Document:

Exhibit 10.4

 

AMYLIN
PHARMACEUTICALS, INC.

 

2001
EMPLOYEE STOCK PURCHASE PLAN, AS AMENDED

 

1.                                      PURPOSE.

 

(a)                                  The purpose of
the Plan is to provide a means by which Employees of the Company and certain
designated Related Corporations may be given an opportunity to purchase shares
of the Common Stock of the Company.

 

(b)                                  The Company, by
means of the Plan, seeks to retain the services of such Employees, to secure
and retain the services of new Employees and to provide incentives for such
persons to exert maximum efforts for the success of the Company and its Related
Corporations.

 

(c)                                  The Company
intends that the Purchase Rights granted under the Plan be considered options
issued under an Employee Stock Purchase Plan.

 

2.                                      DEFINITIONS.

 

(a)                                  “BOARD” means
the Board of Directors of the Company.

 

(b)                                  “CODE” means
the Internal Revenue Code of 1986, as amended.

 

(c)                                  “COMMITTEE”
means a committee appointed by the Board in accordance with Section 3(c) of
the Plan.

 

(d)                                  “COMMON STOCK”
means the common stock of the Company.

 

(e)                                  “COMPANY” means
Amylin Pharmaceuticals, Inc., a Delaware corporation.

 

(f)                                    “CORPORATE
TRANSACTION” means any one or more of the following events:

 

(i)                                    a sale, lease
or other disposition of all or substantially all of the assets of the Company;

 

(ii)                                a merger or
consolidation in which the Company is not the surviving corporation; or

 

(iii)                            a reverse
merger in which the Company is the surviving corporation but the shares of
Common Stock outstanding immediately preceding the merger are converted by virtue
of the merger into other property, whether in the form of securities, cash or
otherwise.

 

(g)                                 “DIRECTOR”
means a member of the Board.

 

(h)                                 “ELIGIBLE
EMPLOYEE” means an Employee who meets the requirements set forth in the
Offering for eligibility to participate in the Offering,

 

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provided
that such Employee also meets the requirements for eligibility to participate
set forth in the Plan.

 

(i)                                    “EMPLOYEE”
means any person who is employed for purposes of Section 423(b)(4) of
the Code by the Company or a Related Corporation. Neither service as a Director
nor payment of a director’s fee shall be sufficient to make an individual an
Employee of the Company or a Related Corporation.

 

(j)                                    “EMPLOYEE STOCK
PURCHASE PLAN” means a plan that grants Purchase Rights intended to be options
issued under an “employee stock purchase plan,” as that term is defined in Section 423(b) of
the Code.

 

(k)                                “EXCHANGE ACT”
means the Securities Exchange Act of 1934, as amended.

 

(l)                                    “FAIR MARKET
VALUE” means the value of a security, as determined in good faith by the Board.
If the security is listed on any established stock exchange or traded on the
Nasdaq National Market or the Nasdaq SmallCap Market, the Fair Market Value of
the security, unless otherwise determined by the Board, shall be the closing
sales price (rounded up where necessary to the nearest whole cent) for such
security (or the closing bid, if no sales were reported) as quoted on such
exchange or market (or the exchange or market with the greatest volume of
trading in the relevant security of the Company) on the Trading Day prior to
the relevant determination date, as reported in The Wall Street Journal or such
other source as the Board deems reliable.

 

(m)                              “OFFERING”
means the grant of Purchase Rights to purchase shares of Common Stock under the
Plan to Eligible Employees.

 

(n)                                 “OFFERING DATE”
means a date selected by the Board for an Offering to commence.

 

(o)                                  “OFFICER” means
a person who is an officer of the Company within the meaning of Section 16
of the Exchange Act and the rules and regulations promulgated thereunder.

 

(p)                                  “PARTICIPANT”
means an Eligible Employee who holds an outstanding Purchase Right granted
pursuant to the Plan.

 

(q)                                  “PLAN” means
this Amylin Pharmaceuticals, Inc. 2001 Employee Stock Purchase Plan, as
amended.

 

(r)                                  “PURCHASE DATE”
means one or more dates during an Offering established by the Board on which
Purchase Rights granted under the Plan shall be exercised and as of which
purchases of shares of Common Stock shall be carried out in accordance with
such Offering.

 

(s)                                  “PURCHASE
PERIOD” means a period of time specified within an Offering beginning on the
Offering Date or on the next day following a Purchase Date within an Offering
and ending on a Purchase Date, at the end of which there shall be

 

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purchased
shares of Common Stock on behalf of Participants. An Offering may consist of
one or more Purchase Periods.

