Exhibit 10.4
AMENDED AND RESTATED AMGEN
INC.
PERFORMANCE AWARD
PROGRAM
(Amended and Restated Effective December 5,
2005)
ARTICLE I
PURPOSE
The purpose of this document is to
set forth the general terms and conditions applicable to the
Performance Award Program (the “ Program ”)
established by the Compensation and Management Development
Committee of the Board of Directors of Amgen Inc. (the “
Company ”) pursuant to, and in implementation of,
Section 10(d) of the Company’s Amended and Restated 1991
Equity Incentive Plan, as amended (the “ 1991 Plan
”). The Program is intended to carry out the purposes of the
1991 Plan and provide a means to reinforce objectives for sustained
long-term performance and value creation by awarding selected key
employees of the Company with payments in Company stock based on
the level of achievement of pre-established performance goals
during three-year performance cycles, subject to the restrictions
and other provisions of the Program and the 1991 Plan. The Program
shall be effective as of December 9, 2003.
ARTICLE II
DEFINITIONS
Unless otherwise defined herein,
capitalized terms used herein shall have the same definitions as
such terms are defined in the 1991 Plan.
“ Award ” shall
mean the earned Performance Units payable in Common Stock under the
Program for a Performance Cycle.
“ Board ” shall
mean the Board of Directors of the Company.
“ Code ” shall
mean the Internal Revenue Code of 1986, as amended, together with
the regulations and official guidance promulgated
thereunder.
“ Committee ”
shall mean the Compensation and Management Development Committee of
the Board, appointed by the Board from among its members to
administer the 1991 Plan in accordance with Section 2
thereof.
“ Common Stock ”
shall mean the common stock, par value $0.0001 per share, of the
Company.
“ Determination Date
” shall have the meaning ascribed to it in
Section 4.1.
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“ Participant ”
shall mean a key employee of the Company or an Affiliate who
participates in this Program pursuant to the provisions of Article
III hereof.
“ Peer Group ”
shall mean a list of companies selected by the
Committee.
“ Performance Cycle
” shall mean each period of three consecutive fiscal years
commencing on the first day of the first fiscal year and ending on
the last day of the third fiscal year. Performance Cycles may
overlap.
“ Performance Goal
” shall have the meaning ascribed to it in
Section 5.2.
“ Performance Unit
” shall mean a right granted to a Participant pursuant to the
Program to receive Common Stock, the payment of which is contingent
upon achieving the Performance Goals.
“ Permanent and Total
Disability ” shall have the meaning ascribed to such term
under Section 22(e)(3) of the Code and with such permanent and
total disability being certified prior to termination of a
Participant’s employment by (i) the Social Security
Administration, (ii) the comparable governmental authority
applicable to an Affiliate of the Company, (iii) such other
body having the relevant decision-making power applicable to an
Affiliate of the Company, or (iv) an independent medical
advisor appointed by the Company in its sole discretion, as
applicable, in any such case.
“ QDRO ” shall
mean a court order (i) that creates or recognizes the right of
the spouse, former spouse or child (an “ Alternate
Payee ”) of an individual who is granted an Award to an
interest in such Award relating to marital property rights or
support obligations and (ii) that the 1991 Plan administrator
determines would be a “qualified domestic relations
order,” as that term is defined in Section 414(p) of the
Code and Section 206(d) of the Employee Retirement Income
Security Act (“ ERISA ”), but for the fact that
the 1991 Plan is not a plan described in Section 3(3) of
ERISA.
“ Retirement-Eligible
” shall mean when a Participant is at least sixty
(60) years of age and has been an employee of the Company
and/or an Affiliate of the Company for at least fifteen
(15) consecutive years.
“ Section 162(m)
Participant ” shall mean any Participant designated by
the Committee as a “covered employee” within the
meaning of Section 162(m) of the Code whose compensation for
the fiscal year in which the Participant is so designated or a
future fiscal year may be subject to the limit on deductible
compensation imposed by Section 162(m) of the Code.
“ Voluntary Retirement
” shall mean voluntary termination of employment that is not
the result of Permanent and Total Disability.
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ARTICLE III
PARTICIPATION
3.1 Participants .
Participants for any Performance Cycle shall be those active key
employees of the Company or an Affiliate who are designated in
writing as eligible for participation by the Committee within the
first ninety (90) days of such Performance Cycle.
3.2 No Right to Participate .
No Participant or other employee of the Company or an Affiliate
shall, at any time, have a right to participate in this Program for
any Performance Cycle, notwithstanding having previously
participated in this Program.
