EXHIBIT 10.15

 

INCYTE CORPORATION

 

1997 EMPLOYEE STOCK PURCHASE PLAN

(as amended March 15, 2003)

 

The following constitute the provisions of the 1997 Employee Stock Purchase Plan
of Incyte Corporation, as amended March 15, 2003.

 

1.    Purpose.    The purpose of the Plan is to provide employees of the Company
and its Designated Subsidiaries with an opportunity to purchase Common Stock of
the Company through accumulated payroll deductions. It is the intention of the
Company to have the Plan qualify as an “Employee Stock Purchase Plan” under
Section 423 of the Internal Revenue Code of 1986, as amended. The provisions of
the Plan, accordingly, shall be construed so as to extend and limit
participation in a manner consistent with the requirements of that section of
the Code.

 

2.    Definitions.

 

(a)    “Board” shall mean the Board of Directors of the Company.

 

(b)    “Code” shall mean the Internal Revenue Code of 1986, as amended.

 

(c)    “Common Stock” shall mean the Common Stock, $.001 par value, of Incyte
Corporation.

 

(d)    “Company” shall mean Incyte Corporation and any Designated Subsidiary of
the Company.

 

(e)    “Compensation” shall mean all cash salary, wages, commissions and
bonuses, but shall not include any imputed income or income arising from the
exercise or disposition of equity compensation.

 

(f)    “Effective Date” shall mean March 15, 2003.

 

(g)    “Designated Subsidiary” shall mean any Subsidiary which has been
designated by the Board from time to time in its sole discretion as eligible to
participate in the Plan.

 

(h)    “Employee” shall mean any individual who is an Employee of the Company
for tax purposes whose customary employment with the Company is at least twenty
(20) hours per week and more than five (5) months in any calendar year. For
purposes of the Plan, the employment relationship shall be treated as continuing
intact while the individual is on sick leave or other leave of absence approved
by the Company. Where the period of leave exceeds 90 days and the individual’s
right to reemployment is not guaranteed either by statute or by contract, the
employment relationship shall be deemed to have terminated on the 91st day of
such leave.

 

(i)    “Enrollment Date” shall mean the first day of each Offering Period.

 

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(j)    “Exercise Date” shall mean the last Trading Day of each Purchase Period.

 

(k)    “Fair Market Value” shall mean, as of any date, the value of Common Stock
determined as follows:

 

(1)    If the Common Stock is listed on any established stock exchange or a
national market system, including without limitation The Nasdaq National Market
or The Nasdaq SmallCap Market of The Nasdaq Stock Market, its Fair Market Value
shall be the closing sales price for such stock (or the closing bid, if no sales
were reported) as quoted on such exchange or system on the date of
determination, as reported in The Wall Street Journal or such other source as
the Administrator deems reliable; or

 

(2)    If the Common Stock is regularly quoted by a recognized securities dealer
but selling prices are not reported, its Fair Market Value shall be the mean of
the closing bid and asked prices for the Common Stock on the date of such
determination, as reported in The Wall Street Journal or such other source as
the Board deems reliable; or

 

(3)    In the absence of an established market for the Common Stock, the Fair
Market Value thereof shall be determined in good faith by the Board.

 

(l)    “Offering Periods” shall mean the periods of approximately twenty-four
(24) months during which an option granted pursuant to the Plan may be
exercised, commencing on the first Trading Day on or after May 1 and November 1
of each year and terminating on the last Trading Day in the periods ending
twenty-four months later. The duration and timing of Offering Periods may be
changed pursuant to Section 4 of this Plan.

 

(m)    “Plan” shall mean this Employee Stock Purchase Plan.

 

(n)    “Purchase Price” shall mean an amount equal to 85% of the Fair Market
Value of a share of Common Stock on the Enrollment Date or on the Exercise Date,
whichever is lower.

 

(o)    “Purchase Period” shall mean the approximately six-month period
commencing after one Exercise Date and ending with the next Exercise Date,
except that the first Purchase Period of any Offering Period shall commence on
the Enrollment Date and end with the next Exercise Date.

 

(p)    “Reserves” shall mean the number of shares of Common Stock covered by
each option under the Plan which have not yet been exercised and the number of
shares of Common Stock which have been authorized for issuance under the Plan
but not yet placed under option.