 

(t)                                    “PURCHASE RIGHT”
means an option to purchase shares of Common Stock granted pursuant to the
Plan.

 

(u)                                 “RELATED
CORPORATION” means, with respect to the Company, any parent corporation or
subsidiary corporation, whether now or hereafter existing, as those terms are
defined in Sections 424(e) and (f), respectively, of the Code.

 

(v)                                   “SECURITIES ACT”
means the Securities Act of 1933, as amended.

 

(w)                                “TRADING DAY”
means any day the exchange(s) or market(s) on which shares of Common
Stock are listed, whether it be any established stock exchange, the Nasdaq
National Market, the Nasdaq SmallCap Market or otherwise, is open for trading.

 

3.                                      ADMINISTRATION.

 

(a)                                  The Board shall
administer the Plan unless and until the Board delegates administration to a
Committee, as provided in Section 3(c). Whether or not the Board has
delegated administration, the Board shall have the final power to determine all
questions of policy and expediency that may arise in the administration of the
Plan.

 

(b)                                  The Board (or
the Committee) shall have the power, subject to, and within the limitations of,
the express provisions of the Plan:

 

(i)                                    To determine
when and how Purchase Rights shall be granted and the provisions of each
Offering of such Purchase Rights (which need not be identical).

 

(ii)                                To designate
from time to time which Related Corporations of the Company shall be eligible
to participate in the Plan.

 

(iii)                            To construe and
interpret the Plan and Purchase Rights granted under the Plan, and to
establish, amend and revoke rules and regulations for the administration of
the Plan. The Board, in the exercise of this power, may correct any defect,
omission or inconsistency in the Plan, in a manner and to the extent it shall
deem necessary or expedient to make the Plan fully effective.

 

(iv)                               To amend the
Plan as provided in Section 15.

 

(v)                                   Generally, to
exercise such powers and to perform such acts as it deems necessary or
expedient to promote the best interests of the Company and its Related
Corporations and to carry out the intent that the Plan be treated as an
Employee Stock Purchase Plan.

 

(c)                                  The Board may
delegate administration of the Plan to a Committee of the Board composed of one
(1) or more members of the Board. If administration is delegated to a
Committee, the Committee shall have, in connection with the administration of
the Plan, the powers theretofore possessed by the Board, subject, however, to
such

 

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resolutions,
not inconsistent with the provisions of the Plan, as may be adopted from time
to time by the Board. The Board may abolish the Committee at any time and
revest in the Board the administration of the Plan. If administration is
delegated to a Committee, references to the Board in this Plan and in the
Offering document shall thereafter be deemed to be to the Board or the
Committee, as the case may be.

 

4.                                      SHARES OF
COMMON STOCK SUBJECT TO THE PLAN.

 

(a)                                  Subject to the
provisions of Section 14 relating to adjustments upon changes in
securities, the shares of Common Stock that may be sold pursuant to Purchase
Rights granted under the Plan shall not exceed in the aggregate four million
one hundred fifty thousand (4,150,000) shares of Common Stock. If any Purchase
Right granted under the Plan shall for any reason terminate without having been
exercised, the shares of Common Stock not purchased under such Purchase Right
shall again become available for issuance under the Plan.

 

(b)                                  The shares of
Common Stock subject to the Plan may be unissued shares or shares that have
been bought on the open market at prevailing market prices or otherwise.

 

5.                                      GRANT OF
PURCHASE RIGHTS; OFFERING.

 

(a)                                  The Board may
from time to time grant or provide for the grant of Purchase Rights under the
Plan to Eligible Employees in an Offering (consisting of one or more Purchase
Periods) on an Offering Date or Offering Dates selected by the Board. Each
Offering shall be in such form and shall contain such terms and conditions as
the Board shall deem appropriate, which shall comply with the requirement of Section 423(b)(5) of
the Code that all Employees granted Purchase Rights under the Plan shall have
the same rights and privileges. The terms and conditions of an Offering shall
be incorporated by reference into the Plan and treated as part of the Plan. The
provisions of separate Offerings need not be identical, but each Offering shall
include (through incorporation of the provisions of this Plan by reference in
the document comprising the Offering or otherwise) the period during which the
Offering shall be effective, which period shall not exceed twenty-seven (27)
months beginning with the Offering Date, and the substance of the provisions
contained in Sections 6 through 9, inclusive.

