Document:

Exhibit 10.14

Exhibit 10.14

Agreement No. [ ]

Long-Term Incentive Agreement

THIS LONG-TERM INCENTIVE AGREEMENT (this “Agreement”) is made by and between [Employee Name]
(“Grantee”) and Endurance Specialty Holdings Ltd., an exempted company organized under the laws of
Bermuda (the “Company”), as of [Grant Date].

WHEREAS, Grantee is currently an employee of the Company or a subsidiary of the Company, and
the Company desires to increase the incentive of the Grantee to exert his or her utmost efforts to
improve the business and increase the assets of the Company.

NOW, THEREFORE, in consideration of the Grantee’s services to the Company and for other good
and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:

1. Grant of Long-Term Incentive Award. The Company hereby grants and promises to pay
to Grantee a long-term restricted cash incentive award of [Dollar Amount of Award] (the “LTI
Award”) pursuant to the terms and provisions of this Agreement.

2. Accrued Interest. The unpaid portion of the LTI Award shall bear interest from the
date of grant of the LTI Award to and including the date of payment of each installment of the LTI
Award (the “Accrued Interest”). Upon the payment of each installment of the LTI Award, only that
portion of the Accrued Interest upon that installment of the LTI Award shall be due and payable.
The Accrued Interest shall be determined based upon an annual simple interest rate while the LTI
Award is outstanding. The annual simple interest rate for the Accrued Interest will be fixed
commencing on [Grant Date and continuing until [Day Before One Year Anniversary] and then shall be
redetermined and fixed by the Company for each succeeding annual period commencing on each March
1st and ending on the last day of each February. For each annual period commencing on
March 1st and ending on the last day of the following February, the annual simple
interest rate for the Accrued Interest shall be equal to the average of the five year United States
treasury note rate for the 20 trading days preceding such March 1st, as published by the
U.S. Department of the Treasury on its website at www.ustreas.gov or, if such data is no longer
published by the U.S. Department of the Treasury, such substitute published interest rate index as
shall be determined by the Company in its sole discretion. The Accrued Interest on the LTI Award
shall be computed on the basis of the actual number of days elapsed in the period during which it
accrues, based upon a 365 or 366 day year, as the case may be. The Accrued Interest shall be
determined without the compounding of interest.

 

 

 

3. Restrictions and Restricted Period.

a. Restrictions. Neither the LTI Award nor any Accrued Interest granted or accrued
hereunder may be sold, assigned, transferred, pledged, hypothecated or otherwise disposed of by the
Grantee except, in the event of the Grantee’s death, by will or the laws of descent and
distribution. The LTI Award and any Accrued Interest granted or accrued hereunder shall be subject
to a risk of forfeiture as described in Section 4 below until paid in full.

b. Restricted Period. Unless the Restricted Period (as defined below) is previously
terminated pursuant to Section 4 of this Agreement, the restrictions set forth above shall lapse
and the LTI Award shall be paid on the first regularly scheduled Company payroll dates following
the dates (the “Restricted Period”) and in the amounts set forth below:

	 	 	 
	Date of Payment	 	Portion of LTI Award Paid
	 
	 	 
	[One Year Anniversary]

	 	[25% of Initial Grant] plus Accrued Interest on
the portion of the LTI Award paid
	 
	 	 
	[Two Year Anniversary]

	 	[25% of Initial Grant] plus Accrued Interest on
the portion of the LTI Award paid
	 
	 	 
	[Three Year Anniversary]

	 	[25% of Initial Grant] plus Accrued Interest on
the portion of the LTI Award paid
	 
	 	 
	[Four Year Anniversary]

	 	[25% of Initial Grant] plus Accrued Interest on
the portion of the LTI Award paid

c. Withholding of Portion of LTI Award for Taxes. The payment of any portion of the
LTI Award or Accrued Interest hereunder shall be conditioned upon Grantee making adequate provision
for federal, state or other tax withholding obligations, if any, which arise upon the payment of
such portion of the LTI Award or Accrued Interest, as set forth in Section 5 hereof.

4. Termination of Employment.

a. General. In the event the Grantee’s employment with the Company or any subsidiary
of the Company is terminated for any reason other than the Grantee’s death, Disability or
Retirement or by the Company during the 24 month period following a Change in Control (each as
defined in Section 11), the unpaid portion of the LTI Award and any and all Accrued Interest at
that time shall be forfeited and neither the Grantee nor any of the Grantee’s successors, heirs,
assigns, or personal representatives shall thereafter have any further rights or interests in such
LTI Award or Accrued Interest.

 

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b. Death or Disability. In the event the Grantee’s employment with the Company or any
subsidiary of the Company is terminated as a result of the
Grantee’s death or Disability, or if the Grantee shall die or become subject to a Disability
within 30 days of the Grantee’s termination of employment other than for Cause (as defined in
Section 11), the restrictions on the unpaid portion of the LTI Award and any Accrued Interest that
would have become due and payable (as provided in the Restricted Period schedule set forth in
Section 3) during the period ending on the second anniversary of the Grantee’s date of termination
of employment shall immediately lapse and such portion of the LTI Award and any Accrued Interest as
so determined shall be paid to the Grantee within 30 days following the date of (i) the Grantee’s
termination of employment due to death or Disability, or (ii) the Grantee’s death or Disability
which occurs within 30 days of the Grantee’s termination of employment other than for Cause, as the
case may be. The portion of the LTI Award and any and all Accrued Interest that would have become
due and payable (as provided in the Restricted Period schedule set forth in Section 3) after the
second anniversary of the Grantee’s date of termination of employment, shall be forfeited and
neither the Grantee nor any of the Grantee’s successors, heirs, assigns, or personal
representatives shall thereafter have any further rights or interests in such LTI Award or Accrued
Interest.

c. Retirement. In the event the Grantee is eligible for Retirement, the restrictions
on the LTI Award and any Accrued Interest as of the date of such eligibility shall immediately
lapse and the Grantee shall be paid in full the LTI Award and any Accrued Interest (through and
including the date of payment) within 30 days of such eligibility.

d. Change in Control. In the event of a Change in Control and the termination by the
Company (or a successor company as a result of the Change in Control) of the Grantee’s employment
with the Company, a subsidiary of the Company (or a successor company as a result of the Change in
Control) within 24 months following such Change in Control, the restrictions set forth above shall
lapse and the unpaid portion of the LTI Award, plus any Accrued Interest to and including the date
of payment, shall be paid in full as of the date of such termination of employment.

5. Tax Withholding. It shall be a condition to the obligation of the Company to pay
the LTI Award and any Accrued Interest to the Grantee upon the lapse of restrictions on the LTI
Award and any Accrued Interest that the Grantee pay to the Company, upon demand (but no later than
10 following such demand), such amount as may be requested by the Company for the purpose of
satisfying any liability to withhold income or other taxes. In the event any such amount so
requested is not paid within 10 days of demand, the LTI Award and any Accrued Interest shall be
forfeited and neither the Grantee nor any of the Grantee’s successors, heirs, assigns, or personal
representatives shall thereafter have any further rights or interests in such LTI Award or Accrued
Interest. Unless the Company shall in its discretion determine otherwise, payment for taxes
required to be withheld may be made by withholding a portion of the LTI Award and/or Accrued
Interest, in either case, equal to the appropriate tax withholding liability as determined by the
Company in its sole discretion.

 

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6. Tax Consequences. By signing this Agreement, the Grantee represents that the
Grantee has reviewed with the Grantee’s own tax advisors the federal,
state, local and foreign tax consequences of the transactions contemplated by this Agreement
and that the Grantee is relying solely on such advisors and not on any statements or
representations of the Company or any of its agents. The Grantee understands and agrees that the
Grantee (and not the Company) shall be responsible for any tax liability that may arise as a result
of the transactions contemplated by this Agreement.