 

(q)    “Subsidiary” shall mean a corporation, domestic or foreign, of which not
less than 50% of the voting shares are held by the Company or a Subsidiary,
whether or not such corporation now exists or is hereafter organized or acquired
by the Company or a Subsidiary.

 

(r)    “Trading Day” shall mean a day on which national stock exchanges and The
Nasdaq National Market (or any successor market system) are open for trading.

 

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3.    Eligibility.

 

(a)    Any Employee who has been employed by the Company for one month or more
on a given Enrollment Date shall be eligible to participate in the Plan.

 

(b)    Any provisions of the Plan to the contrary notwithstanding, no Employee
shall be granted an option under the Plan (i) to the extent that, immediately
after the grant, such Employee (or any other person whose stock would be
attributed to such Employee pursuant to Section 424(d) of the Code) would own
capital stock of the Company and/or hold outstanding options to purchase such
stock possessing five percent (5%) or more of the total combined voting power or
value of all classes of the capital stock of the Company or of any Subsidiary,
or (ii) to the extent that his or her rights to purchase stock under all
employee stock purchase plans of the Company and its subsidiaries accrues at a
rate which exceeds Twenty-Five Thousand Dollars ($25,000) worth of stock
(determined at the fair market value of the shares at the time such option is
granted) for each calendar year in which such option is outstanding at any time.

 

4.    Offering Periods.    The Plan shall be implemented by consecutive,
overlapping Offering Periods with a new Offering Period commencing on the first
Trading Day on or after May 1 and November 1 each year, or on such other dates
as the Board shall determine, and continuing thereafter until terminated in
accordance with Section 19 hereof. The Board or a committee thereof shall have
the power to change the duration of Offering Periods (including the commencement
dates thereof) and Purchase Periods thereunder with respect to future offerings
without stockholder approval if such change is announced at least five (5) days
prior to the scheduled beginning of the first Offering Period to be affected
thereafter.

 

5.    Participation.

 

(a)    An eligible Employee may become a participant in the Plan by completing a
subscription agreement authorizing payroll deductions in the form of Exhibit A
to this Plan and filing it with the Company’s stock administrator not later than
ten (10) business days prior to the applicable Enrollment Date.

 

(b)    Payroll deductions for a participant shall commence on the first payroll
following the Enrollment Date and shall end on the last payroll in the Offering
Period to which such authorization is applicable, unless sooner terminated by
the participant as provided in Section 10 hereof.

 

6.    Payroll Deductions.

 

(a)    At the time a participant files his or her subscription agreement, he or
she shall elect to have payroll deductions made on each pay day during the
Offering Period in an amount not less than one percent (1%) and not more than
ten percent (10%) of the participant’s Compensation, with such amount designated
in integral multiples of one percent (1%); provided, however, that the aggregate
of such payroll deductions during any Offering Period shall not exceed ten
percent (10%) of the participant’s aggregate Compensation during such Offering
Period.

 

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(b)    All payroll deductions made for a participant shall be credited to his or
her account under the Plan and shall be withheld in whole percentages only. A
participant may not make any additional payments into such account.

 

(c)    A participant may discontinue his or her participation in the Plan as
provided in Section 10, or may increase or decrease the rate of his or her
payroll deductions as provided in this Section 6(c). A participant may increase
the rate of his or her payroll deductions only as of the beginning of a Purchase
Period. Such increase shall take effect with the first payroll following the
beginning of the new Purchase Period provided the participant has completed and
delivered to the Company’s stock administrator a new subscription agreement
authorizing the increase in the payroll deduction rate at least ten (10)
business days prior to the beginning of the new Purchase Period. A participant
may decrease the rate of his or her payroll deductions each month. Any decrease
shall become effective as of the first payroll of the next calendar month
following the date that the participant completes and delivers to the Company’s
stock administrator a new subscription agreement authorizing the decrease in the
payroll deduction rate. However, if the subscription agreement is not received
at least five (5) business days prior to such payroll, the decrease shall become
effective as of the first payroll of the second succeeding calendar month. The
Board may, in its discretion, limit the number of participation rate changes
during any Offering Period. Subject to the foregoing, a participant’s
subscription agreement shall remain in effect for successive Offering Periods
unless terminated as provided in Section 10 hereof.