 

(b)                                  If a
Participant has more than one Purchase Right outstanding under the Plan, unless
he or she otherwise indicates in agreements or notices delivered hereunder: (i) each
agreement or notice delivered by that Participant shall be deemed to apply to
all of his or her Purchase Rights under the Plan, and (ii) a Purchase
Right with a lower exercise price (or an earlier-granted Purchase Right, if
different Purchase Rights have identical exercise prices) shall be exercised to
the fullest possible extent before a Purchase Right with a higher exercise
price (or a later-granted Purchase Right, if different Purchase Rights have
identical exercise prices) shall be exercised.

 

6.                                      ELIGIBILITY.

 

(a)                                  Purchase Rights
may be granted only to Employees of the Company or, as the Board may designate
as provided in Section 3(b), to Employees of a Related

 

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Corporation.
Except as provided in Section 6(b), an Employee shall not be eligible to
be granted Purchase Rights under the Plan unless, on the Offering Date, such
Employee has been in the employ of the Company or the Related Corporation, as
the case may be, for such continuous period preceding such Offering Date as the
Board may require, but in no event shall the required period of continuous
employment be greater than two (2) years. In addition, the Board may
provide that no Employee shall be eligible to be granted Purchase Rights under
the Plan unless, on the Offering Date, such Employee’s customary employment
with the Company or the Related Corporation is more than twenty (20) hours per
week and more than five (5) months per calendar year.

 

(b)                                  The Board may
provide that each person who, during the course of an Offering, first becomes
an Eligible Employee shall, on a date or dates specified in the Offering which
coincides with the day on which such person becomes an Eligible Employee or
which occurs thereafter, receive a Purchase Right under that Offering, which
Purchase Right shall thereafter be deemed to be a part of that Offering. Such
Purchase Right shall have the same characteristics as any Purchase Rights
originally granted under that Offering, as described herein, except that:

 

(i)                                    the date on
which such Purchase Right is granted shall be the “Offering Date” of such
Purchase Right for all purposes, including determination of the exercise price
of such Purchase Right;

 

(ii)                                the period of
the Offering with respect to such Purchase Right shall begin on its Offering
Date and end coincident with the end of such Offering; and

 

(iii)                            the Board may
provide that if such person first becomes an Eligible Employee within a
specified period of time before the end of the Offering, he or she shall not
receive any Purchase Right under that Offering.

 

(c)                                  No Employee
shall be eligible for the grant of any Purchase Rights under the Plan if,
immediately after any such Purchase Rights are granted, such Employee owns
stock possessing five percent (5%) or more of the total combined voting power
or value of all classes of stock of the Company or of any Related Corporation.
For purposes of this Section 6(c), the rules of Section 424(d) of
the Code shall apply in determining the stock ownership of any Employee, and
stock which such Employee may purchase under all outstanding Purchase Rights
and options shall be treated as stock owned by such Employee.

 

(d)                                  As specified by
Section 423(b)(8) of the Code, an Eligible Employee may be granted
Purchase Rights under the Plan only if such Purchase Rights, together with any
other rights granted under all Employee Stock Purchase Plans of the Company and
any Related Corporations, do not permit such Eligible Employee’s rights to
purchase stock of the Company or any Related Corporation to accrue at a rate
which exceeds twenty five thousand dollars ($25,000) of Fair Market Value of
such stock (determined at the time such rights are granted, and which, with
respect to the Plan, shall be determined as of their respective Offering Dates)
for each calendar year in which such rights are outstanding at any time.

 

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(e)                                  Officers of the
Company and any designated Related Corporation, if they are otherwise Eligible
Employees, shall be eligible to participate in Offerings under the Plan.
Notwithstanding the foregoing, the Board may provide in an Offering that
Employees who are highly compensated Employees within the meaning of Section 423(b)(4)(D) of
the Code shall not be eligible to participate.

 

7.                                      PURCHASE
RIGHTS; PURCHASE PRICE.

 

(a)                                  On each
Offering Date, each Eligible Employee, pursuant to an Offering made under the
Plan, shall be granted a Purchase Right to purchase up to that number of shares
of Common Stock purchasable either with a percentage or with a maximum dollar
amount, as designated by the Board, but in either case not exceeding fifteen
percent (15%), of such Employee’s Earnings (as defined by the Board in each
Offering) during the period that begins on the Offering Date (or such earlier
or later date as the Board determines for a particular Offering) and ends on
the date stated in the Offering, which date shall be no later than the end of
the Offering.

 

(b)                                  The Board shall
establish one (1) or more Purchase Dates during an Offering as of which
Purchase Rights granted under the Plan and pursuant to that Offering shall be
exercised and purchases of shares of Common Stock shall be carried out in
accordance with such Offering.

