Exhibit 99.1
DENDREON CORPORATION
2009 EQUITY INCENTIVE
PLAN
1.
Purpose. The purpose of the 2009 Equity
Incentive Plan is to attract and retain directors, officers, other
employees and consultants of Dendreon Corporation, a Delaware
corporation, and its Subsidiaries and to provide to such persons
incentives and rewards for superior performance.
2.
Definitions. As used in this Plan,
(a) “Appreciation
Right” means a right granted pursuant to Section 5 of
this Plan.
(b) “Base
Price” means the price to be used as the basis for
determining the Spread upon the exercise of an Appreciation
Right.
(c) “Board” means
the Board of Directors of the Company and, to the extent of any
delegation by the Board to a committee (or subcommittee thereof)
pursuant to Section 12 of this Plan, such committee (or
subcommittee).
(d) “Code” means
the Internal Revenue Code of 1986, as amended from time to
time.
(e) “Common
Shares” means the shares of common stock, par value $0.001
per share, of the Company or any security into which such Common
Shares may be changed by reason of any transaction or event of the
type referred to in Section 11 of this Plan.
(f) “Company” means
Dendreon Corporation, a Delaware corporation.
(g) “Covered
Employee” means a Participant who is, or is determined by the
Board to be likely to become, a “covered employee”
within the meaning of Section 162(m) of the Code (or any
successor provision).
(h) “Date of
Grant” means the date specified by the Board on which a grant
of Option Rights, Appreciation Rights, Performance Shares,
Performance Units or other awards contemplated by Section 9 of
this Plan, or a grant or sale of Restricted Stock, Restricted Stock
Units, or other awards contemplated by Section 9 of this Plan
will become effective (which date will not be earlier than the date
on which the Board takes action with respect thereto).
(i) “Director”
means a member of the Board of Directors of the Company.
(j) “Effective
Date” means the date that this Plan is approved by the
stockholders of the Company.
(k) “Evidence
of Award” means an agreement, certificate, resolution or
other type or form of writing or other evidence approved by the
Board that sets forth the terms and conditions of the awards
granted. An Evidence of Award may be in an electronic medium and
may be limited to notation on the books and records of the
Company.
(l) “Exchange
Act” means the Securities Exchange Act of 1934, as amended,
and the rules and regulations thereunder, as such law, rules and
regulations may be amended from time to time.
(m) “Incentive Stock
Options” means Option Rights that are intended to qualify as
“incentive stock options” under Section 422 of the
Code or any successor provision.
(n) “Management
Objectives” means the measurable performance objective or
objectives established pursuant to this Plan for Participants who
have received grants of Performance Shares or Performance Units or,
when so determined by the Board, Option Rights, Appreciation
Rights, Restricted Stock, Restricted Stock Units or other awards
pursuant to this Plan. Management Objectives may be described in
terms of Company-wide objectives or objectives that are related to
the performance of the individual Participant or of the Subsidiary,
division, department, region or function within the Company or
Subsidiary in which the Participant is employed. The Management
Objectives may be made relative to the performance of other
companies. The Management Objectives applicable to any Qualified
Performance-Based Award to a Covered Employee will be based on
specified levels of or growth in one or more of the following
criteria:
(i) Strategic
Initiative Key Deliverable Metrics consisting of one or more of
the following: product development, strategic partnering, research
and development, vitality index, market penetration,
geographic
business expansion goals, clinical
trials, capital-raising, cost targets, customer satisfaction,
employee satisfaction, management of employment practices and
employee benefits, supervision of litigation and information
technology, and goals relating to acquisitions or divestitures of
subsidiaries, affiliates and joint ventures;
(ii) Sales
Growth, Gross Margin Growth, Cost Initiative and Stock Price
Metrics ( e.g. , revenues, revenue growth, revenue
growth outside the United States, gross margin and gross margin
growth, material margin and material margin growth, stock price
appreciation, total return to stockholders, sales and
administrative costs divided by sales, and sales and administrative
costs divided by profits);
(iii)
Profits ( e.g. , operating income, EBIT, EBT, net
income, earnings per share, residual or economic earnings, economic
profit — these profitability metrics could be measured
before special items and/or subject to GAAP definition);
(iv) Cash
Flow ( e.g. , EBITDA, free cash flow, free cash flow
with or without specific capital expenditure target or range,
including or excluding divestments and/or acquisitions, total cash
flow, cash flow in excess of cost of capital or residual cash flow
or cash flow return on investment);
(v) Returns
( e.g. , Profits or Cash Flow returns on: assets, invested
capital, net capital employed, and equity);
(vi) Working
Capital ( e.g. , working capital divided by sales,
days’ sales outstanding, days’ sales inventory, and
days’ sales in payables);
(vii) Profit
Margins ( e.g. , Profits divided by revenues, gross
margins and material margins divided by revenues, and material
margin divided by sales); and
(viii)
Liquidity Measures ( e.g. , debt-to-capital,
debt-to-EBITDA, total debt ratio).
