Document:

CONFIDENTIAL

PRIVILEGED AND CONFIDENTIAL

LETTER OF INTENT
APRIL 24, 2006
DEAR CHIEF EXECUTIVE OFFICER

We are  pleased to  submit  this  letter of intent  (this  "Letter  of  Intent")
reflecting the proposal of ZHEJIANG FIBERSENSE  COMMUNICATION TECHNOLOGY COMPANY
LIMITED  ("MGER") to enter into a  definitive  agreement  (the  "Share  Exchange
Agreement"),  with the shareholders of PERFISANS HOLDINGS ("MGEE"),  pursuant to
which  MGEE will  acquire  from the MGER  Shareholders  100% of the  issued  and
outstanding  share capital of MGER (the  "Capital") in exchange for the issuance
of MGEE shares (the "Common Shares")  necessary to represent  approximately TBD%
of the issued  outstanding  stock of MGEE on a fully diluted  basis  immediately
following the closing (as defined below) of the transaction contemplated.

The Share Exchange Agreement will encompass the following terms:

1.   EXCHANGE OF SHARES; ESCROW. The MGER Shareholders will deliver to MGEE 100%
     of the Capital of MGER in exchange  for TBD% of the issued and  outstanding
     shares of MGEE, calculated on a fully diluted basis and after giving effect
     to the share exchange.

2.   TERMS OF SHARE  EXCHANGE  AGREEMENT.  The parties  shall  negotiate in good
     faith  to  reach  agreement  on  a  reasonably  acceptable  Share  Exchange
     Agreement,  to  be  drafted  by  counsel  for  MGER,  containing  customary
     covenants,    representations,    warranties,   indemnities,   non-compete,
     non-solicitation,  anti-dilution and other provisions,  it being understood
     however that any shares of MGEE Common Stock issued between the date hereof
     and the closing to  directors  and  officers of MGEE will have an unlimited
     indemnity  from the  issues  thereof.  The Share  Exchange  Agreement  will
     provide that (a) immediately  following the Closing (as defined below), the
     name of MGEE will be  changed to reflect  the nature and  character  of the
     business of MGER, (b) as soon as practical following the Closing, MGER will
     seek to list its securities on either the AMEX or NASDAQ exchange.

3.   CONDITIONS TO CLOSING.  The closing of the Share  Exchange  Agreement  (the
     "Closing")

     (a)  MGEE will have maintained its listing status.

     (b)  MGER shall  represent  within the Share  Exchange  Agreement  that the
          un-audited  financial  statements of PLGL for March 31, 2006 have been
          prepared.

     (c)  MGEE  insider  shareholders  shall have  executed  a  mutually  agreed
          leak-out   agreement   with   respect   to  sales  of  common   shares
          post-Closing.

4.   EXPENSES.  Each  party  will  pay  its own all  fees of its  legal  counsel
     associated  with the  Exchange,  including the  drafting,  preparation  and
     negotiation  of the  Share  Exchange  Agreement  and  all  other  necessary
     documentation.

5.   ACCESS.  Each party shall  provide to the other party  access to its books,
     records,  financial  statements and other  information as may reasonably be
     necessary for the other party to complete its due diligence.

6.   NO-SHOP. MGER contemplates the expenditure of substantial time and money in
     connection  with the  preparation  and  negotiation  of the Share  Exchange
     Agreement  and  the  due  diligence  required  thereby.  Accordingly,  upon
     execution  of this  Letter of  Intent  and for a period of 60 days from the
     date hereof (the "No-Shop Period"),  neither party, directly or indirectly,
     through any  representative  or otherwise will solicit or entertain  offers
     from,  negotiate  with  or in any  manner  encourage,  discuss,  accept  or
     consider the proposal of any other person  relating to the  acquisition  of
     the stock of either party or business, in whole or in part, whether through
     direct  purchase,  merger,  consolidation  or  other  business  combination
     without  the  written  consent  of the other  party.  The  parties  further
     represent  and  warrant  that there are no existing  letters of intent,  or
     other agreements to which either MGER or MGEE are bound with respect to the
     sale of the Company,  the stock of the Company or substantially  all of its
     assets or that conflict with any of the foregoing transactions.

<PAGE>

                                                                    CONFIDENTIAL

7.   GOVERNING  LAW. This Letter of Intent shall be  interpreted,  construed and
     enforced in accordance with the laws of New York,  without giving effect to
     its rule or  principles  governing  conflicts of laws that would compel the
     application of the substantive law of any other jurisdiction.