 

(c)                                  In connection
with each Offering made under the Plan, the Board may specify a maximum number
of shares of Common Stock that may be purchased by any Participant on any
Purchase Date during such Offering. In connection with each Offering made under
the Plan, the Board may specify a maximum aggregate number of shares of Common
Stock that may be purchased by all Participants pursuant to such Offering. In
addition, in connection with each Offering that contains more than one Purchase
Date, the Board may specify a maximum aggregate number of shares of Common
Stock that may be purchased by all Participants on any given Purchase Date
under the Offering. If the aggregate purchase of shares of Common Stock
issuable upon exercise of Purchase Rights granted under the Offering would
exceed any such maximum aggregate number, then, in the absence of any Board
action otherwise, a pro rata allocation of the shares of Common Stock available
shall be made in as nearly a uniform manner as shall be practicable and
equitable.

 

(d)                                  The purchase
price of shares of Common Stock acquired pursuant to Purchase Rights granted
under the Plan shall be not less than the lesser of:

 

(i)                                    an amount equal
to eighty five percent (85%) of the Fair Market Value of the shares of Common
Stock on the Offering Date; or

 

(ii)                                an amount equal
to eighty five percent (85%) of the Fair Market Value of the shares of Common
Stock on the applicable Purchase Date.

 

8.                                      PARTICIPATION;
WITHDRAWAL; TERMINATION.

 

(a)                                  A Participant
may elect to authorize payroll deductions pursuant to an Offering by delivering
an enrollment form to the Company within the time specified in 

 

6

 

the
Offering, in such form as the Company may provide or as otherwise provided for
in the Offering. Each such agreement shall authorize payroll deductions of up
to the maximum percentage specified by the Board of such Participant’s Earnings
(as defined in each Offering) before or during the Offering. The payroll
deductions made for each Participant shall be credited to a bookkeeping account
for such Participant under the Plan and shall be deposited with the general
funds of the Company. To the extent provided in the Offering, a Participant may
reduce (including to zero) or increase such payroll deductions. To the extent
provided in the Offering, a Participant may begin such payroll deductions after
the beginning of the Offering. A Participant may make additional payments into
his or her account only if specifically provided for in the Offering and only
if the Participant has not already had the maximum permitted amount withheld
during the Offering.

 

(b)                                  At any time
during an Offering, a Participant may terminate his or her payroll deductions
under the Plan and withdraw from the Offering by delivering to the Company a
notice of withdrawal in such form as the Company may provide. Such withdrawal
may be elected at any time prior to the end of the Offering, except as provided
in the Offering. Upon such withdrawal from the Offering by a Participant, the Company
shall distribute to such Participant all of his or her accumulated payroll
deductions (reduced to the extent, if any, such deductions have been used to
acquire shares of Common Stock for the Participant) under the Offering, without
interest (unless otherwise specified in the Offering), and such Participant’s
interest in that Offering shall be automatically terminated. A Participant’s
withdrawal from an Offering shall have no effect upon such Participant’s
eligibility to participate in any other Offerings under the Plan, but such
Participant shall be required to deliver a new participation agreement in order
to participate in subsequent Offerings under the Plan.

 

(c)                                  Purchase Rights
granted pursuant to any Offering under the Plan shall terminate immediately
upon a Participant ceasing to be an Employee for any reason or for no reason
(subject to any post employment participation period required by law) or other
lack of eligibility. The Company shall distribute to such terminated or
otherwise ineligible Employee all of his or her accumulated payroll deductions
(reduced to the extent, if any, such deductions have been used to acquire
shares of Common Stock for the terminated or otherwise ineligible Employee)
under the Offering, without interest (unless otherwise specified in the
Offering).

 

(d)                                  Purchase Rights
granted under the Plan shall not be transferable by a Participant otherwise
than by will or the laws of descent and distribution, or by a beneficiary
designation as provided in Section 13 and, during a Participant’s
lifetime, shall be exercisable only by such Participant.

 

(e)                                  The Board may
specify in an Offering that potential Participants in the Offering may elect to
have payroll deductions relating to the Offering made prior to the Offering’s
commencement. In such event, the Board may specify in the Offering the
procedures for potential Participants to follow to authorize or change such
payroll deductions, the time or times when such payroll deductions may be made,
such potential Participants’ withdrawal rights with respect to the Offering,
and other related matters.

 

7

 

9.                                      EXERCISE.

 

(a)                                  On each
Purchase Date during an Offering, each Participant’s accumulated payroll
deductions and other additional payments specifically provided for in the
Offering (without any increase for interest) shall be applied to the purchase
of shares of Common Stock up to the maximum number of shares of Common Stock
permitted pursuant to the terms of the Plan and the applicable Offering, at the
purchase price specified in the Offering. No fractional shares shall be issued
upon the exercise of Purchase Rights granted under the Plan unless specifically
provided for in the Offering.

