Document:

EX-10.01

 

Exhibit 10.01

Form of Option Agreement and

Notice of Grant of Options for Directors and Named

Executive Officers of Regeneron Pharmaceuticals, Inc.

	 	 	 
	

	 	Regeneron Pharmaceuticals, Inc.
	

	 	ID: [          ]
	Notice of Grant of Stock Options

	 	777 Old Saw Mill River Road
	Option Agreement for

	 	Tarrytown, New York 10591
	Option Awards
	 	 

	 	 	 
	[OPTIONEE NAME]

	 	Option Number: [          ]
	[OPTIONEE ADDRESS]

	 	Plan:
                         2005
	

	 	ID                               [          ]

Effective <date>
(the Grant Date) you have been granted a Non-Qualified Stock Option to buy [     ] shares of Regeneron
Pharmaceuticals, Inc. (the Company) stock at [$     ] per share.

The total option price of the shares granted is [$     ].

[Shares in each period will become fully vested on the date shown.

	 	 	 	 	 	 	 
	[Shares
	 	Vest Type
	 	Full Vest
	 	Expiration Date

	**

	 	On Vest Date
	 	[_/_/_]**
	 	[10 years from Grant
	Date]
	 	 	 	 	 	 
	**

	 	On Vest Date
	 	[_/_/_]**
	 	[10 years from Grant
	Date]
	 	 	 	 	 	 
	**

	 	On Vest Date
	 	[_/_/_]**
	 	[10 years from Grant
	Date]

**

	 	On Vest Date
	 	[_/_/_]**
	 	[10 years from Grant
	Date] ]
	 	 	 	 	 	 

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The Non-Qualified Stock Option expires on [          ]*** (the “Expiration Date”).

	 	 	You and the Company agree that these options are granted under and governed by
the terms and conditions of the Company’s 2000 Long-Term Incentive Plan as
amended and the enclosed Option Agreement, both of which are attached and made
a part of this document.

** Options for executive officers will vest in approximately equal annual 25%
installments. Full Vest Dates will occur on the first, second, third and fourth
anniversaries of the Grant Date. Options for non-employee directors will vest
in approximately equal annual 33-1/3% installments. Full Vest Dates will occur
on the first, second, and third anniversaries of the Grant Date.

*** Date to be 10 years from the Grant Date.

6

 

REGENERON PHARMACEUTICALS, INC.

OPTION AGREEMENT

PURSUANT TO THE

2000 LONG-TERM INCENTIVE PLAN

          THIS AGREEMENT, made as of the date on the Notice of Grant of Stock
Options, by and between Regeneron Pharmaceuticals, Inc., a New York corporation
(the “Company”), and the employee named on the Notice of Grant of Stock Options
(the “Grantee”);

          WHEREAS, the Grantee is an employee of the Company and the Company desires
to afford the Grantee the opportunity to acquire or enlarge the Grantee’s stock
ownership in the Company so that the Grantee may have a direct proprietary
interest in the Company’s success; and

          WHEREAS, the
Committee administering the 2000 Long-Term Incentive Plan
(as amended from time to time, the “Plan”) has granted (as of the effective date of grant specified in the
Notice of Grant of Stock Options) to the Grantee a Stock Option to purchase the
number of shares of the Company’s Common Stock ($.001 par value) (the “Common
Stock”) as set forth in the Notice of Grant of Stock Options.

          NOW, THEREFORE, in consideration of the covenants and agreements herein
contained, the parties agree as follows:

     1. Grant of Award. Pursuant to Section 7 of the Plan, the Company grants
to the Grantee, subject to the terms and conditions of the Plan and subject
further to the terms and conditions set forth here, the option to purchase from
the Company all or any part of an aggregate of shares of Common Stock at the
purchase price per share (the “Option”) as shown on the Notice of Grant of
Stock Options. No part of the Option granted hereby is intended to qualify
as an Incentive Stock Option under Section 422 of the Internal Revenue Code of
1986, as amended (the “Code”).

