver of any other or subsequent breach or condition, whether
of like or different nature.
12. Optionee Undertaking. The Optionee hereby agrees to take whatever
additional actions and execute whatever additional documents the Company may in
its reasonable judgement deem necessary or advisable in order to carry out or
effect one or more of the obligations or restrictions imposed on the Optionee
pursuant to the express provisions of this Agreement.
13. Modification of Rights. The rights of the Optionee are subject to
modification and termination in certain events as provided in this Agreement and
the Plan.
14. Governing Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New Jersey without giving effect to
principles of conflicts of laws.
15. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
16. Entire Agreement. This Agreement, the Separation Agreement (the
provisions relating to stock options of which are hereby incorporated herein by
reference) and the Plan constitute the entire agreement between the parties with
respect to the subject matter hereof and thereof, and supersede all previously
written or oral negotiations, commitments, representations and agreements with
respect thereto. In the event of any inconsistency among the terms of this
Agreement, the terms of the Separation Agreement and the terms of the Plan, the
terms of the Separation Agreement shall control.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first written above.
SYNAPTIC PHARMACEUTICAL CORPORATION
By:/s/Xxxxxxx X. Xxxxxxxxx
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Name: Xxxxxxx X. Xxxxxxxxx
Title: Vice President of Business Developemnt
/s/Xxxxxxxx X. Xxxxxxxx
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Xxxxxxxx X. Xxxxxxxx