7. Termination of this Agreement. This Agreement shall terminate upon the earliest to
occur of (a) the termination of the Restricted Period with respect to all of the LTI Award and
Accrued Interest in accordance with Section 3 of this Agreement, (b) the forfeiture of the LTI
Award and Accrued Interest in accordance with Section 4 of this Agreement or (c) the termination of
this Agreement by an instrument in writing signed by the parties hereto. Upon termination of this
Agreement, all rights and obligations of the Grantee and the Company hereunder shall cease.

8. Agreement to Perform Necessary Acts. Each party to this Agreement agrees to
perform any further acts and execute and deliver any documents that may be reasonably necessary to
carry out the provisions of this Agreement.

9. No Limitation on Rights of the Company. This Agreement shall not in any way affect
the right or power of the Company to make adjustments, reclassifications or changes in its capital
or business structure or to merge, consolidate, dissolve, liquidate, sell or transfer all or any
part of its business or assets.

10. Creditor Status. The Grantor shall be a general creditor of the Company under
this Agreement and any obligation of the Company to the Grantee under this Agreement shall be
subordinated to any obligation of the Company to the various lending institutions under the Amended
and Restated Credit Agreement, dated as of May 8, 2007 and as amended or restated from time to
time, among the Company, various designated subsidiary borrowers, various lending institutions and
JPMorgan Chase Bank, N.A., as Administrative Agent.

11. Definitions.

The following definitions shall be applicable within this Agreement.

a. “Cause” means (i) any intentional act of fraud, embezzlement or theft by the Grantee in
connection with or in the course of his or her employment with the Company or a Grantee’s admission
or conviction of, or plea of nolo contendere to, (x) a felony or (y) any crime involving moral
turpitude, fraud, embezzlement, theft or misrepresentation; (ii) any gross negligence or willful
misconduct of a Grantee resulting in a loss to the Company, or damage to the reputation of the
Company or (iii) any violation of any statutory or common law duty of loyalty to the Company.

 

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b. “Change in Control” means any of the following:

(1) the acquisition by any individual, entity or group (a “Person”), including any
“person” within the meaning of Section 13(d)(3) or 14(d)(2) of the
U.S. Securities Exchange Act of 1934, as amended from time to time (the “Exchange
Act”), of beneficial ownership within the meaning of Rule 13d-3 promulgated under the
Exchange Act, of 50% or more of either (i) the then outstanding ordinary shares, par value
U.S.$1.00 per share, of the Company (the “Outstanding Ordinary Shares”) or (ii) the
combined voting power of the then outstanding securities of the Company entitled to vote
generally in the election of directors pursuant to the Bye-Laws of the Company (the
“Outstanding Voting Securities”); excluding, however, the following: (A)
any acquisition directly from the Company (excluding any acquisition resulting from the
exercise of an exercise, conversion or exchange privilege unless the security being so
exercised, converted or exchanged was acquired directly from the Company), (B) any
acquisition by the Company, (C) any acquisition by an employee benefit plan (or related
trust) sponsored or maintained by the Company or any corporation controlled by the Company
or (D) any acquisition by any corporation pursuant to a transaction which complies with
clauses (i), (ii) and (iii) of subsection (3) of this definition of Change in Control;
provided, further, that for purposes of clause (B), if any Person (other
than the Company or any employee benefit plan (or related trust) sponsored or maintained by
the Company or any corporation controlled by the Company) shall become the beneficial owner
of 50% or more of the Outstanding Ordinary Shares or 50% or more of the Outstanding Voting
Securities by reason of an acquisition by the Company, and such Person shall, after such
acquisition by the Company, become the beneficial owner of any additional Outstanding
Ordinary Shares or any additional Outstanding Voting Securities and such beneficial
ownership is publicly announced, such additional beneficial ownership shall constitute a
Change in Control;

(2) individuals who, as of the date hereof, constitute the Board (the “Incumbent
Board”) cease for any reason to constitute at least a majority of such Board within a 24
month period; provided, that any individual who becomes a director of the Company
subsequent to the date hereof whose election, or nomination for election by the Company’s
shareholders, was approved by the vote of at least a majority of the directors then
comprising the Incumbent Board shall be deemed a member of the Incumbent Board; and
provided, further, that any individual who was initially elected as a
director of the Company as a result of an actual or threatened solicitation by a Person
other than the Board for the purpose of opposing a solicitation by any other Person with
respect to the election or removal of directors, or any other actual or threatened
solicitation of proxies or consents by or on behalf of any Person other than the Board
shall not be deemed a member of the Incumbent Board;

 

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(3) the consummation of a reorganization, amalgamation, merger or consolidation or
sale or other disposition of all or substantially all of the assets of the Company (a
“Corporate Transaction”); excluding, however, a Corporate Transaction
pursuant to which (i) all or substantially all of the individuals or entities who are the
beneficial owners, respectively, of the Outstanding Ordinary Shares and the Outstanding
Voting Securities immediately prior to such Corporate Transaction will beneficially own,
directly or indirectly, more than 55% of, respectively, the outstanding shares of common stock, and the combined voting power of
the outstanding securities entitled to vote generally in the election of directors, as the
case may be, of the corporation resulting from such Corporate Transaction (including,
without limitation, a corporation which as a result of such transaction owns the Company or
all or substantially all of the Company’s assets either directly or indirectly) in
substantially the same proportions relative to each other as their ownership, immediately
prior to such Corporate Transaction, of the Outstanding Ordinary Shares and the Outstanding
Voting Securities, as the case may be, (ii) no Person (other than: the Company; any
employee benefit plan (or related trust) sponsored or maintained by the Company or any
corporation controlled by the Company; the corporation resulting from such Corporate
Transaction; and any Person which beneficially owned, immediately prior to such Corporate
Transaction, directly or indirectly, 50% or more of the Outstanding Ordinary Shares or the
Outstanding Voting Securities, as the case may be) will beneficially own, directly or
indirectly, 50% or more of, respectively, the outstanding shares of common stock of the
corporation resulting from such Corporate Transaction or the combined voting power of the
outstanding securities of such corporation entitled to vote generally in the election of
directors and (iii) individuals who were members of the Incumbent Board will constitute at
least a majority of the members of the board of directors of the corporation resulting from
such Corporate Transaction; or

(4) the consummation of a plan of complete liquidation or dissolution of the Company.

c. “Disability” means the inability of a Grantee to perform the duties of the occupation at
which a Grantee was employed when such disability commenced for a period of at least 120
consecutive days, or 180 non-consecutive days within any 365-day period, as determined by the
Company in its discretion based upon medical evidence acceptable to it.

d. “Retirement” means the voluntary termination of a Grantee’s employment with the Company
after the Grantee has (a) attained the age of 65 and (b) been employed with the Company for a
period greater than five years.

e. “Section 409A” means Section 409A of the U.S. Internal Revenue Code of 1986, as amended,
and any related regulations or other guidance promulgated thereunder.

f. “Section 457A” means Section 457A of the U.S. Internal Revenue Code of 1986, as amended,
and any related regulations or other guidance promulgated thereunder.

 

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12. Miscellaneous.

a. Notices. Any notice or other communication required or permitted hereunder shall
be in writing and shall be delivered personally or sent by
certified, registered, or express mail, postage prepaid. Any such notice shall be deemed
given when delivered to each party at the following addresses (or to such other address as may be
designated in a notice given in accordance with this Section):

(i) if to the Company:

Endurance Specialty Holdings Ltd.

