Document:

Reigstrant's 2004 Employee Stock Purchase Plan

 EXHIBIT 10.6 
  
 COTHERIX, INC. 
  
 2004 EMPLOYEE STOCK PURCHASE
PLAN 
  
 (ADOPTED
FEBRUARY 24, 2004) 
 (AMENDED AND RESTATED MAY 14, 2004)

  

 TABLE OF CONTENTS 
  

			
	 	  	Page

		
	 SECTION 1. PURPOSE OF THE PLAN
	  	1
		
	 SECTION 2. ADMINISTRATION OF THE PLAN
	  	1
	 (a) Committee Composition
	  	1
	 (b) Committee Responsibilities
	  	1
		
	 SECTION 3. ENROLLMENT AND PARTICIPATION
	  	1
	 (a) Offering Periods
	  	1
	 (b) Accumulation Periods
	  	1
	 (c) Enrollment
	  	1
	 (d) Duration of Participation
	  	2
	 (e) Applicable Offering Period
	  	2
		
	 SECTION 4. EMPLOYEE CONTRIBUTIONS
	  	3
	 (a) Frequency of Payroll Deductions
	  	3
	 (b) Amount of Payroll Deductions
	  	3
	 (c) Changing Withholding Rate
	  	3
	 (d) Discontinuing Payroll Deductions
	  	3
	 (e) Limit on Number of Elections
	  	3
		
	 SECTION 5. WITHDRAWAL FROM THE PLAN
	  	3
	 (a) Withdrawal
	  	3
	 (b) Re-Enrollment After Withdrawal
	  	4
		
	 SECTION 6. CHANGE IN EMPLOYMENT STATUS
	  	4
	 (a) Termination of Employment
	  	4
	 (b) Leave of Absence
	  	4
	 (c) Death
	  	4
		
	 SECTION 7. PLAN ACCOUNTS AND PURCHASE OF SHARES
	  	4
	 (a) Plan Accounts
	  	4
	 (b) Purchase Price
	  	4
	 (c) Number of Shares Purchased
	  	5
	 (d) Available Shares Insufficient
	  	5
	 (e) Issuance of Stock
	  	5
	 (f) Tax Withholding
	  	5
	 (g) Unused Cash Balances
	  	5
	 (h) Stockholder Approval
	  	5
		
	 SECTION 8. LIMITATIONS ON STOCK OWNERSHIP
	  	6
	 (a) Five Percent Limit
	  	6
	 (b) Dollar Limit
	  	6

  

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	 SECTION 9. RIGHTS NOT TRANSFERABLE
	  	7
		
	 SECTION 10. NO RIGHTS AS AN EMPLOYEE
	  	7
		
	 SECTION 11. NO RIGHTS AS A STOCKHOLDER
	  	7
		
	 SECTION 12. SECURITIES LAW REQUIREMENTS.
	  	7
		
	 SECTION 13. STOCK OFFERED UNDER THE PLAN
	  	7
	 (a) Authorized Shares
	  	7
	 (b) Anti-Dilution Adjustments
	  	7
	 (c) Reorganizations
	  	8
		
	 SECTION 14. AMENDMENT OR DISCONTINUANCE
	  	8
	 (a) General Rule
	  	8
	 (b) Impact on Purchase Price
	  	8
		
	 SECTION 15. DEFINITIONS
	  	9
	 (a) Accumulation Period
	  	9
	 (b) Board
	  	9
	 (c) Code
	  	9
	 (d) Committee
	  	9
	 (e) Company
	  	9
	 (f) Compensation
	  	9
	 (g) Corporate Reorganization
	  	9
	 (h) Eligible Employee
	  	9
	 (i) Exchange Act
	  	9
	 (j) Fair Market Value
	  	9
	 (k) IPO
	  	10
	 (l) Offering Period
	  	10
	 (m) Participant
	  	10
	 (n) Participating Company
	  	10
	 (o) Plan
	  	10
	 (p) Plan Account
	  	10
	 (q) Purchase Price
	  	10
	 (r) Stock
	  	10
	 (s) Subsidiary
	  	10

  
  

 ii 

 COTHERIX, INC. 
  
 2004 EMPLOYEE STOCK PURCHASE
PLAN 
  
 SECTION 1. PURPOSE OF THE PLAN. 
  
 The Board adopted the Plan to be effective as of the date determined by the
Committee, which in no event will be earlier than the date of the IPO. The purpose of the Plan is to provide Eligible Employees with an opportunity to increase their proprietary interest in the success of the Company by purchasing Stock from the
Company on favorable terms and to pay for such purchases through payroll deductions. The Plan is intended to qualify under section 423 of the Code. 
  