8.   BINDING  CONSENT.  While it is understood that this Letter of Intent,  with
     the  exception of the Section 6, does not  constitute  a binding  agreement
     between the parties,  it does set forth the  understanding in principle and
     the present  intention of the parties to enter into a definitive  agreement
     providing  for the  above  understandings  upon the  terms  and  conditions
     mutually acceptable to the parties.

9.   TERMINATION. This Letter of Intent may be terminated:

     (a)  By mutual written consent of the parties;

     (b)  Upon execution by the parties of the Share Exchange Agreement;

     (c)  Upon  written  notice  by any  party  that  the due  diligence  is not
          satisfactory; or

     (d)  Upon  written  notice  by any  party to the  other  party if the Share
          Exchange  Agreement has not been executed  prior to the  expiration of
          the No-Shop  Period;  provided,  however,  that the termination of the
          binding  provisions  shall not  affect the  liability  of any party of
          breach of any of the binding provisions prior to the termination. Upon
          termination, the parties shall have no further obligations hereunder.

If the above  meets with your  approval  in  principle,  please so  indicate  by
returning to us one fully executed copy of this Letter of Intent.  The Letter of
Intent  shall be null and void if it is not executed and received by the parties
on or before APRIL 28, 2006, at 8:00 p.m. Pacific Time.

                                 Very truly yours,

                                 ZHEJIANG FIBERSENSE COMMUNICATION TECHNOLOGY
                                 COMPANY LIMITED (MGER)

                                 By:    /s/ Joe Lin
                                    ----------------------------------
                                 Name:  Joe Lin
                                 Title: Chairman, F&P Holdings

Accepted and Agreed:             PERFISANS HOLDINGS INC. (MGEE)

                                 By:    /s/ To Hon Bam
                                    ----------------------------------
                                 Name:  To Hon Bam
                                 Title: CEO

                                                                               2exv10w1

 

EXHIBIT 10.1

NEUROCRINE BIOSCIENCES, INC.

AMENDED
AND RESTATED EMPLOYEE STOCK PURCHASE PLAN

(as amended May 24, 2001, June 15, 2001 and November 7, 2005)

     The following constitute the provisions of the Employee Stock Purchase Plan of Neurocrine
Biosciences, Inc.

     1. Purpose. The purpose of the Plan is to provide employees of the Company and its
Designated Subsidiaries with an opportunity to purchase Common Stock of the Company through
accumulated payroll deductions. It is the intention of the Company to have the Plan qualify as an
“Employee Stock Purchase Plan” under Section 423 of the Internal Revenue Code of 1986, as amended.
The provisions of the Plan, accordingly, shall be construed so as to extend and limit participation
in a manner consistent with the requirements of that section of the Code.

     2. Definitions.

          (a) “Board” shall mean the Board of Directors of the Company.

          (b) “Code” shall mean the Internal Revenue Code of 1986, as amended.

          (c) “Common Stock” shall mean the Common Stock of the Company.

          (d) “Company” shall mean Neurocrine Biosciences, Inc. and any Designated Subsidiary of
the Company.

          (e) “Compensation” shall mean all regular straight time gross earnings but shall
exclude variable compensation for field sales personnel, incentive bonuses, overtime, shift
premium, lead pay and automobile allowances and other compensation.

          (f) “Designated Subsidiaries” shall mean the Subsidiaries which have been designated
by the Board from time to time in its sole discretion as eligible to participate in the Plan.

          (g) “Employee” shall mean any individual who is an Employee of the Company for tax
purposes whose customary employment with the Company is at least twenty (20) hours per week and
more than five (5) consecutive months in any calendar year. For purposes of the Plan, the
employment relationship shall be treated as continuing intact while the individual is on sick leave
or other leave of absence approved by the Company. Where the period of leave exceeds 90 days and
the individual’s right to reemployment is not guaranteed either by statute or by contract, the
employment relationship will be deemed to have terminated on the 91st day of such leave.

          (h) “Enrollment Date” shall mean the first day of each Offering Period.

 

 

          (i) “Exercise Date” shall mean the last Trading Day of each Purchase Period. The
first Exercise Date shall be the last Trading Day on or before December 31, 1996.