Wellesley House

90 Pitts Bay Road

Pembroke HM 08

Bermuda

Attn: General Counsel

(ii) if to the Grantee, to the most recent primary residence address
listed for the Grantee in the employment records of the Company.

b. Failure to Enforce Not a Waiver. The failure of the Company or the Grantee to
enforce at any time any provision of this Agreement shall in no way be construed to be a waiver of
such provision or of any other provision hereof.

c. Governing Law. This Agreement shall be governed by and construed according to the
laws of Bermuda without giving effect to the choice of law principles thereof. The Grantee submits
to the non-exclusive jurisdiction of the courts of Bermuda in respect to matters arising hereunder.

d. Arbitration. All disputes, controversies or claims arising out of, relating to or
in connection with this Agreement, the LTI Award or the Accrued Interest, or the breach,
termination or validity thereof, shall be finally settled by arbitration. The arbitration shall be
conducted in accordance with the rules of the International Chamber of Commerce except as same may
be modified herein or by mutual agreement of the parties. The seat of the arbitration shall be
Bermuda and it shall be conducted in the English language. The arbitration shall be conducted by
one arbitrator who shall be selected by BIBA (Bermuda International Business Association), in the
event that the parties fail to agree. The arbitral award shall be in writing, shall state reasons
for the award, and shall be final and binding on the parties. The award may include an award of
costs, including reasonable attorneys fees and disbursements. Judgment on the award may be entered
by any court having jurisdiction thereof or having jurisdiction over the parties or their assets.

e. Amendments. This Agreement may be amended or modified at any time by an instrument
in writing signed by the parties hereto.

f. Agreement Not a Contract of Employment. This Agreement is not a contract of
employment, and the terms of employment of the Grantee or the relationship of the Grantee with the
Company or any subsidiary of the Company shall not be affected in any way by this Agreement except
as specifically provided herein. The execution of this Agreement shall not be construed as
conferring any legal rights upon the
Grantee for a continuation of employment or relationship with the Company or any subsidiary of
the Company, nor shall it interfere with the right of the Company or any subsidiary of the Company
to discharge the Grantee and to treat the Grantee without regard to the effect which that treatment
might have upon the Grantee as a holder of the LTI Award and Accrued Interest.

 

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g. Entire Agreement. This Agreement contains the entire understanding and agreement
of the parties hereto concerning the subject matter hereof, and supersedes all earlier negotiations
and understandings, written or oral, between the parties hereto with respect thereto.

h. Captions. The captions and headings of the sections and subsections of this
Agreement are included for convenience only and are not to be considered in construing or
interpreting this Agreement.

i. Counterparts. This Agreement may be executed in counterparts and by facsimile or
electronic reproduction, each of which when signed by the Company or the Grantee will be deemed an
original and all of which together will be deemed the same agreement.

j. Assignment. The Company may assign its rights and delegate its duties under this
Agreement. If any such assignment or delegation requires consent of any state securities
authorities, the parties hereto agree to cooperate in requesting such consent. This Agreement
shall inure to the benefit of the successors and assigns of the Company and, subject to the
restrictions on transfer herein set forth, be binding upon the Grantee, the Grantee’s heirs,
executors, administrators, successors and assigns.

k. Severability. This Agreement will be severable, and the invalidity or
unenforceability of any term or provision hereof will not affect the validity or enforceability of
this Agreement or of any other term or provision hereof. Furthermore, in lieu of any invalid or
unenforceable term or provision, the parties hereto intend that there be added as a part of this
Agreement a valid and enforceable provision as similar in terms to such invalid or unenforceable
provision as may be possible.

l. Section 409A and Section 457A Compliance. To the extent applicable, it is intended
that the compensation arrangements under this Agreement be in full compliance with Section 409A and
Section 457A. This Agreement will be construed in a manner to give effect to such intention. Any
references to a “termination of employment” (or similar term) under this Agreement shall mean a
“separation from service” within the meaning of Section 409A. Each installment of the LTI Award
payments and corresponding Accrued Interest shall be deemed to be a separate payment for purposes
of Section 409A. If it is determined that all or a portion of the LTI Award or Accrued Interest
constitutes deferred compensation for purposes of Section 409A, and if the Grantee is a “specified
employee” (within the meaning of Section 409A) at the time of the Grantee’s separation from
service, then the portion of such payments that would otherwise be payable during the six-month
period immediately following the Grantee’s separation from service shall instead be paid on the
earlier of (i) the first business day of
the seventh month following the Grantee’s separation from service or (ii) the Grantee’s death.

 

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year
first above written.

	 	 	 	 	 
	 	ENDURANCE SPECIALTY HOLDINGS LTD.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

The undersigned hereby accepts and agrees to all the terms and provisions of the foregoing
Agreement.

	 	 	 
	 

[Employee Name]
	 	 

 

-9-exv10w3

Exhibit 10.3

NEKTAR THERAPEUTICS

(formerly known as Inhale Therapeutic Systems, Inc.)

2000 Non-Officer Equity Incentive Plan

Adopted August 18, 1998

Amended February 23, 1999

Amended December 14, 1999

Amended and Restated June 6, 2000

Adjusted for 2-for-1 Stock Split on August 22, 2000

Amended August 22, 2000

Amended January 16, 2001

Amended April 25, 2001

Amended June 28, 2001

Amended September 6, 2001

Amended November 12, 2002

Amended April 23, 2004

Amended June 1, 2006

Amended September 14, 2010

Stockholder Approval Not Required

Termination Date: None

1. Purposes.

          Amendment and Restatement. The 1998 Non-Officer Equity Incentive Plan initially was adopted
on August 18, 1998 (the “1998 Plan”). The 1998 Plan hereby is amended and restated in its
entirety, effective upon adoption by the Board, and renamed the “2000 Non-Officer Equity Incentive
Plan.” The terms of the Plan shall apply to all Stock Awards granted pursuant to the Initial Plan.

          Eligible Stock Award Recipients. The persons eligible to receive Stock Awards are the
Employees and Consultants of the Company and its Affiliates who are neither Officers nor Directors.

          Available Stock Awards. The purpose of the Plan is to provide a means by which eligible
recipients of Stock Awards may be given an opportunity to benefit from increases in value of the
Common Stock through the granting of the following Stock Awards: (i) Nonstatutory Stock Options,
(ii) stock bonuses and (iii) rights to acquire restricted stock.

          General Purpose. The Company, by means of the Plan, seeks to retain the services of the group
of persons eligible to receive Stock Awards, to secure and retain the services of new members of
this group and to provide incentives for such persons to exert maximum efforts for the success of
the Company and its Affiliates.

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2. Definitions.

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

          “Board” means the Board of Directors of the Company.

          “Code” means the Internal Revenue Code of 1986, as amended.

          “Committee” means a Committee appointed by the Board in accordance with subsection 3(c).

          “Common Stock” means the common stock of the Company.

          “Company” means Nektar Therapeutics, a Delaware corporation.

          “Consultant” means any person, including an advisor, (i) engaged by the Company or an
Affiliate to render consulting or advisory services and who is compensated for such services or
(ii) who is a member of the Board of Directors of an Affiliate. However, the term “Consultant”
shall not include Directors of the Company

          “Continuous Service” means that the Participant’s service with the Company or an Affiliate,
whether as an Employee or Consultant, is not interrupted or terminated. The Participant’s
Continuous Service shall not be deemed to have terminated merely because of a change in the
capacity in which the Participant renders service to the Company or an Affiliate as an Employee,
Consultant or Director or a change in the entity for which the Participant renders such service,
provided that there is no interruption or termination of the Participant’s Continuous Service. For
example, a change in status from an Employee of the Company to a Consultant of an Affiliate or a
Director of the Company will not constitute an interruption of Continuous Service. The Board or
the chief executive officer of the Company, in that party’s sole discretion, may determine whether
Continuous Service shall be considered interrupted in the case of any leave of absence approved by
that party, including sick leave, military leave or any other personal leave.