 

(b)                                  If any amount
of accumulated payroll deductions remains in a Participant’s account after the
purchase of shares of Common Stock and such remaining amount is less than the
amount required to purchase one share of Common Stock on the final Purchase
Date of an Offering, then such remaining amount shall be held in each such
Participant’s account for the purchase of shares of Common Stock under the next
Offering under the Plan, unless such Participant withdraws from such next
Offering, as provided in Section 8(b), or is not eligible to participate
in such Offering, as provided in Section 6, in which case such amount
shall be distributed to the Participant after said final Purchase Date, without
interest (unless otherwise specified in the Offering). If any amount, of
accumulated payroll deductions remains in a Participant’s account after the
purchase of shares of Common Stock and such remaining amount is equal to the
amount required to purchase one (1) or more whole shares of Common Stock
on the final Purchase Date of the Offering, then such remaining amount shall be
distributed in full to the Participant at the end of the Offering without
interest (unless otherwise specified in the Offering).

 

(c)                                  No Purchase
Rights granted under the Plan may be exercised to any extent unless the shares
of Common Stock to be issued upon such exercise under the Plan are covered by
an effective registration statement pursuant to the Securities Act and the Plan
is in material compliance with all applicable federal, state, foreign and other
securities and other laws applicable to the Plan. If on a Purchase Date during
any Offering hereunder the shares of Common Stock are not so registered or the Plan
is not in such compliance, no Purchase Rights granted under the Plan or any
Offering shall be exercised on such Purchase Date, and the Purchase Date shall
be delayed until the shares of Common Stock are subject to such an effective
registration statement and the Plan is in such compliance, except that the
Purchase Date shall not be delayed more than twelve (12) months and the
Purchase Date shall in no event be more than twenty seven (27) months from the
Offering Date. If, on the Purchase Date under any Offering hereunder, as
delayed to the maximum extent permissible, the shares of Common Stock are not
registered and the Plan is not in such compliance, no Purchase Rights granted
under the Plan or any Offering shall be exercised and all payroll deductions accumulated
during the Offering (reduced to the extent, if any, such deductions have been
used to acquire shares of Common Stock) shall be distributed to the
Participants, without interest (unless otherwise specified in the Offering).

 

8

 

10.                               COVENANTS
OF THE COMPANY.

 

(a)                                  During the
terms of the Purchase Rights granted under the Plan, the Company shall ensure
that the amount of shares of Common Stock required to satisfy such Purchase
Rights are available.

 

(b)                                  The Company
shall seek to obtain from each federal, state, foreign or other regulatory
commission or agency having jurisdiction over the Plan such authority as may be
required to issue and sell shares of Common Stock upon exercise of the Purchase
Rights granted under the Plan. If, after reasonable efforts, the Company is
unable to obtain from any such regulatory commission or agency the authority
that counsel for the Company deems necessary for the lawful issuance and sale
of shares of Common Stock under the Plan, the Company shall be relieved from
any liability for failure to issue and sell shares of Common Stock upon
exercise of such Purchase Rights unless and until such authority is obtained.

 

11.                               USE OF
PROCEEDS FROM SHARES OF COMMON STOCK.

 

Proceeds from the sale of shares of Common Stock pursuant to Purchase
Rights granted under the Plan shall constitute general funds of the Company.

 

12.                               RIGHTS AS
A STOCKHOLDER.

 

A Participant shall not be deemed to be the holder of, or to have any
of the rights of a holder with respect to, shares of Common Stock subject to
Purchase Rights granted under the Plan unless and until the Participant’s
shares of Common Stock acquired upon exercise of Purchase Rights granted under
the Plan are recorded in the books of the Company (or its transfer agent).

 

13.                               DESIGNATION
OF BENEFICIARY.

 

(a)                                  A Participant
may file a written designation of a beneficiary who is to receive any shares of
Common Stock and/or cash, if any, from the Participant’s account under the Plan
in the event of such Participant’s death subsequent to the end of an Offering
but prior to delivery to the Participant of such shares of Common Stock or
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 during an Offering.

 

(b)                                  The Participant
may change such designation of beneficiary 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 of Common Stock 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 sole discretion, may deliver such shares of Common Stock 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.

 

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14.                               ADJUSTMENTS
UPON CHANGES IN SECURITIES; CORPORATE TRANSACTIONS.