          (j) “Fair Market Value” shall mean, as of any date, the value of Common Stock
determined as follows:

               (1) If the Common Stock is listed on any established stock exchange or a national market
system, including without limitation the Nasdaq National Market of the National Association of
Securities Dealers, Inc. Automated Quotation (“NASDAQ”) System, its Fair Market Value shall be the
closing sale price for the Common Stock (or the mean of the closing bid and asked prices, if no
sales were reported), as quoted on such exchange (or the exchange with the greatest volume of
trading in Common Stock) or system on the date of such determination, as reported in The Wall
Street Journal or such other source as the Board deems reliable; or

               (2) If the Common Stock is quoted on the NASDAQ System (but not on the National Market
thereof) or is regularly quoted by a recognized securities dealer but selling prices are not
reported, its Fair Market Value shall be the mean of the closing bid and asked prices for the
Common Stock on the date of such determination, as reported in The Wall Street Journal or such
other source as the Board deems reliable; or

               (3) In the absence of an established market for the Common Stock, the Fair Market Value
thereof shall be determined in good faith by the Board.

               (4) For purposes of the Enrollment Date of the first Offering Period, the Fair Market Value
of the Common Stock shall be the Price to Public as set forth in the final prospectus filed with
the Securities and Exchange Commission pursuant to Rule 424 under the Securities Act of 1933, as
amended.

          (k)
“Offering Period” shall mean the period of
approximately six (6) months during
which an option granted pursuant to the Plan may be exercised, commencing on the first Trading Day
on or after January 1 and July 1 of each year and terminating on the last Trading Day in the
periods ending up to six-months later (provided, however, that any employee with an Offering Period
beginning before January 1, 2001, shall have an initial Offering Period of up to two-years). The
first day of the first Offering Period shall be the effective date of the Company’s initial public
offering of its Common Stock that is registered with the Securities and Exchange Commission. The
duration and timing of Offering Periods may be changed pursuant to Section 4 of this Plan.

          (l) “Plan” shall mean this Neurocrine Biosciences, Inc. Employee Stock Purchase
Plan as amended hereby.

          (m) “Purchase Price” shall mean an amount equal to 85% of the Fair Market Value of a
share of Common Stock on the Enrollment Date or on the Exercise Date, whichever is lower. For
purposes of Offering Periods commencing on or after January 1, 2006, “Purchase Price” shall mean an
amount equal to 85% of the Fair Market Value of a share of Common Stock on the Exercise Date.

          (n) “Purchase Period” shall mean the approximately six-month period commencing after
one Exercise Date and ending with the next Exercise Date, except that the first Purchase Period

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of any Offering Period shall begin on the Enrollment Date and end with the next Exercise Date.
The first Purchase Period of the first Offering Period shall begin on the first day of the first
Offering Period and shall end on the first Exercise Date.

          (o) “Reserves” shall mean the number of shares of Common Stock covered by each option
under the Plan which have not yet been exercised and the number of shares of Common Stock which
have been authorized for issuance under the Plan but not yet placed under option.

          (p) “Subsidiary” shall mean a corporation, domestic or foreign, of which not less than
50% of the voting shares are held by the Company or a Subsidiary, whether or not such corporation
now exists or is hereafter organized or acquired by the Company or a Subsidiary.

          (q) “Trading Day” shall mean a day on which national stock exchanges and the National
Association of Securities Dealers Automated Quotation (NASDAQ) System are open for trading.

     3. Eligibility.

          (a) Any Employee (as defined in Section 2(g)), who shall be employed by the Company on a given
Enrollment Date shall be eligible to participate in the Plan.

          (b) Any provisions of the Plan to the contrary notwithstanding, no Employee shall be granted
an option under the Plan (i) if, immediately after the grant, such Employee (or any other person
whose stock would be attributed to such Employee pursuant to Section 424(d) of the Code) would own
capital stock of the Company and/or hold outstanding options to purchase such stock possessing five
percent (5%) or more of the total combined voting power or value of all classes of the capital
stock of the Company or of any Subsidiary, or (ii) if such option permits his or her rights to
purchase stock under all employee stock purchase plans of the Company and its Subsidiaries to
accrue at a rate which exceeds twenty-five thousand dollars ($25,000) worth of stock (determined at
the fair market value of the shares at the time such option is granted) for each calendar year in
which such option is outstanding at any time.

     4. Offering Periods. The Plan shall be implemented by consecutive Offering
Periods with a new Offering Period beginning on the first Trading Day on or after July 1 and
January 1, or on such other date as the Board shall determine, and continuing thereafter
until terminated in accordance with Section 19 hereof. The first day of the first Offering Period
shall be the effective date of the Company’s initial public offering of its Common Stock that is
registered with the Securities and Exchange Commission. The Board shall have the power to change
the duration of Offering Periods (including the commencement dates thereof) with respect to future
offerings without stockholder approval if such change is announced at least five (5) days prior to
the scheduled beginning of the first Offering Period to be affected thereafter.