          “Director” means a member of the Board of Directors of the Company.

          “Disability” means the permanent and total disability of a person within the meaning of
Section 22(e)(3) of the Code.

          “Employee” means any person employed by the Company or an Affiliate. Mere service as a
Director or payment of a director’s fee by the Company or an Affiliate shall not be sufficient to
constitute “employment” by the Company or an Affiliate.

          “Exchange Act” means the Securities Exchange Act of 1934, as amended.

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          “Fair Market Value” means, as of any date, the value of the Common Stock determined as
follows:

               If the Common Stock is listed on any established stock exchange or traded on the Nasdaq
National Market System or the Nasdaq SmallCap Market, the Fair Market Value of a share of Common
Stock shall be the closing sales price for such stock (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 Common Stock) on the day of determination, as reported in The Wall Street Journal
or such other source as the Board deems reliable.

               In the absence of such markets for the Common Stock, the Fair Market Value shall be determined
in good faith by the Board.

          “Nonstatutory Stock Option” means an option not intended to qualify as an Incentive Stock
Option within the meaning of Section 422 of the Code and the regulations promulgated thereunder.

          “Officer” means (i) 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 and (ii) any other person
designated by the Company as an officer.

          “Option” means a Nonstatutory Stock Option granted pursuant to the Plan.

          “Option Agreement” means a written agreement between the Company and an Optionholder
evidencing the terms and conditions of an individual Option grant. Each Option Agreement shall be
subject to the terms and conditions of the Plan.

          “Optionholder” means a person to whom an Option is granted pursuant to the Plan or, if
applicable, such other person who holds an outstanding Option.

          “Participant” means a person to whom a Stock Award is granted pursuant to the Plan or, if
applicable, such other person who holds an outstanding Stock Award.

          “Plan” means this Nektar Therapeutics 2000 Non-Officer Equity Incentive Plan.

          “Rule 16b-3” means Rule 16b-3 promulgated under the Exchange Act or any successor to Rule
16b-3, as in effect from time to time.

          “Securities Act” means the Securities Act of 1933, as amended.

          “Stock Award” means any right granted under the Plan, including an Option, a stock bonus and a
right to acquire restricted stock.

          “Stock Award Agreement” means a written agreement between the Company and a holder of a Stock
Award evidencing the terms and conditions of an individual Stock Award grant. Each Stock Award
Agreement shall be subject to the terms and conditions of the Plan.

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3. Administration.

          Administration by Board. The Board will administer the Plan unless and until the Board
delegates administration to a Committee, as provided in subsection 3(c).

          Powers of Board. The Board shall have the power, subject to, and within the limitations of,
the express provisions of the Plan:

               To determine from time to time which of the persons eligible under the Plan shall be granted
Stock Awards; when and how each Stock Award shall be granted; what type or combination of types of
Stock Award shall be granted; the provisions of each Stock Award granted (which need not be
identical), including the time or times when a person shall be permitted to receive stock pursuant
to a Stock Award; and the number of shares with respect to which a Stock Award shall be granted to
each such person.

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

               To amend the Plan or a Stock Award as provided in Section 12.

               Generally, to exercise such powers and to perform such acts as the Board deems necessary or
expedient to promote the best interests of the Company that are not in conflict with the provisions
of the Plan.

          Delegation to Committee. The Board may delegate administration of the Plan to a Committee or
Committees of one (1) or more members of the Board, and the term “Committee” shall apply to any
person or persons to whom such authority has been delegated. 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, including the power to delegate to a subcommittee any of the
administrative powers the Committee is authorized to exercise (and references in this Plan to the
Board shall thereafter be to the Committee or subcommittee), subject, however, to such 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.

          Effect of Board’s Decision. All determinations, interpretations and constructions made by the
Board in good faith shall not be subject to review by any person and shall be final, binding and
conclusive on all persons.

4. Shares Subject to the Plan.

          Share Reserve. Subject to the provisions of Section 11 relating to adjustments upon changes
in stock, the stock that may be issued pursuant to Stock Awards shall not exceed in

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the aggregate twelve million seven hundred fifty thousand (12,750,000)1shares of
Common Stock. Subject to Section 4(b), the number of shares available for issuance under the Plan
shall be reduced by (i) one (1) share for each share of stock issued pursuant to an Option granted
under Section 6, and (ii) one and one-half (1.5) shares for each share that is issued pursuant to a
stock bonus award or restricted stock award under Section 7.

          Reversion of Shares to the Share Reserve. If any Stock Award shall for any reason expire or
otherwise terminate, in whole or in part, without having been exercised in full or if any shares of
Common Stock issued to a Participant pursuant to a Stock Award are forfeited to or reacquired or
repurchased by the Company, including, but not limited to, any forfeiture, reacquisition or
repurchase caused by the failure to meet a contingency or condition required for the vesting of
such shares, the stock not acquired under such Stock Award shall revert to and again become
available for issuance under the Plan at the rate of (i) one (1) share for each share of stock that
had been issued pursuant to an Option granted under Section 6, and (ii) one and one-half (1.5)
shares for each share that had been issued pursuant to a stock bonus award or restricted stock
award under Section 7.

          Source of Shares. The stock subject to the Plan may be unissued shares or reacquired shares,
bought on the market or otherwise.

5. Eligibility.

          Eligibility. Stock Awards may be granted only to Employees and Consultants who are neither
Officers nor Directors.

          Consultants. A Consultant shall not be eligible for the grant of a Stock Award if, at the
time of grant, a Form S-8 Registration Statement under the Securities Act (“Form S-8”) is not
available to register either the offer or the sale of the Company’s securities to such Consultant
because of the nature of the services that the Consultant is providing to the Company, or because
the Consultant is not a natural person, or as otherwise provided by the rules governing the use of
Form S-8, unless the Company determines both (i) that such grant (A) shall be registered in another
manner under the Securities Act (e.g., on a Form S-3 Registration Statement) or (B) does not
require registration under the Securities Act in order to comply with the requirements of the
Securities Act, if applicable, and (ii) that such grant complies with the securities laws of all
other relevant jurisdictions.2

 

			
	1	 	The 3,525,000 shares in the share reserve
automatically were adjusted to 7,050,000 shares pursuant to the 2-for-1 stock
split on August 22, 2000. The Board of Directors amended the Plan on August
22, 2000 and increased this number by 1,500,000 shares (post stock split) to a
total of 8,550,000 shares. The Board of Directors amended the Plan on January
16, 2001 and increased this number by 800,000 shares to a total of 9,350,000
shares. The Board of Directors amended the Plan on June 28, 2001 and increased
this number by 900,000 to a total of 10,250,000 shares. The Board of Directors
amended the Plan on September 6, 2001 and increased this number by 1,000,000 to
a total of 11,250,000 shares. The Board of Directors amended the Plan on
November 12, 2002 and increased this number by 1,500,000 to a total of
12,750,000 shares.
	 
	2	 	Form S-8 generally is available to
consultants and advisors only if (i) they are natural persons; (ii) they
provide bona fide services to the issuer, its parents, its majority-owned
subsidiaries or majority-owned subsidiaries

5

 

6. Option Provisions.

     Each Option shall be in such form and shall contain such terms and conditions as the Board
shall deem appropriate. The provisions of separate Options need not be identical, but each Option
shall include (through incorporation of provisions hereof by reference in the Option or otherwise)
the substance of each of the following provisions:

          Exercise Price. The Board shall determine the exercise price of each Option, provided,
however, that the exercise price of each Option shall be not less than one hundred percent (100%)
of the Fair Market Value of the stock subject to the Option on the date the Option is granted.

