Document:

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EXHIBIT 4.1

CERTIFICATE OF AMENDMENT

TO

CERTIFICATE OF INCORPORATION

OF

ENCYSIVE PHARMACEUTICALS INC.

     Encysive Pharmaceuticals Inc. (the “Corporation”), a corporation organized and existing under
the General Corporation Law of the State of Delaware (the “DGCL”), hereby certifies as follows:

     FIRST: That at a meeting of the Board of Directors of the Corporation on March 1, 2005,
resolutions were duly adopted setting forth a proposed amendment to the Certificate of
Incorporation of the Corporation, declaring said amendment to be advisable and calling a meeting of
the stockholders of the Corporation for consideration thereof. The resolution setting forth the
proposed amendment is as follows:

     RESOLVED, that the introductory paragraph of Article Fourth of the Certificate
of Incorporation of the Corporation be amended and restated in its entirety as
follows:

     FOURTH: The total number of shares of all classes of stock
which the Corporation shall have authority to issue is One Hundred
Fifty Million (150,000,000) shares of common stock (hereinafter
called “Common Stock”), of a par value of one-half of one cent
($.005) per share and Five Million (5,000,000) shares of preferred
stock (hereinafter called “Preferred Stock”) of a par value of
one-half of one cent ($.005) per share.

     SECOND: That thereafter, pursuant to resolution of its Board of Directors, a meeting of the
stockholders of the Corporation was duly called and held, upon notice in accordance with Section
222 of the DGCL, at which meeting the holders of a majority of the shares of issued and outstanding
common stock, par value $.005 per share, of the Corporation voted in favor of the foregoing
amendment.

     THIRD: That the foregoing amendment to the Certificate of Incorporation was duly adopted by
the stockholders of the Corporation on May 11, 2005, pursuant to the applicable provisions of
Section 242 of the DGCL.

[Signature page follows]

 

 

     IN WITNESS WHEREOF, the undersigned, being the duly authorized Secretary of the Corporation,
for the purpose of amending the Certificate of Incorporation of the Corporation pursuant to Section
242 of the DGCL, does make and file this Certificate of Amendment this 11th day of May, 2005.

	 	 	 	 	 
	 	ENCYSIVE PHARMACEUTICALS INC.

 	 
	 	By:  	/s/ Stephen L. Mueller
 	 
	 	 	Stephen L. Mueller, Secretary 	 
	 	 	 	 

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EXHIBIT 4.2

TEKELEC

2005 EMPLOYEE STOCK PURCHASE PLAN

     The following constitutes the provisions of the Tekelec 2005 Employee Stock Purchase Plan (the
“Plan”).

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

     2. Certain Definitions.

          (a) “Board” shall mean the Board of Directors of the Company or any committee thereof
designated by the Board of Directors of the Company in accordance with Section 13 of the Plan.

          (b) “Code” shall mean the Internal Revenue Code of 1986, as amended, and any applicable
regulations promulgated thereunder.

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

          (d) “Compensation,” unless otherwise determined by the Board of Directors of the Company,
means total cash compensation from employment reportable on Form W-2 including, without limitation,
regular straight-time gross earnings, overtime pay, shift premium, incentive compensation, bonuses,
commissions, but expressly excluding expense reimbursements, automobile allowances, relocation
benefits, equity-based compensation, gains realized in connection with the exercise of stock
options or participation in a stock option or purchase programs and contributions by the Company to
qualified deferred compensation plans.

          (e) “Eligible Subsidiary” means any subsidiary that from time to time is expressly designated
by the Board of Directors as being an “Eligible Subsidiary” for purposes of the Plan.

          (f) “Employee” means any person, including an officer, who is customarily employed for more
than 20 hours per week by the Company or its Eligible Subsidiary and more than five 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 shall be deemed to
have terminated on the 91st day of such leave.

 

 

          (g) “Enrollment Date” means the first Trading Day of each Offering Period.

          (h) “Exercise Date” means the last Trading Day of each Purchase Period.