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     5. Participation.

          (a) An eligible Employee may become a participant in the Plan by completing a subscription
agreement authorizing payroll deductions in the form of Exhibit A to this Plan and filing it with
the Company’s payroll office prior to the applicable Enrollment Date.

          (b) Payroll deductions for a participant shall commence on the first payroll date following
the Enrollment Date and shall end on the last payroll date in the Offering Period to which such
authorization is applicable, unless sooner terminated by the participant as provided in Section 10
hereof.

     6. Payroll Deductions.

          (a) At the time a participant files his or her subscription agreement, he or she shall elect
to have payroll deductions made on each pay day during the Offering Period in an amount not
exceeding fifteen percent (15%) of the Compensation which he or she receives on each pay day during
the Offering Period, and the aggregate of such payroll deductions during the Offering Period shall
not exceed fifteen percent (15%) of the participant’s Compensation during said Offering Period.

          (b) All payroll deductions made for a participant shall be credited to his or her account
under the Plan and will be withheld in whole percentages only. A participant may not make any
additional payments into such account.

          (c) A participant may discontinue his or her participation in the Plan as provided in Section
10 hereof, or may increase or decrease the rate of his or her payroll deductions during the
Offering Period by completing or filing with the Company a new subscription agreement authorizing a
change in payroll deduction rate. The Board may, in its discretion, limit the number of
participation rate changes during any Offering Period. The change in rate shall be effective with
the first full payroll period following five (5) business days after the Company’s receipt of the
new subscription agreement unless the Company elects to process a given change in participation
more quickly. A participant’s subscription agreement shall remain in effect for successive
Offering Periods unless terminated as provided in Section 10 hereof.

          (d) Notwithstanding the foregoing, to the extent necessary to comply with Section 423(b)(8) of
the Code and Section 3(b) hereof, a participant’s payroll deductions may be decreased to 0% at such
time during any Purchase Period which is scheduled to end during the current calendar year (the
“Current Purchase Period”) that the aggregate of all payroll deductions which were previously used
to purchase stock under the Plan in a prior Purchase Period which ended during that calendar year
plus all payroll deductions accumulated with respect to the Current Purchase Period equal $21,250.
Payroll deductions shall recommence at the rate provided in such participant’s subscription
agreement at the beginning of the first Purchase Period which is scheduled to end in the following
calendar year, unless terminated by the participant as provided in Section 10 hereof.

          (e) At the time the option is exercised, in whole or in part, or at the time some or all of
the Company’s Common Stock issued under the Plan is disposed of, the participant must make adequate
provision for the Company’s federal, state, or other tax withholding obligations, if any,

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which arise upon the exercise of the option or the disposition of the Common Stock. At any
time, the Company may, but will not be obligated to, withhold from the participant’s compensation
the amount necessary for the Company to meet applicable withholding obligations, including any
withholding required to make available to the Company any tax deductions or benefits attributable
to sale or early disposition of Common Stock by the Employee.

     7. Grant of Option. On the Enrollment Date of each Offering Period, each eligible Employee
participating in such Offering Period shall be granted an option to purchase on each Exercise Date
during such Offering Period (at the Purchase Price) up to a number of shares of the Company’s
Common Stock determined by dividing such Employee’s payroll deductions accumulated prior to such
Exercise Date and retained in the Participant’s account as of the Exercise Date by the Purchase
Price; provided, that in no event shall an Employee be permitted to purchase during each Purchase
Period more than a number of Shares determined by dividing $12,500 by the Fair Market Value of a
share of the Company’s Common Stock on the Enrollment Date; and provided, further, that such
purchase shall be subject to the limitations set forth in Sections 3(b) and 12 hereof. Exercise of
the option shall occur as provided in Section 8 hereof, unless the participant has withdrawn
pursuant to Section 10 hereof, and shall expire on the last day of the Offering Period.

     8. Exercise of Option. Unless a participant withdraws from the Plan as provided in Section
10 hereof, his or her option for the purchase of shares will be exercised automatically on the
Exercise Date, and the maximum number of full shares subject to the option shall be purchased for
such participant at the Purchase Price with the accumulated payroll deductions in his or her
account. No fractional shares will be purchased; any payroll deductions accumulated in a
participant’s account which are not sufficient to purchase a full share shall be retained in the
participant’s account for the subsequent Purchase Period or Offering Period, subject to earlier
withdrawal by the participant as provided in Section 10 hereof. Any other monies left over in a
participant’s account after the Exercise Date shall be returned to the participant. During a
participant’s lifetime, a participant’s option to purchase shares hereunder is exercisable only by
him or her.

