Exhibit 10.59


 


Amylin
Pharmaceuticals, Inc.

2001 Equity Incentive Plan




Stock
Option Agreement

(Incentive Stock Option or Nonstatutory Stock Option)


 


Pursuant to your Stock Option Grant Notice (“Grant Notice”) and this
Stock Option Agreement, Amylin Pharmaceuticals, Inc. (the “Company”) has
granted you an option under its 2001 Equity Incentive Plan (the “Plan”) to
purchase the number of shares of the Company’s Common Stock indicated in your
Grant Notice at the exercise price indicated in your Grant Notice.  Defined terms not explicitly defined in this
Stock Option Agreement but defined in the Plan shall have the same definitions
as in the Plan.


 


The details of your option are as follows:


 


1.                                      Vesting.  Subject
to the limitations contained herein, your option will vest as provided in your
Grant Notice, provided that vesting will cease upon the termination of your
Continuous Service.


 


2.                                      Number of Shares and Exercise Price. 
The number of shares of Common Stock subject to your
option and your exercise price per share referenced in your Grant Notice may be
adjusted from time to time for capitalization adjustments, as provided in the
Plan.


 


3.                                      Exercise Prior to Vesting (“Early Exercise”).  If permitted in your Grant Notice (i.e., the
“Exercise Schedule” indicates that “Early Exercise” of your option is
permitted) and subject to the provisions of your option, you may elect at any
time that is both (i) during the period of your Continuous Service and (ii)
during the term of your option, to exercise all or part of your option,
including the nonvested portion of your option; provided, however, that:


 


(a)                                  a partial exercise of
your option shall be deemed to cover first vested shares of Common Stock and
then the earliest vesting installment of unvested shares of Common Stock;


 


(b)                                  any shares of Common
Stock so purchased from installments that have not vested as of the date of
exercise shall be subject to the purchase option in favor of the Company as
described in the Company’s form of Early Exercise Stock Purchase Agreement;


 


(c)                                  you shall enter into
the Company’s form of Early Exercise Stock Purchase Agreement with a vesting
schedule that will result in the same vesting as if no early exercise had
occurred; and


 


(d)                                  if your option is an
incentive stock option, then, as provided in the Plan, to the extent that the
aggregate Fair Market Value (determined at the time of grant) of the shares of
Common Stock with respect to which your option plus all other incentive stock
options you hold are exercisable for the first time by you during any calendar
year (under all plans of the Company and its Affiliates) exceeds one hundred
thousand dollars ($100,000), your option(s) or portions thereof that exceed
such limit (according to the order in which they were granted) shall be treated
as nonstatutory stock options.


 


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4.                                      Method of Payment.  Payment
of the exercise price is due in full upon exercise of all or any part of your
option.  You may elect to make payment
of the exercise price in cash or by check or in any other manner permitted by
your Grant Notice, which may include one or more of the following:


 


(a)                                  In the Company’s sole
discretion at the time your option is exercised and provided that at the time
of exercise the Common Stock is publicly traded and quoted regularly in The
Wall Street Journal, pursuant to a program developed under Regulation T as
promulgated by the Federal Reserve Board that, prior to the issuance of Common
Stock, results in either the receipt of cash (or check) by the Company or the
receipt of irrevocable instructions to pay the aggregate exercise price to the
Company from the sales proceeds.


 


(b)                                  Provided that at the
time of exercise the Common Stock is publicly traded and quoted regularly in
The Wall Street Journal, by delivery of already-owned shares of Common Stock
either that you have held for the period required to avoid a charge to the
Company’s reported earnings (generally six months) or that you did not acquire,
directly or indirectly from the Company, that are owned free and clear of any
liens, claims, encumbrances or security interests, and that are valued at Fair
Market Value on the date of exercise. 
“Delivery” for these purposes, in the sole discretion of the Company at
the time you exercise your option, shall include delivery to the Company of
your attestation of ownership of such shares of Common Stock in a form approved
by the Company.  Notwithstanding the
foregoing, you may not exercise your option by tender to the Company of Common
Stock to the extent such tender would violate the provisions of any law,
regulation or agreement restricting the redemption of the Company’s stock.


 


(c)                                  Pursuant to the
following deferred payment alternative:


 


(i)                                    Not less than one
hundred percent (100%) of the aggregate exercise price, plus accrued interest,
shall be due (i) on the date designated by the Company in its sole and absolute
discretion but not to exceed four (4) years from date of exercise, or (ii) at
the Company’s election, upon termination of your Continuous Service.