          (i) “Fair Market Value” means, as of any date, the fair market value of one share of Common
Stock, determined as follows:

          (i) If the Common Stock is listed on a national or regional securities exchange or
market system, including without limitation the Nasdaq National Market or The Nasdaq
SmallCap Market of The Nasdaq Stock Market, its fair market value shall be the closing sales
price for such stock (or the mean of the closing bid and asked prices, if no sales were
reported) as reported on such date (or, if such day is not a Trading Day, on the most recent
Trading Day prior to such date) in The Wall Street Journal or such other source as
the Board deems reliable;

          (ii) If the Common Stock is regularly quoted by a recognized securities dealer but
sales prices are not reported, its fair market value shall be the mean of the closing bid
and asked prices for the Common Stock on such date (or, if such day is not a Trading Day, on
the most recent Trading Day prior to such date), as reported in The Wall Street
Journal or such other source as the Board deems reliable; or

          (iii) 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.

          (j) “Offering Periods” shall mean the periods of approximately 24 months during which an
option granted pursuant to the Plan may be exercised, commencing on the first Trading Day on or
after August 1 and February 1 of each year and terminating on the last Trading Day in the period
prior to the 24-month anniversary of such date. The first Offering Period under the Plan shall
commence on August 1, 2005 and shall end on July 31, 2007, unless earlier terminated in accordance
with the terms of this Plan. The duration and timing of Offering Periods may be changed pursuant
to Section 4 of this Plan.

          (k) “Purchase Period” shall mean the approximately six-month periods commencing on the first
Trading Day on or after August 1 and February 1 of each year during
the term of this Plan and ending with the last Trading Day prior to the commencement of the
next Purchase Period. The first Purchase Period of any Offering Period shall commence on the
Enrollment Date and end on the last Trading Day prior to the first day of the next Purchase Period.
The first Purchase Period under the Plan shall commence on August 1, 2005 and end on January 31,
2006.

          (l) “Purchase Price” shall mean 85% of the Fair Market Value of a share of Common Stock on the
Enrollment Date or on the Exercise Date, whichever is lower; provided, however,
that the Purchase Price may be adjusted by the Board pursuant to Section 19.

          (m) “Subsidiary” means any corporation described in Section 424 of the Code in which the
Company owns, directly or indirectly, 50% or more of the voting shares.

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          (n) “Trading Day” shall mean a day on which national stock exchanges and The Nasdaq Stock
Market are open for trading.

     3. Eligibility.

          (a) General Rule. Any Employee, as defined in Section 2, who shall have completed at
least 30 days of continuous employment by the Company or its Eligible Subsidiaries on the date his
or her participation in the Plan is effective shall be eligible to participate in the Plan, subject
to the limitations imposed by Section 423(b) of the Code.

          (b) Exceptions. Any provisions of the Plan to the contrary notwithstanding, no
Employee shall be granted an option under the Plan if:

          (i) immediately after the grant, such Employee (or any other person whose stock
ownership would be attributed to such Employee pursuant to Section 424(d) of the Code) would
own shares and/or hold outstanding options to purchase shares possessing five percent or
more of the total combined voting power or value of all classes of shares of the Company or
of any Subsidiary; or

          (ii) such option would permit the Employee’s rights to purchase shares under all
employee stock purchase plans of the Company and its Subsidiaries to accrue (i.e., become
exercisable) at a rate which exceeds $25,000 of fair market value of such shares (determined
at the time such option is granted) for any calendar year in which such option is
outstanding at any time.

     4. Offering Periods. The Plan shall be implemented by consecutive, overlapping
Offering Periods with a new Offering Period commencing on the first Trading Day on or after August
1 and February 1 of each year, or on such other date as the Board shall determine, and continuing
thereafter until terminated in accordance with Section 20 hereof. The first Offering Period under
the Plan shall commence on August 1, 2005. The Board shall have the power to change the duration of Offering
Periods (including the commencement dates thereof) with respect to future offerings without
shareholder approval if such change is announced at least five days prior to the scheduled
beginning of the first Offering Period to be affected thereafter. Participation in one offering
under the Plan shall neither limit nor require participation in any other offering.