 

(d)    Notwithstanding the foregoing, to the extent necessary to comply with
Section 423(b)(8) of the Code and Section 3(b) hereof, a participant’s payroll
deductions may be decreased to zero percent (0%) at any time during a Purchase
Period. Such a decrease shall not be treated as a withdrawal from the Plan
subject to Section 10, unless the participant elects to withdraw pursuant to
Section 10. Payroll deductions shall recommence at the rate provided in such
participant’s subscription agreement at the beginning of the first Purchase
Period which is scheduled to end in the following calendar year, unless the
participant elects to withdraw from the Plan as provided in Section 10 hereof.

 

(e)    At the time the option is exercised, in whole or in part, or at the time
some or all of the Common Stock issued under the Plan is disposed of, the
participant must make adequate provision for the Company’s federal, state, or
other tax withholding obligations, if any, which arise upon the exercise of the
option or the disposition of the Common Stock. At any time, the Company may, but
shall not be obligated to, withhold from the participant’s compensation the
amount necessary for the Company to meet applicable withholding obligations,
including any withholding required to make available to the Company any tax
deductions or benefits attributable to sale or early disposition of Common Stock
by the Employee.

 

7.    Grant of Option.    On the Enrollment Date of each Offering Period, each
eligible Employee participating in such Offering Period shall be granted an
option to purchase on each Exercise Date during such Offering Period (at the
applicable Purchase Price) up to a number of shares of Common Stock determined
by dividing such Employee’s payroll deductions accumulated prior to such
Exercise Date and retained in the Participant’s account as of the Exercise Date
by the applicable Purchase Price; provided that in no event shall an Employee be

 

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permitted to purchase during each Purchase Period more than eight thousand
(8,000) shares of Common Stock (subject to any adjustment pursuant to Section
18) on the Enrollment Date, and provided further that such purchase shall be
subject to the limitations set forth in Sections 3(b) and 13 hereof. Exercise of
the option shall occur as provided in Section 8 hereof, unless the participant
has withdrawn pursuant to Section 10 hereof. The option shall expire on the last
day of the Offering Period.

 

8.    Exercise of Option.    Unless a participant withdraws from the Plan as
provided in Section 10 hereof, his or her option for the purchase of shares of
Common Stock shall be exercised automatically on the Exercise Date, and the
maximum number of full shares of Common Stock subject to option shall be
purchased for such participant at the applicable Purchase Price with the
accumulated payroll deductions in his or her account. No fractional shares shall
be purchased; any payroll deductions accumulated in a participant’s account
which are not sufficient to purchase a full share shall be retained in the
participant’s account for the subsequent Purchase Period or Offering Period,
subject to earlier withdrawal by the participant as provided in Section 10
hereof. Any other monies left over in a participant’s account after the Exercise
Date shall be returned to the participant. During a participant’s lifetime, a
participant’s option to purchase shares hereunder is exercisable only by him or
her.

 

9.    Delivery.    As promptly as practicable after each Exercise Date on which
a purchase of shares occurs, a share certificate or certificates representing
the number of shares of Common Stock so purchased shall be delivered to a
brokerage account designated by the Company and kept in such account pursuant to
a subscription agreement between each participant and the Company and subject to
the conditions described therein which may include a requirement that shares be
held and not sold for certain time periods, or the Company shall establish some
other means for such participants to receive ownership of the shares.

 

10.    Discontinuation; Withdrawal.

 

(a)    A participant may discontinue his or her participation in the Plan only
by withdrawing from the Plan as provided in this Section 10. A participant may
withdraw all but not less than all the payroll deductions credited to his or her
account and not yet used to exercise his or her option under the Plan by giving
written notice to the Company in the form of Exhibit B to this Plan. Such notice
must be received by the Company no later than 2:00 p.m. Pacific Standard Time on
the second Trading Day preceding the Exercise Date. All of the participant’s
payroll deductions credited to his or her account shall be paid to such
participant promptly after receipt of notice of withdrawal and such
participant’s option for the Offering Period shall be automatically terminated,
and no further payroll deductions for the purchase of shares shall be made for
such Offering Period. If a participant withdraws from an Offering Period,
payroll deductions shall not resume at the beginning of the succeeding Offering
Period unless the participant delivers to the Company a new subscription
agreement in accordance with Section 5(a) .

 

(b)    A participant’s withdrawal from an Offering Period shall not have any
effect upon his or her eligibility to participate in any similar plan which may
hereafter be adopted by the Company or in succeeding Offering Periods which
commence after the participant withdraws from the Plan, subject to compliance
with Section 5(a).

 

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11.    Termination of Employment.