 


(ii)                                Interest shall be
compounded at least annually and shall be charged at the market rate of
interest necessary to avoid a charge to earnings for financial accounting
purposes.


 


(iii)                            At any time that the
Company is incorporated in Delaware, payment of the Common Stock’s “par value,”
as defined in the Delaware General Corporation Law, shall be made in cash and
not by deferred payment.


 


(iv)                               In order to elect the
deferred payment alternative, you must, as a part of your written notice of
exercise, give notice of the election of this payment alternative and, in order
to secure the payment of the deferred exercise price to the Company hereunder,
if the Company so requests, you must tender to the Company a promissory note
and a security agreement covering the purchased shares of Common Stock, both in
form and substance satisfactory to the Company, or such other or additional
documentation as the Company may request.


 


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5.                                      Whole Shares.  You
may exercise your option only for whole shares of Common Stock.


 


6.                                      Securities Law Compliance.  Notwithstanding
anything to the contrary contained herein, you may not exercise your option
unless the shares of Common Stock issuable upon such exercise are then registered
under the Securities Act or, if such shares of Common Stock are not then so
registered, the Company has determined that such exercise and issuance would be
exempt from the registration requirements of the Securities Act.  The exercise of your option must also comply
with other applicable laws and regulations governing your option, and you may
not exercise your option if the Company determines that such exercise would not
be in material compliance with such laws and regulations.


 


7.                                      Term.  You may
not exercise your option before the commencement of its term or after its term
expires.  The term of your option
commences on the Date of Grant and expires upon the earliest of the following:


 


(a)                                  subject to
Section 7(f), three (3) months after the termination of your Continuous
Service for any reason other than your Disability or death, provided that if
during any part of such three (3) month period your option is not exercisable
solely because of the condition set forth in the preceding paragraph relating to
“Securities Law Compliance,” your option shall not expire until the earlier of
the Expiration Date or until it shall have been exercisable for an aggregate
period of three (3) months after the termination of your Continuous Service;


 


(b)                                  subject to Section 7(f),
twelve (12) months after the termination of your Continuous Service due to your
Disability;


 


(c)                                  subject to
Section 7(f), twelve (12) months after your death if you die either during
your Continuous Service or within three (3) months after your Continuous
Service terminates;


 


(d)                                  the Expiration Date
indicated in your Grant Notice;


 


(e)                                  the day before the
tenth (10th) anniversary of the Date of Grant; or


 


(f)                                    in the event that
your Continuous Service terminates without Cause (as defined below) or because
of your Disability or death, in any such case at a time when you are 55 years
old or older and have Continuous Service of 5 years or more, then, to the
extent you were entitled to exercise your option at the date of such
termination, your option will expire upon the earliest of the fifth anniversary
of such date, the Expiration Date indicated in your Grant Notice, or the day
before the tenth (10th) anniversary of the Date of Grant.


 


For purposes of this
Section 7(f) only, “Cause” means that, in the reasonable determination of
the Company, you have (i) been convicted of or pleaded guilty or nolo
contendere to a felony or any crime involving moral turpitude or
dishonesty; (ii) participated in a fraud or act of


 


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dishonesty against the Company;
(iii) willfully and materially breached a Company policy; (iv) intentionally
damaged the Company’s property; (v) willfully and materially breached your
Proprietary Information and Inventions Agreement with the Company; (vi) engaged
in conduct that, in the reasonable determination of the Company, demonstrates
gross unfitness to serve; or (vii) repeatedly failed to satisfactorily perform
job duties to which you previously agreed in writing.  The conduct described under clauses (iii), (vi) and (vii) above
will only constitute Cause if such conduct is not cured within 90 days after
your receipt of written notice from the Company or the Board specifying the
particulars of the conduct that may constitute Cause.


 


If your option is an incentive stock option, note that, to obtain the
federal income tax advantages associated with an “incentive stock option,” the
Code requires that at all times beginning on the date of grant of your option
and ending on the day three (3) months before the date of your option’s
exercise, you must be an employee of the Company or an Affiliate, except in the
event of your death or Disability.  The
Company has provided for extended exercisability of your option under certain
circumstances for your benefit but cannot guarantee that your option will
necessarily be treated as an “incentive stock option” if you continue to
provide services to the Company or an Affiliate as a Consultant or Director
after your employment terminates or if you otherwise exercise your option more
than three (3) months after the date your employment terminates.