 SECTION 2. ADMINISTRATION OF THE PLAN. 
  
 (a) Committee Composition. The Committee shall administer the Plan. The Committee shall consist exclusively of one or more directors of the
Company, who shall be appointed by the Board. 
  
 (b) Committee
Responsibilities. The Committee shall interpret the Plan and make all other policy decisions relating to the operation of the Plan. The Committee may adopt such rules, guidelines and forms as it deems appropriate to implement the Plan. The
Committee’s determinations under the Plan shall be final and binding on all persons. 
  
 SECTION 3. ENROLLMENT AND PARTICIPATION. 
  
 (a) Offering Periods. While the Plan is in effect, the Committee shall determine the duration and commencement date of each Offering Period, and the Offering Periods may be consecutive or overlapping.

  
 (b) Accumulation Periods. While the Plan is in effect,
the Committee shall determine the duration and commencement date of each Accumulation Period. 
  
 (c) Enrollment. 
  
 (i) At First Offering Period. Each individual who, on the day of the first Offering Period, qualifies as an Eligible Employee shall automatically become a Participant on such day. Each Participant who was automatically enrolled on
the date of the first Offering Period shall file the prescribed enrollment form with the Company. The enrollment form shall be filed at the prescribed location within 10 business days after the later of (a) the date on which the Company filed a
registration statement on Form S-8 for the shares of Stock offered under the Plan and (b) the commencement date of the first Offering Period. If a Participant who was automatically enrolled on the date of the first 

 
Offering Period fails to file such form in a timely manner, then such Participant shall be deemed to have withdrawn from the Plan under Section 5(a). A
former Participant who is deemed to have withdrawn from the Plan shall not be a Participant until he or she re-enrolls in the Plan under Subsection (ii) below. Re-enrollment may be effective only at the commencement of an Offering Period.

  
 (ii) After First Offering Period. In
the case of any individual who qualifies as an Eligible Employee on the first day of any Offering Period other than the first Offering Period, he or she may elect to become a Participant on such day by filing the prescribed enrollment form with the
Company. The enrollment form shall be filed at the prescribed location not later than the commencement date of such Offering Period. 
  
 (d) Duration of Participation. Once enrolled in the Plan, a Participant shall continue to participate in the Plan until he or she ceases to be an
Eligible Employee, withdraws from the Plan under Section 5(a) or is deemed to withdraw from the Plan under Section 3(c)(i) or reaches the end of the Accumulation Period in which his or her employee contributions were discontinued under Section 4(d)
or 8(b). A Participant who discontinued employee contributions under Section 4(d) or withdrew from the Plan under Section 5(a) may again become a Participant, if he or she then is an Eligible Employee, by following the procedure described in
Subsection (c)(ii) above. A Participant whose employee contributions were discontinued automatically under Section 8(b) shall automatically resume participation at the beginning of the earliest Accumulation Period ending in the next calendar year,
if he or she then is an Eligible Employee. In all other cases, a former Participant may again become a Participant, if he or she then is an Eligible Employee, by following the procedure described in Subsection (c)(ii) above. 
  
 (e) Applicable Offering Period. For purposes of calculating the
Purchase Price under Section 7(b), the applicable Offering Period shall be determined as follows: 
  
 (i) Once a Participant is enrolled in the Plan for an Offering Period, such Offering Period shall continue to apply to him or her until
the earliest of (A) the end of such Offering Period, (B) the end of his or her participation under Subsection (d) above or (C) re-enrollment for a subsequent Offering Period under Paragraph (ii), (iii) or (iv) below. 
  
 (ii) In the event that the Fair Market Value of Stock on the
last trading day before the commencement of the Offering Period for which the Participant is enrolled is higher than on the last trading day before the commencement of any subsequent Offering Period, the Participant shall automatically be
re-enrolled for such subsequent Offering Period. 
  
 (iii) If Section 14(b) applies, the Participant shall automatically be re-enrolled for a new Offering Period. 
  
 (iv) Any other provision of the Plan notwithstanding, the Company (at its sole discretion) may determine prior to the commencement of any
new 

  

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Offering Period that all Participants shall be re-enrolled for such new Offering Period. 
  
 (v) When a Participant reaches the end of an Offering Period but his or her participation is to continue,
then such Participant shall automatically be re-enrolled for the Offering Period that commences immediately after the end of the prior Offering Period. 
  
 SECTION 4. EMPLOYEE CONTRIBUTIONS. 
  
 (a) Frequency of Payroll Deductions. A Participant may purchase shares of Stock under the Plan solely by means of payroll deductions. Payroll
deductions, as designated by the Participant pursuant to Subsection (b) below, shall commence as soon as reasonably practicable after the Company has received the prescribed enrollment form. 
  