     2. Vesting; Exercise. (a) The Option is exercisable as provided on the Notice of
Grant of Stock Options. To the extent that the Option has become exercisable
as provided on the Notice of Grant of Stock Options and subject to the terms
and conditions of the Plan, including without limitation, Section 7(c)(1) &
(2), the Option may thereafter be exercised by the Grantee, in whole or in
part, at any time or from time to time prior to the expiration of the Option in
accordance with the requirements set forth in Section 7(c)(3) of the Plan,
including, without limitation, the filing of such written form of exercise
notice as may be

7

 

promulgated by the Committee, and in accordance with applicable tax and
other laws. In addition to the methods of payment described in
Section 7(c)(3) of the Plan, the Grantee shall be eligible to pay for
shares of Common Stock purchased upon the exercise of the Option by
directing the Company to withhold shares of Common Stock that would
otherwise be issued pursuant to the Option exercise having a Fair
Market Value (as measured on the date of exercise) equal to the
Option exercise price. The Company shall have the right to require the Grantee in
connection with the exercise of the Option to remit to the Company in cash an
amount sufficient to satisfy any federal, state and local withholding tax
requirements related thereto.

     (b) The Notice of Grant of Stock Options describes the date (the “Full
Vest Date”) upon which the Grantee shall be entitled to exercise the Option
provided that the Grantee has not incurred a termination of employment or
service with the Company and all Subsidiaries (collectively, the Company and
all Subsidiaries shall be referred to herein as the “Employer” and no
termination of employment or service shall be deemed to take place unless the
Grantee is no longer employed by or providing service to the Employer) prior to
such date. There shall be no proportionate or partial vesting prior to the
Full Vest Date specified in the Notice of Grant of Stock Options and all
vesting shall occur only on the Full Vest Date. Except as otherwise provided in
any employment agreement, consulting agreement, change in control agreement or
similar agreement in effect between the Employer and the Grantee on the date
specified in the Notice of Grant of Stock Options, no vesting shall occur after
such date as the Grantee ceases to be employed by the Employer (or serve as a
member of the Board of Directors, as the case may be) and all unvested Options
shall be forfeited at such time.

     (c) If Grantee makes payment upon exercise of the Option by delivering
shares of Common Stock owned by the Grantee for at least six months prior to
the date of exercise, the Grantee shall be granted a new option (a “Reload
Option”) on the date of exercise for a number of shares equal to the number of
shares surrendered by the Grantee upon exercise, subject to the availability of
shares of Common Stock under the Plan at the time of such exercise. Such
Reload Option shall be granted at an exercise price equal to the Fair Market
Value (as defined in the Plan) of a share of Common Stock on the date of grant,
shall expire on the date on which the original Option would have expired, and
shall be fully vested; provided, however, that the Reload Option may not be
exercised until the date that is six months after the date of grant. The
Reload Option shall otherwise be subject to the same terms and conditions as
the original Option; provided, however, that the exercise of the Reload Option
shall not entitle the Grantee to any further Reload grant.

     (d) Notwithstanding anything herein (except the following sentence) or in
the Notice of Grant of Stock Options to the contrary, the Option shall be fully
vested if the Grantee’s employment with the Employer (or serve as a member of
the Board of Directors, as the case may be) is terminated on or within two
years after the occurrence of a Change in Control by the Employer (other than
for Cause) or by the Grantee for Good Reason. Except as otherwise provided in
any employment agreement, consulting agreement, change in control agreement or
similar agreement in effect between the Employer and the Grantee on the date of
grant specified in the Notice of Grant of Stock Options, if the application of
the provision in the foregoing sentence, similar provisions in other stock
option or restricted stock grants, and other payments and benefits payable to
the Grantee upon termination of employment (collectively, the “Company
Payments”) would result in the Grantee being subject to excise tax payable
under Internal Revenue Code Section 4999 (the Excise Tax”), the amount of any
Company Payments shall be automatically reduced to an amount one dollar less
than an amount that would subject the Grantee to the Excise Tax; provided,
however, that the reduction shall occur only if the reduced Company Payments
received by the Grantee (after taking into account further reductions for
applicable federal, state and local income, social security and other taxes)
would be greater than the unreduced Company Payments to be received by the
Grantee minus (i) the Excise Tax payable with respect to such Company Payments
and (ii) all applicable federal, state and local income, social security and
other taxes on such Company Payments. If the Company Payments are to be
reduced in accordance with the foregoing, the Company Payments shall be reduced
as mutually agreed between the Employer and the Grantee or, in the event the
parties cannot agree, in the following order (1) acceleration of vesting of any
option where the exercise price exceeds the fair market value of the underlying
shares at the time the acceleration would otherwise occur, (2) any lump sum
severance based on a multiple of base salary or bonus, (3) any other cash
amounts payable to the

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Grantee, (4) any benefits valued as parachute payments, and (5) acceleration of
vesting of any equity not covered by (1) above.

