<PAGE>
Exhibit 10.16
ALLERGAN, INC.
2003 NONEMPLOYEE DIRECTOR EQUITY INCENTIVE PLAN
NON-QUALIFIED STOCK OPTION AWARD AGREEMENT
This
Non-qualified Stock Option Agreement ("Agreement") is entered into
as
of May __, 200_, (the "Date of Grant") between Allergan, Inc., a
Delaware
corporation (the "Company"), and [INSERT NAME OF DIRECTOR], a
director of the
Company (the "Director").
The
Company has adopted and the stockholders of the Company have
approved
the 2003 Nonemployee Director Equity Incentive Plan, as amended
(the "Plan").
Pursuant to Section 3.1 of the Plan and in consideration of the
services
rendered and to be rendered by the Director, the Company has
granted an option
to the Director upon the terms and conditions set forth in the Plan
and this
Agreement.
1.
NUMBER OF OPTION SHARES. This Agreement evidences the grant by
the
Company to the Director of a non-qualified stock option (the
"Option") to
purchase, from time to time, an aggregate of 5,700 shares (the
"Option Shares")
of the Company's Common Stock, par value $0.01 per share (the
"Common Stock"),
under Section 3.1 of the Plan, subject to the terms and conditions
and to
adjustment as set forth herein or in the Plan.
2.
OPTION PURCHASE PRICE. Upon exercise of vested Option Shares,
the
Director shall pay to the Company $______ per Option Share (the
"Option Purchase
Price") being exercised.
3. OPTION EXPIRATION
DATE. Unless terminated sooner in accordance with the
provisions of the Plan or this Agreement, the right to exercise the
Option shall
expire on the close of business on the business day immediately
preceding the
tenth (10th) anniversary of the Date of Grant (the "Expiration
Date").
4.
VESTING RESTRICTIONS. Subject to the provisions of Section 5 of
this
Agreement and to adjustment pursuant to Section 4.2 of the Plan,
the Option
shall become fully vested and exercisable as to all Option Shares
on the date of
the regular annual meeting of stockholders of the Company at which
directors are
to be elected following the Date of Grant.
5.
EFFECT OF CERTAIN EVENTS ON VESTING AND EXERCISE.
a. TERMINATION OF SERVICE.
(i) General. If the Director ceases to serve as a director of
the
Company for any reason other than such Director's death or total
disability, any
portion of the Option that has not vested as of such termination of
service
shall be forfeited.
(ii) Termination as a Result of Death or Disability. If the
Director ceases to serve as a director of the Company by reason of
such
Director's death or total disability, the Option shall vest
immediately as to
the entire number of Option Shares.
b. CHANGE OF CONTROL. Upon the occurrence of a Change of Control
(as
defined in Section 4.3 of the Plan), the Option shall vest
immediately as to the
entire number of Option Shares.
1
<PAGE>
c.
EXERCISE PERIOD FOLLOWING TERMINATION OF SERVICE.
(i) In the event the Director ceases to be a director by reason
of such Director's voluntary resignation or removal for cause, any
unexercised
portion of the Option that is vested as of such termination of
service may be
exercised by the Director at any time within three (3) months
following such
termination of service, but in no event after the Expiration
Date.
(ii) In the event the Director ceases to be a director other
than
by reason of such Director's voluntary resignation or removal for
cause, any
unexercised portion of the Option that is vested as of such
termination of
service may be exercised by the Director or by the Director's
personal
representative or by the person or persons to whom the Option shall
have been
transferred by will or the laws of descent and distribution at any
time within
twelve (12) months following such termination of service, but in no
event after
the Expiration Date.
6.
EXERCISE OF OPTION.
a. All or a portion of the vested Option may be exercised in
accordance with procedures (including requisite holding periods)
established
from time to time by the Board.
b. Payment of the aggregate Option Purchase Price for the number
of
vested Option Shares for which the Option is being exercised shall
be made (i)
in cash or by check, (ii) by delivery of a notice that the Director
has placed a
market sell order with a broker with respect to shares of Common
Stock then
issuable upon exercise of the Option, and the brok