 (b) Amount of Payroll Deductions. An Eligible Employee shall designate
on the enrollment form the portion of his or her Compensation that he or she elects to have withheld for the purchase of Stock. Such portion shall be a whole percentage of the Eligible Employee’s Compensation, but not less than 1% nor more than
the percentage determined by the Committee, which shall in no event exceed 15%. 
  
 (c) Changing Withholding Rate. If a Participant wishes to change the rate of payroll withholding, he or she may do so by filing a new enrollment form with the Company at the prescribed location at any time. The
new withholding rate shall be effective as soon as reasonably practicable after the Company has received such form. The new withholding rate shall be a whole percentage of the Eligible Employee’s Compensation, but not less than 1% nor more than
the percentage determined by the Committee, which shall in no event exceed 15%. 
  
 (d) Discontinuing Payroll Deductions. If a Participant wishes to discontinue employee contributions entirely, he or she may do so by filing a new enrollment form with the Company at the prescribed location at
any time. Payroll withholding shall cease as soon as reasonably practicable after the Company has received such form. (In addition, employee contributions may be discontinued automatically pursuant to Section 8(b).) A Participant who has
discontinued employee contributions may resume such contributions by filing a new enrollment form with the Company at the prescribed location. Payroll withholding shall resume as soon as reasonably practicable after the Company has received such
form. 
  
 (e) Limit on Number of Elections. No Participant
shall make more than two elections under Subsection (c) or (d) above during any Accumulation Period. 
  
 SECTION 5. WITHDRAWAL FROM THE PLAN. 
  
 (a) Withdrawal. A Participant may elect to withdraw from the Plan by filing the prescribed form with the Company at the prescribed location at any time before the last day of an Accumulation Period. As soon as
reasonably practicable thereafter, payroll deductions shall cease and the entire amount credited to the Participant’s Plan Account shall be refunded to him or her in cash, without interest. No partial withdrawals shall be permitted. 

 

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 (b) Re-Enrollment After Withdrawal. A former Participant who has withdrawn from the Plan shall not
be a Participant until he or she re-enrolls in the Plan under Section 3(c)(ii). Re-enrollment may be effective only at the commencement of an Offering Period. 
  

SECTION 6. CHANGE IN EMPLOYMENT STATUS. 
  
 (a) Termination of Employment. Termination of employment as an Eligible Employee for any reason, including death, shall be treated as an automatic
withdrawal from the Plan under Section 5(a). (A transfer from one Participating Company to another shall not be treated as a termination of employment.) 
  
 (b) Leave of Absence. For purposes of the Plan, employment shall not be deemed to terminate when the Participant goes on a military leave, a sick
leave or another bona fide leave of absence, if the leave was approved by the Company in writing. Employment, however, shall be deemed to terminate 90 days after the Participant goes on a leave, unless a contract or statute guarantees his or
her right to return to work. Employment shall be deemed to terminate in any event when the approved leave ends, unless the Participant immediately returns to work. 
  
 (c) Death. In the event of the Participant’s death, the amount credited to his or her Plan Account shall be paid
to a beneficiary designated by him or her for this purpose on the prescribed form or, if none, to the Participant’s estate. Such form shall be valid only if it was filed with the Company at the prescribed location before the Participant’s
death. 
  
 SECTION 7. PLAN ACCOUNTS AND PURCHASE OF SHARES. 
  
 (a) Plan Accounts. The Company shall maintain a Plan Account on its
books in the name of each Participant. Whenever an amount is deducted from the Participant’s Compensation under the Plan, such amount shall be credited to the Participant’s Plan Account. Amounts credited to Plan Accounts shall not be trust
funds and may be commingled with the Company’s general assets and applied to general corporate purposes. No interest shall be credited to Plan Accounts. 
  
 (b) Purchase Price. The Purchase Price for each share of Stock purchased at the close of an Accumulation Period shall be determined by the
Committee but in no event will the Purchase Price be less than the lower of: 
  
 (i) 85% of the Fair Market Value of such share on the last trading day in such Accumulation Period; or 
  
 (ii) 85% of the Fair Market Value of such share on the last trading day before the commencement of the applicable Offering Period (as
determined under Section 3(e)) or, in the event that the first Offering Period under the Plan commences on the date of the IPO, 85% of the price at which one share of Stock is offered to the public in the IPO. 
  