     5. Participation. An eligible Employee may become a participant in the Plan by
completing and signing a subscription agreement authorizing payroll deductions on a form provided
by the Company (the “Subscription Agreement”) and by filing it with the Company’s payroll office
not less than three business days prior to the start of the applicable Offering Period with respect
to which it is to be effective unless a later time for filing the Subscription Agreement has been
set by the Company with respect to a given offering. An Employee’s authorization and participation
in the Plan shall become effective on the first Enrollment Date following the timely filing of his
or her Subscription Agreement and shall remain effective until revoked by the participant by the
filing of a Payroll Deduction Authorization Change or Withdrawal form as described in Section 10(a)
hereof or until changed by the filing of a Payroll Deduction Authorization Change or Withdrawal
form providing for a change in the participant’s payroll deduction rate. An Employee who becomes

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eligible to participate in the Plan after the commencement of an Offering Period or who is eligible
but declines to participate prior to the commencement of such Offering Period may not become a
participant in the Plan until the commencement of the next Offering Period.

     6. Payroll Deductions.

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

          (b) At the time a participant files his or her Subscription Agreement with the Company, he or
she shall elect to have payroll deductions made on each payday during the next Offering Period at a
percentage rate equal to a positive whole number not exceeding 15%, or such other maximum rate as
may be determined from time to time by the Board subject to the provisions of Section 19 hereof, of
the Compensation which would otherwise be payable to such participant on each such payday.

          (c) Payroll deductions for a participant shall commence on the first payday following the date
on which a participant’s payroll deduction authorization becomes effective and shall automatically
continue from Offering Period to Offering Period (and from Purchase Period to Purchase Period
within an Offering Period) until changed or terminated by the participant in accordance with the
terms hereof.

          (d) All payroll deductions authorized by a participant shall be credited to the participant’s
individual account under the Plan. A participant may not make any additional payments into such
account.

          (e) A participant may terminate his or her participation in the Plan at any time prior to the
termination of the Offering Period as provided in Section 10 hereof, or may increase or decrease
the rate of his or her payroll deductions for a future Offering Period or Purchase Period by
completing and filing with the Company at least three business days prior to the start of the next
Purchase Period or Offering Period, as applicable, 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 as of
the first full payday of the next Purchase Period or Offering Period, as applicable. A
participant’s Subscription Agreement shall remain in effect for successive Offering Periods (and
Purchase Periods within an Offering Period) unless terminated as provided in Section 10 hereof.

     7. Grant of Option. On the Enrollment Date of each Offering Period, each participant
in such Offering Period shall automatically be granted an option to purchase on each Exercise Date
during such Offering Period (at the applicable 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
applicable Purchase Price; provided, however, that in no event shall an Employee be
permitted to purchase during each Purchase Period more than a number of shares determined by

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dividing $12,500 by the Fair Market Value of a share of the Company’s Common Stock (subject to any
adjustment pursuant to Section 19) on the Enrollment Date; and provided further that such grant of
options and purchase shall be subject to the limitations set forth in Sections 3(b) and 12 hereof.
The Board may, for future Offering Periods, increase or decrease, in its absolute discretion, the
maximum number of shares of the Company’s Common Stock an Employee may purchase during each
Purchase Period of an Offering Period. Exercise of the option shall occur as provided in Section 8
hereof, unless the participant has withdrawn pursuant to Section 10 hereof. The option shall
expire on the last day of the Offering Period.

     8. Exercise of Option.

          (a) Unless a participant withdraws from the Plan as provided in Section 10, his or her option
for the purchase of shares shall be exercised automatically on each Exercise Date of the Offering
Period, and the accumulated payroll deductions credited to a participant’s account on the Exercise
Date will be applied to purchase whole shares of the Company’s Common Stock (up to the maximum
number subject to option as determined in Section 7 hereof) at the Purchase Price. Any amount
credited to a participant’s account and not applied to the purchase of Common Stock by reason of
the limitation on the number of shares subject to option shall be refunded promptly to such
participant after the Exercise Date, provided that any amount
remaining in a participant’s account and representing a fractional share shall be carried over
and applied to the purchase of shares in the subsequent Purchase Period or Offering Period if the
participant participates in the subsequent offering. During his or her lifetime, a participant’s
option to purchase shares hereunder is exercisable only by the participant.

