Document:

exhibit10_4.htm

    EXHIBIT
      10.4

    

    

    SECOND
      AMENDED AND RESTATED

    POZEN
      INC. 2000 EQUITY COMPENSATION PLAN

    

    NONQUALIFIED
      STOCK OPTION GRANT

    [For
      Non-Employee Directors]

    

    This
      STOCK OPTION GRANT, dated as of [insert date of grant] (the
“Date of Grant”), is delivered by POZEN Inc. (the “Company”) to
      _________________ (the “Grantee”).

    

    RECITALS

    

    The
      Amended and Restated POZEN Inc. 2000 Equity Compensation Plan (the “Plan”),
      provides for the grant of options to purchase shares of common stock of the
      Company.  The Compensation Committee (the “Committee”) of the Board of
      Directors has decided to make a stock option grant as an inducement for the
      Grantee to promote the best interests of the Company and its
      stockholders.  A copy of the Plan is attached.

    

    NOW,
      THEREFORE, the parties to this Agreement, intending to be legally bound hereby,
      agree as follows:

    

    1.           Grant
      of Option.  Subject to the terms and conditions set forth in this
      Agreement and in the Plan, the Company hereby grants to the Grantee a
      nonqualified stock option (the “Option”) to purchase ________ shares of common
      stock of the Company (“Shares”) at an exercise price of $_____ per Share which
      represents the Fair Market Value (as defined in the Plan) of the underlying
      common stock of the Company on the Date of Grant.  The Option shall
      become exercisable according to Paragraph 2 below.

    

    2.           Exercisability
      of Option.  The Option shall vest and become exercisable on the
      following date(s), if the Grantee is employed by, or providing service to,
      the
      Company (as defined in the Plan) on the applicable date:

    

    [Insert
      applicable vesting date(s) or schedule below]

    

    

    [The
      exercisability of the Option is cumulative.  If the foregoing schedule
      would produce fractional shares, the number of Shares as to which the Option
      shall become exercisable shall be rounded down to the nearest whole share,
      with
      all Shares being exercisable on [insert final vesting
      date].]

    

    
      
        
        

      

      
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              3.

            	
              Term
                of Option.

            

    

    

    (a)           The
      Option shall have a term of ten years from the Date of Grant and shall terminate
      at the expiration of that period, unless it is terminated at an earlier date
      pursuant to the provisions of this Agreement or the Plan.

    

    (b)           The
      Option shall automatically terminate upon the happening of the first of the
      following events:

    

    (i)           The
      expiration of the three-year period after the Grantee ceases to be employed
      by,
      or provide service to, the Company (as defined in the Plan) for any reason,
      including Disability (as defined in the Plan) or death, but other than for
      Cause
      (as defined in the Plan).

    

    (ii)           The
      date on which the Grantee ceases to be employed by, or provide service to,
      the
      Company for Cause.  In addition, notwithstanding the prior provisions
      of this Paragraph 3, if the Grantee engages in conduct that constitutes Cause
      after the Grantee’s employment or service terminates, the Option shall
      immediately terminate.

    

    Notwithstanding
      the foregoing, in no event may the Option be exercised after the date that
      is
      ten years from the Date of Grant.  Any portion of the Option that is
      not exercisable at the time the Grantee ceases to be employed by, or provide
      service to, the Company shall immediately terminate, unless otherwise determined
      by the Board of Directors of the Company or the Committee at the time of such
      termination of service to the Company.

    

    4.           Exercise
      Procedures.

    

    (a)           Subject
      to the provisions of Paragraphs 2 and 3 above, the Grantee may exercise part
      or
      all of the exercisable Option by giving the Company written notice of intent
      to
      exercise in the manner provided in this Agreement, specifying the number of
      Shares as to which the Option is to be exercised.  On the delivery
      date, the Grantee shall pay the exercise price (i) in cash, (ii) with the
      approval of the Committee, by delivering Shares of the Company which shall
      be
      valued at their fair market value on the date of delivery, (iii) payment through
      a broker in accordance with procedures permitted by Regulation T of the Federal
      Reserve Board, or (iv) by such other method as the Committee may
      approve.  The Committee may impose from time to time such limitations
      as it deems appropriate on the use of Shares of the Company to exercise the
      Option.