 

Upon a participant’s ceasing to be an Employee, for any reason, he or she shall
be deemed to have elected to withdraw from the Plan and the payroll deductions
credited to such participant’s account during the Offering Period but not yet
used to exercise the option shall be returned to such participant or, in the
case of his or her death, to the person or persons entitled thereto under
Section 15 hereof, and such participant’s option shall be automatically
terminated. The preceding sentence notwithstanding, a participant who receives
payment in lieu of notice of termination of employment shall be treated as
continuing to be an Employee for the participant’s customary number of hours per
week of employment during the period in which the participant is subject to such
payment in lieu of notice.

 

12.    Interest.    No interest shall accrue on the payroll deductions of a
participant in the Plan.

 

13.    Stock.

 

(a)    The maximum number of shares of the Company’s Common Stock which shall be
made available for sale under the Plan shall be two million one hundred thousand
(2,100,000) shares, subject to adjustment upon changes in capitalization of the
Company as provided in Section 18 hereof. If, on a given Exercise Date, the
number of shares with respect to which options are to be exercised exceeds the
number of shares then available under the Plan, the Company shall make a pro
rata allocation of the shares remaining available for purchase in as uniform a
manner as shall be practicable and as it shall determine to be equitable.

 

(b)    The participant shall have no interest or voting right in shares covered
by his option until such option has been exercised.

 

(c)    Shares purchased by a participant under the Plan shall be registered in
the name of the participant or in the name of the participant and his or her
spouse.

 

14.    Administration.    The Plan shall be administered by the Board or a
committee of members of the Board appointed by the Board. The Board or its
committee shall have full and exclusive discretionary authority to construe,
interpret and apply the terms of the Plan, to determine eligibility and to
adjudicate all disputed claims filed under the Plan. Every finding, decision and
determination made by the Board or its committee shall, to the full extent
permitted by law, be final and binding upon all parties.

 

15.    Designation of Beneficiary.

 

(a)    A participant may file a written designation of a beneficiary who is to
receive any shares and cash, if any, from the participant’s account under the
Plan in the event of such participant’s death subsequent to an Exercise Date on
which the option is exercised but prior to delivery to such participant of such
shares and cash. In addition, a participant may file a written designation of a
beneficiary who is to receive any cash from the participant’s account under the
Plan in the event of such participant’s death prior to exercise of the option.
If a participant is married and the designated beneficiary is not the spouse,
spousal consent shall be required for such designation to be effective.

 

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(b)    Such designation of beneficiary may be changed by the participant at any
time by written notice. In the event of the death of a participant and in the
absence of a beneficiary validly designated under the Plan who is living at the
time of such participant’s death, the Company shall deliver such shares and/or
cash to the executor or administrator of the estate of the participant, or if no
such executor or administrator has been appointed (to the knowledge of the
Company), the Company, in its discretion, may deliver such shares and/or cash to
the spouse or to any one or more dependents or relatives of the participant, or
if no spouse, dependent or relative is known to the Company, then to such other
person as the Company may designate.

 

16.    Transferability.    Neither payroll deductions credited to a
participant’s account nor any rights with regard to the exercise of an option or
to receive shares under the Plan may be assigned, transferred, pledged or
otherwise disposed of in any way (other than by will, the laws of descent and
distribution or as provided in Section 15 hereof) by the participant. Any such
attempt at assignment, transfer, pledge or other disposition shall be without
effect, except that the Company may treat such act as an election to withdraw
funds from an Offering Period in accordance with Section 10 hereof.

 

17.    Use of Funds.    All payroll deductions received or held by the Company
under the Plan may be used by the Company for any corporate purpose, and the
Company shall not be obligated to segregate such payroll deductions.

 

18.    Adjustments Upon Changes in Capitalization, Dissolution, Liquidation,
Merger or Asset Sale.

 

(a)    Changes in Capitalization.    Subject to any required action by the
stockholders of the Company, the Reserves, the maximum number of shares each
participant may purchase each Purchase Period (pursuant to Section 7), as well
as the Purchase Price per share and the number of shares of Common Stock covered
by each option under the Plan which has not yet been exercised shall be
proportionately adjusted for any increase or decrease in the number of issued
shares of Common Stock resulting from a stock split, reverse stock split, stock
dividend, combination or reclassification of the Common Stock, or any other
increase or decrease in the number of outstanding shares of Common Stock
effected without receipt of consideration by the Company; provided, however,
that conversion of any convertible securities of the Company shall not be deemed
to have been “effected without receipt of consideration”. Such adjustment shall
be made by the Board, whose determination in that respect shall be final,
binding and conclusive. Except as expressly provided herein, no issuance by the
Company of shares of stock of any class, or securities convertible into shares
of stock of any class, shall affect, and no adjustment by reason thereof shall
be made with respect to, the number or price of shares of Common Stock subject
to an option.