          Consideration.

               The purchase price of stock acquired pursuant to an Option shall be paid, to the extent
permitted by applicable statutes and regulations, either (A) in cash at the time the Option is
exercised or (B) at the discretion of the Board at the time of the grant of the Option (or
subsequently) by delivery to the Company of other Common Stock, according to a deferred payment or
other similar arrangement (which may include, without limiting the generality of the foregoing, the
use of other Common Stock) with the Participant or in any other form of legal consideration that
may be acceptable to the Board; provided, however, that at any time that the Company is
incorporated in Delaware, payment of the Common Stock’s “par value,” as defined in the Delaware
General Corporation Law, shall not be made by deferred payment.

               Unless otherwise specifically provided in the Option, the purchase price of Common Stock
acquired pursuant to an Option that is paid by delivery to the Company of other Common Stock
acquired, directly or indirectly from the Company, shall be paid only by shares of the Common Stock
of the Company that have been held for more than six (6) months (or such longer or shorter period
of time required to avoid a charge to earnings for financial accounting purposes).

               In the case of any deferred payment arrangement, interest shall be compounded at least
annually and shall be charged at the minimum rate of interest necessary to avoid the treatment as
interest, under any applicable provisions of the Code, of any amounts other than amounts stated to
be interest under the deferred payment arrangement.

          Transferability. An Option shall be transferable to the extent provided in the Option
Agreement. If the Option does not provide for transferability, then the Option shall not be
transferable except by will or by the laws of descent and distribution and shall be exercisable
during the lifetime of the Optionholder only by the Optionholder. Notwithstanding the foregoing
provisions of this subsection 6(c), the Optionholder may, by delivering written notice to the
Company, in a form satisfactory to the Company, designate a third party who, in the event of the
death of the Optionholder, shall thereafter be entitled to exercise the Option.

 

			
	of the issuer’s parent; and (iii)
the services are not in connection with the offer or sale of securities in a
capital-raising transaction, and do not directly or indirectly promote or
maintain a market for the issuer’s securities.

6

 

          Vesting Generally. The total number of shares of Common Stock subject to an Option may, but
need not, vest and therefore become exercisable in periodic installments that may, but need not, be
equal. The Option may be subject to such other terms and conditions on the time or times when it
may be exercised (which may be based on performance or other criteria) as the Board may deem
appropriate. The vesting provisions of individual Options may vary. The provisions of this
subsection 6(d) are subject to any Option provisions governing the minimum number of shares as to
which an Option may be exercised.

          Termination of Continuous Service. In the event an Optionholder’s Continuous Service
terminates (other than upon the Optionholder’s death or Disability), the Optionholder may exercise
his or her Option (to the extent that the Optionholder was entitled to exercise it as of the date
of termination) but only within such period of time ending on the earlier of (i) the date three (3)
months following the termination of the Optionholder’s Continuous Service (or such longer or
shorter period specified in the Option Agreement), or (ii) the expiration of the term of the Option
as set forth in the Option Agreement. If, after termination, the Optionholder does not exercise
his or her Option within the time specified in the Option Agreement, the Option shall terminate.

          Extension of Termination Date. An Optionholder’s Option Agreement may also provide that if
the exercise of the Option following the termination of the Optionholder’s Continuous Service
(other than upon the Optionholder’s death or Disability) would be prohibited at any time solely
because the issuance of shares would violate the registration requirements under the Securities
Act, then the Option shall terminate on the earlier of (i) the expiration of the term of the Option
set forth in subsection 6(a) or (ii) the expiration of three months (or such longer or shorter
period specified in the Option Agreement) after the termination of the Optionholder’s Continuous
Service during which the exercise of the Option would not be in violation of such registration
requirements.

          Disability of Optionholder. In the event an Optionholder’s Continuous Service terminates as a
result of the Optionholder’s Disability, then, subject to any restrictions in the Option Agreement,
the Option shall become fully vested and exercisable as of the date of termination. The
Optionholder may exercise his or her Option, but only within such period of time ending on the
earlier of (i) the date twelve (12) months following such termination (or such longer or shorter
period specified in the Option Agreement) or (ii) the expiration of the term of the Option as set
forth in the Option Agreement. If, after termination, the Optionholder does not exercise his or
her Option within the time specified herein, the Option shall terminate.

          Death of Optionholder. In the event an Optionholder’s Continuous Service terminates as a
result of the Optionholder’s death, then, subject to any restrictions in the Option Agreement, the
Option shall become fully vested and exercisable as of the date of termination. In the event (i)
an Optionholder’s Continuous Service terminates as a result of the Optionholder’s death or (ii) the
Optionholder dies within the period (if any) specified in the Option Agreement after the
termination of the Optionholder’s Continuous Service for a reason other than death, then the Option
may be exercised (to the extent the Optionholder was entitled to exercise the Option as of the date
of death) by the Optionholder’s estate, by a person who acquired the right to exercise the Option
by bequest or inheritance or by a person designated to

7

 

exercise the Option upon the Optionholder’s death pursuant to subsection 6(c), but only within
the period ending on the earlier of (1) the date eighteen (18) months following the date of death
(or such longer or shorter period specified in the Option Agreement) or (2) the expiration of the
term of such Option as set forth in the Option Agreement. If, after death, the Option is not
exercised within the time specified herein, the Option shall terminate.

          Early Exercise. The Option may, but need not, include a provision whereby the Optionholder
may elect at any time before the Optionholder’s Continuous Service terminates to exercise the
Option as to any part or all of the shares subject to the Option prior to the full vesting of the
Option. Any unvested shares so purchased may be subject to an unvested share repurchase option in
favor of the Company or to any other restriction the Board determines to be appropriate.

          Term. No Option shall be exercisable after the expiration of eight (8) years from the date it
was granted.

7. Provisions of Stock Awards other than Options.

          Stock Bonus Awards. Each stock bonus agreement shall be in such form and shall contain such
terms and conditions as the Board shall deem appropriate. The terms and conditions of stock bonus
agreements may change from time to time, and the terms and conditions of separate stock bonus
agreements need not be identical, but each stock bonus agreement shall include (through
incorporation of provisions hereof by reference in the agreement or otherwise) the substance of
each of the following provisions:

               Consideration. A stock bonus shall be awarded in consideration for past services actually
rendered to the Company or an Affiliate for its benefit.

               Vesting. Shares of Common Stock awarded under the stock bonus agreement may, but need not, be
subject to a share repurchase option in favor of the Company in accordance with a vesting schedule
to be determined by the Board.

               Termination of Participant’s Continuous Service. In the event a Participant’s Continuous
Service terminates, the Company may reacquire any or all of the shares of Common Stock held by the
Participant that have not vested as of the date of termination under the terms of the stock bonus
agreement; provided, however, that in the event a Participant’s Continuous Service terminates as a
result of the Participant’s death, then, subject to any restrictions in the stock bonus agreement,
the shares acquired pursuant to the stock bonus agreement shall become fully vested as of the date
of termination.

               Transferability. Rights to acquire shares under the stock bonus agreement shall be
transferable by the Participant only upon such terms and conditions as are set forth in the stock
bonus agreement, as the Board shall determine in its discretion, so long as stock awarded under the
stock bonus agreement remains subject to the terms of the stock bonus agreement.