    
      
        
        

      

      
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          2
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    (b)           The
      obligation of the Company to deliver Shares upon exercise of the Option shall
      be
      subject to all applicable laws, rules, and regulations and such approvals by
      governmental agencies as may be deemed appropriate by the Committee, including
      such actions as Company counsel shall deem necessary or appropriate to comply
      with relevant securities laws and regulations.  The Company may
      require that the Grantee (or other person exercising the Option after the
      Grantee’s death) represent that the Grantee is purchasing Shares for the
      Grantee’s own account and not with a view to or for sale in connection with any
      distribution of the Shares, or such other representation as the Committee deems
      appropriate.  All obligations of the Company under this Agreement
      shall be subject to the rights of the Company as set forth in the Plan to
      withhold amounts required to be withheld for any taxes, if
      applicable.  Subject to Committee approval, the Grantee may elect to
      satisfy any income tax withholding obligation of the Company with respect to
      the
      Option by having Shares withheld up to an amount that does not exceed the
      minimum applicable withholding tax rate for federal (including FICA), state
      and
      local tax liabilities.

    

    5.           Change
      of Control.  The provisions of the Plan applicable to a Change of
      Control shall apply to the Option, and, in the event of a Change of Control,
      the
      Committee may take such actions as it deems appropriate pursuant to the
      Plan.

    

    6.           Restrictions
      on Exercise.  Only the Grantee may exercise the Option during the
      Grantee’s lifetime and, after the Grantee’s death, the Option shall be
      exercisable (subject to the limitations specified in the Plan) solely by the
      legal representatives of the Grantee, or by the person who acquires the right
      to
      exercise the Option by will or by the laws of descent and distribution, to
      the
      extent that the Option is exercisable pursuant to this Agreement.

    

    7.           Grant
      Subject to Plan Provisions.  This grant is made pursuant to the
      Plan, the terms of which are incorporated herein by reference, and in all
      respects shall be interpreted in accordance with the Plan.  The grant
      and exercise of the Option are subject to the provisions of the Plan and to
      interpretations, regulations and determinations concerning the Plan established
      from time to time by the Committee in accordance with the provisions of the
      Plan, including, but not limited to, provisions pertaining to (i) rights and
      obligations with respect to withholding taxes, (ii) the registration,
      qualification or listing of the Shares, (iii) changes in capitalization of
      the
      Company, and (iv) other requirements of applicable law.  The Committee
      shall have the authority to interpret and construe the Option pursuant to the
      terms of the Plan, and its decisions shall be conclusive as to any questions
      arising hereunder.

    

    8.           No
      Employment or Other Rights.  The grant of the Option shall not
      confer upon the Grantee any right to be retained by or in the employ or service
      of the Company and shall not interfere in any way with the right of the Company
      to terminate the Grantee’s employment or service at any time.  The
      right of the Company to terminate at will the Grantee’s employment or service at
      any time for any reason is specifically reserved.

    
      
        
        

      

      
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    9.           No
      Stockholder Rights.  Neither the Grantee, nor any person entitled
      to exercise the Grantee’s rights in the event of the Grantee's death, shall have
      any of the rights and privileges of a stockholder with respect to the Shares
      subject to the Option, until certificates for Shares have been issued upon
      the
      exercise of the Option.

    

    10.           Assignment
      and Transfers.  The rights and interests of the Grantee under this
      Agreement may not be sold, assigned, encumbered or otherwise transferred except,
      in the event of the death of the Grantee, by will or by the laws of descent
      and
      distribution.  In the event of any attempt by the Grantee to alienate,
      assign, pledge, hypothecate, or otherwise dispose of the Option or any right
      hereunder, except as provided for in this Agreement, or in the event of the
      levy
      or any attachment, execution or similar process upon the rights or interests
      hereby conferred, the Company may terminate the Option by notice to the Grantee,
      and the Option and all rights hereunder shall thereupon become null and
      void.  The rights and protections of the Company hereunder shall
      extend to any successors or assigns of the Company and to the Company’s parents,
      subsidiaries, and affiliates.  This Agreement may be assigned by the
      Company without the Grantee’s consent.

    

    11.           Applicable
      Law.  The validity, construction, interpretation and effect of
      this instrument shall be governed by and construed in accordance with the laws
      of the State of Delaware, without giving effect to the conflicts of laws
      provisions thereof.