If the Board determines
that a change in the business, operations, corporate structure or
capital structure of the Company, or the manner in which it
conducts its business, or other events or circumstances render the
Management Objectives unsuitable, the Board may in its discretion
modify such Management Objectives or the related minimum acceptable
level of achievement, in whole or in part, as the Board deems
appropriate and equitable, except in the case of a Qualified
Performance-Based Award where such action would result in the loss
of the otherwise available exemption of the award under
Section 162(m) of the Code. In such case, the Board will not
make any modification of the Management Objectives or minimum
acceptable level of achievement with respect to such Covered
Employee.
(o) “Market
Value per Share” means as of any particular date the closing
sale price of the Common Shares as reported on The NASDAQ Stock
Market LLC or, if not listed on such exchange, on any other
national securities exchange on which the Common Shares are listed.
If the Common Shares are not traded as of any given date, the
Market Value per Share means the closing price for the Common
Shares on the principal exchange on which the Common Shares are
traded for the immediately preceding date on which the Common
Shares were traded. If there is no regular public trading market
for the Common Shares, the Market Value per Share of the Common
Shares shall be the fair market value of the Common Shares as
determined in good faith by the Board. The Board is authorized to
adopt another fair market value pricing method, provided such
method is stated in the Evidence of Award, and is in compliance
with the fair market value pricing rules set forth in
Section 409A of the Code.
(p) “Non-Employee
Director” means a Director who is not also an employee of the
Company or any of its Subsidiaries or affiliates.
(q) “Optionee”
means the optionee named in an Evidence of Award evidencing an
outstanding Option Right.
(r) “Option
Price” means the purchase price payable on exercise of an
Option Right.
(s) “Option
Right” means the right to purchase Common Shares upon
exercise of an option granted pursuant to Section 4 of this
Plan.
(t) “Participant”
means a person who is selected by the Board to receive benefits
under this Plan and who is at the time a consultant or an officer
or other key employee of the Company or any one or more of its
Subsidiaries, or who has agreed to commence serving in any of such
capacities within 90 days of the Date of Grant, and will also
include each Non-Employee Director who receives Common Shares or an
award of Option Rights, Appreciation
Rights, Restricted Stock,
Restricted Stock Units or other awards under this Plan. The term
“Participant” shall also include any person who
provides services to the Company or a Subsidiary that are
equivalent to those typically provided by an employee.
(u) “Performance
Period” means, in respect of a Performance Share or
Performance Unit, a period of time established pursuant to
Section 8 of this Plan within which the Management Objectives
relating to such Performance Share or Performance Unit are to be
achieved.
(v) “Performance
Share” means a bookkeeping entry that records the equivalent
of one Common Share awarded pursuant to Section 8 of this
Plan.
(w) “Performance
Unit” means a bookkeeping entry awarded pursuant to
Section 8 of this Plan that records a unit equivalent to $1.00
or such other value as is determined by the Board.
(x) “Plan” means
this Dendreon Corporation 2009 Equity Incentive Plan.
(y) “Qualified
Performance-Based Award” means any award or portion of an
award that is intended to satisfy the requirements for
“qualified performance-based compensation” under
Section 162(m) of the Code.
(z) “Restricted
Stock” means Common Shares granted or sold pursuant to
Section 6 of this Plan as to which neither the substantial
risk of forfeiture nor the prohibition on transfers has
expired.
(aa) “Restriction
Period” means the period of time during which Restricted
Stock Units are subject to restrictions, as provided in
Section 7 of this Plan.
(bb) “Restricted Stock
Unit” means an award made pursuant to Section 7 of this
Plan of the right to receive Common Shares or cash at the end of a
specified period.
(cc) “Spread” means
the excess of the Market Value per Share on the date when an
Appreciation Right is exercised, or on the date when Option Rights
are surrendered in payment of the Option Price of other Option
Rights, over the Option Price or Base Price provided for in the
related Option Right or Appreciation Right,
respectively.