8

 

          Restricted Stock Awards. Each restricted stock purchase agreement shall be in such form and
shall contain such terms and conditions as the Board shall deem appropriate. The terms and
conditions of the restricted stock purchase agreements may change from time to time, and the terms
and conditions of separate restricted stock purchase agreements need not be identical, but each
restricted stock purchase agreement shall include (through incorporation of provisions hereof by
reference in the agreement or otherwise) the substance of each of the following provisions:

               Purchase Price. The purchase price under each restricted stock purchase agreement shall be
such amount as the Board shall determine and designate in such restricted stock purchase agreement.

               Consideration. The purchase price of stock acquired pursuant to the restricted stock purchase
agreement shall be paid either: (1) in cash at the time of purchase; (2) at the discretion of the
Board, according to a deferred payment or other similar arrangement with the Participant; or (3) in
any other form of legal consideration that may be acceptable to the Board in its discretion;
provided, however, that at any time that the Company is incorporated in Delaware, payment of the
Common Stock’s “par value,” as defined in the Delaware General Corporation Law, shall not be made
by deferred payment.

               Vesting. Shares of Common Stock acquired under the restricted stock purchase agreement may,
but need not, be subject to a share repurchase option in favor of the Company in accordance with a
vesting schedule to be determined by the Board.

               Termination of Participant’s Continuous Service. In the event a Participant’s Continuous
Service terminates, the Company may repurchase or otherwise reacquire any or all of the shares of
Common Stock held by the Participant that have not vested as of the date of termination under the
terms of the restricted stock purchase agreement; provided, however, that in the event a
Participant’s Continuous Service terminates as a result of the Participant’s death, then, subject
to any restrictions in the restricted stock purchase agreement, the shares acquired pursuant to the
restricted stock purchase agreement shall become fully vested as of the date of termination.

               Transferability. Rights to acquire shares under the restricted stock purchase agreement shall
be transferable by the Participant only upon such terms and conditions as are set forth in the
restricted stock purchase agreement, as the Board shall determine in its discretion, so long as
stock awarded under the restricted stock purchase agreement remains subject to the terms of the
restricted stock purchase agreement.

8. Covenants of the Company.

          Availability of Shares. During the terms of the Stock Awards, the Company shall keep
available at all times the number of shares of Common Stock required to satisfy such Stock Awards.

9

 

          Securities Law Compliance. The Company shall seek to obtain from each regulatory commission
or agency having jurisdiction over the Plan such authority as may be required to grant Stock Awards
and to issue and sell shares of Common Stock upon exercise of the Stock Awards; provided, however,
that this undertaking shall not require the Company to register under the Securities Act the Plan,
any Stock Award or any stock issued or issuable pursuant to any such Stock Award. 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
stock under the Plan, the Company shall be relieved from any liability for failure to issue and
sell stock upon exercise of such Stock Awards unless and until such authority is obtained.

9. Use of Proceeds from Stock.

     Proceeds from the sale of stock pursuant to Stock Awards shall constitute general funds of the
Company.

10. Miscellaneous.

          Acceleration of Exercisability and Vesting. The Board shall have the power to accelerate the
time at which a Stock Award may first be exercised or the time during which a Stock Award or any
part thereof will vest in accordance with the Plan, notwithstanding the provisions in the Stock
Award stating the time at which it may first be exercised or the time during which it will vest.

          Stockholder Rights. No Participant shall be deemed to be the holder of, or to have any of the
rights of a holder with respect to, any shares subject to such Stock Award unless and until such
Participant has satisfied all requirements for exercise of the Stock Award pursuant to its terms.

          No Employment or other Service Rights. Nothing in the Plan or any instrument executed or
Stock Award granted pursuant thereto shall confer upon any Participant or other holder of Stock
Awards any right to continue to serve the Company or an Affiliate in the capacity in effect at the
time the Stock Award was granted or shall affect the right of the Company or an Affiliate to
terminate (i) the employment of an Employee with or without notice and with or without cause or
(ii) the service of a Consultant pursuant to the terms of such Consultant’s agreement with the
Company or an Affiliate.

          Investment Assurances. The Company may require a Participant, as a condition of exercising or
acquiring stock under any Stock Award, (i) to give written assurances satisfactory to the Company
as to the Participant’s knowledge and experience in financial and business matters and/or to employ
a purchaser representative reasonably satisfactory to the Company who is knowledgeable and
experienced in financial and business matters and that he or she is capable of evaluating, alone or
together with the purchaser representative, the merits and risks of exercising the Stock Award; and
(ii) to give written assurances satisfactory to the Company stating that the Participant is
acquiring the stock subject to the Stock Award for the Participant’s own account and not with any
present intention of selling or otherwise distributing

10

 

the stock. The foregoing requirements, and any assurances given pursuant to such
requirements, shall be inoperative if (1) the issuance of the shares upon the exercise or
acquisition of stock under the Stock Award has been registered under a then currently effective
registration statement under the Securities Act or (2) as to any particular requirement, a
determination is made by counsel for the Company that such requirement need not be met in the
circumstances under the then applicable securities laws. The Company may, upon advice of counsel
to the Company, place legends on stock certificates issued under the Plan as such counsel deems
necessary or appropriate in order to comply with applicable securities laws, including, but not
limited to, legends restricting the transfer of the stock.

          Withholding Obligations. To the extent provided by the terms of a Stock Award Agreement, the
Participant may satisfy any federal, state or local tax withholding obligation relating to the
exercise or acquisition of stock under a Stock Award by any of the following means (in addition to
the Company’s right to withhold from any compensation paid to the Participant by the Company) or by
a combination of such means: (i) tendering a cash payment; (ii) authorizing the Company to
withhold shares from the shares of the Common Stock otherwise issuable to the Participant as a
result of the exercise or acquisition of stock under the Stock Award, provided, however, that no
shares of Common Stock are withheld with a value exceeding the minimum amount of tax required to be
withheld by law; or (iii) delivering to the Company owned and unencumbered shares of the Common
Stock.

11. Adjustments upon Changes in Stock.

          Capitalization Adjustments. If any change is made in the stock subject to the Plan, or
subject to any Stock Award, 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 will be appropriately adjusted in the class(es) and maximum
number of securities subject to the Plan pursuant to subsection 4(a), and the outstanding Stock
Awards will be appropriately adjusted in the class(es) and number of securities and price per share
of stock subject to such outstanding Stock Awards. Such adjustments shall be made by the Board,
the determination of which shall be final, binding and conclusive. (The conversion of any
convertible securities of the Company shall not be treated as a transaction “without receipt of
consideration” by the Company.)

          Dissolution or Liquidation. In the event of a dissolution or liquidation of the Company, then
such Stock Awards shall be terminated if not exercised (if applicable) prior to such event.

          Corporate Transaction. In the event of (1) a sale, lease or other disposition of all or
substantially all of the assets of the Company, (2) a merger or consolidation in which the Company
is not the surviving corporation or (3) 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 (a “Corporate Transaction”), then any surviving corporation or

11

 

acquiring corporation shall assume any Stock Awards outstanding under the Plan or shall
substitute similar stock awards (including an award to acquire the same consideration paid to the
stockholders in the Corporate Transaction) for those outstanding under the Plan. In the event any
surviving corporation or acquiring corporation refuses to assume such Stock Awards or to substitute
similar stock awards for those outstanding under the Plan, then with respect to Stock Awards held
by Participants whose Continuous Service has not terminated, the vesting of such Stock Awards (and,
if applicable, the time during which such Stock Awards may be exercised) shall be accelerated in
full, and the Stock Awards shall terminate if not exercised (if applicable) at or prior to such
Corporate Transaction. With respect to any other Stock Awards outstanding under the Plan, such
Stock Awards shall terminate if not exercised (if applicable) prior to such Corporate Transaction.