     9. Delivery. As promptly as practicable after each Exercise Date on which a purchase of
shares occurs, the Company shall arrange the delivery to each participant, as appropriate, of a
certificate representing the shares purchased upon exercise of his or her option.

     10. Withdrawal; Termination of Employment.

          (a) A participant may withdraw all but not less than all the payroll deductions credited to
his or her account and not yet used to exercise his or her option under the Plan at any time by
giving written notice to the Company in the form of Exhibit B to this Plan. All of the
participant’s payroll deductions credited to his or her account will be paid to such participant
promptly after receipt of notice of withdrawal and such participant’s option for the Offering
Period will be automatically terminated, and no further payroll deductions for the purchase of
shares will be made for such Offering Period. If a participant withdraws from an Offering Period,
payroll deductions will not resume at the beginning of the succeeding Offering Period unless the
participant delivers to the Company a new subscription agreement.

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          (b) Upon a participant’s ceasing to be an Employee (as defined in Section 2(g) hereof), for
any reason, he or she will be deemed to have elected to withdraw from the Plan and the payroll
deductions credited to such participant’s account during the Offering Period but not yet used to
exercise the option will be returned to such participant or, in the case of his or her death, to
the person or persons entitled thereto under Section 14 hereof, and such participant’s option will
be automatically terminated. The preceding sentence notwithstanding, a participant who receives
payment in lieu of notice of termination of employment shall be treated as continuing to be an
Employee for the participant’s customary number of hours per week of employment during the period
in which the participant is subject to such payment in lieu of notice.

     11. Interest. No interest shall accrue on the payroll deductions of a participant in
the Plan.

     12. Stock.

          
(a) The maximum number of shares of the Company’s Common Stock which shall be made available
for sale under the Plan shall be six hundred and twenty five
thousand (625,000), subject to
adjustment upon changes in capitalization of the Company as provided in Section 18 hereof. If, on
a given Exercise Date, the number of shares with respect to which options are to be exercised
exceeds the number of shares then available under the Plan, the Company shall make a pro rata
allocation of the shares remaining available for purchase in as uniform a manner as shall be
practicable and as it shall determine to be equitable.

          (b) The participant will have no interest or voting right in shares covered by his option
until such option has been exercised.

          (c) Shares to be delivered to a participant under the Plan will be registered in the name of
the participant or in the name of the participant and his or her spouse.

     13. Administration.

          (a) Administrative Body. The Plan shall be administered by the Board or a committee
of members of the Board appointed by the Board. The Board or its committee shall have full and
exclusive discretionary authority to construe, interpret and apply the terms of the Plan, to
determine eligibility and to adjudicate all disputed claims filed under the Plan. Every finding,
decision and determination made by the Board or its committee shall, to the full extent permitted
by law, be final and binding upon all parties.

          (b) Rule 16b-3 Limitations. Notwithstanding the provisions of Subsection (a) of this
Section 13, in the event that Rule 16b-3 promulgated under the Securities Exchange Act of 1934, as
amended (the “Exchange Act”), or any successor provision (“Rule 16b-3”) provides specific
requirements for the administrators of plans of this type, the Plan shall be only administered by
such a body and in such a manner as shall comply with the applicable requirements of Rule 16b-3.
Unless permitted by Rule 16b-3, no discretion concerning decisions regarding the Plan shall be
afforded to any committee or person that is not “disinterested” as that term is used in Rule 16b-3.

     14. Designation of Beneficiary.

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          (a) A participant may file a written designation of a beneficiary who is to receive any shares
and cash, if any, from the participant’s account under the Plan in the event of such participant’s
death subsequent to an Exercise Date on which the option is exercised but prior to delivery to such
participant of such shares and cash. In addition, a participant may file a written designation of
a beneficiary who is to receive any cash from the participant’s account under the Plan in the event
of such participant’s death prior to exercise of the option. If a participant is married and the
designated beneficiary is not the spouse, spousal consent shall be required for such designation to
be effective.