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 (c) Number of Shares Purchased. As of the last day of each Accumulation Period, each Participant
shall be deemed to have elected to purchase the number of shares of Stock calculated in accordance with this Subsection (c), unless the Participant has previously elected to withdraw from the Plan in accordance with Section 5(a). The amount then in
the Participant’s Plan Account shall be divided by the Purchase Price, and the number of shares that results shall be purchased from the Company with the funds in the Participant’s Plan Account. The foregoing notwithstanding, with respect
to any Accumulation Period, no Participant shall purchase more than the number of shares of Stock determined by the Committee, which in no event will exceed 1,290 shares of Stock, nor more than the amounts of Stock set forth in Sections 8(b) and
13(a). The Committee may determine with respect to all Participants that any fractional share, as calculated under this Subsection (c), shall be (i) rounded down to the next lower whole share or (ii) credited as a fractional share. 
  
 (d) Available Shares Insufficient. In the event that the aggregate
number of shares that all Participants elect to purchase during an Accumulation Period exceeds the maximum number of shares remaining available for issuance under Section 13(a), then the number of shares to which each Participant is entitled shall
be determined by multiplying the number of shares available for issuance by a fraction. The numerator of such fraction is the number of shares that such Participant has elected to purchase, and the denominator of such fraction is the number of
shares that all Participants have elected to purchase. 
  
 (e)
Issuance of Stock. Certificates representing the shares of Stock purchased by a Participant under the Plan shall be issued to him or her as soon as reasonably practicable after the close of the applicable Accumulation Period, except that the
Committee may determine that such shares shall be held for each Participant’s benefit by a broker designated by the Committee (unless the Participant has elected that certificates be issued to him or her). Shares may be registered in the name
of the Participant or jointly in the name of the Participant and his or her spouse as joint tenants with right of survivorship or as community property. 
  
 (f) Tax Withholding. To the extent required by applicable federal, state, local or foreign law, a Participant shall make arrangements satisfactory
to the Company for the satisfaction of any withholding tax obligations that arise in connection with the Plan. The Company shall not be required to issue any shares of Stock under the Plan until such obligations are satisfied. 
  
 (g) Unused Cash Balances. An amount remaining in the
Participant’s Plan Account that represents the Purchase Price for any fractional share shall be carried over in the Participant’s Plan Account to the next Accumulation Period. Any amount remaining in the Participant’s Plan Account
that represents the Purchase Price for whole shares that could not be purchased by reason of Subsection (c) above, Section 8(b) or Section 13(a) shall be refunded to the Participant in cash, without interest. 
  
 (h) Stockholder Approval. Any other provision of the Plan
notwithstanding, no shares of Stock shall be purchased under the Plan unless and until the Company’s stockholders have approved the adoption of the Plan. 
  

 5 

 SECTION 8. LIMITATIONS ON STOCK OWNERSHIP. 
  
 (a) Five Percent Limit. Any other provision of the Plan notwithstanding, no Participant shall be granted a right to
purchase Stock under the Plan if such Participant, immediately after his or her election to purchase such Stock, would own stock possessing more than 5% of the total combined voting power or value of all classes of stock of the Company or any parent
or Subsidiary of the Company. For purposes of this Subsection (a), the following rules shall apply: 
  
 (i) Ownership of stock shall be determined after applying the attribution rules of section 424(d) of the Code; 
  
 (ii) Each Participant shall be deemed to own any stock that
he or she has a right or option to purchase under this or any other plan; and 
  
 (iii) With respect to each Accumulation Period, each Participant shall be deemed to have the right to purchase under this Plan the number of shares of Stock determined by the Committee under Subsection 7(c), which
will in no event exceed 1,290 shares of Stock. 
  
 (b)
Dollar Limit. Any other provision of the Plan notwithstanding, no Participant shall purchase Stock with a Fair Market Value in excess of the following limit: 
  
 (i) In the case of Stock purchased during an Offering Period that commenced in the current calendar year,
the limit shall be equal to (A) $25,000 minus (B) the Fair Market Value of the Stock that the Participant previously purchased in the current calendar year (under this Plan and all other employee stock purchase plans of the Company or any parent or
Subsidiary of the Company). 
  
 (ii) In the case
of Stock purchased during an Offering Period that commenced in the immediately preceding calendar year, the limit shall be equal to (A) $50,000 minus (B) the Fair Market Value of the Stock that the Participant previously purchased (under this Plan
and all other employee stock purchase plans of the Company or any parent or Subsidiary of the Company) in the current calendar year and in the immediately preceding calendar year. 
  
 For purposes of this Subsection (b), the Fair Market Value of Stock shall be determined in each case as of the beginning of the Offering
Period in which such Stock is purchased. Employee stock purchase plans not described in section 423 of the Code shall be disregarded. If a Participant is precluded by this Subsection (b) from purchasing additional Stock under the Plan, then his or
her employee contributions shall automatically be discontinued and shall resume at the beginning of the earliest Accumulation Period ending in the next calendar year (if he or she then is an Eligible Employee). 
  