     3. Option Term. (a) Except as otherwise provided in the next sentence or
in the Plan, the Option shall expire on the Expiration Date shown on the Notice
of Grant of Stock Options. In the event of termination of employment or
service with the Employer (including, by way of example, termination of service
as a member of the Board of Directors), except as set forth in any employment
agreement, consulting agreement, change in control agreement or similar
agreement in effect between the Employer and the Grantee on the date of grant
specified in the Notice of Grant of Stock Option, the vested portion of the
Option shall expire on the earlier of (i) the Expiration Date, or (ii)(A)
subject to (E) below, three months after such termination if such termination
is for any reason other than death, retirement, or long-term disability, (B)
two years after such termination if such termination is due to the Grantee’s
retirement, (C) one year after the termination if such termination is due to
the Grantee’s death or long-term disability, (D) the occurrence of the Cause
event if such termination is for Cause or Cause existed at the time of such
termination (whether then known or later discovered) or (E) one year after such
termination if such termination is at any time within two years after the
occurrence of a Change in Control and is by the Employer without Cause or by
the Grantee for Good Reason.

     (b) For purposes of this Agreement, “Cause” shall mean (i) in the case
where there is no employment agreement, consulting agreement, change in control
agreement or similar agreement in effect between the Company and the Grantee on
the date of grant specified in the Notice of Grant of Stock Options (or where
there is such an agreement but it does not define “cause” (or words of like
import)) (A) the willful and continued failure by the Grantee substantially to
perform his or her duties and obligations to the Employer, including without
limitation, repeated refusal to follow the reasonable directions of the
Employer, knowing violation of law in the course of performance of the duties
of the Grantee’s employment with the Employer, repeated absences from work
without a reasonable excuse, and intoxication with alcohol or illegal drugs
while on the Employer’s premises during regular business hours (other than any
such failure resulting from his or her incapacity due to physical or mental
illness); (B) fraud or material dishonesty against the Employer; or (C) a
conviction or plea of guilty or nolo contendere to a felony or a crime
involving material dishonesty or (ii) in the case where there is an employment
agreement, consulting agreement, change in control agreement or similar
agreement in effect between the Employer and the Grantee on the date of grant
specified in the Notice of Grant of Stock Options that defines “cause” (or
words of like import), as defined under such agreement. For purposes of this
Section 3(b), no act, or failure to act, on a Grantee’s part shall be
considered “willful” unless done, or omitted to be done, by the Grantee in bad
faith and without reasonable belief that his or her action or omission was in
the best interest of the Employer. Any determination of Cause made prior to a
Change in Control shall be made by the Committee in its sole discretion.

     (c) For purposes of this Agreement, “Good Reason” shall mean (i) in the
case where there is no employment agreement, consulting agreement, change in
control agreement or similar agreement in effect between the Employer and the
Grantee on the date of grant specified in the Notice of Grant of Stock Options
(or where there is such an agreement but it does not define “good reason” (or
words of like import)) a termination of employment or services by the Grantee
within one hundred twenty (120) days after the occurrence of one of the
following events after the occurrence of a Change in Control unless such events
are fully corrected in all material respects by the Employer within thirty (30)
days following written notification by the Grantee to the Employer that Grantee
intends to terminate his employment hereunder for one of the reasons set forth
below: (A) (1) any material diminution in the Grantee’s duties and
responsibilities from that which exists immediately prior to a Change in
Control (except in each case in connection with the termination of the
Grantee’s employment or services for Cause or as a result of the Grantee’s
death, or temporarily as a result of the Grantee’s illness or other absence),
or (2) the assignment to the Grantee of duties and responsibilities materially
inconsistent with the position held by the Grantee; (B) any material breach by
the Employer of any material provision of any written agreement with the
Grantee or failure to timely pay any compensation obligation to the Grantee;
(C) a reduction in the Grantee’s annual base salary or target bonus opportunity
(if any) from that which exists immediately prior to a Change in Control; or
(D) if the Grantee is based at the Employer’s principal executive office, any
relocation therefrom or, in any event, a relocation of the Grantee’s primary
office of more than fifty (50) miles from the location immediately prior to a
Change in Control; or (ii) in the case where there is an