    

    12.           Notice.  Any
      notice to the Company provided for in this instrument shall be addressed to
      the
      Company in care of the Vice President, Finance and Administration, at 1414
      Raleigh Road, Suite 400, Chapel Hill, N.C. 27517, and any notice to the Grantee
      shall be addressed to such Grantee at the current address shown on the payroll
      of the Company, or to such other address as the Grantee may designate to the
      Company in writing.  Any notice shall be delivered by hand, sent by
      telecopy or enclosed in a properly sealed envelope addressed as stated above,
      registered and deposited, postage prepaid, in a post office regularly maintained
      by the United States Postal Service.

    

    

    

    

    

    

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    IN
      WITNESS WHEREOF, the Company has caused its duly authorized officer to execute
      this Agreement, and the Grantee has executed this Agreement, effective as of
      the
      Date of Grant.

    

    

    
      	 	
              POZEN
                INC.

            
	 	 	 
	 	 	 
	 	 	 
	 	
              By:

            	 
	 	
              Its:

            	 
	 	 	 
	 	 	 
	 	 	 
	 	
              Accepted:

            	 
	 	 	
              [Grantee]

            

    

    

    
      
        
        

      

      
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          -exhibit10_5.htm

    EXHIBIT
      10.5

    

    

    SECOND
      AMENDED AND RESTATED

    POZEN
      INC. 2000 EQUITY COMPENSATION PLAN

    

    RESTRICTED
      STOCK UNIT AGREEMENT

    [For
      Non-Employee Directors]

    

    This
      RESTRICTED STOCK UNIT AGREEMENT (the “Agreement”), dated as of _________, 20__
      (the “Date of Grant”), is delivered by POZEN Inc. (“POZEN” or the “Company”), to
      _________________ (the “Grantee”).

     

    RECITALS

     

    The
      Second Amended and Restated POZEN Inc. 2000 Equity Compensation Plan (the
“Plan”) provides for the grant of stock-based awards with respect to shares of
      common stock, par value $0.001 per share, of POZEN (the “Common Stock”), in
      accordance with the terms and conditions of the Plan.  The
      Compensation Committee of the Board of Directors of POZEN (the “Committee”) has
      decided to make a stock-based award in the form of a grant of restricted stock
      units, subject to the terms and conditions set forth in this Agreement and
      the
      Plan, as an inducement for the Grantee to promote the best interests of POZEN
      and its stockholders.  The Grantee may receive a copy of the Plan by
      contacting the Department of Finance and Administration at POZEN.

     

    NOW,
      THEREFORE, the parties to this Agreement, intending to be legally bound hereby,
      agree as follows:

     

    1.  Grant
      of Restricted Units.  Subject to the terms and conditions set
      forth in this Agreement and the Plan, POZEN hereby grants to the Grantee
      ____________________ restricted stock units (the “Restricted Units”) under the
      Plan.  The Grantee accepts the Restricted Units and agrees to be bound
      by the terms and conditions of this Agreement and the Plan with respect to
      the
      Restricted Units.

     

    
      
        
        

      

      
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    2.  Restricted
      Unit Account.  Restricted Units represent hypothetical shares of
      Common Stock, and not actual shares of stock.  POZEN shall establish
      and maintain a Restricted Unit account, as a bookkeeping account on its records,
      for the Grantee and shall record in such account the number of Restricted Units
      granted to the Grantee.  No shares of stock shall be issued to the
      Grantee at the time the grant is made, and the Grantee shall not be, nor have
      any of the rights or privileges of, a stockholder of POZEN with respect to
      any
      Restricted Units recorded in the account.  The Grantee shall not have
      the right to receive any dividends or other distributions with respect to
      hypothetical shares of stock recorded in the Restricted Unit account; provided,
      however, that the Committee shall appropriately adjust the number and kind
      of
      Restricted Units in the event of a stock split, stock dividend or other change
      in capitalization of POZEN as described in the Plan.  The Grantee
      shall not have any interest in any fund or specific assets of POZEN by reason
      of
      this award or the Restricted Unit account established for the
      Grantee.

     

    3.  Lapse
      of Restrictions.

     

    (a)  The
      Restricted Units shall be subject to forfeiture until the restrictions on the
      Restricted Units lapse.  The restrictions on the Restricted Units
      shall lapse, and the Restricted Units shall become vested, on the earlier of:
      (i) the date of the first anniversary of the Date of Grant, and (ii) the date
      of
      the Company’s next Annual Meeting of Stockholders subsequent to the Date of
      Grant, provided in each case that the Grantee continues to be employed by,
      or
      provide service to, the Company (as defined in the Plan) at such
      date.