          (b) Such designation of beneficiary may be changed by the participant at any time by written
notice. In the event of the death of a participant and in the absence of a beneficiary validly
designated under the Plan who is living at the time of such participant’s death, the Company shall
deliver such shares and/or cash to the executor or administrator of the estate of the participant,
or if no such executor or administrator has been appointed (to the knowledge of the Company), the
Company, in its discretion, may deliver such shares and/or cash to the spouse or to any one or more
dependents or relatives of the participant, or if no spouse, dependent or relative is known to the
Company, then to such other person as the Company may designate.

     15. Transferability. Neither payroll deductions credited to a participant’s account
nor any rights with regard to the exercise of an option or to receive shares under the Plan may be
assigned, transferred, pledged or otherwise disposed of in any way (other than by will, the laws of
descent and distribution or as provided in Section 14 hereof) by the participant. Any such attempt
at assignment, transfer, pledge or other disposition shall be without effect, except that the
Company may treat such act as an election to withdraw funds from an Offering Period in accordance
with Section 10 hereof.

     16. Use of Funds. All payroll deductions received or held by the Company under the
Plan may be used by the Company for any corporate purpose, and the Company shall not be obligated
to segregate such payroll deductions.

     17. Reports. Individual accounts will be maintained for each participant in the Plan.
Statements of account will be given to participating Employees at least annually, which statements
will set forth the amounts of payroll deductions, the Purchase Price, the number of shares
purchased and the remaining cash balance, if any.

     18. Adjustments Upon Changes in Capitalization, Dissolution, Liquidation, Merger or Asset
Sale.

          (a) Changes in Capitalization. Subject to any required action by the stockholders of
the Company, the Reserves as well as the price per share of Common Stock covered by each option
under the Plan which has not yet been exercised shall be proportionately adjusted for any increase
or decrease in the number of issued shares of Common Stock resulting from a stock split, reverse
stock split, stock dividend, combination or reclassification of the Common Stock, or any other
increase or decrease in the number of shares of Common Stock effected without receipt of
consideration by the Company; provided, however, that conversion of any convertible securities of
the Company shall not be deemed to have been “effected without receipt of consideration”. Such
adjustment shall be made by the Board, whose determination in that respect shall be final, binding
and conclusive. Except as

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expressly provided herein, no issuance by the Company of shares of stock of any class, or
securities convertible into shares of stock of any class, shall affect, and no adjustment by reason
thereof shall be made with respect to, the number or price of shares of Common Stock subject to an
option.

          (b) Dissolution or Liquidation. In the event of the proposed dissolution or
liquidation of the Company, the Offering Periods will terminate immediately prior to the
consummation of such proposed action, unless otherwise provided by the Board.

          (c) Merger or Asset Sale. In the event of a proposed sale of all or substantially all
of the assets of the Company, or the merger of the Company with or into another corporation, each
option under the Plan shall be assumed or an equivalent option shall be substituted by such
successor corporation or a parent or subsidiary of such successor corporation, unless the Board
determines, in the exercise of its sole discretion and in lieu of such assumption or substitution,
to shorten the Offering Periods then in progress by setting a new Exercise Date (the “New Exercise
Date”). If the Board shortens the Offering Periods then in progress in lieu of assumption or
substitution in the event of a merger or sale of assets, the Board shall notify each participant in
writing, at least ten (10) business days prior to the New Exercise Date, that the Exercise Date for
his option has been changed to the New Exercise Date and that his option will be exercised
automatically on the New Exercise Date, unless prior to such date he has withdrawn from the
Offering Period as provided in Section 10 hereof. For purposes of this paragraph, an option
granted under the Plan shall be deemed to be assumed if, following the sale of assets or merger,
the option confers the right to purchase, for each share of option stock subject to the option
immediately prior to the sale of assets or merger, the consideration (whether stock, cash or other
securities or property) received in the sale of assets or merger by holders of Common Stock for
each share of Common Stock held on the effective date of the transaction (and if such holders were
offered a choice of consideration, the type of consideration chosen by the holders of a majority of
the outstanding shares of Common Stock); provided, however, that if such consideration received in
the sale of assets or merger was not solely common stock of the successor corporation or its parent
(as defined in Section 424(e) of the Code), the Board may, with the consent of the successor
corporation, provide for the consideration to be received upon exercise of the option to be solely
common stock of the successor corporation or its parent equal in fair market value to the per share
consideration received by holders of Common Stock and the sale of assets or merger.