9

 

employment agreement, consulting agreement, change in control agreement or similar
agreement in effect between the Employer and the Grantee on the date of grant
specified in the Notice of Grant of Stock Options that defines “good reason”
(or words of like import), as defined under such agreement.

     4. Restrictions on Transfer of Option. The Option granted hereby shall
not be transferable other than by will or by the laws of descent and
distribution. During the lifetime of the Grantee, this Option shall be
exercisable only by the Grantee. In addition, except as otherwise provided in
this Agreement, the Option shall not be assigned, negotiated, pledged or
hypothecated in any way (whether by operation of law or otherwise), and the
Option shall not be subject to execution, attachment or similar process. Upon
any other attempt to transfer, assign, negotiate, pledge or hypothecate the
Option, or in the event of any levy upon the option by reason of any execution,
attachment, or similar process contrary to the provisions hereof, the Option
shall immediately become null and void. Notwithstanding the foregoing
provisions of this Section 4, subject to the approval of the Committee in its
sole and absolute discretion and to any conditions that the Committee may
prescribe, the Grantee may, upon providing written notice to the Company, elect
to transfer the Option to members of his or her immediate family, including,
but not limited to, children, grandchildren and spouse or to trusts for the
benefit of such immediate family members or to partnerships in which such
family members are the only partners; provided, however, that no such transfer
may be made in exchange for consideration.

     5. Rights of a Stockholder. The Grantee shall have no rights as a
stockholder with respect to any shares of Common Stock subject to this Option
prior to the date of issuance to the Grantee of a certificate or certificates
for such shares. No adjustment shall be made for dividends in cash or other
property, distributions, or other rights with respect to such shares for which
the record date is prior to the date upon which the Grantee shall become the
holder of record therefor.

     6. Compliance with Law and Regulations. This award and any obligation of
the Company hereunder shall be subject to all applicable federal, state and
local laws, rules and regulations and to such approvals by any government or
regulatory agency as may be required. The Company shall be under no obligation
to effect the registration pursuant to federal securities laws of any interests
in the Plan or any shares of Common Stock to be issued hereunder or to effect
similar compliance under any state laws. The Company shall not be obligated to
cause to be issued or delivered any certificates evidencing shares of Common
Stock pursuant to this Agreement unless and until the Company is advised by its
counsel that the issuance and delivery of such certificates is in compliance
with all applicable laws, regulations of governmental authority and the
requirements of any securities exchange on which shares of Common Stock are
traded. The Committee may require, as a condition of the issuance and delivery
of certificates evidencing shares of Common Stock pursuant to the terms hereof,
that the recipient of such shares make such agreements and representations, and
that such certificates bear such legends, as the Committee, in its sole
discretion, deems necessary or desirable. Except to the extent preempted by
any applicable federal law, this Agreement shall be construed and administered
in accordance with the laws of the State of New York without reference to its
principles of conflicts of law.

     7. Grantee Bound by Plan. The Grantee acknowledges receipt of a copy of
the Plan and agrees to be bound by all the terms and provisions thereof. The
Plan is incorporated herein by reference, and any capitalized term used but not
defined herein shall have the same meaning as in the Plan. To the extent that
this Agreement is silent with respect to, or in any way inconsistent with, the
terms of the Plan, the provisions of the Plan shall govern and this Agreement
shall be deemed to be modified accordingly.