 

(a)                                  If any change
is made in the shares of Common Stock, subject to the Plan, or subject to any
Purchase Right, without the receipt of consideration by the Company (through
merger, consolidation, reorganization, recapitalization, reincorporation, stock
dividend, dividend in property other than cash, stock split, liquidating
dividend, combination of shares, exchange of shares, change in corporate
structure or other transaction not involving the receipt of consideration by
the Company), the Plan shall be appropriately adjusted in the type(s),
class(es) and maximum number of shares of Common Stock subject to the Plan
pursuant to Section 4(a), and the outstanding Purchase Rights granted
under the Plan shall be appropriately adjusted in the type(s), class(es),
number of shares and purchase limits of such outstanding Purchase Rights. The
Board shall make such adjustments, and its determination shall be final,
binding and conclusive. (The conversion of any convertible securities of the
Company shall not be treated as a “transaction not involving the receipt of
consideration by the Company.”)

 

(b)                                  In the event of
a Corporate Transaction, then: (i) any surviving or acquiring corporation
may continue or assume Purchase Rights outstanding under the Plan or may
substitute similar rights (including a right to acquire the same consideration
paid to stockholders in the Corporate Transaction) for those outstanding under
the Plan, or (ii) if any surviving or acquiring corporation does not
assume such Purchase Rights or does not substitute similar rights for Purchase
Rights outstanding under the Plan, then, the Participants’ accumulated payroll
deductions (exclusive of any accumulated interest that cannot be applied toward
the purchase of shares of Common Stock under the terms of the Offering) shall
be used to purchase shares of Common Stock immediately prior to the Corporate
Transaction under the ongoing Offering, and the Participants’ Purchase Rights
under the ongoing Offering shall terminate immediately after such purchase.

 

15.                               AMENDMENT
OF THE PLAN.

 

(a)                                  The Board at
any time, and from time to time, may amend the Plan. However, except as
provided in Section 14 relating to adjustments upon changes in securities
and except as to amendments solely to benefit the administration of the Plan,
to take account of a change in legislation or to obtain or maintain favorable
tax, exchange control or regulatory treatment for Participants or the Company
or any Related Corporation, no amendment shall be effective unless approved by
the stockholders of the Company to the extent stockholder approval is necessary
for the Plan to satisfy the requirements of Section 423 of the Code or
other applicable laws or regulations.

 

(b)                                  It is expressly
contemplated that the Board may amend the Plan in any respect the Board deems necessary
or advisable to provide Employees with the maximum benefits provided or to be
provided under the provisions of the Code and the regulations promulgated
thereunder relating to Employee Stock Purchase Plans and/or to bring the Plan
and/or Purchase Rights granted under the Plan into compliance therewith.

 

(c)                                  The rights and
obligations under any Purchase Rights granted before amendment of the Plan
shall not be impaired by any amendment of the Plan except (i) 

 

10

 

with
the consent of the person to whom such Purchase Rights were granted, (ii) as
necessary to comply with any laws or governmental regulations, or (iii) as
necessary to ensure that the Plan and/or Purchase Rights granted under the Plan
comply with the requirements of Section 423 of the Code.

 

16.                               TERMINATION
OR SUSPENSION OF THE PLAN.

 

(a)                                  The Board in
its discretion may suspend or terminate the Plan at any time. Unless sooner
terminated, the Plan shall terminate at the time that all of the shares of
Common Stock reserved for issuance under the Plan, as increased and/or adjusted
from time to time, have been issued under the terms of the Plan. No Purchase
Rights may be granted under the Plan while the Plan is suspended or after it is
terminated.

 

(b)                                  Any benefits,
privileges, entitlements and obligations under any Purchase Rights granted
under the Plan while the Plan is in effect shall not be impaired by suspension
or termination of the Plan except (i) as expressly provided in the Plan or
with the consent of the person to whom such Purchase Rights were granted, (ii) as
necessary to comply with any laws, regulations, or listing requirements, or (iii) as
necessary to ensure that the Plan and/or Purchase Rights granted under the Plan
comply with the requirements of Section 423 of the Code.

 

17.                               EFFECTIVE
DATE OF PLAN.

 

The Plan shall become effective as determined by the Board, but no
Purchase Rights granted under the Plan shall be exercised unless and until the
Plan has been approved by the stockholders of the Company within twelve (12)
months before or after the date the Plan is adopted by the Board.

 

18.                               MISCELLANEOUS
PROVISIONS.

 

(a)                                  The Plan and
Offering do not constitute an employment contract. Nothing in the Plan or in
the Offering shall in any way alter the at will nature of a Participant’s
employment or be deemed to create in any way whatsoever any obligation on the
part of any Participant to continue in the employ of the Company or a Related
Corporation, or on the part of the Company or a Related Corporation to continue
the employment of a Participant.