     

    (b)  When
      the
      restrictions on the Restricted Units lapse as described above, such Restricted
      Units shall be vested and shall no longer be subject to
      forfeiture.  The Company shall pay to the Grantee whole shares of
      Common Stock equal to the number of vested whole Restricted Units as described
      in Paragraph 5 below.

     

    4.  Termination
      of Restricted Units.  If the Grantee ceases to be employed by, or
      provide service to, the Company for any reason before the restrictions on all
      the Restricted Units lapse, any Restricted Units for which the restrictions
      have
      not lapsed according to the vesting schedule above shall automatically terminate
      and shall be forfeited as of the date of the Grantee’s termination of employment
      or service unless otherwise determined by the Board of Directors of POZEN or
      the
      Committee at the time of termination of Grantee’s service to the
      Company.  No payment shall be made with respect to any Restricted
      Units that terminate as described in this Paragraph 4.

     

    5.  Payment
      of Restricted Units.

     

    (a)  On
      July
      15, 20__ [the year following the Grant Date] , provided that the
      Restricted Units have vested in accordance with Section 3(a) of this Agreement,
      POZEN will issue to the Grantee one share of Common Stock for each whole vested
      Restricted Unit.  Any vested amounts representing partial shares shall
      be paid in cash.

     

    
      
        
        

      

      
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    (b)  The
      obligation of POZEN to deliver shares hereunder shall be subject to the
      condition that if at any time the Committee shall determine in its discretion
      that the listing, registration or qualification of the shares of Common Stock
      upon any securities exchange or under any state or federal law, or the consent
      or approval of any governmental regulatory body is necessary or desirable as
      a
      condition of, or in connection with, the issue of shares, the shares may not
      be
      issued in whole or in part unless such listing, registration, qualification,
      consent or approval shall have been effected or obtained free of any conditions
      not acceptable to the Committee.  The issuance of shares of Common
      Stock to the Grantee pursuant to this Agreement is subject to any applicable
      taxes and other laws or regulations of the United States or of any state having
      jurisdiction thereof.

     

    (c)  The
      Grantee agrees to be bound by the Company’s policies regarding transfer of
      shares of Common Stock and understands that there may be certain times during
      the year in which the Grantee will be prohibited from selling, transferring,
      pledging, donating, assigning, mortgaging, hypothetically or encumbering
      shares.

     

    6.  Change
      of Control.  The provisions of the Plan applicable to a Change of
      Control shall apply to the Restricted Units; provided, however, that for
      purposes of this Agreement, a “Change of Control” shall be deemed to have
      occurred:

     

    (i)           if
      any “person” (as such term is used in sections 13(d) and 14(d) of the Exchange
      Act) (other than the Company or any trustee or fiduciary holding securities
      under an employee benefit plan of the Company) becomes a “beneficial owner” (as
      defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of
      securities of the Company representing more than 50% of the voting power of
      the
      then outstanding securities of the Company; provided that a Change of Control
      shall not be deemed to occur as a result of a transaction in which the Company
      becomes a subsidiary of another corporation and in which the stockholders of
      the
      Company, immediately prior to the transaction, will beneficially own,
      immediately after the transaction, shares entitling such stockholders to more
      than 50% of all votes to which all stockholders of the parent corporation would
      be entitled in the election of directors (without consideration of the rights
      of
      any class of stock to elect directors by a separate class vote); or

     

    (ii)           upon
      the consummation of (A) a merger or consolidation of the Company with another
      corporation where the stockholders of the Company, immediately prior to the
      merger or consolidation, will beneficially own, immediately after the merger
      or
      consolidation, shares entitling such stockholders to less than 50% of all votes
      to which all stockholders of the surviving corporation would be entitled in
      the
      election of directors (without consideration of the rights of any class of
      stock
      to elect directors by a separate class vote) or (B) a sale or other disposition
      of all or substantially all of the assets of the Company.

     

    In
      the
      event of a Change of Control, the Committee may take such actions as it deems
      appropriate pursuant to the Plan, provided that all payments in settlement
      of
      the Restricted Units pursuant to the Plan shall be made on or within 30 days
      of
      the occurrence of the Change of Control, notwithstanding anything to the
      contrary set forth in Section 15(c) of the Plan.