     8. Notices. Any notice or communication given hereunder shall be in
writing and shall be deemed given when delivered in person, or by United States
mail, at the following addresses: (i) if to the Employer, to: Regeneron
Pharmaceuticals, Inc., 777 Old Saw Mill River Road, Tarrytown, NY 10591,
Attention: Secretary, and (ii) if to the Grantee, to: the Grantee at
Regeneron Pharmaceuticals, Inc., 777 Old Saw Mill River Road, Tarrytown, NY
10591, or, if the Grantee has terminated employment, to the last address for
the Grantee indicated in the records of the Employer, or such other address as
the relevant party shall specify at any time hereafter in accordance with this
Section 8.

     9. No Obligation to Continue Employment. This Agreement does not
guarantee that the Employer will employ the Grantee for any specified time
period, nor does it modify in any respect the Grantee’s employment or
compensation.

10EX-10.02

 

Exhibit 10.02

Form of Option Agreement and

Notice of Grant of Options for Executive Officers (other than

“named executive officers”) of Regeneron Pharmaceuticals, Inc.

	 	 	 
	

	 	Regeneron Pharmaceuticals, Inc.
	

	 	ID: [          ]
	Notice of Grant of Stock Options

	 	777 Old Saw Mill River Road
	and Option Agreement for

	 	Tarrytown, New York 10591
	Option Awards
	 	 

	 	 	 
	[OPTIONEE NAME]

	 	Option Number: [          ]
	[OPTIONEE ADDRESS]

	 	          Plan:                    2005
	

	 	          ID                          [          ]

Effective <date> (the “Grant Date”) you have been granted a
Non-Qualified Stock Option to
buy  [          ] shares of
Regeneron Pharmaceuticals, Inc. (the Company) stock at [$          ] per share.

The total option price of the shares granted is [$          ].

Shares in each period will become fully vested on the date shown.

	 	 	 	 	 	 	 
	Shares
	 	Vest Type
	 	Full Vest
	 	Expiration Date

	**

	 	On Vest Date
	 	[_/_/_]**
	 	***
	**

	 	On Vest Date
	 	[_/_/_]**
	 	***
	**

	 	On Vest Date
	 	[_/_/_]**
	 	***
	**

	 	On Vest Date
	 	[_/_/_]**
	 	***

You and the Company agree that these options are granted under and governed by
the terms and conditions of the Company’s 2000 Long-Term Incentive Plan as
amended and the enclosed Option Agreement, both of which are attached and made
a part of this document.

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** Option vests in approximately equal annual 25% installments. Full Vest
Dates will occur on the first, second, third and fourth anniversaries of the
Grant Date.

*** Option expires 10 years from the Grant Date.

12

 

REGENERON PHARMACEUTICALS, INC.

OPTION AGREEMENT

PURSUANT TO THE

2000 LONG-TERM INCENTIVE PLAN

          THIS AGREEMENT, made as of the date on the Notice of Grant of Stock
Options, by and between Regeneron Pharmaceuticals, Inc., a New York corporation
(the “Company”), and the employee named on the Notice of Grant of Stock Options
(the “Grantee”);

          WHEREAS, the Grantee is an employee of the Company and the Company desires
to afford the Grantee the opportunity to acquire or enlarge the Grantee’s stock
ownership in the Company so that the Grantee may have a direct proprietary
interest in the Company’s success; and

          WHEREAS, the Committee administering the 2000 Long-Term Incentive Plan
(as amended from time to time, the “Plan”) has granted (as of the effective date of grant specified in the
Notice of Grant of Stock Options) to the Grantee a Stock Option to purchase the
number of shares of the Company’s Common Stock ($.001 par value) (the “Common
Stock”) as set forth in the Notice of Grant of Stock Options.

          NOW, THEREFORE, in consideration of the covenants and agreements herein
contained, the parties agree as follows:

     1. Grant of Award. Pursuant to Section 7 of the Plan, the Company grants
to the Grantee, subject to the terms and conditions of the Plan and subject
further to the terms and conditions set forth here, the option to purchase from
the Company all or any part of an aggregate of shares of Common Stock at the
purchase price per share (the “Option”) as shown on the Notice of Grant of
Stock Options. No part of the Option granted hereby is intended to qualify
as an Incentive Stock Option under Section 422 of the Internal Revenue Code of
1986, as amended (the “Code”).