          Securities Acquisition. In the event of an acquisition by any person, entity or group within
the meaning of Section 13(d) or 14(d) of the Exchange Act, or any comparable successor provisions
(excluding any employee benefit plan, or related trust, sponsored or maintained by the Company or
an Affiliate) of the beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act, or comparable successor rule) of securities of the Company representing at least
fifty percent (50%) of the combined voting power entitled to vote in the election of Directors and
provided that such acquisition is not a result of, and does not constitute, a Corporate Transaction
described in subsection 11(c) hereof, then with respect to Stock Awards held by Participants whose
Continuous Service has not terminated, the vesting of such Stock Awards (and, if applicable, the
time during which such Stock Awards may be exercised) shall be accelerated in full.

12. Amendment of the Plan and Stock Awards.

          Amendment of Plan. The Board at any time, and from time to time, may amend the Plan; provided
however, that the rights under any Stock Award shall not be impaired by any amendment of the Plan
unless (i) the Company requests the consent of the Participant and (ii) the Participant consents in
writing.

          Amendment of Stock Awards. The Board at any time, and from time to time, may amend the terms
of any one or more Stock Awards; provided, however, that the rights under any Stock Award shall not
be impaired by any such amendment unless (i) the Company requests the consent of the Participant
and (ii) the Participant consents in writing.

13. Termination or Suspension of the Plan.

          Plan Term. The Board may suspend or terminate the Plan at any time. No Stock Awards may be
granted under the Plan while the Plan is suspended or after it is terminated.

          No Impairment of Rights. Rights and obligations under any Stock Award granted while the Plan
is in effect shall not be impaired by suspension or termination of the Plan, except with the
written consent of the Participant.

12

 

14. Effective Date of Plan.

     The Plan shall become effective upon adoption by the Board.

15. Choice of Law.

The law of the State of Delaware shall govern all questions concerning the construction, validity
and interpretation of this Plan, without regard to such state’s conflict of laws rules.

13

 

Nektar Therapeutics 2000 Non-Officer Equity Incentive Plan (“the Plan”)

     This section of the Plan will be known as the Approved Section of the Nektar Therapeutics 2000
Non-Officer Equity Incentive Plan (the “Approved Section”). The Approved Section has been adopted
by way of amendment to the Plan for the sole purpose of providing for the grant of options to
United Kingdom-based employees of Nektar Therapeutics and its Subsidiaries and to directors of the
Subsidiaries under Section 6 of the Plan where the Committee wishes to grant the employees of
Nektar Therapeutics and its Subsidiaries and to directors of the Subsidiaries options under a plan
approved by the Board of the Inland Revenue under Schedule 9 of the Income and Corporation Taxes
Act 1988 in addition to or as an alternative to the grant of Options and other Stock Awards under
the Plan. The Approved Section shall only be used in connection with option grants to United
Kingdom-based employees of Nektar Therapeutics and its Subsidiaries and United Kingdom-based
directors of the Subsidiaries. All other Stock Awards made under the Plan shall be governed by the
Plan without reference to the Approved Section.

     For the purposes of the Approved Section, the Sections set forth in the Plan shall apply
subject to the amendments provided for below and any provision in the Plan that is inconsistent
with the following provisions shall not form part of the Approved Section shall be governed by the
Plan subject to the amendments provided for below:

	1.	 	Definitions and Interpretation

	 	1.1	 	The following words and expressions shall have the following meanings for the
purposes of the Approved Section, unless the context otherwise requires:

“the Adoption Date” means the date on which the Approved Section is approved by the Inland Revenue;

“the Appropriate Period” has the same meaning as in paragraph 15(2) of Schedule 9 to the Taxes Act;

“Approved Option” means an Option to acquire Section Shares which is granted under Section 6 and
satisfies the conditions of the Approved section;

“Approved Section” means the Approved Section of the Nektar Therapeutics 200 Non-Officer Equity
Incentive Plan constituted and governed by the Plan subject to the amendments set out herein;

“Associated Company” has the same meaning as in Section 187(2) of the Taxes Act;

“the Company” means Nektar Therapeutics, a Delaware corporation with business address 150
Industrial Road, San Carlos, California 94070-6256;

“Control” has the same meaning as in section 840 of the Taxes Act and “controlled” shall be
construed accordingly;

14

 

“Date of Grant” means the date on which an Approved Option is, was, or is to be granted under the
Approved Section;

“Eligible Employee” means a person who is at the relevant Date of Grant:

	 	(A)	 	a Full-time Director or a qualifying Employee selected by the
Committee to participate in the Approved Section; and
	 
	 	(B)	 	not precluded by paragraph 8 of Schedule 9 (material interest I
close company) to the Taxes act from participating in the Approved Section;

“Full-Time Director” means a director of a Subsidiary whose terms of office or employment require
such director to work for at least twenty-five hours per week (excluding meal breaks);

“Qualifying Employee” means an employee of the Company or a Subsidiary who is not a director of the
Company or Subsidiary;

“Qualifying Employment” means office or employment either as a Full-Time Director or as a
Qualifying Employee as the case may be;

“Section Shares” means Shares which satisfy the conditions specified in Paragraphs 10 to 14 of
Schedule 9 to the Taxes Act (fully paid up, unrestricted, ordinary share capital) to be acquired by
a Participant on the exercise by such participant of an Approved Option which Shares shall as to
voting, dividend, transfer and other rights including those arising in the liquidation of the
Company rank pari passu in all respects and as to one class with the Shares of the Company in issue
at that time;

“Subsidiary” means a body corporate of which the Company is for the time being to be taken to have
Control and which is a subsidiary of the Company within section 736 of the Companies Act 1985;

“Subsisting Option” means an Approved Option which has neither lapsed nor been exercised;

“Taxes Act” means the Income and Corporation Taxes Act 1988;

Where the context so permits the singular shall include the plural and vice
versa and the masculine shall include the feminine.

Reference to any Act shall include any statutory modification, amendment or re-enactment
thereof;

	2.	 	Eligibility

	 	2.1	 	Notwithstanding Section 5 of the Plan, Approved Options shall only be granted
to Eligible Employees.

15

 

	3.	 	Option Provisions

     Section 6 of the Plan shall apply provided that the grant of each Approved Option shall comply
with the following conditions:

	 	3.1	 	An Approved Option may not be exercised later than the day before the tenth
anniversary of the Date of Grant on which day the same (if it has not already ceased to
be exercisable) shall lapse.

The exercise price payable for each Section Share in the event of an Approved
Option being exercised shall be:

	 	(A)	 	Where Approved Options are granted when the Shares are not
quoted on the New York Stock Exchange, the greater of:

	 	(1)	 	the par value of a Share; and
	 
	 	(2)	 	the amount determined to be the market value of
a share on the Date of grant in accordance with the provisions of part
VIII of the Taxation of Chargeable Gains Act of 1992 and agreed for the
purposes of the Approved Section with the Inland Revenue Share
Valuation Division prior to the date on which an Approved Option is
granted to a Participant;

	 	(B)	 	where Approved options are granted when the Shares are quoted
on the New York Stock Exchange, the greater of:

	 	(1)	 	the par value of a Share; and
	 
	 	(2)	 	on any Date of Grant, the closing sales price
for a Share on the New York Stock Exchange on the immediately preceding
day on which Shares were traded on the New York Stock Exchange as
published in the Wall Street Journal;

	 	3.2	 	The form of grant of an Approved Option shall be executed by the Company as a
deed, and shall state the exercise price, the number of Shares, the Date of Grant and
any performance conditions applicable to the exercise of the approved Option.
	 