          (b) If the Board determines that, on a given Enrollment Date or Exercise Date, the number of
shares with respect to which options are to be granted or exercised, as applicable, may exceed (i)
the number of shares of Common Stock that were available for sale under the Plan on the Enrollment
Date of the applicable Offering Period, or (ii) the number of shares available for sale under the
Plan on such Exercise Date, the Board may in its sole discretion (x) provide that the Company shall
make a pro rata allocation of the shares of Common Stock available for grant or purchase on such
Enrollment Date or Exercise Date, as applicable, in as uniform a manner as shall be practicable and
as it shall determine in its sole discretion to be equitable among all participants granted options
to purchase Common Stock on such Enrollment Date or exercising options to purchase Common Stock on
such Exercise Date, as applicable, and continue all Offering Periods then in effect, or (y) provide
that the Company shall make a pro rata allocation of the shares available for grant or purchase on
such Enrollment Date or Exercise Date, as applicable, in as uniform a manner as shall be
practicable and as it shall determine in its sole discretion to be equitable among all participants
granted options to purchase Common Stock on such Enrollment Date or exercising options to purchase
Common Stock on such Exercise Date, and terminate any or all Offering Periods then in effect
pursuant to Section 19 hereof. The Company may make a pro rata allocation of the shares available
on the Enrollment Date of any applicable Offering Period pursuant to the preceding sentence,
notwithstanding any authorization of additional shares for issuance under the Plan by the Company’s
shareholders subsequent to such Enrollment Date. In the event of any pro rata allocation of
shares, the Company shall give written notice of such

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allocation to each participant affected
thereby and shall reduce the rate of payroll deductions, if necessary.

     9. Delivery; Holding Period. As promptly as practicable after each Exercise Date on
which a purchase of shares occurs, the Company shall arrange for the issuance and delivery to, or
credit to the account of, each participant, as appropriate, of the shares purchased upon exercise
of his or her option. At the election of the Company, the issuance and delivery of the shares
purchased upon exercise of a participant’s option may be effected by transfer (electronic or
otherwise in the discretion of the Company) of such shares to a securities account maintained in
the participant’s name. The shares purchased upon exercise of any option granted to a participant
may not be assigned, transferred, pledged or otherwise disposed of in any way (other than by will
or by the laws of descent and distribution) for a period of 90 days following the exercise of the
option; provided, however, that the Board of Directors may, in its sole discretion,
permit an assignment, transfer, pledge or other disposition of such shares at such other time as
the Company’s Board of Directors may determine in the event that the participant has suffered a
hardship, as determined by the Company’s Board of Directors in its sole discretion. Shares
purchased upon exercise of any option granted to a participant and subject to the above
restrictions may include a legend
indicating that such shares may not be transferred, pledged or otherwise disposed of for 90
days from the date of issue.

     10. Withdrawal; Termination of Employment.

          (a) A participant may terminate his or her participation in an offering under the Plan and
withdraw all, but not less than all, of the payroll deductions credited to his or her account under
the Plan at any time prior to an Exercise Date by giving written notice of withdrawal to the
Company on a Payroll Deduction Authorization Change or Withdrawal form provided for such purpose.
In such case, all of the participant’s payroll deductions credited to his or her account shall be
paid to him or her promptly after receipt of his or her notice of withdrawal, his or her option for
the Offering Period shall be automatically canceled, and no further payroll deductions for the
purchase of shares shall be made for such Offering Period. If a participant withdraws from an
Offering Period, payroll deductions shall not resume at the beginning of the succeeding Offering
Period unless the participant delivers to the Company a new Subscription Agreement in accordance
with Section 5 hereof.

          (b) A participant may terminate his or her participation in the Plan effective as of the first
day of the next Purchase Period or Offering Period by giving written notice of withdrawal to the
Company on a Payroll Deduction Authorization Change or Withdrawal form provided for such purpose.
In such case, the participant’s payroll deductions will continue through the end of the Purchase
Period or Offering Period in which the notice of withdrawal is given, all amounts deducted from the
participant’s Compensation during such Purchase Period or Offering Period will be applied to the
purchase of Common Stock pursuant to the Plan, and following such termination of participation no
further payroll deductions for the purchase of shares shall be made except pursuant to a new
Subscription Agreement delivered in accordance with Section 5 hereof.

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          (c) Upon termination of a participant’s employment for any reason, including retirement or
death, as soon as practicable after such termination, the payroll deductions credited to his or her
account shall be returned to him or her or, in the case of his or her death, to the person or
persons entitled thereto under Section 14, and his or her option shall be automatically canceled.