     2. Vesting;
Exercise. (a) The Option is exercisable in installments as provided on
the Notice of Grant of Stock Options. To the extent that the Option has become
exercisable with respect to the number of shares of Common Stock as provided on
the Notice of Grant of Stock Options and subject to the terms and conditions of
the Plan, including without limitation, Section 7(c)(1) & (2), the Option may
thereafter be exercised by the Grantee, in whole or in part, at any time or
from time to time prior to the expiration of the Option in accordance with the
requirements set forth in Section 7(c)(3) of the Plan, including, without
limitation, the filing of such written form of exercise notice as may be
promulgated by the Committee, and in accordance with applicable tax and other
laws. In addition to the methods of payment described in Section
7(c)(3) of the Plan, the Grantee shall be eligible to pay for shares
of Common Stock purchased upon the exercise of the Option by
directing the Company to withhold shares of Common Stock that would
otherwise be issued pursuant to the Option exercise having a Fair
Market Value (as measured on the date of exercise) equal to the
Option exercise price. The Company shall have the right to require the Grantee

13

 

in connection with the exercise of the Option to remit to the Company in
cash an amount sufficient to satisfy any federal, state and local withholding
tax requirements related thereto.

     (c) The Notice of Grant of Stock Options indicates each date upon which
the Grantee shall be entitled to exercise the Option with respect to the
additional number of shares of Common Stock granted as indicated provided that
the Grantee has not incurred a termination of employment or service with the
Company and all Subsidiaries (collectively, the Company and all Subsidiaries
shall be referred to herein as the “Employer” and no termination of employment
or service shall be deemed to take place unless the Grantee is no longer
employed by or providing service to the Employer) prior to such date. There
shall be no proportionate or partial vesting in the periods between the Full
Vest Dates specified in the Notice of Grant of Stock Options and all vesting
shall occur only on the Full Vest Dates. Except as otherwise provided in any
employment agreement, consulting agreement, change in control agreement or
similar agreement in effect between the Employer and the Grantee on the date
specified in the Notice of Grant of Stock Options, no vesting shall occur after
such date as the Grantee ceases to be employed by the Employer and all unvested
Options shall be forfeited at such time.

     (c) Notwithstanding anything herein (except the following sentence) or
in the Notice of Grant of Stock Options to the contrary, the Option shall be
fully vested if the Grantee’s employment with the Employer is terminated on or
within two years after the occurrence of a Change in Control by the Employer
(other than for Cause) or by the Grantee for Good Reason. Except as otherwise
provided in any employment agreement, consulting agreement, change in control
agreement or similar agreement in effect between the Employer and the Grantee
on the date of grant specified in the Notice of Grant of Stock Options, if the
application of the provision in the foregoing sentence, similar provisions in
other stock option or restricted stock grants, and other payments and benefits
payable to the Grantee upon termination of employment (collectively, the
“Company Payments”) would result in the Grantee being subject to the excise tax
payable under Internal Revenue Code Section 4999 (the “Excise Tax”), the amount
of any Company Payments shall be automatically reduced to an amount one dollar
less than an amount that would subject the Grantee to the Excise Tax; provided,
however, that the reduction shall occur only if the reduced Company Payments
received by the Grantee (after taking into account further reductions for
applicable federal, state and local income, social security and other taxes)
would be greater than the unreduced Company Payments to be received by the
Grantee minus (i) the Excise Tax payable with respect to such Company Payments
and (ii) all applicable federal, state and local income, social security and
other taxes on such Company Payments. If the Company Payments are to be
reduced in accordance with the foregoing, the Company Payments shall be reduced
as mutually agreed between the Employer and the Grantee or, in the event the
parties cannot agree, in the following order (1) acceleration of vesting of any
option where the exercise price exceeds the fair market value of the underlying
shares at the time the acceleration would otherwise occur, (2) any lump sum
severance based on a multiple of base salary or bonus, (3) any other cash
amounts payable to the Grantee, (4) any benefits valued as parachute payments,
and (5) acceleration of vesting of any equity not covered by (1) above.