 6 

 SECTION 9. RIGHTS NOT TRANSFERABLE. 
  
 The rights of any Participant under the Plan, or any Participant’s interest in any Stock or moneys to which he or she
may be entitled under the Plan, shall not be transferable by voluntary or involuntary assignment or by operation of law, or in any other manner other than by beneficiary designation or the laws of descent and distribution. If a Participant in any
manner attempts to transfer, assign or otherwise encumber his or her rights or interest under the Plan, other than by beneficiary designation or the laws of descent and distribution, then such act shall be treated as an election by the Participant
to withdraw from the Plan under Section 5(a). 
  
 SECTION 10. NO RIGHTS AS AN
EMPLOYEE. 
  
 Nothing in the Plan or in any right granted
under the Plan shall confer upon the Participant any right to continue in the employ of a Participating Company for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Participating Companies or of
the Participant, which rights are hereby expressly reserved by each, to terminate his or her employment at any time and for any reason, with or without cause. 
  

SECTION 11. NO RIGHTS AS A STOCKHOLDER. 
  
 A Participant shall have no rights as a stockholder with respect to any shares of Stock that he or she may have a right to purchase under the Plan until
such shares have been purchased on the last day of the applicable Accumulation Period. 
  
 SECTION 12. SECURITIES LAW REQUIREMENTS. 
  
 Shares of Stock shall not be issued under the Plan unless the issuance and delivery of such shares comply with (or are exempt from) all applicable requirements of law, including (without limitation) the Securities Act of 1933, as amended,
the rules and regulations promulgated thereunder, state securities laws and regulations, and the regulations of any stock exchange or other securities market on which the Company’s securities may then be traded. 
  
 SECTION 13. STOCK OFFERED UNDER THE PLAN. 
  
 (a) Authorized Shares. The number of shares of Stock available for
purchase under the Plan shall be 293,352[1] (subject to adjustment pursuant to this Section 13). On January 1 of each year, commencing with January 1, 2005, the aggregate number of shares of Stock available for purchase during the life of the Plan
shall automatically be increased by the lesser of (a) 159,529[2] shares of Stock or (b) 0.75% of the total number of shares of Stock then outstanding (subject to adjustment pursuant to this Section 13). 
  
 (b) Anti-Dilution Adjustments. The aggregate number of shares of Stock
offered under the Plan, the share limitation described in Section 7(c) and the price of shares that 
  

	[1]	Reflects the reverse stock split approved by the Board on April 26, 2004, pursuant to which each outstanding share of Stock will be converted into 0.606 shares of Stock (the
“Reverse Stock Split”). 

	[2]	Reflects the Reverse Stock Split. 

  

 7 

 
any Participant has elected to purchase shall be adjusted proportionately for any increase or decrease in the number of outstanding shares of Stock resulting
from a subdivision or consolidation of shares or the payment of a stock dividend, any other increase or decrease in such shares effected without receipt or payment of consideration by the Company, the distribution of the shares of a Subsidiary to
the Company’s stockholders or a similar event. 
  
 (c)
Reorganizations. Any other provision of the Plan notwithstanding, immediately prior to the effective time of a Corporate Reorganization, the Offering Period and Accumulation Period then in progress shall terminate and shares shall be
purchased pursuant to Section 7, unless the Plan is continued or assumed by the surviving corporation or its parent corporation. The Plan shall in no event be construed to restrict in any way the Company’s right to undertake a dissolution,
liquidation, merger, consolidation or other reorganization. 
  
 SECTION 14.
AMENDMENT OR DISCONTINUANCE. 
  
 (a) General Rule. The
Board shall have the right to amend, suspend or terminate the Plan at any time and without notice. Except as provided in Section 13, any increase in the aggregate number of shares of Stock to be issued under the Plan shall be subject to approval by
a vote of the stockholders of the Company. In addition, any other amendment of the Plan shall be subject to approval by a vote of the stockholders of the Company to the extent required by an applicable law or regulation. The Plan shall terminate
automatically 20 years after its adoption by the Board, unless (a) the Plan is extended by the Board and (b) the extension is approved within 12 months by a vote of the stockholders of the Company. 
  
