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Sample Business Contracts

2002 Stock Incentive Plan - Sepracor Inc.

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                                  SEPRACOR INC.

                            2002 STOCK INCENTIVE PLAN

1. PURPOSE

     The purpose of this 2002 Stock Incentive Plan (the "Plan") of Sepracor
Inc., a Delaware corporation (the "Company"), is to advance the interests of the
Company's stockholders by enhancing the Company's ability to attract, retain and
motivate persons who make (or are expected to make) important contributions to
the Company by providing such persons with equity ownership opportunities and
performance-based incentives, thereby better aligning the interests of such
persons with those of the Company's stockholders. Except where the context
otherwise requires, the term "Company" shall include any of the Company's
present or future parent or subsidiary corporations as defined in Sections
424(e) or (f) of the Internal Revenue Code of 1986, as amended, and any
regulations promulgated thereunder (the "Code") and any other business venture
(including, without limitation, a joint venture or limited liability company) in
which the Company has a controlling interest, as determined by the Board of
Directors of the Company (the "Board").

2. ELIGIBILITY

     All of the Company's employees (and any individuals who have accepted an
offer for employment), consultants and advisors, other than those who are also
officers (within the meaning of Section 16 of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and the rules and regulations promulgated
thereunder), or directors of the Company, are eligible to be granted options,
restricted stock awards, or other stock-based awards (each, an "Award") under
the Plan. Each person who has been granted an Award under the Plan shall be
deemed a "Participant".

3. ADMINISTRATION AND DELEGATION

     (a) ADMINISTRATION BY BOARD OF DIRECTORS. The Plan will be administered by
the Board. The Board shall have authority to grant Awards and to adopt, amend
and repeal such administrative rules, guidelines and practices relating to the
Plan as it shall deem advisable. The Board may correct any defect, supply any
omission or reconcile any inconsistency in the Plan or any Award in the manner
and to the extent it shall deem expedient to carry the Plan into effect and it
shall be the sole and final judge of such expediency. All decisions by the Board
shall be made in the Board's sole discretion and shall be final and binding on
all persons having or claiming any interest in the Plan or in any Award. No
director or person acting pursuant to the authority delegated by the Board shall
be liable for any action or determination relating to or under the Plan made in
good faith.

     (b) APPOINTMENT OF COMMITTEES. To the extent permitted by applicable law,
the Board may delegate any or all of its powers under the Plan to one or more
committees or subcommittees of the Board (a "Committee"). All references in the
Plan to the "Board" shall mean the Board or a Committee of the Board or the
executive officers referred to in Section 3(c) to the extent that the Board's
powers or authority under the Plan have been delegated to such Committee or
executive officers.


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     (c) DELEGATION TO EXECUTIVE OFFICERS. To the extent permitted by applicable
law, the Board may delegate to one or more executive officers of the Company the
power to grant Awards to employees or officers of the Company or any of its
present or future subsidiary corporations and to exercise such other powers
under the Plan as the Board may determine, provided that the Board shall fix the
terms of the Awards to be granted by such executive officers (including the
exercise price of such Awards, which may include a formula by which the exercise
price will be determined) and the maximum number of shares subject to Awards
that the executive officers may grant; provided further, however, that no
executive officer shall be authorized to grant Awards to any "executive officer"
of the Company (as defined by Rule 3b-7 under the Exchange Act) or to any
"officer" of the Company (as defined by Rule 16a-1 under the Exchange Act).

4. STOCK AVAILABLE FOR AWARDS. Subject to adjustment under Section 8, Awards may
be made under the Plan for up to 500,000 shares of common stock, $0.10 par value
per share, of the Company (the "Common Stock"). If any Award expires or is
terminated, surrendered or canceled without having been fully exercised or is
forfeited in whole or in part (including as the result of shares of Common Stock
subject to such Award being repurchased by the Company at the original issuance
price pursuant to a contractual repurchase right) or results in any Common Stock
not being issued, the unused Common Stock covered by such Award shall again be
available for the grant of Awards under the Plan. Shares issued under the Plan
may consist in whole or in part of authorized but unissued shares or treasury
shares.

5. STOCK OPTIONS

     (a) GENERAL. The Board may grant options to purchase Common Stock (each, an
"Option") and determine the number of shares of Common Stock to be covered by
each Option, the exercise price of each Option and the conditions and
limitations applicable to the exercise of each Option, including conditions
relating to applicable federal or state securities laws, as it considers
necessary or advisable. Each Option granted under the Plan shall be a
"nonstatutory stock option," not intended to qualify as an "incentive stock
option" as defined in Section 422 of the Code (an "Incentive Stock Option"). No
Incentive Stock Options shall be granted under the Plan.