          (d) In the event an Employee fails to remain in the continuous employ of the Company or its
Eligible Subsidiaries for more than 20 hours per week during the Offering Period in which the
Employee is a participant, he or she will be deemed to have elected to withdraw from the Plan and
the payroll deductions credited to his or her account will be returned to him or her and his or her
option will be canceled.

          (e) A participant’s withdrawal from an offering shall not have any effect upon his or her
eligibility to participate in a subsequent offering or in any similar plan which may hereafter be
adopted by the Company.

     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 1,000,000 shares, subject to adjustment upon changes in
capitalization of the Company as provided in Section 18(a) hereof, together with a cumulative
annual increase to the number of shares reserved for issuance thereunder on August 1, 2006 and on
each August 1 thereafter equal to the lesser of (i) 500,000 shares, (ii) 1% of the number of
outstanding shares of Common Stock of the Company on the date of such increase or (iii) such amount
as may be determined by the Board. The shares to be sold to participants in the Plan will be
authorized but unissued shares. Upon the cancellation of any option granted under the Plan, the
shares subject thereto shall return to the Plan and become available for options thereafter granted
under the Plan.

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

          (c) Shares to be delivered to a participant under the Plan shall, as specified in the
participant’s Subscription Agreement, be registered in the name of the participant or in the name
of the participant and his or her spouse.

     13. Administration. 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 fullest extent
permitted by law, be final and binding upon all parties.

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     14. Designation of Beneficiary.

          (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 the Exercise Date on which an option is exercised but prior to delivery to him
or her 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 valid designation of a
beneficiary 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, pursuant to a qualified domestic relations order as defined by the Code
or Title I of the Employee Retirement Income Security Act, or the rules thereunder, 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 on behalf of
a participant 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.
Individual statements of account will be given to participating Employees at least annually, which
statements shall set forth the amounts of payroll deductions, the Purchase Price, the number of
shares purchased and the remaining cash balance, if any, in a participant’s account.

     18. Adjustments upon Changes in Capitalization or Control.

          (a) Changes in Capitalization. Subject to any required action by the shareholders of
the Company, the number of shares of Common Stock covered by each option under the Plan which has
not yet been exercised and the number of shares of Common Stock which has been authorized for
issuance under the Plan but has not yet been placed under option or which has been returned to the
Plan upon the cancellation of an option, as well as the option price per share of Common Stock
covered by each option under the Plan which has not yet been
exercised, shall be

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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 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
expressly provided herein, no issue 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 option.

          (b) Dissolution or Liquidation. In the event of the proposed dissolution or
liquidation of the Company, the Offering Period then in progress shall be shortened by setting a
new Exercise Date (the “New Exercise Date”), and shall terminate immediately prior to the
consummation of such proposed dissolution or liquidation, unless provided otherwise by the Board.
The New Exercise Date shall be before the date of the Company’s proposed dissolution or
liquidation. The Board shall notify each participant in writing, at least ten business days prior
to the New Exercise Date, that the Exercise Date for the participant’s option has been changed to
the New Exercise Date and that the participant’s option shall be exercised automatically on the New
Exercise Date, unless prior to such date the participant has withdrawn from the Offering Period as
provided in Section 10 hereof.

          (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
outstanding option shall be assumed or an equivalent option substituted by the successor
corporation or a parent or subsidiary of the successor corporation. In the event that the
successor corporation refuses to assume or substitute for the option, any Purchase Periods then in
progress shall be shortened by setting a new Exercise Date (the “Modified Exercise Date”) and any
Offering Periods then in progress shall end on the Modified Exercise Date. The Modified Exercise
Date shall be before the date of the Company’s proposed sale or merger. The Board shall notify
each participant in writing, at least ten business days prior to the Modified Exercise Date, that
the Exercise Date for the participant’s option has been changed to the Modified Exercise Date and
that the participant’s option shall be exercised automatically on the Modified Exercise Date,
unless prior to such date the participant has withdrawn from the Offering Period as provided in
Section 10 hereof.

          (d) No fractional shares of Common Stock shall be issuable on account of any adjustment
described herein, and the aggregate number of shares into which shares then covered by an option,
when changed as the result of such adjustment, shall be reduced to the largest number of whole
shares resulting from such adjustment, unless the Board, in its sole discretion, shall determine to
issue scrip certificates in respect to any fractional shares, which scrip certificates, in such
event, shall be in a form and have such terms and conditions as the Board in its discretion shall
prescribe.