     19. Amendment or Termination.

          (a) The Board may at any time and for any reason terminate or amend the Plan. Except as
provided in Section 18 hereof, no such termination can affect options previously granted; provided,
that an Offering Period may be terminated by the Board on any Exercise Date if the Board determines
that the termination of the Plan is in the best interests of the Company and its stockholders.
Except as provided in Section 18 hereof, no amendment may make any change in any option theretofore
granted which adversely affects the rights of any participant. To the extent necessary to comply
with Rule 16b-3 or under Section 423 of the Code (or any successor rule or provision or any other
applicable law or regulation), the Company shall obtain stockholder approval in such a manner and
to such a degree as required.

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          (b) Without stockholder consent and without regard to whether any participant rights may be
considered to have been “adversely affected,” the Board (or its committee) shall be entitled to
change the Offering Periods, limit the frequency and/or number of changes in the amount withheld
during an Offering Period, establish the exchange ratio applicable to amounts withheld in a
currency other than U.S. dollars, permit payroll withholding in excess of the amount designated by
a participant in order to adjust for delays or mistakes in the Company’s processing of properly
completed withholding elections, establish reasonable waiting and adjustment periods and/or
accounting and crediting procedures to ensure that amounts applied toward the purchase of Common
Stock for each participant properly correspond with amounts withheld from the participant’s
Compensation, and establish such other limitations or procedures as the Board (or its committee)
determines in its sole discretion advisable which are consistent with the Plan.

     20. Notices. All notices or other communications by a participant to the Company
under or in connection with the Plan shall be deemed to have been duly given when received in the
form specified by the Company at the location, or by the person, designated by the Company for the
receipt thereof.

     21. Conditions Upon Issuance of Shares. Shares shall not be issued with respect to an
option unless the exercise of such option and the issuance and delivery of such shares pursuant
thereto shall comply with all applicable provisions of law, domestic or foreign, including, without
limitation, the Securities Act of 1933, as amended, the Exchange Act, the rules and regulations
promulgated thereunder, and the requirements of any stock exchange upon which the shares may then
be listed, and shall be further subject to the approval of counsel for the Company with respect to
such compliance.

            As a condition to the exercise of an option, the Company may require the person exercising
such option to represent and warrant at the time of any such exercise that the shares are being
purchased only for investment and without any present intention to sell or distribute such shares
if, in the opinion of counsel for the Company, such a representation is required by any of the
aforementioned applicable provisions of law.

     22. Term of Plan.
 The Plan shall become effective upon the earlier to occur of its
adoption by the Board or its approval by the stockholders of the Company. It shall continue in
effect until December 31, 2015 unless sooner terminated under Section 19 hereof.

     23. Automatic Transfer to Low Price Offering Period. To the extent permitted by Rule
16b-3 of the Exchange Act, if the Fair Market Value of the Common Stock on any Exercise Date in an
Offering Period is lower than the Fair Market Value of the Common Stock on the Enrollment Date of
such Offering Period, then all participants in such Offering Period shall be automatically
withdrawn from such Offering Period immediately after the exercise of their option on such Exercise
Date and automatically re-enrolled in the immediately following Offering Period as of the first day
thereof.

     24. Stockholder Approval. Continuance of the Plan shall be subject to approval by the
stockholders of the Company within twelve (12) months before or after the date the Plan is adopted.

-9-

 

Such stockholder approval shall be obtained in the degree and manner required under applicable
state and federal law.

     25. Financial Reports. The Company shall provide to each Optionee, not less
frequently than annually during the period such Optionee has one or more Options outstanding,
copies of annual financial statements. The Company shall not be required to provide such
statements to key employees whose duties in connection with the Company assure their access to
equivalent information.

-10-

 

EXHIBIT A

NEUROCRINE BIOSCIENCES, INC.

EMPLOYEE STOCK PURCHASE PLAN

SUBSCRIPTION AGREEMENT

			
	 
	                     Original Application
	 	Enrollment Date:                     
	                     Change in Payroll Deduction Rate	 	 
	                     Change of Beneficiary(ies)	 	 

	1.	 	                                         hereby elects to participate in the Neurocrine Biosciences, Inc. Employee Stock Purchase Plan (the “Employee Stock Purchase Plan”) and subscribes to purchase
shares of the Company’s Common Stock in accordance with this Subscription Agreement and the
Employee Stock Purchase Plan.
	 
	2.	 	I hereby authorize payroll deductions from each paycheck in the amount of                     % of my
Compensation on each payday (1-15%) during the Offering Period in accordance with the Employee
Stock Purchase Plan. (Please note that no fractional percentages are permitted.)
	 