 (b) Impact on Purchase Price. This Subsection (b) shall apply in the
event that (i) the Company’s stockholders during an Accumulation Period approve an increase in the number of shares of Stock that may be issued under Section 13 and (ii) the aggregate number of shares to be purchased at the close of such
Accumulation Period exceeds the number of shares that remained available under Section 13 before such increase. In such event, the Purchase Price for each share of Stock purchased at the close of such Accumulation Period shall be determined by the
Committee, but the Purchase Price for each share of Stock shall in no event be less than the lower of: 
  
 (i) The higher of (A) 85% of the Fair Market Value of such share on the last trading day before the commencement of the applicable
Offering Period or, in the event that the first Offering Period under the Plan commences on the date of the IPO, 85% of the price at which one share of Stock is offered to the public in the IPO or (B) 85% of the Fair Market Value of such share on
the last trading day before the date when the Company’s stockholders approve such increase; or 
  
 (ii) 85% of the Fair Market Value of such share on the last trading day in such Accumulation Period. 
  
 Immediately after the close of such Accumulation Period, a new Offering Period shall commence
for all Participants. 
  

 8 

 SECTION 15. DEFINITIONS. 
  

(a) “Accumulation Period” means a period, as determined by the Committee, during which contributions may be made toward the purchase
of Stock under the Plan, as determined pursuant to Section 3(b), but in no event will such period exceed six months. 
  
 (b) “Board” means the Board of Directors of the Company, as constituted from time to time. 
  
 (c) “Code” means the Internal Revenue Code of 1986, as
amended. 
  
 (d) “Committee” means a committee of
the Board, as described in Section 2. 
  
 (e)
“Company” means CoTherix, Inc., a Delaware corporation. 
  
 (f) “Compensation” means (i) the total compensation paid in cash to a Participant by a Participating Company, including salaries, wages, bonuses, incentive compensation, commissions, overtime pay and
shift premiums, plus (ii) any pre-tax contributions made by the Participant under section 401(k) or 125 of the Code. “Compensation” shall exclude all non-cash items, moving or relocation allowances, cost-of-living equalization payments,
car allowances, tuition reimbursements, imputed income attributable to cars or life insurance, severance pay, fringe benefits, contributions or benefits received under employee benefit plans, income attributable to the exercise of stock options, and
similar items. The Committee shall determine whether a particular item is included in Compensation. 
  
 (g) “Corporate Reorganization” means: 
  
 (i) The consummation of a merger or consolidation of the Company with or into another entity or any other corporate reorganization; or

  
 (ii) The sale, transfer or other disposition
of all or substantially all of the Company’s assets or the complete liquidation or dissolution of the Company. 
  
 (h) “Eligible Employee” means any employee of a Participating Company whose customary employment is for more than five months per
calendar year and for more than 20 hours per week. The foregoing notwithstanding, an individual shall not be considered an Eligible Employee if his or her participation in the Plan is prohibited by the law of any country which has jurisdiction over
him or her or if he or she is subject to a collective bargaining agreement that does not provide for participation in the Plan. 
  
 (i) “Exchange Act” means the Securities Exchange Act of 1934, as amended. 
  
 (j) “Fair Market Value” means the market price of Stock, determined by the Committee as follows:

  
 (i) If the Stock was traded on The Nasdaq
National Market or The Nasdaq SmallCap Market on the date in question, then the Fair Market Value shall be equal to the last-transaction price quoted for such date by such Market; 
  

 9 

 (ii) If the Stock was traded on a stock exchange on the date in question, then the Fair
Market Value shall be equal to the closing price reported by the applicable composite transactions report for such date; or 
  
 (iii) If none of the foregoing provisions is applicable, then the Committee shall determine the Fair Market Value in good faith on such
basis as it deems appropriate. 
  
 Whenever possible, the determination of Fair
Market Value by the Committee shall be based on the prices reported in The Wall Street Journal or as reported directly to the Company by Nasdaq or a stock exchange. Such determination shall be conclusive and binding on all persons.

  
 (k) “IPO” means the initial offering of Stock
to the public pursuant to a registration statement filed by the Company with the Securities and Exchange Commission. 
  
 (l) “Offering Period” means a period, as determined by the Committee, with respect to which the right to purchase Stock may be granted
under the Plan, as determined pursuant to Section 3(a), but in no event will such period exceed 12 months. 
  
 (m) “Participant” means an Eligible Employee who elects to participate in the Plan, as provided in Section 3(c). 
  
 (n) “Participating Company” means (i) the Company and (ii)
each present or future Subsidiary designated by the Committee as a Participating Company. 
  
 (o) “Plan” means this CoTherix, Inc. 2004 Employee Stock Purchase Plan, as it may be amended from time to time. 
  

(p) “Plan Account” means the account established for each Participant pursuant to Section 7(a). 
  
 (q) “Purchase Price” means the price at which Participants
may purchase Stock under the Plan, as determined pursuant to Section 7(b). 
  
 (r) “Stock” means the Common Stock of the Company. 
  