     19. Amendment or Termination. The Board of Directors of the Company may at any time and for any reason terminate or amend
the Plan. Except as provided in Section 18 hereof, no

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such termination can affect options
previously granted, provided that an Offering Period may be terminated by the Board of Directors on
any Exercise Date if the Board determines that the termination of the Offering Period or the Plan
is in the best interests of the Company and its shareholders. Except as provided in Section 18 and
this Section 19, no amendment may make any change in any option theretofore granted which adversely

affects the rights of any participant without the prior written consent of such participant:

          (a) To the extent necessary to comply with Section 423 of the Code (or any successor rule or
provision or any other applicable law, regulation or stock exchange rule), the Company shall obtain
shareholder approval of any amendment to the Plan in such a manner and to such a degree as is
required.

          (b) Without shareholder approval 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.

          (c) In the event the Board determines that the ongoing operation of the Plan may result in
unfavorable financial accounting consequences, the Board may, in its discretion and to the extent
necessary or desirable, modify or amend the Plan to reduce or eliminate such accounting consequence
including, but not limited to:

          (i) altering the Purchase Price for any Offering Period including an Offering Period
underway at the time of the change in Purchase Price;

          (ii) shortening any Offering Period so that Offering Period ends on a new Exercise
Date, including an Offering Period underway at the time of the Board action; and

          (iii) allocating shares.

          Such modifications or amendments shall not require shareholder approval or the consent of any
Plan participants.

     20. Term of Plan. The Plan shall become effective upon its approval by vote of the outstanding shares of the
Company as provided in Section 22. The Plan shall continue in effect for a term of ten years
following the date of approval of the Plan by the Board of Directors unless sooner terminated under
Sections 19 or 22 hereof.

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     21. Notices. All notices or other communications (i) by a participant to the Company
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 and (ii) by the Company to a participant in connection with the Plan shall be
deemed to have been duly given when received by the participant or, if earlier, five days after
deposit in the United States mail by certified or registered mail, return receipt requested, first
class postage prepaid, addressed to the participant at his or her address as shown on the records
of the Company or as such participant may request by written notice to the Company hereunder.

     22. Shareholder Approval. Notwithstanding anything to the contrary herein, the
effectiveness of the Plan shall be expressly subject to approval by the Company’s shareholders
prior to August 31, 2005 by the affirmative vote of the holders of a majority of the outstanding
shares of stock of the Company present or represented and entitled to vote thereon at a shareholder
meeting duly held or by written consent in accordance with applicable law.

     23. Automatic Transfer to Low Price Offering Period. To the extent permitted by any
applicable laws, regulations or stock exchange or market system rules, 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 in accordance with the terms and conditions
of their Subscription Agreement then in effect.

     24. No Enlargement of Employee Rights. The Plan is purely voluntary on the part of
the Company, and the continuance of the Plan shall not be deemed to constitute a contract between
the Company and any Employee, or to be consideration for or a condition of the employment of any
Employee. Nothing contained in this Plan shall be deemed to give any Employee the right to be
retained in the employ of the Company, its parent, any Subsidiary or a successor corporation, or to
interfere with the right of the Company or any such corporations to discharge or retire any
Employee thereof at any time. No Employee shall have any right to or interest in options
authorized hereunder prior to the grant of an option to such Employee, and upon such grant he or
she shall have only such rights and
interests as are expressly provided herein, subject, however, to all applicable provisions of
the Company’s Articles of Incorporation, as the same may be amended from time to time.

     25. Information to Participants. The Company shall provide without charge to each
participant in the Plan copies of such annual and periodic reports as are provided by the Company
to its shareholders generally.

     26. Governing Law. To the extent that federal laws do not otherwise control, the Plan
and all determinations made or actions taken pursuant hereto shall be governed by the laws of the
State of California, without regard to the conflicts of laws rules thereof.