 

(b)    Dissolution or Liquidation.    In the event of the proposed dissolution
or liquidation of the Company, the Offering Periods shall terminate immediately
prior to the consummation of such proposed action, unless otherwise provided by
the Board.

 

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(c)    Merger or Asset Sale.    In the event of a proposed sale of all or
substantially all of the assets of the Company, or the merger of the Company
with or into another corporation, limited liability company or other entity, the
Plan shall terminate upon the date of the consummation of such transaction
unless the plan of merger, consolidation or reorganization provides otherwise,
and any Purchase Periods then in progress shall be shortened by setting a new
Exercise Date (the “New Exercise Date”) and any Offering Periods then in
progress shall end on the New Exercise Date. The New Exercise Date shall be
before the date of the Company’s proposed sale or merger. The Board shall notify
each participant in writing, at least ten (10) business days prior to the New
Exercise Date, that the Exercise Date for the participant’s option has been
changed to the New Exercise Date and that the participant’s option shall be
exercised automatically on the New Exercise Date, unless prior to such date the
participant has withdrawn from the Offering Period as provided in Section 10
hereof. The Plan shall in no event be construed to restrict the Company’s right
to undertake any liquidation, dissolution, merger, consolidation or other
reorganization.

 

19.    Amendment or Termination.

 

(a)    The Board of Directors of the Company may at any time and for any reason
terminate or amend the Plan. Except as provided in Section 18 hereof, no such
termination can affect options previously granted, provided that an Offering
Period may be terminated by the Board of Directors on any Exercise Date if the
Board determines that the termination of the Plan is in the best interests of
the Company and its stockholders. Except as provided in Section 18 hereof, no
amendment may make any change in any option theretofore granted which adversely
affects the rights of any participant. To the extent necessary to comply with
Section 423 of the Code (or any successor rule or provision or any other
applicable law, regulation or stock exchange rule), the Company shall obtain
stockholder approval in such a manner and to such a degree as required.

 

(b)    Without stockholder consent and without regard to whether any participant
rights may be considered to have been “adversely affected,” the Board (or its
committee) shall be entitled to change the Offering Periods, limit the frequency
and/or number of changes in the amount withheld during an Offering Period,
establish the exchange ratio applicable to amounts withheld in a currency other
than U.S. dollars, permit payroll withholding in excess of the amount designated
by a participant in order to adjust for delays or mistakes in the Company’s
processing of properly completed withholding elections, establish reasonable
waiting and adjustment periods and/or accounting and crediting procedures to
ensure that amounts applied toward the purchase of Common Stock for each
participant properly correspond with amounts withheld from the participant’s
Compensation, and establish such other limitations or procedures as the Board
(or its committee) determines in its sole discretion advisable which are
consistent with the Plan.

 

20.    Notices.    All notices or other communications by a participant to the
Company under or in connection with the Plan shall be deemed to have been duly
given when received in the form specified by the Company at the location, or by
the person, designated by the Company for the receipt thereof.

 

21.    Conditions Upon Issuance of Shares.    Shares shall not be issued with
respect to an option unless the exercise of such option and the issuance and
delivery of such shares pursuant thereto shall comply with all applicable
provisions of law, domestic or foreign, including,

 

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without limitation, the Securities Act of 1933, as amended, the Securities
Exchange Act of 1934, as amended, the rules and regulations promulgated
thereunder, and the requirements of any stock exchange upon which the shares may
then be listed, and shall be further subject to the approval of counsel for the
Company with respect to such compliance.

 

As a condition to the exercise of an option, the Company may require the person
exercising such option to represent and warrant at the time of any such exercise
that the shares are being purchased only for investment and without any present
intention to sell or distribute such shares if, in the opinion of counsel for
the Company, such a representation is required by any of the aforementioned
applicable provisions of law.

 

22.    Term of Plan.    The Plan, as amended and restated, shall become
effective upon the Effective Date. It shall continue until February 27, 2007
unless sooner terminated under Section 19 hereof.