 

(b)                                  The provisions
of the Plan shall be governed by the laws of the State of California without
resort to that state’s conflicts of laws rules.

 

11EXHIBIT 10.1

 

EXECUTION COPY

 

May 28, 2009

 

To the Consenting Lenders under the Lock-Up
Agreement referred to below:

 

Reference
is made to the letter agreement, dated as of March 9, 2009 (as amended,
supplemented or otherwise modified and in effect as of the date hereof, the “Lock-Up
Agreement”), among Herbst Gaming, Inc. (the “Company”), the
Guarantor Debtors (as defined therein) and the Consenting Parties (as defined
therein).  Capitalized terms used but not
otherwise defined herein shall have the meanings ascribed to such terms in the
Lock-Up Agreement.

 

By
this instrument (this “Amendment and Waiver”), each of the Debtors and
the Consenting Lenders, intending to be legally bound, hereby agrees as
follows:

 

1.                                       The termination
event described in Section 12(a)(ix) of the Lock-Up Agreement is
hereby waived.

 

2.                                       The consent of
the THI Parties as a condition to the effectiveness of this Amendment and
Waiver and to the continued binding effect of the Lock-Up Agreement with
respect to the Debtors and Consenting Lenders is hereby waived.

 

3.                                       A new
termination event is hereby added as Section 12(a)(xxiv) of the Lock-Up
Agreement as follows:

 

“(xxiv)  The Plan
and the Disclosure Statement, in each case in form and substance acceptable to
Required Consenting Lenders, shall not have been filed with the Bankruptcy
Court on or before June 15, 2009.”

 

provided  that the waiver of Required
Consenting Lenders, but not the Debtors, shall be required with respect to any
automatic termination that occurs pursuant to such new paragraph (xxiv).

 

4.                                       In light of the
termination of the Lock-Up Agreement with respect to the THI Parties, the
Restructuring, the Term Sheet, the Plan and the Plan Documents shall all be
modified to reflect treatment of all claims, rights and obligations of the THI
Parties, including the treatment of the Related Party Agreements, in a manner
acceptable to the Debtors and Required Consenting Lenders.

 

 

5.                                       Any Consenting
Lender that does not find acceptable the tax or capital structure proposed in
the Plan and Disclosure Statement filed with the Bankruptcy Court can elect to
terminate the Lock-Up Agreement solely with respect to such Consenting Lender
upon notice to the Company within 2 Business Days of such filing; provided that if any such election
shall result in all other remaining Consenting Lenders holding less than a
majority in dollar amount of all outstanding Claims under the Senior Credit
Facility, then the Lock-Up Agreement shall automatically terminate
notwithstanding any waiver by the Debtors.

 

References in the Lock-Up Agreement (including
references to the Lock-Up Agreement as amended hereby) to “this Agreement” (and
indirect references such as “hereunder”, “hereby”, “herein” and “hereof” or
words of like import) shall be deemed to be references to the Lock-Up Agreement
as amended hereby.  This Amendment and
Waiver shall be limited as written and nothing herein shall be deemed to
constitute a waiver of any other term, provision or condition of the Lock-Up
Agreement in any other instance than as set forth herein or prejudice any right
or remedy that any Consenting Lender may have or may in the future have under
the Lock-Up Agreement.  Except as herein
provided, the Lock-Up Agreement shall remain unchanged and in full force and
effect with respect to the Debtors and the Consenting Lenders and is hereby in
all respects ratified and confirmed. 
This Amendment and Waiver may be executed by the Debtors in any number
of counterparts and by different Debtors in separate counterparts and by
facsimile, with the same effect as if all Debtors had signed the same document,
and may be ratified by the Consenting Lenders through electronic
transmission.  This Amendment and Waiver
shall be governed by and construed in accordance with the laws of the State of
New York.

 

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  HERBST GAMING, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ TROY D. HERBST

  
	
   

  	
   

  	
  Name: 

  	
  TROY D. HERBST

  
	
   

  	
   

  	
  Title:

  	
  CEO

  
	
   

  	
   

  
	
   

  	
  GUARANTOR DEBTORS:

  
	
   

  	
   

  
	
   

  	
  FLAMINGO PARADISE GAMING, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ TROY D. HERBST

  
	
   

  	
   

  	
  Name:

  	
  TROY D. HERBST

  
	
   

  	
   

  	
  Title:

  	
  MANAGING MEMBER

  
	
   

  	
   

  
	
   

  	
  MARKET GAMING, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ TROY D. HERBST

  
	
   

  	
   

  	
  Name:

  	
  TROY D. HERBST

  
	
   

  	
   

  	
  Title:

  	
  SECRETARY/TREASURER

  
	
   

  	
   

  
	
   

  	
  CARDIVAN COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ TROY D. HERBST

  
	
   

  	
   

  	
  Name:

  	
  TROY D. HERBST

  
	
   

  	
   

  	
  Title:

  	
  SECRETARY/TREASURER

  
	
   

  	
   

  
	
   

  	
  CORRAL COIN, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ TROY D. HERBST

  
	
   

  	
   

  	
  Name:

  	
  TROY D. HERBST

  
	
   

  	
   

  	
  Title:

  	
  SECRETARY/TREASURER

  
	
   

  	
   

  
	
   

  	
  CORRAL COUNTRY COIN, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ TROY D. HERBST

  
	
   

  	
   

  	
  Name:

  	
  TROY D. HERBST

  
	
   

  	
   

  	
  Title:

  	
  SECRETARY/TREASURER

  

 

 

	
   

  	
  E-T-T ENTERPRISES, L.L.C.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ TROY D. HERBST

  
	
   

  	
   

  	
  Name:

  	
  TROY D. HERBST

  
	
   

  	
   

  	
  Title:

  	
  MANAGING MEMBER

  
	
   

  	
   

  
	
   

  	
  E-T-T, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ TROY D. HERBST

  
	
   

  	
   

  	
  Name:

  	
  TROY D. HERBST

  
	
   

  	
   

  	
  Title:

  	
  SECRETARY/TREASURER

  
	
   

  	
   

  
	
   

  	
  HGI — ST. JO, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ TROY D. HERBST

  
	
   

  	
   

  	
  Name:

  	
  TROY D. HERBST

  
	
   

  	
   

  	
  Title:

  	
  SECRETARY/TREASURER

  
	
   

  	
   

  
	
   

  	
  HGI — LAKESIDE, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ TROY D. HERBST

  
	
   

  	
   

  	
  Name:

  	
  TROY D. HERBST

  
	
   

  	
   

  	
  Title:

  	
  SECRETARY/TREASURER

  
	
   

  	
   

  
	
   

  	
  HGI — MARK TWAIN, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ TROY D. HERBST

  
	
   

  	
   

  	
  Name:

  	
  TROY D. HERBST

  
	
   

  	
   

  	
  Title:

  	
  SECRETARY/TREASURER

  
	
   

  	
   

  
	
   

  	
  THE SANDS REGENT

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ TROY D. HERBST

  
	
   

  	
   

  	
  Name:

  	
  TROY D. HERBST

  
	
   

  	
   

  	
  Title:

  	
  SECRETARY/TREASURER

  

 

 

	
   

  	
  ZANTE INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  TROY D. HERBST

  
	
   

  	
   

  	
  Name:

  	
  TROY
  D. HERBST

  
	
   

  	
   

  	
  Title:

  	
  SECRETARY/TREASURER

  
	
   

  	
   

  
	
   

  	
  LAST
  CHANCE, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  TROY D. HERBST

  
	
   

  	
   

  	
  Name:

  	
  TROY
  D. HERBST

  
	
   

  	
   

  	
  Title:

  	
  SECRETARY/TREASURER

  
	
   

  	
   

  
	
   

  	
  CALIFORNIA
  PROSPECTORS, LTD.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  TROY D. HERBST

  
	
   

  	
   

  	
  Name:

  	
  TROY
  D. HERBST

  
	
   

  	
   

  	
  Title:

  	
  MANAGING
  MEMBER

  
	
   

  	
   

  
	
   

  	
  PLANTATION
  INVESTMENTS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  TROY D. HERBST

  
	
   

  	
   

  	
  Name:

  	
  TROY
  D. HERBST

  
	
   

  	
   

  	
  Title:

  	
  SECRETARY/TREASURER

  
	
   

  	
   

  
	
   

  	
  DAYTON
  GAMING, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  TROY D. HERBST

  
	
   

  	
   

  	
  Name:

  	
  TROY
  D. HERBST

  
	
   

  	
   

  	
  Title:

  	
  SECRETARY/TREASURER

  
	
   

  	
   

  
	
   

  	
  THE
  PRIMADONNA COMPANY, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  TROY D. HERBST

  
	
   

  	
   

  	
  Name:

  	
  TROY
  D. HERBST

  
	
   

  	
   

  	
  Title:

  	
  MANAGING
  MEMBER

  

 

 

Accepted and agreed to by the Consenting
Lenders named below:

 

[electronic
transmissions, constituting the consent of Required Consenting Lenders, on file
with the Senior Credit Facility Agent]

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00159-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00159-of-00352.parquet"}]]