Exhibit 10.2
LIGAND PHARMACEUTICALS
INCORPORATED
EMPLOYEE STOCK PURCHASE
PLAN
(AS AMENDED AND RESTATED
EFFECTIVE JULY 1, 2009)
I. PURPOSE OF THE
PLAN
This Employee Stock Purchase Plan is
intended to promote the interests of Ligand Pharmaceuticals
Incorporated, a Delaware corporation, by providing eligible
employees with the opportunity to acquire a proprietary interest in
the Corporation through participation in a payroll deduction-based
employee stock purchase plan designed to qualify under
Section 423 of the Code.
Capitalized terms herein shall have
the meanings assigned to such terms in the attached
Appendix.
II. ADMINISTRATION OF THE
PLAN
The Plan Administrator shall have
full authority to interpret and construe any provision of the Plan
and to adopt such rules and regulations for administering the Plan
as it may deem necessary in order to comply with the requirements
of Code Section 423. Decisions of the Plan Administrator shall
be final and binding on all parties having an interest in the
Plan.
III. STOCK SUBJECT TO
PLAN
A. The stock purchasable under the
Plan shall be shares of authorized but unissued or reacquired
Common Stock, including shares of Common Stock purchased on the
open market. The aggregate number of shares of Common Stock
reserved for issuance over the term of the Plan shall be 1,310,248
shares.
B. Should any change be made to the
Common Stock by reason of any stock split, stock dividend,
recapitalization, combination of shares, exchange of shares or
other change affecting the outstanding Common Stock as a class
without the Corporation’s receipt of consideration,
appropriate adjustments shall be made to (i) the maximum
number and class of securities issuable under the Plan,
(ii) the maximum number and class of securities purchasable
per Participant on any one Purchase Date and (iii) the number
and class of securities and the price per share in effect under
each outstanding purchase right in order to prevent the dilution or
enlargement of benefits thereunder.
IV. OFFERING
PERIODS
A. Shares of Common Stock shall be
offered for purchase under the Plan through a series of successive
Offering Periods, which shall continue until such time as
(i) the maximum number of shares of Common Stock available for
issuance under the Plan shall have been purchased (ii) the
Plan Administrator shall have terminated the Offering Period as
provided below or (iii) the Plan shall have been sooner
terminated.
B. Each Offering Period shall be six
(6) months in duration, commencing on each January 1 and
July 1 during the term of the Plan. The Plan Administrator
shall have the power to change the duration of Offering Periods
(including the commencement dates thereof) with respect to future
offerings (but in no event may the duration of any Offering Period
under the Plan exceed twenty-four (24) months), or to provide
that purchases shall be made more frequently under the Plan during
each Offering Period, without stockholder approval pursuant to an
action taken prior to the commencement of the first Offering Period
to be affected thereafter.
C. The Plan Administrator may in its
discretion terminate any ongoing Offering Period when, in the sole
discretion of the Plan Administrator, such termination would be in
the best interests of the Corporation or its stockholders,
including, without limitation, to assure that the Corporation will
not recognize, for financial reporting purposes, any compensation
expense in connection with the shares of Common Stock offered for
purchase under the Plan. Upon such early termination, a new
Offering Period will begin at the time designated by the Plan
Administrator.
V. ELIGIBILITY
A. Each individual who is an
Eligible Employee on the Entry Date of any Offering Period under
the Plan may enter that Offering Period on such Entry Date,
provided he or she remains an Eligible Employee.
B. Each Eligible Employee must
complete the enrollment forms prescribed by the Plan Administrator
(including a stock purchase agreement and a payroll deduction
authorization or such other forms as the Plan Administrator may
determine) and file such forms with the Plan Administrator (or its
designate) on or before his or her scheduled Entry Date.
C. A Participant’s completion
of the enrollment forms will enroll such Participant in the Plan
for each successive Offering Period on the terms contained therein
until the Participant either submits new enrollment forms,
withdraws from participation under the Plan or otherwise becomes
ineligible to participate in the Plan.
VI. PAYROLL
DEDUCTIONS
A. The payroll deduction authorized
by the Participant for purposes of acquiring shares of Common Stock
during an Offering Period may be any multiple of one percent
(1%) of the Cash Earnings paid to the Participant during each
Offering Period, up to a maximum of ten percent (10%). The
deduction rate so authorized shall continue in effect throughout
the Offering Period, except to the extent such rate is changed in
accordance with the following guidelines:
(i) The Participant may, at any time
during an Offering Period, reduce his or her rate of payroll
deduction (including to zero (0%)) to become effective as soon as
possible after filing the appropriate form with the Plan
Administrator. The Participant may not, however, effect more than
one (1) such reduction per Offering Period.
(ii) The Participant may, prior to
the commencement of any new Offering Period, increase the rate of
his or her payroll deduction by filing the appropriate form with
the Plan Administrator. The new rate (which may not exceed the ten
percent (10%) maximum) shall become effective on the start
date of the first Offering Period following the filing of such
form.