 

23.    Automatic Transfer to Low Price Offering Period.    To the extent
permitted by any applicable laws, regulations, or stock exchange rules, if the
Fair Market Value of the Common Stock on any Exercise Date in an Offering Period
is lower than the Fair Market Value of the Common Stock on the Enrollment Date
of such Offering Period, then all participants in such Offering Period shall be
automatically withdrawn from such Offering Period immediately after the exercise
of their option on such Exercise Date and automatically re-enrolled in the
immediately following Offering Period as of the first day thereof.

 

24.    Execution.    To record the amendment and restatement of the Plan by the
Board of Directors as of the Effective Date, the Company has caused its
authorized officer to execute the same.

 

INCYTE CORPORATION

By:

 

 

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Its

 

 

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EXHIBIT A

 

INCYTE CORPORATION

 

1997 EMPLOYEE STOCK PURCHASE PLAN

 

SUBSCRIPTION AGREEMENT

 

Enrollment Date:                         

 

____    Original Application

____    Change in Payroll Deduction Rate

____    Change of Beneficiary(ies)

 

(1)   _____________________________________    hereby elects to participate in
the Incyte Corporation 1997 Employee Stock Purchase Plan (the “Employee Stock
Purchase Plan”) and subscribes to purchase shares of the Company’s Common Stock
in accordance with this Subscription Agreement and the Employee Stock Purchase
Plan.

 

(2)   I hereby authorize payroll deductions from each paycheck in the amount of
___% of my Compensation (as defined in the Employee Stock Purchase Plan) on each
payday (from 1 to 10%) during the Offering Period in accordance with the
Employee Stock Purchase Plan. (Please note that no fractional percentages are
permitted.)

 

(3)   I understand that these payroll deductions will be accumulated for the
purchase of shares of Common Stock at the applicable Purchase Price determined
in accordance with the Employee Stock Purchase Plan. I understand that if I do
not withdraw from an Offering Period, any accumulated payroll deductions will be
used to automatically exercise my option to purchase shares.

 

(4)   I have received a copy of the complete Employee Stock Purchase Plan. I
understand that my participation in the Employee Stock Purchase Plan is in all
respects subject to the terms of such Plan. I understand that my ability to
exercise the option under this Subscription Agreement is subject to stockholder
approval of the Employee Stock Purchase Plan.

 

(5)   Shares purchased for me under the Employee Stock Purchase Plan should be
deposited in my brokerage account with ________________________ [name of
broker], or issued in the name(s) of (Employee or Employee and Spouse only):

 

       __________________________________________________________.

 

(6)  

I understand that if I dispose of any shares received by me pursuant to the Plan
within 2 years after the Enrollment Date (the first day of the Offering Period
during which I purchased such shares) or one year after the Exercise Date, I
will be treated for federal income tax purposes as having received ordinary
income at the time of such disposition in an amount equal to the excess of the
fair market value of the shares at the time such

 

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shares were purchased by me over the price which I paid for the shares. I hereby
agree to notify the Company in writing within 30 days after the date of any
disposition of my shares and I will make adequate provision for Federal, state
or other tax withholding obligations, if any, which arise upon the disposition
of the Common Stock. The Company may, but will not be obligated to, withhold
from any compensation the amount necessary to meet any applicable withholding
obligation including any withholding necessary to make available to the Company
any tax deductions or benefits attributable to sale or early disposition of
Common Stock by me. If I dispose of such shares at any time after the expiration
of the 2-year and 1-year holding periods, I understand that I will be treated
for federal income tax purposes as having received income only at the time of
such disposition, and that such income will be taxed as ordinary income only to
the extent of an amount equal to the lesser of (1) the excess of the fair market
value of the shares at the time of such disposition over the purchase price
which I paid for the shares; or (2) 15% of the fair market value of the shares
on the first day of the Offering Period. The remainder of the gain, if any,
recognized on such disposition will be taxed as capital gain.

 

(7)   I hereby agree to be bound by the terms of the Employee Stock Purchase
Plan. The effectiveness of this Subscription Agreement is dependent upon my
eligibility to participate in the Employee Stock Purchase Plan.