 (s) “Subsidiary” means any corporation (other than the Company) in an unbroken chain of corporations beginning with the Company, if each
of the corporations other than the last corporation in the unbroken chain owns stock possessing 50% or more of the total combined voting power of all classes of stock in one of the other corporations in such chain. 
  

 10Thomas L Feldman Employment Offer Letter

			
	 ____________
 ________________
 ___________________
 ______________
 _________________
	 	EXHIBIT 10.13

  

			
	December 5, 2003	 	[GRAPHIC]

  
 Thomas L. Feldman 
 13246 Via Ranchero Court 
 Saratoga CA 95070 
  
 Dear Tom: 
  
 CoTherix, Inc. (the “Company”) is pleased to offer you employment on the following terms: 
  
 1. Position. Your initial title will be Chief Commercial Officer, and
you will initially report to the Company’s Chief Executive Officer. This is a full-time position. By signing this letter agreement, you confirm to the Company that you have no contractual commitments or other legal obligations that would
prohibit you from performing your duties for the Company. 
  
 2.
Cash Compensation. The Company will pay you a starting salary at the rate of $240,000.00 per year, payable in accordance with the Company’s standard payroll schedule. This salary will be subject to adjustment pursuant to the
Company’s employee compensation policies in effect from time to time. You will also receive a sign on bonus of $30,000.00. In addition, you will be eligible to be considered for an incentive bonus for each fiscal year of the Company. The bonus
(if any) will be awarded based on objective or subjective criteria established by the Company’s Chief Executive Officer and approved by the Company’s Board of Directors. Your target bonus will be equal to 35% of your annual base salary.
Any bonus for the fiscal year in which your employment begins will be prorated, based on the number of days you are employed by the Company during that fiscal year. The bonus for a fiscal year will be paid after the Company’s books for that
year have been closed and will be paid only if you are employed by the Company at the time of payment. The determinations of the Company’s Board of Directors with respect to your bonus will be final and binding. 
  
 3. Employee Benefits. As a regular employee of the Company, you will
be eligible to participate in a number of Company-sponsored benefits. In addition, you will be entitled to paid vacation in accordance with the Company’s vacation policy, as in effect from time to time. 
  

 Thomas L. Fedlman 
 December 3, 2003 
 Page 2 
  

 4. Stock Options. Subject to the approval of the Company’s Board of Directors of its
Compensation Committee, you will be granted an option to purchase 367,526 shares of the Company’s Common Stock. This number gives effect to a 1 for 3 reverse stock split which as been approved by the CoTherix Board of Directors. The exercise
price per share will be equal to the fair market value per share on the date the option is granted or on your first day of employment, whichever is later. The option will be subject to the terms and conditions applicable to options granted under the
Company’s 2000 Stock Plan (the “Plan”), as described in the Plan and the applicable Stock Option Agreement. The option will be immediately exercisable but the unvested portion of the purchase shares will be subject to repurchase by
the Company at the exercise price in the event that your service terminates for any reason before you vest in the shares. You will vest in 25% of the option shares after 12 months of continuous service and the balance will vest in equal monthly
installments over the next 36 months of continuous service, as described in the applicable Stock Option Agreement. 
  
 If the Company is subject to a Change in Control before your service with the Company terminates and you are subject to an Involuntary Termination within 12 months after
that Change in Control, then the vested percentage of your option shares will be determined by adding another 12 months to the actual period of service that you have completed with the Company. 
  
 5. Severance Pay. If the Company terminated your employment for any
reason other than Cause or Permanent Disability, then the Company will continue to pay your base salary for a period of six months following the termination of your employment. Your base salary will be paid at the rate in effect at the time of the
termination of your employment and in accordance with the Company’s standard payroll procedures. [If you elect to continue your health insurance coverage under the Consolidated Omnibus Budget Reconciliation Act (“COBRA”) following the
termination of your employment, then the Company will pay the same portion of your monthly premium under COBRA as it pays for active employees until the earliest of (a) the close of the six month period following the termination of your employment,
(b) the expiration of your continuation coverage under COBRA or (c) the date when you become eligible for substantially equivalent health insurance coverage in connection with new employment or self-employment. 
  
 “Permanent Disability” means that you are unable to perform the
essential functions of your position, with or without reasonable accommodation, for a period of at least 120 consecutive days because of a physical or mental impairment. 
  
 6. Proprietary Information and Inventions Agreement. Like all Company employees, you will be required, as a condition
of your employment with the Company, to sign the Company’s standard Proprietary Information and Inventions Agreement, a copy of which is attached hereto as Exhibit A. 
  