     3. Option Term. (a) Except as otherwise provided in the next sentence or
in the Plan, the Option shall expire on the Expiration Date shown on the Notice
of Grant of Stock Options. In the event of termination of employment or
service with the Employer, except as set forth in any employment agreement,
consulting agreement, change in control agreement or similar agreement in
effect between the Employer and the Grantee on the date of grant specified in
the Notice of Grant of Stock Options, the vested portion of the Option shall
expire on the earlier of (i) the Expiration Date, or (ii) (A) subject to (E)
below, three months after such termination if such termination is for any
reason other than death, retirement, or long-term disability, (B) two years
after such termination if such termination is due to the Grantee’s retirement,
(C) one year after the termination if such termination is due to the Grantee’s
death or long-term disability, (D) the occurrence of the Cause event if such
termination is for Cause or Cause existed at the time of such termination
(whether then known or later discovered) or (E) one year after such termination
if such termination is at any time within two years after the occurrence of a
Change in Control and is by the Employer without Cause or by the Grantee for
Good Reason.

     (d) For purposes of this Agreement, “Cause” shall mean (i) in the case
where there is no employment agreement, consulting agreement, change in control
agreement or similar agreement in effect between the Company and the Grantee on
the date of grant specified in the Notice of Grant of Stock

14

 

Options (or where there is such an agreement but it does not define
“cause” (or words of like import)) (A) the willful and continued failure by the
Grantee substantially to perform his or her duties and obligations to the
Employer, including without limitation, repeated refusal to follow the
reasonable directions of the Employer, knowing violation of law in the course
of performance of the duties of the Grantee’s employment with the Employer,
repeated absences from work without a reasonable excuse, and intoxication with
alcohol or illegal drugs while on the Employer’s premises during regular
business hours (other than any such failure resulting from his or her
incapacity due to physical or mental illness); (B) fraud or material dishonesty
against the Employer; or (C) a conviction or plea of guilty or nolo contendere
to a felony or a crime involving material dishonesty or (ii) in the case where
there is an employment agreement, consulting agreement, change in control
agreement or similar agreement in effect between the Employer and the Grantee
on the date of grant specified in the Notice of Grant of Stock Options that
defines “cause” (or words of like import), as defined under such agreement.
For purposes of this Section 3(b), no act, or failure to act, on a Grantee’s
part shall be considered “willful” unless done, or omitted to be done, by the
Grantee in bad faith and without reasonable belief that his or her action or
omission was in the best interest of the Employer. Any determination of Cause
made prior to a Change in Control shall be made by the Committee in its sole
discretion.

     (e) For purposes of this Agreement, “Good Reason” shall mean (i) in the
case where there is no employment agreement, consulting agreement, change in
control agreement or similar agreement in effect between the Employer and the
Grantee on the date of grant specified in the Notice of Grant of Stock Options
(or where there is such an agreement but it does not define “good reason” (or
words of like import)) a termination of employment by the Grantee within one
hundred twenty (120) days after the occurrence of one of the following events
after the occurrence of a Change in Control unless such events are fully
corrected in all material respects by the Employer within thirty (30) days
following written notification by the Grantee to the Employer that Grantee
intends to terminate his employment hereunder for one of the reasons set forth
below: (A) (1) any material diminution in the Grantee’s duties and
responsibilities from that which exists immediately prior to a Change in
Control (except in each case in connection with the termination of the
Grantee’s employment for Cause or as a result of the Grantee’s death, or
temporarily as a result of the Grantee’s illness or other absence), or (2) the
assignment to the Grantee of duties and responsibilities materially
inconsistent with the position held by the Grantee; (B) any material breach by
the Employer of any material provision of any written agreement with the
Grantee or failure to timely pay any compensation obligation to the Grantee;
(C) a reduction in the Grantee’s annual base salary or target bonus opportunity
(if any) from that which exists immediately prior to a Change in Control; or
(D) if the Grantee is based at the Employer’s principal executive office, any
relocation therefrom or, in any event, a relocation of the Grantee’s primary
office of more than fifty (50) miles from the location immediately prior to a
Change in Control; or (ii) in the case where there is an employment agreement,
consulting agreement, change in control agreement or similar agreement in
effect between the Employer and the Grantee on the date of grant specified in
the Notice of Grant of Stock Options that defines “good reason” (or words of
like import), as defined under such agreement.