 

(8)   In the event of my death, I hereby designate the following as my
beneficiary(ies) to receive all payments and shares due me under the Employee
Stock Purchase Plan:

 

NAME: (Please
print)    ________________________________________________________________________________________

                                      
                              (First)         
                                   (Middle)    
                                             (Last)

 

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(Relationship)

       

 

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(Address)

Employee’s Social Security
Number:    ____________________________________________________________________________

Employee’s
Address:    ________________________________________________________________________________________

 

I UNDERSTAND THAT THIS SUBSCRIPTION AGREEMENT SHALL REMAIN IN EFFECT THROUGHOUT
SUCCESSIVE OFFERING PERIODS UNLESS TERMINATED BY ME. I HAVE RECEIVED A COPY OF
THE COMPLETE EMPLOYEE STOCK PURCHASE PLAN AND UNDERSTAND THAT MY PARTICIPATION
IN SUCH PLAN IS IN ALL RESPECTS SUBJECT TO THE TERMS OF SUCH PLAN.

 

Dated:    ______________________________________________

    

__________________________________________________

      

Signature of Employee

      

__________________________________________________

      

Spouse’s Signature

(If beneficiary other than spouse)

 

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EXHIBIT B

 

INCYTE CORPORATION

 

1997 EMPLOYEE STOCK PURCHASE PLAN

 

NOTICE OF WITHDRAWAL

 

The undersigned participant in the Offering Period of the Incyte Corporation
1997 Employee Stock Purchase Plan which began on _________________, ____ (the
“Enrollment Date”) hereby notifies the Company that he or she hereby withdraws
from the Offering Period. He or she hereby directs the Company to pay to the
undersigned as promptly as practicable all the payroll deductions credited to
his or her account with respect to the Offering Period. The undersigned
understands and agrees that his or her option for such Offering Period will be
automatically terminated. The undersigned understands further that no further
payroll deductions will be made for the purchase of shares in the current
Offering Period and the undersigned shall be eligible to participate in
succeeding Offering Periods only by delivering to the Company a new Subscription
Agreement. The undersigned has received a copy of the complete Employee Stock
Purchase Plan, and understands that his or her participation in the Employee
Stock Purchase Plan is in all respects subject to the terms of such Plan.

 

Name and Address of Participant:

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Signature:

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Date:

 

 

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PLEASE RETURN FORM TO MARILYN PASQUINELLI IN STOCK ADMINISTRATION

OR FAX TO (650) 621-7532.

 

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APPENDIX A

 

EMPLOYEES OF INCYTE CORPORATION LTD

 

Gains on options exercised under the Plan by Employees who are employed by
Incyte Corporation Ltd (“Limited”) are subject to National Insurance
Contributions under United Kingdom Social Security Contributions and Benefits
Act 1992, section 4(4)(a) (“Secondary Contributions”). Secondary Contributions
are payable by Limited unless Limited and the Employee enter into a joint
election in the form attached hereto as Exhibit A to transfer liability for
payment of the Secondary Contributions to the Employee (the “Joint Election”).
Effective January 1, 2001, any Employee of Limited who wishes to exercise
options granted pursuant to the Plan must enter into a Joint Election in
accordance with the following provisions:

 

A.1    Filing Date for Current Participants.    Employees of Limited who
enrolled in the Plan prior to October 31, 2001 and who have not withdrawn from
the Plan must file the Joint Election with the Company’s stock administrator not
later than ten (10) business days prior to October 31, 2001. Any such Employee
who fails to file the Joint Election in a timely manner will be deemed to have
withdrawn from the Plan prior to October 31, 2001 and his or her option or
options will not be exercised on the Exercise Date falling on October 31, 2001.

 

A.2    New Participants.    An eligible Employee of Limited who wishes to become
a participant in the Plan on or after November 1, 2001 must file a Joint
Election with the Company’s stock administrator at least ten (10) business days
prior to the applicable Enrollment Date. An eligible Employee who does not file
a Joint Election will not be granted an option under the Plan.

 

A.3    Amendment of the Joint Election; Approval.    The form for the Joint
Election, as it may be amended by the Company from time to time, shall be
submitted to the Board of Inland Revenue for approval and such approval shall be
obtained before the Company and an eligible Employee enter into a particular
Joint Election. A Joint Election may be amended in a writing signed by both the
Company and the Employee, provided that any such amendment must be approved by
the Board of Inland Revenue before it takes effect.

 

A.4    Effect of Withdrawal from the Plan.    If a participant withdraws from
the Plan, the Joint Election shall continue to apply in the event that the
Employee re-enrolls in the Plan.

 

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