 7. Employment Relationship. Employment with the Company is for no specific period of time. Your employment with the
Company will be “at will,” meaning that 

  

 Thomas L. Fedlman 
 December 3, 2003 
 Page 3 
  

 
either you or the Company may terminate your employment at any time and for any reason, with or without cause. Any contrary representations that may have
been made to you are superseded by this letter agreement. This is the full and complete agreement between you and the Company on this term. Although your job duties, title, compensation and benefits, as well as the Company’s personnel policies
and procedures, may change from time to time, the “at will” nature of your employment may only be changed in an express written agreement signed by you and a duly authorized officer of the Company (other than you). 
  
 8. Outside Activities. While you render services to the Company, you
agree that you will not engage in any other employment, consulting or other business activity without the prior written consent of the Company. While you render services to the Company, you also will not assist any person or entity in competing with
the Company, in preparing to compete with the Company or in hiring any employees or consultants of the Company. 
  
 9. Withholding Taxes. All forms of compensation referred to in this letter agreement are subject to reduction to reflect applicable withholding and
payroll taxes and other deductions required by law. 
  
 10.
Entire Agreement. This letter agreement supersedes and replaces any prior agreements, representations or understandings, whether written, oral or implied, between you and the Company. 
  
 11. Arbitration. You and the Company agree to waive any rights to a
trial before a judge or jury and agree to arbitrate before a neutral arbitrator any and all claims or disputes arising out of this letter agreement and any and all claims arising from or relating to your employment with the Company, including (but
not limited to ) claims against any current or former employee, director or agent of the Company, claims of wrongful termination, retaliation, discrimination, harassment, breach of contract, breach of the covenant of good faith and fair dealing,
defamation, invasion of privacy, fraud, misrepresentation, constructive discharge or failure to provide a leave of absence, or claims regarding commissions, stock options or bonuses, infliction or emotional distress or unfair business practices.

  
 The arbitrator’s decision must be written and must
include the findings of fact and law that support the decision. The arbitrator’s decision will be final and binding on both parties, except to the extent applicable law allows for judicial review of arbitration awards. The arbitrator may award
any remedies that would otherwise be available to the parties if they were to bring the dispute in court. The arbitration will be conducted in accordance with the National Rules for the Resolution of Employment Disputes of the American Arbitration
Association; provided, however that the arbitrator must allow the discovery authorized by the California Arbitration Act or the discovery that the arbitrator deems necessary for the parties to vindicate their respective claims or defenses. The
arbitration will take place in San Mateo County or, at your option, the country in which you primarily worked with the Company at the time when the arbitrable dispute or claim first arose. 
  

 Thomas L. Fediman 
 December 3, 2003 
 Page 4 
  

 You and the Company will share the cost of arbitration equally, except that the Company will bear the
cost of the arbitrator’s fee and any other type of expense or cost that you would not be required to bear if you were to bring the dispute or claim in court. Both the Company and you will be responsible for their own attorneys’ fees, and
the arbitrator may not award attorneys’ fees unless a statute or contract at issue specifically authorizes such an award. 
  
 The foregoing notwithstanding, this arbitration provision does not apply to (a) workers’ compensation or unemployment insurance claims or (b) claims
concerning the ownership, validity, infringement, misappropriation, disclosure, misuse or enforceability of any confidential information, patent right, copyright, mask work, trademark or any other trade secret or intellectual property held or sought
by either you or the Company (whether or not arising under the Proprietary Information and Inventions Agreement between you and the Company). 
  
 If an arbitrator or court of competent jurisdiction (the “Neutral”) determines that any provision of this arbitration provision is illegal or
unenforceable, then the Neutral shall modify or replace the language of this arbitration provision with a valid and enforceable provision, but only to the minimum extent necessary to render this arbitration provision legal and enforceable.

  
 * * * * * 
  
 We hope that you will accept our offer to join the Company. You may indicate
your agreement with these terms and accept this offer by signing and dating both the enclosed duplicate original of this letter agreement and the enclosed Proprietary Information and Inventions Agreement and returning them to me. This offer, is not
accepted, will expire at the close of the business on December 16, 2003. As required by law, your employment with the Company is contingent upon your providing legal proof of your identity and authorization to work in the United States. Your
employment is also contingent upon your starting work with the Company on or before January 6, 2004. 
  
 If you have any questions, please call me at 650-486-2106. 
  

			
	Very truly yours,
	
	COTHERIX, INC.
		
	By:	 	 /s/ W. Scott Harkonen

	 	 	

	 Title:
	 	 Chief Executive Officer

  

 Thomas L. Fediman 
 December 3, 2003 
 Page 5 
  

 I have read and accept this employment offer: 
  

	
	 
	
	 /s/ Tom Feldman

	

	Signature of [Name]
	 Dated: 12/11/03

  
 Attachment 
  
 Exhibit A: Proprietary Information and Inventions Agreement

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