     27. Tax Withholding. If at any time the Company or any Eligible Subsidiary is
required, under applicable laws and regulations, to withhold, or to make any deduction of, any
taxes or take

11

 

any other action in connection with any exercise of an option granted hereunder or
any disposition of shares of Common Stock issued hereunder, the participant must make adequate
provision for the Company’s federal, state or other tax withholding obligations which arise from
such exercise or disposition. The Company or such Eligible Subsidiary shall have the right to
deduct or withhold from the participant’s compensation the amount necessary for the Company or such
Eligible Subsidiary to meet applicable withholding obligations.

     28. Securities Law Compliance. No shares of Common Stock may be issued upon the
exercise of any option under the Plan until all requirements of applicable federal, state, foreign
or other securities laws with respect to the purchase, sale and issuance of shares of Common Stock
shall have been satisfied. If any action must be taken because of such requirements, then the
purchase, sale and issuance of shares shall be postponed until such action can reasonably be taken.
Upon request by the Company, an Employee shall deliver to the Company such information,
representations or undertakings as the Company may reasonably request in order to comply with any
registration requirements or exemptions therefrom of applicable securities laws. The Company may
require any securities so issued to bear a legend, may give its transfer agent instructions, and
may take such other steps as in its judgment are reasonably required to prevent any violation of
applicable securities laws.

*     *    *

12

 

TEKELEC

2005 EMPLOYEE STOCK PURCHASE PLAN

FORM OF

SUBSCRIPTION AGREEMENT

Instructions: Please print or type all information except your signature.

	 	 	 	 	 	 	 	 	 
	Name:
	 	 	 	 	 	 	 	 
	 	 	 
	

	 	 	 	First
	 	Middle
	 	Last
	Address:
	 	 	 	 	 	 	 	 
	 	 	 

	 	 	 
	Social Security No.:

	 	                                 —                                  —                                 

	 	 	 	 	 	 	 
	Employee No.:

	 	 	 	Employment Start Date:	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

ORIGINAL APPLICATION

	1.  	I hereby elect to participate in the Tekelec 2005 Employee Stock Purchase Plan (the “Plan”)
in accordance with this Subscription Agreement and subject to the terms and conditions of the
Plan.

	2.  	I hereby authorize Tekelec to make regular payroll deductions, at the rate indicated below
and in accordance with the terms of the Plan, from the total Compensation (as defined in the
Plan) including overtime, bonuses, commissions and other earnings, if any, paid to me during
each offering period during which I remain a participant in the Plan:

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	 	(circle one)
	 	 	1	%	 	 	2	%	 	 	3	%	 	 	4	%	 	 	5	%	 	 	6	%	 	 	7	%	 	 	8	%	 	 	9	%
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	10	%	 	 	11	%	 	 	12	%	 	 	13	%	 	 	14	%	 	 	15	%	 	of compensation	 	 	 	 

	3.  	I understand that payroll deductions at the indicated rate will continue from offering period
to offering period unless I become ineligible to participate in the Plan or I file the Payroll
Deduction Authorization Change or Withdrawal portion of this form below.

	4.  	I understand that the deducted amounts will be applied automatically to the purchase of shares of Tekelec Common Stock at the end of each offering period unless I elect to cancel my
option and withdraw from the Plan by filing the Payroll Deduction Authorization Change or
Withdrawal portion of this form below.

	5.  	I hereby acknowledge that I have received and read a copy of Tekelec’s most recent Prospectus
describing the terms and provisions of the Plan and understand the information therein and the
risks of participating in the Plan.

 

 

	 	 	 	 	 
	6.

	 	Shares purchased for me under the Plan should be issued in the name(s) of:	 	 
	

	 	 	 	 
	 
	 	 	 	 
	 
	 
	 	 	 	 
	7.	 	I hereby agree to be bound by the terms of the Plan. The effectiveness of this Subscription
Agreement is dependent upon my eligibility to participate in the Plan.
	 
	 	 	 	 
	8.	 	I will promptly (a) notify Tekelec if I have sold, transferred, gifted or otherwise disposed
of any shares purchased for me under the Plan at any time within two years after the end of
the offering period in which such shares were purchased and (b) provide Tekelec with all
requested information regarding such transaction.
	 