     4. Restrictions on Transfer of Option. The Option granted hereby shall
not be transferable other than by will or by the laws of descent and
distribution. During the lifetime of the Grantee, this Option shall be
exercisable only by the Grantee. In addition, except as otherwise provided in
this Agreement, the Option shall not be assigned, negotiated, pledged or
hypothecated in any way (whether by operation of law or otherwise), and the
Option shall not be subject to execution, attachment or similar process. Upon
any other attempt to transfer, assign, negotiate, pledge or hypothecate the
Option, or in the event of any levy upon the option by reason of any execution,
attachment, or similar process contrary to the provisions hereof, the Option
shall immediately become null and void. Notwithstanding the foregoing
provisions of this Section 4, subject to the approval of the Committee in its
sole and absolute discretion and to any conditions that the Committee may
prescribe, the Grantee may, upon providing written notice to the Company, elect
to transfer the Option to members of his or her immediate family, including,
but not limited to, children, grandchildren and spouse or to trusts for the
benefit of such immediate family members or to partnerships in which such
family members are the only partners; provided, however, that no such transfer
may be made in exchange for consideration.

     5. Rights of a Stockholder. The Grantee shall have no rights as a
stockholder with respect to any shares of Common Stock subject to this Option
prior to the date of issuance to the Grantee of a

15

 

certificate or certificates for such shares. No adjustment shall be made
for dividends in cash or other property, distributions, or other rights with
respect to such shares for which the record date is prior to the date upon
which the Grantee shall become the holder of record therefor.

     6. Compliance with Law and Regulations. This award and any obligation of
the Company hereunder shall be subject to all applicable federal, state and
local laws, rules and regulations and to such approvals by any government or
regulatory agency as may be required. The Company shall be under no obligation
to effect the registration pursuant to federal securities laws of any interests
in the Plan or any shares of Common Stock to be issued hereunder or to effect
similar compliance under any state laws. The Company shall not be obligated to
cause to be issued or delivered any certificates evidencing shares of Common
Stock pursuant to this Agreement unless and until the Company is advised by its
counsel that the issuance and delivery of such certificates is in compliance
with all applicable laws, regulations of governmental authority and the
requirements of any securities exchange on which shares of Common Stock are
traded. The Committee may require, as a condition of the issuance and delivery
of certificates evidencing shares of Common Stock pursuant to the terms hereof,
that the recipient of such shares make such agreements and representations, and
that such certificates bear such legends, as the Committee, in its sole
discretion, deems necessary or desirable. Except to the extent preempted by
any applicable federal law, this Agreement shall be construed and administered
in accordance with the laws of the State of New York without reference to its
principles of conflicts of law.

     7. Grantee Bound by Plan. The Grantee acknowledges receipt of a copy of
the Plan and agrees to be bound by all the terms and provisions thereof. The
Plan is incorporated herein by reference, and any capitalized term used but not
defined herein shall have the same meaning as in the Plan. To the extent that
this Agreement is silent with respect to, or in any way inconsistent with, the
terms of the Plan, the provisions of the Plan shall govern and this Agreement
shall be deemed to be modified accordingly.

     8. Notices. Any notice or communication given hereunder shall be in
writing and shall be deemed given when delivered in person, or by United States
mail, at the following addresses: (i) if to the Employer, to: Regeneron
Pharmaceuticals, Inc., 777 Old Saw Mill River Road, Tarrytown, NY 10591,
Attention: Secretary, and (ii) if to the Grantee, to: the Grantee at
Regeneron Pharmaceuticals, Inc., 777 Old Saw Mill River Road, Tarrytown, NY
10591, or, if the Grantee has terminated employment, to the last address for
the Grantee indicated in the records of the Employer, or such other address as
the relevant party shall specify at any time hereafter in accordance with this
Section 8.

     9. No Obligation to Continue Employment. This Agreement does not
guarantee that the Employer will employ the Grantee for any specified time
period, nor does it modify in any respect the Grantee’s employment or
compensation.

16

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