     (b) EXERCISE PRICE. The Board shall establish the exercise price at the
time each Option is granted and specify it in the applicable option agreement.

     (c) DURATION OF OPTIONS. Each Option shall be exercisable at such times and
subject to such terms and conditions as the Board may specify in the applicable
option agreement.

     (d) EXERCISE OF OPTION. Options may be exercised by delivery to the Company
of a written notice of exercise signed by the proper person or by any other form
of notice (including electronic notice) approved by the Board together with
payment in full as specified in Section 5(e) for the number of shares for which
the Option is exercised.

     (e) PAYMENT UPON EXERCISE. Common Stock purchased upon the exercise of an
Option granted under the Plan shall be paid for as follows:

          (1) in cash or by check, payable to the order of the Company;


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          (2) except as the Board may, in its sole discretion, otherwise provide
in an option agreement, by (i) delivery of an irrevocable and unconditional
undertaking by a creditworthy broker to deliver promptly to the Company
sufficient funds to pay the exercise price and any required tax withholding or
(ii) delivery by the Participant to the Company of a copy of irrevocable and
unconditional instructions to a creditworthy broker to deliver promptly to the
Company cash or a check sufficient to pay the exercise price and any required
tax withholding;

          (3) when the Common Stock is registered under the Exchange Act, by
delivery of shares of Common Stock owned by the Participant valued at their fair
market value as determined by (or in a manner approved by) the Board in good
faith ("Fair Market Value"), provided (i) such method of payment is then
permitted under applicable law and (ii) such Common Stock, if acquired directly
from the Company was owned by the Participant at least six months prior to such
delivery;

          (4) to the extent permitted by the Board, in its sole discretion by
(i) delivery of a promissory note of the Participant to the Company on terms
determined by the Board, or (ii) payment of such other lawful consideration as
the Board may determine; or

          (5) by any combination of the above permitted forms of payment.

     (f) SUBSTITUTE OPTIONS. In connection with a merger or consolidation of an
entity with the Company or the acquisition by the Company of property or stock
of an entity, the Board may grant Options in substitution for any options or
other stock or stock-based awards granted by such entity or an affiliate
thereof. Substitute Options may be granted on such terms as the Board deems
appropriate in the circumstances, notwithstanding any limitations on Options
contained in the other sections of this Section 5 or in Section 2.

6. RESTRICTED STOCK.

     (a) GRANTS. The Board may grant Awards entitling recipients to acquire
shares of Common Stock, subject to the right of the Company to repurchase all or
part of such shares at their issue price or other stated or formula price (or to
require forfeiture of such shares if issued at no cost) from the recipient in
the event that conditions specified by the Board in the applicable Award are not
satisfied prior to the end of the applicable restriction period or periods
established by the Board for such Award (each, a "Restricted Stock Award").

     (b) TERMS AND CONDITIONS. The Board shall determine the terms and
conditions of any such Restricted Stock Award, including the conditions for
repurchase (or forfeiture) and the issue price, if any.

     (c) STOCK CERTIFICATES. Any stock certificates issued in respect of a
Restricted Stock Award shall be registered in the name of the Participant and,
unless otherwise determined by the Board, deposited by the Participant, together
with a stock power endorsed in blank, with the Company (or its designee). At the
expiration of the applicable restriction periods, the Company (or such designee)
shall deliver the certificates no longer subject to such restrictions to the
Participant or if the Participant has died, to the beneficiary designated, in a
manner determined by the Board, by a Participant to receive amounts due or
exercise rights of the Participant in the


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event of the Participant's death (the "Designated Beneficiary"). In the absence
of an effective designation by a Participant, Designated Beneficiary shall mean
the Participant's estate.

7. OTHER STOCK-BASED AWARDS

     The Board shall have the right to grant other Awards based upon the Common
Stock having such terms and conditions as the Board may determine, including the
grant of shares based upon certain conditions, the grant of securities
convertible into Common Stock and the grant of stock appreciation rights.


8. ADJUSTMENTS FOR CHANGES IN COMMON STOCK AND CERTAIN OTHER EVENTS

     (a) CHANGES IN CAPITALIZATION. In the event of any stock split, reverse
stock split, stock dividend, recapitalization, combination of shares,
reclassification of shares, spin-off or other similar change in capitalization
or event, or any distribution to holders of Common Stock other than a normal
cash dividend, (i) the number and class of securities available under this Plan,
(ii) the number and class of securities and exercise price per share subject to
each outstanding Option, (iii) the repurchase price per share subject to each
outstanding Restricted Stock Award, and (iv) the terms of each other outstanding
Award shall be appropriately adjusted by the Company (or substituted Awards may
be made, if applicable) to the extent the Board shall determine, in good faith,
that such an adjustment (or substitution) is necessary and appropriate. If this
Section 8(a) applies and Section 8(c) also applies to any event, Section 8(c)
shall be applicable to such event, and this Section 8(a) shall not be
applicable.