	3.	 	I understand that said payroll deductions shall be accumulated for the purchase of shares of
Common Stock at the Purchase Price determined in accordance with the Employee Stock Purchase
Plan. I understand that if I do not withdraw from an Offering Period, any accumulated payroll
deductions will be used to automatically exercise my option.
	 
	4.	 	I have received a copy of the complete “Neurocrine Biosciences, Inc. Employee Stock
Purchase Plan.” I understand that my participation in the Employee Stock Purchase Plan is in
all respects subject to the terms of the Employee Stock Purchase Plan. I understand that my
ability to exercise the option under this Subscription Agreement is subject to obtaining
stockholder approval of the Employee Stock Purchase Plan.
	 
	5.	 	Shares purchased for me under the Employee Stock Purchase Plan should be issued in the
name(s) of (Employee or Employee and spouse only):                                                             .
	 
	6.	 	I understand that if I dispose of any shares received by me pursuant to the Plan within 2
years after the Enrollment Date (the first day of the Offering Period during which I purchased
such shares) or one year after the Exercise Date, I will be treated for federal income tax
purposes as having received ordinary income at the time of such disposition in an amount equal
to the excess of the fair market value of the shares at the time such shares were purchased
over the price which I paid for the shares. I hereby agree to notify the Company in
writing within 30 days after the date of any disposition of my shares and I will make adequate

 

 

	 	 	provision for Federal, state or other tax withholding obligations, if any, which arise
upon the disposition of the Common Stock. The Company may, but will not be obligated to,
withhold from my compensation the amount necessary to meet any applicable withholding
obligation including any withholding necessary to make available to the Company any tax
deductions or benefits attributable to sale or early disposition of Common Stock by me. If I
dispose of such shares at any time after the expiration of the 2-year and 1-year holding
periods, I understand that I will be treated for federal income tax purposes as having
received income only at the time of such disposition, and that such income will be taxed as
ordinary income only to the extent of an amount equal to the lesser of (1) the excess of the
fair market value of the shares at the time of such disposition over the purchase price
which I paid for the shares, or (2) 15% of the fair market value of the shares on the first
day of the Offering Period. The remainder of the gain, if any, recognized on such
disposition will be taxed as capital gain.
	 
	7.	 	I hereby agree to be bound by the terms of the Employee Stock Purchase Plan. The
effectiveness of this Subscription Agreement is dependent upon my eligibility to participate
in the Employee Stock Purchase Plan.
	 
	8.	 	In the event of my death, I hereby designate the following as my beneficiary(ies) to receive
all payments and shares due me under the Employee Stock Purchase Plan:

	 	 	 	 	 	 	 	 	 
	NAME: (Please print)
	 	 	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	(First)
	 	(Middle)
	 	(Last)	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	Relationship	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	(Address)	 	 	 	 	 	 

-2-

 

	 	 	 	 	 
	Employee’s Social
	 	 	 	 
	Security Number:

	 	 

	 	 
	 
	 	 	 	 
	Employee’s Address:

	 	 

	 	 
	 
	 
	 	 	 	 
	 

	 	 

	 	 
	 
	 	 	 	 
	 

	 	 

	 	 

I UNDERSTAND THAT THIS SUBSCRIPTION AGREEMENT SHALL REMAIN IN EFFECT THROUGHOUT SUCCESSIVE OFFERING
PERIODS UNLESS TERMINATED BY ME.

	 	 	 	 	 	 	 	 	 
	Dated:
	 	 	 	 	 	 	 	 
	 

	 	 

	 	 
	 	 

Signature of Employee
	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 

Spouse’s Signature (If beneficiary other than spouse)
	 	 

-3-

 

EXHIBIT B

NEUROCRINE BIOSCIENCES, INC.

EMPLOYEE STOCK PURCHASE PLAN

NOTICE OF WITHDRAWAL

     The undersigned participant in the Offering Period of the Neurocrine Biosciences, Inc. Employee Stock Purchase Plan which began on                                         , 19                     (the “Enrollment Date”) hereby
notifies the Company that he or she hereby withdraws from the Offering Period. He or she hereby
directs the Company to pay to the undersigned as promptly as practicable all the payroll deductions
credited to his or her account with respect to such Offering Period. The undersigned understands
and agrees that his or her option for such Offering Period will be automatically terminated. The
undersigned understands further that no further payroll deductions will be made for the purchase of
shares in the current Offering Period and the undersigned shall be eligible to participate in
succeeding Offering Periods only by delivering to the Company a new Subscription Agreement.

	 	 	 	 	 	 	 
	 	 	Name and Address of Participant:	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	Signature:	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Date:

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