(dd) “Subsidiary”
means a corporation, company or other entity (i) more than
50 percent of whose outstanding shares or securities
(representing the right to vote for the election of directors or
other managing authority) are, or (ii) which does not have
outstanding shares or securities (as may be the case in a
partnership, joint venture or unincorporated association), but more
than 50 percent of whose ownership interest representing the
right generally to make decisions for such other entity is, now or
hereafter, owned or controlled, directly or indirectly, by the
Company except that for purposes of determining whether any person
may be a Participant for purposes of any grant of Incentive Stock
Options, “Subsidiary” means any corporation in which at
the time the Company owns or controls, directly or indirectly, more
than 50 percent of the total combined voting power represented
by all classes of stock issued by such corporation.
3. Shares
Available Under the Plan.
(a) Maximum
Shares Available Under Plan.
(i) Subject to
adjustment as provided in Section 11 of this Plan, the number
of Common Shares that may be issued or transferred (A) upon
the exercise of Option Rights or Appreciation Rights, (B) in
payment of Restricted Stock and released from substantial risks of
forfeiture thereof, (C) in payment of Restricted Stock Units,
(D) in payment of Performance Shares or Performance Units that
have been earned, (E) as awards to Non-Employee Directors, or
(F) as awards contemplated by Section 9 of this Plan,
will not exceed in the aggregate 13,200,000 Common Shares. Any
Common Shares that are subject to Option Rights or Appreciation
Rights shall be counted against this limit as one Common Share for
every one Common Share subject to such Option Rights or
Appreciation Rights, and any Common Shares that are subject to
awards other than Option Rights or Appreciation Rights shall be
counted against this limit as 1.37 Common Shares for every one
Common Share subject to such other awards. Such shares may be
shares of original issuance or treasury shares or a combination of
the foregoing.
(ii) Common Shares
covered by an award granted under the Plan shall not be counted as
used unless and until they are actually issued and delivered to a
Participant and, therefore, the total number of shares available
under the Plan as of a given date shall not be reduced by any
shares relating to prior awards that have expired or have been
forfeited or cancelled, and upon payment in cash of the benefit
provided by any award granted under
the Plan, any Common Shares that
were covered by that award will be available for issue or transfer
hereunder. Each Common Share that again becomes available for grant
pursuant to this Section 3(a)(ii) shall be added back as
(A) one Common Share if such Common Share was subject to an
Option Right or Appreciation Right granted under the Plan, and
(B) as 1.37 Common Shares if such Common Shares were subject
to an award other than an Option Right or Appreciation Right
granted under the Plan.
(iii) Notwithstanding anything
to the contrary contained herein: (A) if Common Shares are
tendered or otherwise used in payment of the Option Price of an
Option Right, the total number of shares covered by the Option
Right being exercised shall reduce the aggregate plan limit
described above; (B) Common Shares withheld by the Company to
satisfy the tax withholding obligation shall count against the
aggregate plan limit described above; and (C) the number of
Common Shares covered by an Appreciation Right, to the extent that
it is exercised and settled in Common Shares, and whether or not
shares are actually issued to the Participant upon exercise of the
Appreciation Right, shall be considered issued or transferred
pursuant to the Plan. In the event that the Company repurchases
shares with Option Right proceeds, those shares will not be added
to the aggregate plan limit described above.
(b) Life of
Plan Limits. Notwithstanding anything in this
Section 3, or elsewhere in this Plan, to the contrary, and
subject to adjustment as provided in Section 11 of this Plan,
the aggregate number of Common Shares actually issued or
transferred by the Company upon the exercise of Incentive Stock
Options will not exceed 10,000,000 Common Shares.
(c) Individual
Participant Limits. Notwithstanding anything in
this Section 3, or elsewhere in this Plan, to the contrary,
and subject to adjustment as provided in Section 11 of this
Plan:
(i) No Participant
will be granted Option Rights or Appreciation Rights, in the
aggregate, for more than 500,000 Common Shares during any calendar
year;
(ii) No Participant
will be granted Qualified Performance Based Awards of Restricted
Stock, Restricted Stock Units, Performance Shares or other awards
under Section 9 of this Plan, in the aggregate, for more than
350,000 Common Shares during any calendar year; and
(iii) In no event
will any Participant in any calendar year receive a Qualified
Performance-Based Award of Performance Units having an aggregate
maximum value as of their respective Dates of Grant in excess of
$5,000,000.
4. Option
Rights. The Board may, from time to time and upon
such terms and conditions as it may determine, authorize the
granting to Participants of options to purchase Common Shares. Each
such grant may utilize any or all of the authorizations, and will
be subject to all of the requirements contained in the following
provisions:
(a) Each grant will
specify the number of Common Shares to which it pertains subject to
the limitations set forth in Section 3 of this
Plan.