ARTICLE IV
ADMINISTRATION
4.1 Generally . Within the
first ninety (90) days of each Performance Cycle, the
Committee shall establish the basis for payments under this Program
in relation to specified Performance Goals, as more fully described
in Article V hereof. Following the end of each Performance Cycle,
once all of the information necessary for the Committee to
determine the Company’s performance and comparative
performance with the Peer Group is made available to the Committee,
the Committee shall determine the amount of the Award payable to
each Participant; provided, however , that any such
determination shall be made no later than six months following the
end of such Performance Cycle (the date of such determination shall
hereinafter be called the “ Determination Date
”). The Committee shall have the power and authority granted
it under Section 2 of the 1991 Plan, including, without
limitation, the authority to construe and interpret this Program,
to prescribe, amend and rescind rules, regulations and procedures
relating to its administration and to make all other determinations
necessary or advisable for administration of this Program.
Decisions of the Committee in accordance with the authority granted
hereby shall be conclusive and binding. Subject only to compliance
with the express provisions hereof, the Committee may act in its
sole and absolute discretion with respect to matters within its
authority under this Program.
4.2 Provisions Applicable to
Section 162(m) Participants . Any Awards paid hereunder to
a Section 162(m) Participant shall satisfy and shall be
interpreted in a manner that satisfies any applicable requirements
as “qualified performance-based compensation” within
the meaning of Section 162(m) of the Code and any provisions,
application or interpretation of the Program or the 1991 Plan that
is inconsistent with this intent shall be disregarded. To the
extent that any Award (i) is deemed to constitute
“nonqualified deferred compensation” (within the
meaning of Code Section 409A) and (ii) would nevertheless
be subject to the deduction limitations imposed by
Section 162(m) of the Code in the year in which such Award
would otherwise be paid under this Program, the payment of such
Award may, in the Committee’s discretion, be delayed until
the earlier of (A) the first year in which such Award would
not be subject to the deduction limitations imposed by
Section 162(m) or (B) such time as the Participant ceases
to be a “service provider” to the Company (within the
meaning of Section 409A of the Code).
4.3 Provisions Applicable to
Participants in Foreign Jurisdictions . Notwithstanding any
provision of the Program to the contrary, in order to comply with
the laws in other countries in which the Company and its Affiliates
operate or have employees, the Committee, in its sole discretion,
shall have the power and authority to:
(i) modify the terms and conditions
of any award of Performance Units granted to employees outside the
United States to comply with applicable foreign laws;
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(ii) condition the effectiveness of
any award of Performance Units upon approval or compliance with any
applicable foreign laws, regulations, rules or local governmental
regulatory exemption or approvals;
(iii) provide for payment of any
Award in cash or Common Stock, at the Company’s election, to
the extent necessary to comply with applicable foreign laws;
and
(iv) take any other action, before
or after an award of Performance Units is made, that it deems
advisable to obtain approval or comply with any necessary local
governmental regulatory exemptions or approvals.
Notwithstanding the foregoing, the Committee may
not take any actions hereunder, and no award of Performance Units
shall be granted, that would violate the Securities Act of 1933, as
amended, Securities Exchange Act of 1934, as amended, the Code, or
any other securities or tax or other applicable law or
regulation.
ARTICLE V
AWARD
DETERMINATIONS
5.1 Award of Performance
Units . Within the first ninety (90) days of each
Performance Cycle, the Committee shall determine the number of
Performance Units (rounded down to the nearest whole number) to be
awarded under this Program to each Participant with respect to such
Performance Cycle and a date upon which the Performance Units shall
be assigned a unit value based on the fair market value of a share
of Common Stock on such specified date. Performance Units granted
under the Program shall constitute stock bonuses under Sections 7
and 10(d) of the 1991 Plan.
5.2 Performance Requirements
. Within the first ninety (90) days of each Performance Cycle,
the Committee shall approve the performance goals (collectively,
the “ Performance Goals ”) with respect to any
of the business criteria permitted under Section 10(d) of the
1991 Plan), each subject to such adjustments as the Committee may
specify in writing at such time, and shall establish a formula,
standard or schedule which aligns the level of achievement of the
Performance Goals with the earned Performance Units. The
Performance Goals may not be changed during the Performance Cycle,
but the thresholds and targets of the Performance Goals shall be
subject to such adjustments as the Committee may specify in writing
within the first ninety (90) days of the Performance
Cycle.
ARTICLE VI
PAYMENT OF AWARDS
6.1 Form and Timing of
Payment . Except as set forth in Section 8.1 below, any
Award payable pursuant to this Program shall be paid by the
fifteenth day of the third month
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following the tax year containing the last day
of the Performance Cycle in shares of Common Stock based on the
average of