	 	 	 	 
	9.	 	In the event of my death before the end of an offering period, I hereby designate as my
beneficiary(ies) to receive all payments and shares due me under the Plan:

	 	 	 	 	 	 	 	 	 
	Name: (Please print)	 	 	 	 	 	 
	 	 	 	 	 
	

	 	 	 	First
	 	Middle
	 	Last
	 
	 	 	 	 	 	 	 	 
	 	 	 
	Relationship	 	Address	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 
	

	 	 	 	City
	 	State
	 	Zip Code
	 
	 	 	 	 	 	 	 	 
	Name: (Please print)	 	 	 	 	 	 
	 	 	 	 	 
	

	 	 	 	First
	 	Middle
	 	 Last
	 
	 	 	 	 	 	 	 	 
	 	 	 
	Relationship	 	Address	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 
	

	 	 	 	City
	 	State
	 	Zip Code
	 
	 	 	 	 	 	 	 	 
	Date:
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	Signature of Employee
	 
	 	 	 	 	 	 	 	 
	 

ELECTION NOT TO PARTICIPATE

     I hereby acknowledge receipt of a copy of Tekelec’s most recent Prospectus which describes the
Tekelec 2005 Employee Stock Purchase Plan and elect not to participate in the Plan. I understand
that my decision not to participate in the next offering under the Plan will not affect my
eligibility to participate in subsequent offerings under the Plan.

	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Date:
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 	 	 	 	 	 	Signature of Employee
	 
	 	 	 	 	 	 	 	 
	 

(To be completed by Tekelec)

	 	 	 	 	 	 	 	 	 
	Date Received:

	 	 	 	 	 	Approved by:	 	 
	

	 	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 

 

 

TEKELEC

2005 EMPLOYEE STOCK PURCHASE PLAN

FORM OF

PAYROLL DEDUCTION AUTHORIZATION CHANGE OR WITHDRAWAL

        I am now a participant in the Tekelec 2005 Employee Stock Purchase Plan (the “Plan”) and I
wish to make the change indicated below (check one):

	 	 	 	 	 
	o

	 	A.
	 	Change in Payroll Deduction Rate: I hereby authorize the following new rate of
payroll deduction, effective as of the first payday of the next Purchase Period (such
change must be filed with the Company at least three days prior to the start of the
Purchase Period with respect to which it is to be effective):

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	 	(circle one)
	 	 	1	%	 	 	2	%	 	 	3	%	 	 	4	%	 	 	5	%	 	 	6	%	 	 	7	%	 	 	8	%	 	 	9	%
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	10	%	 	 	11	%	 	 	12	%	 	 	13	%	 	 	14	%	 	 	15	%	 	of compensation	 	 	 	 

	 	 	 	 	 
	o

	 	B.
	 	Withdrawal from Plan and Immediate Cancellation of Option: I hereby
elect to cancel my participation in the Plan effective immediately and to cancel my
option to purchase Tekelec Common Stock under the Plan and request that all amounts
withheld from me through payroll deductions relating to the canceled option be refunded
to me. I understand that cancellation of my option will be effective only if this form
is filed with the Company prior to the close of the current Purchase Period. I
understand that if I wish to participate in the Plan following my cancellation and
withdrawal from the Plan, I must re-enroll by filing a new Subscription Agreement with
the Company at least three business days prior to the start of the Offering Period with
respect to which it is to be effective.

	 	 	 	 	 
	o

	 	C.
	 	Withdrawal from Plan without Cancellation of Option in Current Purchase
Period. I hereby elect to cancel my participation in the Plan effective as of the
first day of the next Purchase Period. However, I request that my previously
authorized payroll deductions continue through the end of the current Purchase Period
and that all amounts deducted from my Compensation during the current Purchase Period
be applied to the purchase of Tekelec Common Stock pursuant to the Plan. I understand
that if I wish to participate in the Plan following my cancellation and withdrawal from
the Plan, I must re-enroll by filing a new Subscription Agreement with the Company at
least three business days prior to the start of the Offering Period with respect to
which it is to be effective.

	 	 	 	 	 	 	 	 	 	 	 
	Date:
	 	 	 	 	 	 	 	 	 	 
	

	 	 
	 	 	 	 	 	 	 	 
	

	 	 	 	 	 	 	 	Signature of Employee	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	

	 	 	 	 	 	Print Name:	 	 	 	 
	

	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

(To be completed by Tekelec)

	 	 	 	 	 	 	 	 	 
	Date Received:

	 	 	 	 	 	Approved by:

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