     

    
      
        
        

      

      
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    7.  Grant
      Subject to Plan Provisions.  This grant is made pursuant to the
      Plan, the terms of which are incorporated herein by reference, and in all
      respects shall be interpreted in accordance with the Plan.  The grant
      and payment of the Restricted Units are subject to interpretations, regulations
      and determinations concerning the Plan established from time to time by the
      Committee in accordance with the provisions of the Plan, including, but not
      limited to, provisions pertaining to (i) rights and obligations with respect
      to
      any applicable withholding taxes, (ii) the registration, qualification or
      listing of the shares issued under the Plan, (iii) changes in capitalization
      of
      POZEN and (iv) other requirements of applicable law.  The Committee
      shall have the authority to interpret and construe the Restricted Units pursuant
      to the terms of the Plan, and its decisions shall be conclusive as to any
      questions arising hereunder.

     

    8.  No
      Rights.  The grant of the Restricted Units shall not confer upon
      the Grantee any right to be retained by or in the service of the Company and
      shall not interfere in any way with the right of the Company to terminate the
      Grantee’s service at any time.  The right of the Company to terminate
      at will the Grantee’s service at any time for any reason is specifically
      reserved.

     

    9.  No
      Stockholder Rights.  Neither the Grantee, nor any person entitled
      to receive payment in the event of the Grantee’s death, shall have any of the
      rights and privileges of a stockholder with respect to shares of Common Stock,
      until certificates for shares have been issued upon payment of Restricted
      Units.

     

    10.  Assignment
      and Transfers.  Except as the Committee may otherwise permit
      pursuant to the Plan, the rights and interests of the Grantee under this
      Agreement may not be sold, assigned, encumbered or otherwise transferred except,
      in the event of the death of the Grantee, by will or by the laws of descent
      and
      distribution.  In the event of any attempt by the Grantee to alienate,
      assign, pledge, hypothecate, or otherwise dispose of the Restricted Units or
      any
      right hereunder, except as provided for in this Agreement, or in the event
      of
      the levy or any attachment, execution or similar process upon the rights or
      interests hereby conferred, POZEN may terminate the Restricted Units by notice
      to the Grantee, and the Restricted Units and all rights hereunder shall
      thereupon become null and void.  The rights and protections of POZEN
      hereunder shall extend to any successors or assigns of POZEN and to POZEN’s
      parents, subsidiaries, and affiliates.  This Agreement may be assigned
      by POZEN without the Grantee’s consent.

     

    11.  Unfunded
      Arrangement.   The Grantee’s right to receive payments under
      this Agreement shall be no greater than the right of an unsecured general
      creditor of the Company.  All payments shall be made from the general
      assets of the Company, and no special or separate fund shall be established
      and
      no segregation of assets shall be made to assure payment.

     

    12.  Applicable
      Law.  The validity, construction, interpretation and effect of
      this Agreement shall be governed by and construed in accordance with the laws
      of
      the State of Delaware, without giving effect to the conflicts of laws provisions
      thereof.

     

    
      
        
        

      

      
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    13.  Notice.  Any
      notice to POZEN provided for in this Agreement shall be addressed to POZEN
      in
      care of the Vice President, Finance and Administration, at the corporate
      headquarters of POZEN, and any notice to the Grantee shall be addressed to
      such
      Grantee at the current address shown on the payroll of POZEN, or to such other
      address as the Grantee may designate to POZEN in writing.  Any notice
      shall be delivered by hand, sent by telecopy or enclosed in a properly sealed
      envelope addressed as stated above, registered and deposited, postage prepaid,
      in a post office regularly maintained by the United States Postal
      Service.

     

    

     

    

     

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    IN
      WITNESS WHEREOF, POZEN has caused its duly authorized officer to execute this
      Restricted Stock Unit Agreement, and the Grantee has placed his or her signature
      hereon, effective as of the Date of Grant.

     

    
      	 	
              POZEN
                INC.

            
	 	 	 
	 	 	 
	 	 	 
	 	
              By:

            	 
	 	
              Its:

            	 

    

    

     

    I
      hereby
      accept the award of Restricted Units described in this Agreement, and I agree
      to
      be bound by the terms of the Plan and this Agreement.  I hereby agree
      that all of the decisions and determinations of the Committee with respect
      to
      the Restricted Units shall be final and binding.

     

    

    
      	 	 	 
	 	 	
              Grantee

            
	 	 	 
	 	 	 
	 	 	
              Date

            

    

    

    
      
        
        

      

      
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