(b) Each grant will
specify an Option Price per share, which may not be less than the
Market Value per Share on the Date of Grant.
(c) Each grant will
specify whether the Option Price will be payable (i) in cash
or by check acceptable to the Company or by wire transfer of
immediately available funds, (ii) by the actual or
constructive transfer to the Company of Common Shares owned by the
Optionee (or other consideration authorized pursuant to
Section 4(d)) having a value at the time of exercise equal to
the total Option Price, (iii) by a combination of such methods
of payment, or (iv) by such other methods as may be approved
by the Board; provided, however, the Board reserves the discretion
at or after the Date of Grant to provide for the right to tender in
satisfaction of the Option Price nonforfeitable, unrestricted
Common Shares, which are already owned by the Optionee and have a
value at the time of exercise that is equal to the Option Price.
Notwithstanding the foregoing, in the event the Optionee is subject
to Section 16 of the Exchange Act, any Common Shares
transferred to the Company in payment of the Option Price must have
been owned by the Optionee for at least six months.
(d) To the extent
permitted by law, any grant may provide for deferred payment of the
Option Price from the proceeds of sale through a bank or broker on
a date satisfactory to the Company of some or all of the shares to
which such exercise relates.
(e) Successive
grants may be made to the same Participant whether or not any
Option Rights previously granted to such Participant remain
unexercised.
(f) Each grant will
specify the period or periods of continuous service by the Optionee
with the Company or any Subsidiary that is necessary before the
Option Rights or installments thereof will become exercisable. A
grant of Option Rights may provide for the earlier exercise of such
Option Rights in the event of the retirement, death or disability
of a Participant, or a change of control, as may be defined in an
Evidence of Award.
(g) Any grant of
Option Rights may specify Management Objectives that must be
achieved as a condition to the exercise of such rights.
(h) Option Rights
granted under this Plan may be (i) options, including, without
limitation, Incentive Stock Options, that are intended to qualify
under particular provisions of the Code, (ii) options that are
not intended so to qualify, or (iii) combinations of the
foregoing. Incentive Stock Options may only be granted to
Participants who meet the definition of “employees”
under Section 3401(c) of the Code.
(i) No Option Right
will be exercisable more than 10 years from the Date of
Grant.
(j) The Board may
substitute, without receiving Participant permission, Appreciation
Rights payable only in Common Shares (or Appreciation Rights
payable in Common Shares or cash, or a combination of both, at the
Board’s discretion) for outstanding Options; provided
, however , that the terms of the substituted Appreciation
Rights are substantially the same as the terms for the Options and
the difference between the Market Value Per Share of the underlying
Common Shares and the Base Price of the Appreciation Rights is
equivalent to the difference between the Market Value Per Share of
the underlying Common Shares and the Option Price of the Options.
If, in the opinion of the Company’s auditors, this provision
creates adverse accounting consequences for the Company, it shall
be considered null and void.
(k) Each grant of
Option Rights will be evidenced by an Evidence of Award. Each
Evidence of Award shall be subject to the Plan and shall contain
such terms and provisions as the Board may approve.
5.
Appreciation Rights.
(a) The Board may,
from time to time and upon such terms and conditions as it may
determine, authorize the granting of Appreciation Rights, which
will be the right of the Participant to receive from the Company an
amount determined by the Board, which will be expressed as a
percentage of the Spread (not exceeding 100 percent) at the
time of exercise.
(b) Each grant of
Appreciation Rights may utilize any or all of the authorizations,
and will be subject to all of the requirements, contained in the
following provisions:
(i) Any grant may
specify that the amount payable on exercise of an Appreciation
Right may be paid by the Company in cash, in Common Shares or in
any combination thereof and may either grant to the Participant or
retain in the Board the right to elect among those
alternatives.
(ii) Any grant may
specify that the amount payable on exercise of an Appreciation
Right may not exceed a maximum specified by the Board at the Date
of Grant.
(iii) Any grant may
specify waiting periods before exercise and permissible exercise
dates or periods.
(iv) Any grant may
specify that such Appreciation Right may be exercised only in the
event of, or earlier in the event of, the retirement, death or
disability of a Participant, or a change of control, as may be
defined in an Evidence of Award.
(v) Any grant of
Appreciation Rights may specify Management Objectives that must be
achieved as a condition of the exercise of such Appreciation
Rights.
(vi) Each grant
will specify a Base Price, which will be equal to or greater than
the Market Value per Share on the Date of Grant.
|