B. Payroll deductions shall begin on
the first pay day administratively feasible following the
Participant’s Entry Date into the Offering Period and shall
(unless sooner terminated by the Participant) continue through the
pay day ending with or immediately prior to the last day of that
Offering Period. The amounts so collected shall be credited to the
Participant’s book account under the Plan, but no interest
shall be paid on the balance from time to time outstanding in such
account. The amounts collected from the Participant shall not be
required to be held in any segregated account or trust fund and may
be commingled with the general assets of the Corporation and used
by the Corporation for general corporate purposes.
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C. Payroll deductions shall
automatically cease upon the termination of the Participant’s
purchase right in accordance with the provisions of the
Plan.
D. Subject to the terms and
conditions contained herein, the Participant’s acquisition of
Common Stock under the Plan on any Purchase Date shall neither
limit nor require the Participant’s acquisition of Common
Stock on any subsequent Purchase Date, whether within the same or a
different Offering Period.
VII. PURCHASE
RIGHTS
A. GRANT OF PURCHASE RIGHTS. A
Participant shall be granted a separate purchase right for each
Offering Period in which he or she participates. The purchase right
shall be granted on the Participant’s Entry Date into the
Offering Period and shall provide the Participant with the right to
purchase shares of Common Stock, in a series of one or more
installments over the remainder of such Offering Period, upon the
terms set forth below.
Under no circumstances shall
purchase rights be granted under the Plan to any Eligible Employee
if such individual would, immediately after the grant, own (within
the meaning of Code Section 424(d)) or hold outstanding
options or other rights to purchase, stock possessing five percent
(5%) or more of the total combined voting power or value of
all classes of stock of the Corporation or any Corporate
Affiliate.
B. EXERCISE OF THE PURCHASE RIGHT.
Each purchase right shall be automatically exercised in one or more
installments on each successive Purchase Date, and shares of Common
Stock shall accordingly be purchased on behalf of each Participant
on each such Purchase Date. The purchase shall be effected by
applying the Participant’s payroll deductions for the
Offering Period ending on such Purchase Date to the purchase of
whole shares of Common Stock at the purchase price in effect for
the Participant for that Purchase Date.
C. PURCHASE PRICE. The purchase
price per share at which Common Stock will be purchased on the
Participant’s behalf on each Purchase Date within the
Offering Period shall be equal to eighty-five percent (85%) of
the lower of (i) the Fair Market Value per share of Common
Stock on the Entry Date for that Offering Period or (ii) the
Fair Market Value per share of Common Stock on that Purchase
Date.
D. NUMBER OF PURCHASABLE SHARES. The
number of shares of Common Stock purchasable by a Participant on
each Purchase Date during the Offering Period shall be the number
of whole shares obtained by dividing the amount collected from the
Participant through payroll deductions during the Offering Period
by the purchase price in effect for the Participant for that
Purchase Date. However, the maximum number of shares of Common
Stock purchasable per Participant during any Offering Period shall
not exceed 7,500 shares and the maximum number of shares of Common
Stock purchasable per Participant during any calendar year shall
not exceed 7,500 shares, subject to periodic adjustments in the
event of certain changes in the Corporation’s capitalization
as contemplated in Section III.B. above. However, the Plan
Administrator shall have the discretionary authority, exercisable
prior to the start of any Offering Period under the Plan, to
increase or decrease the limitations to be in effect for the number
of shares purchasable per Participant and to establish limitations
on the maximum number of shares that may be purchased in total by
all Participants on each Purchase Date during that Offering
Period.
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E. EXCESS PAYROLL DEDUCTIONS. Any
payroll deductions not applied to the purchase of shares of Common
Stock on any Purchase Date because they are not sufficient to
purchase a whole share of Common Stock shall be held for the
purchase of Common Stock on the next Purchase Date. However, any
payroll deductions not applied to the purchase of Common Stock by
reason of the limitation on the maximum number of shares
purchasable per Participant or in total by all Participants on the
Purchase Date shall be promptly refunded.
F. SUSPENSION OF PAYROLL DEDUCTIONS.
In the event that a Participant is, by reason of the accrual
limitations in Article VIII, precluded from purchasing additional
shares of Common Stock on one or more Purchase Dates during the
Offering Period in which he or she is enrolled, then no further
payroll deductions shall be collected from such Participant with
respect to those Purchase Dates. The suspension of such deductions
shall not terminate the Participant’s purchase right for the
Offering Period in which he or she is enrolled, and payroll
deductions shall automatically resume on behalf of such Participant
once he or she is again able to purchase shares during that
Offering Period in compliance with the accrual limitations of
Article VIII.
G. TERMINATION OF PURCHASE RIGHT.
The following provisions shall govern the termination of
outstanding purchase rights:
(i) A Participant may, at any time
prior to the next scheduled Purcha