	 	3.3	 	Any Approved Option granted to an Eligible Employee shall be limited and take
effect so that at the Date of Grant of such Approved Option the aggregate of:

(A) the market value of shares comprised in such Approved Option; and

(B) the market value of shares comprised in any Subsisting Options
which have been granted to that Eligible Employee; and

16

 

(C) the market value of any Shares the Eligible Employee may
acquire in pursuance of options granted to such Eligible Employee (and not
exercised) under any other scheme approved under Schedule 9 to the Taxes Act
and established by the Company or any Associated Company of the Company
providing for the grant of options to acquire Shares (other than a savings
related share option scheme)

shall not exceed £30,000 (or such other amount as may be prescribed by Paragraph 28 of Schedule 9
to the Taxes Act from time to time).

For the purposes of this paragraph “market value” shall be calculated in accordance with Paragraph
28 of Schedule 9 to the Taxes Act at the respective Dates of Grant.

	 	3.4	 	The type of consideration in which the exercise price of an Approved Option is
to be paid shall be in monetary form.
	 
	 	3.5	 	An Approved Option shall be personal to the Eligible Employee to whom it is
granted and shall not be capable of assignment. Any purported sale, pledge,
assignment, hypothecation, transfer or disposal of or dealing with an Approved Option
shall cause the Approved Option to lapse forthwith.
	 
	 	3.6	 	No Approved Option may be exercised at any time when the Shares which may be
thereby acquired are not Section Shares.
	 
	 	3.7	 	Upon the exercise of an Approved Option in accordance with the Plan, the
Company shall promptly and in any event not later than 30 days after the exercise of an
Approved Option issue or cause to be issued a stock certificate to the Participant or a
book-entry crediting the Participant’s account with the appropriate number of Section
Shares.
	 
	 	3.8	 	No Approved Option may be exercised when the Participant to who it was granted
is precluded from participating in the Approved Section by virtue of paragraph 8 of
Schedule 9 to the Taxes act (material interest in close company).

	4.	 	Termination of Employment

	 	4.1	 	Except as provided in Section 6 paragraph (e) (Termination of continuous
Service), Section paragraph (g) (Disability of the Optionholder) and Section 6
paragraph (h) (Death of the Optionholder) of the Plan no Approved Option may be
exercised unless the Participant shall have been in Qualifying Employment since the
date of the grant of such Approved Option.
	 
	 	4.2	 	Section 6 paragraph (h) (Death of the Optionholder) of the Plan shall apply for
the purposes of the Approved Section provided that no Approve Option may be exercised
more than one year later the death of a Participant and following the death of a
Participant an Approved Option may only be exercised by the personal representatives of
that Participant.

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	 	4.3	 	A female Participant whose employment has been terminated in circumstances such
that, pursuant to the Employment Rights Act 1996, she has a right to return to work
shall be deemed for the purposes of the Approved Section not to have eased to be in
Qualifying Employment until such time as she is no longer capable, pursuant to the said
Act, of exercising a right to return to work and has not exercised such right.

5. Provisions of the Plan not to Apply to Approved Options

	 	5.1	 	Section 6 paragraphs 6 (b)(I)(B), (ii) and (iii) Consideration) and (i) (Early
Exercise), 7 (Provisions of Stock Awards other than Options) and 10 paragraphs 9a)
(Acceleration of Exercisability and Vesting) and (d) (Investment Assurances) of the
Plan shall not apply for the purposes of the Approved Section.

6. No Obligation to Employ

Section 10 paragraph © (No Employment or other Service Rights) of the Plan shall apply subject to
the following further condition for the purposes of the Approved Section:

	 	6.1	 	Participation in the Approved Section by a participant is a matter entirely
separate from, and shall not affect, the Participant’s pension rights and terms of
employment and, in particular (but without prejudice to the foregoing), if a
Participant shall cease for any reason (including wrongful dismissal) to be employed by
or hold office with the Company or a Subsidiary the Participant shall not be entitled
by way of compensation for loss or otherwise howsoever, of any sum or benefit to
compensate the Participant for the loss of any right or benefit under the Approved
Section.

7. Withholding Obligations

     The following provision shall be substituted for Section 10 paragraph (e) (Withholding
Obligations) of the Plan for the purposes of the Approve Section:

	 	7.1	 	If a Participant is liable to tax, duties and social security contributions on
the exercise of an Approved Option and the Company or the Participant’s employing
company or former employing company is liable to make payment to appropriate
authorities on account of that liability, then the Participant will enter into such
arrangements as necessary for ensuring that that company is put in sufficient funds to
enable t to discharge its liability to make the payment to the appropriate authority,
or is reimbursed for any payment made.

8. Adjustment upon Changes in Stock

	 	8.1	 	The provisions of Section 11 paragraphs (c) (Corporate Transaction) and (d)
(Securities Acquisition) of the Plan shall be modified for the purposes of the Approved
Section so that they applies only where a company (“the Acquiring Company”)

18

 

	 	(A)	 	obtains Control of the Company as a result of:

	 	(1)	 	a general offer to acquire the whole of the
issued share capital of the Company (other than that which is already
owned by it) made on a condition such that if satisfied the Acquiring
Company will have Control of the Company; or
	 
	 	(2)	 	a general offer to acquire all the Ordinary
Shares (or such Ordinary Shares as are not already owned by the
Acquiring Company); or

	 	(B)	 	obtains Control of the Company in pursuance of a compromise or
arrangement sanctioned by the Court under Section 425 of the Companies Act
1985;
	 
	 	(C)	 	becomes bound or entitled to acquire Ordinary Shares under
sections 428 to 430 of the Companies Act 1985.

	 	8.2	 	Where Rule 8.1 applies any Option subsisting at the date of the Corporate
Transaction or Securities Acquisition (as defined in the Plan) may be released by the
Participant at any time during the Appropriate period, at the option of the Committee
and with the agreement of the Acquiring Company, for an equivalent option over shares
of the Acquiring Company which satisfies the conditions that it:

(A) is over shares in the acquiring company or a company which has
Control of the acquiring company which satisfy the conditions specified in
paragraphs 10 to 14 of Schedule 9 to the Taxes Act (and the terms “Ordinary
Shares” and “Scheme Shares” in this Scheme shall thereafter be construed
accordingly);

(B) is the right to acquire such number of Scheme Shares as has on
acquisition of the new Option as aggregate market value equal to the aggregate
market value of the Scheme Shares subject to the old Option immediately before
its release;

(C) has an Option Price per Scheme Share such that the total amount
payable on exercise is equal to the total amount payable on exercise of the old
Option; and

(D) is otherwise in identical terms to the old Option and for this
purpose references to “the Company” in the Plan other than Section 6) shall,
unless the context otherwise requires, be deemed to refer to the acquiring
company or, as the case may be, to the other company over whose shares the new
Option is granted.

The new Option shall for all other purposes of the Scheme be treated as having been acquired at the
same time as the old Option is respect of which it is granted.

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	 	8.3	 	Every alteration or variation made pursuant to Section 11 for the purposes of
the Approved Section shall be subject to the prior approval of the Board of Inland
Revenue.
	 
	 	8.4	 	Following the adjustment, the Shares continue to be Section Shares.

9. Amendment of the Plan and Stock Awards

     Section 12 of the Plan shall operate for the purposes of the Approved Section of the Plan
subject to the following condition:

	 	9.1	 	Following the approval of the Approved Section under Schedule 9 to the Taxes
Act, no alteration of the Approved Section shall have effect until approved by the
Board of Inland Revenue.

10. Choice of Law

	 	10.1	 	Notwithstanding Section 15 of the Plan, the Approved Section shall be governed
by and construed in accordance with the laws of England, except that any matters
relating to the internal governance of the Company shall be governed by Delaware law.

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