 


8.                                      EXERCISE.


 


(a)                                  You may exercise the
vested portion of your option (and the unvested portion of your option if your
Grant Notice so permits) during its term by delivering a Notice of Exercise (in
a form designated by the Company) together with the exercise price to the
Secretary of the Company, or to such other person as the Company may designate,
during regular business hours, together with such additional documents as the
Company may then require.


 


(b)                                  By exercising your
option you agree that, as a condition to any exercise of your option, the
Company may require you to enter into an arrangement providing for the payment
by you to the Company of any tax withholding obligation of the Company arising
by reason of (1) the exercise of your option, (2) the lapse of any substantial
risk of forfeiture to which the shares of Common Stock are subject at the time
of exercise, or (3) the disposition of shares of Common Stock acquired upon
such exercise.


 


(c)                                  If your option is an
incentive stock option, by exercising your option you agree that you will
notify the Company in writing within fifteen (15) days after the date of any
disposition of any of the shares of the Common Stock issued upon exercise of
your option that occurs within two (2) years after the date of your option
grant or within one (1) year after such shares of Common Stock are transferred
upon exercise of your option.


 


9.                                      Transferability.  Your
option is not transferable, except by will or by the laws of descent and
distribution, and is exercisable during your life only by you.  Notwithstanding the foregoing, by delivering
written notice to the Company, in a form satisfactory to the Company, you may
designate a third party who, in the event of your death, shall thereafter be
entitled to exercise your option.


 


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10.                               Option Not a Service Contract.  Your
option is not an employment or service contract, and nothing in your option
shall be deemed to create in any way whatsoever any obligation on your part to
continue in the employ of the Company or an Affiliate, or of the Company or an
Affiliate to continue your employment. 
In addition, nothing in your option shall obligate the Company or an
Affiliate, their respective stockholders, Boards of Directors, Officers or
Employees to continue any relationship that you might have as a Director or
Consultant for the Company or an Affiliate.


 


11.                               Withholding Obligations.


 


(a)                                  At the time you
exercise your option, in whole or in part, or at any time thereafter as
requested by the Company, you hereby authorize withholding from payroll and any
other amounts payable to you, and otherwise agree to make adequate provision
for (including by means of a “cashless exercise” pursuant to a program
developed under Regulation T as promulgated by the Federal Reserve Board to the
extent permitted by the Company), any sums required to satisfy the federal,
state, local and foreign tax withholding obligations of the Company or an
Affiliate, if any, which arise in connection with your option.


 


(b)                                  Upon your request and
subject to approval by the Company, in its sole discretion, and compliance with
any applicable conditions or restrictions of law, the Company may withhold from
fully vested shares of Common Stock otherwise issuable to you upon the exercise
of your option a number of whole shares of Common Stock having a Fair Market
Value, determined by the Company as of the date of exercise, not in excess of
the minimum amount of tax required to be withheld by law.  If the date of determination of any tax
withholding obligation is deferred to a date later than the date of exercise of
your option, share withholding pursuant to the preceding sentence shall not be
permitted unless you make a proper and timely election under Section 83(b)
of the Code, covering the aggregate number of shares of Common Stock acquired
upon such exercise with respect to which such determination is otherwise
deferred, to accelerate the determination of such tax withholding obligation to
the date of exercise of your option. 
Notwithstanding the filing of such election, shares of Common Stock
shall be withheld solely from fully vested shares of Common Stock determined as
of the date of exercise of your option that are otherwise issuable to you upon
such exercise.  Any adverse consequences
to you arising in connection with such share withholding procedure shall be
your sole responsibility.


 


(c)                                  You may not exercise
your option unless the tax withholding obligations of the Company and/or any
Affiliate are satisfied.  Accordingly,
you may not be able to exercise your option when desired even though your
option is vested, and the Company shall have no obligation to issue a
certificate for such shares of Common Stock or release such shares of Common
Stock from any escrow provided for herein.


 


12.                               Notices.  Any
notices provided for in your option or the Plan shall be given in writing and
shall be deemed effectively given upon receipt or, in the case of notices
delivered by mail by the Company to you, five (5) days after deposit in the
United States mail, postage prepaid, addressed to you at the last address you
provided to the Company.


 


13.                               Governing Plan Document.  Your
option is subject to all the provisions of the Plan, the provisions of which
are hereby made a part of your option, and is further subject to all
interpretations, amendments, rules and regulations which may from time to time
be promulgated and adopted pursuant to the Plan.  In the event of any conflict between the provisions of your
option and those of the Plan, the provisions of the Plan shall control.


 


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