     (b) LIQUIDATION OR DISSOLUTION. In the event of a proposed liquidation or
dissolution of the Company, the Board shall upon written notice to the
Participants provide that all then unexercised Options will (i) become
exercisable in full as of a specified time at least 10 business days prior to
the effective date of such liquidation or dissolution and (ii) terminate
effective upon such liquidation or dissolution, except to the extent exercised
before such effective date. The Board may specify the effect of a liquidation or
dissolution on any Restricted Stock Award or other Award granted under the Plan
at the time of the grant of such Award.

     (c) ACQUISITION AND CHANGE IN CONTROL EVENTS

          (1) DEFINITIONS

               (a) An "Acquisition Event" shall mean:

                    (i)  any merger or consolidation of the Company with or into
                         another entity as a result of which the Common Stock is
                         converted into or exchanged for the right to receive
                         cash, securities or other property; or

                    (ii) any exchange of shares of the Company for cash,
                         securities or other property pursuant to a statutory
                         share exchange transaction.


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               (b) A "Change in Control Event" shall mean:

                    (i)  the acquisition by an individual, entity or group
                         (within the meaning of Section 13(d)(3) or 14(d)(2) of
                         the Exchange Act) (a "Person") of beneficial ownership
                         of any capital stock of the Company if, after such
                         acquisition, such Person beneficially owns (within the
                         meaning of Rule 13d-3 promulgated under the Exchange
                         Act) 30% or more of either (x) the then-outstanding
                         shares of common stock of the Company (the "Outstanding
                         Company Common Stock") or (y) the combined voting power
                         of the then-outstanding securities of the Company
                         entitled to vote generally in the election of directors
                         (the "Outstanding Company Voting Securities");
                         PROVIDED, HOWEVER, that for purposes of this subsection
                         (i), the following acquisitions shall not constitute a
                         Change in Control Event: (A) any acquisition directly
                         from the Company (excluding an acquisition pursuant to
                         the exercise, conversion or exchange of any security
                         exercisable for, convertible into or exchangeable for
                         common stock or voting securities of the Company,
                         unless the Person exercising, converting or exchanging
                         such security acquired such security directly from the
                         Company or an underwriter or agent of the Company), (B)
                         any acquisition by any employee benefit plan (or
                         related trust) sponsored or maintained by the Company
                         or any corporation controlled by the Company, or (C)
                         any acquisition by any corporation pursuant to a
                         Business Combination (as defined below) which complies
                         with clauses (x) and (y) of subsection (iii) of this
                         definition; or

                    (ii) such time as the Continuing Directors (as defined
                         below) do not constitute a majority of the Board (or,
                         if applicable, the Board of Directors of a successor
                         corporation to the Company), where the term "Continuing
                         Director" means at any date a member of the Board (x)
                         who was a member of the Board on the date of the
                         initial adoption of this Plan by the Board or (y) who
                         was nominated or elected subsequent to such date by at
                         least a majority of the directors who were Continuing
                         Directors at the time of such nomination or election or
                         whose election to the Board was recommended or endorsed
                         by at least a majority of the directors who were
                         Continuing Directors at the time of such nomination or
                         election; PROVIDED, HOWEVER, that there shall be
                         excluded from this clause (y) any individual whose
                         initial assumption of office occurred as a result of an
                         actual or threatened election contest with respect to
                         the election or removal of


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<PAGE>


                         directors or other actual or threatened solicitation of
                         proxies or consents, by or on behalf of a person other
                         than the Board; or

                    (iii) the consummation of a merger, consolidation,
                         reorganization, recapitalization or statutory share
                         exchange involving the Company or a sale or other
                         disposition of all or substantially all of the assets
                         of the Company (a "Business Combination"), unless,
                         immediately following such Business Combination, each
                         of the following two conditions is satisfied: (x) all
                         or substantially all of the individuals and entities
                         who were the beneficial owners of the Outstanding
                         Company Common Stock and Outstanding Company Voting
                         Securities immediately prior to such Business
                         Combination beneficially own, directly or indirectly,
                         more than 50% of the then-outstanding shares of common
                         stock and the combined voting power of the
                         then-outstanding securities entitled to vote generally
                         in the election of directors, respectively, of the
                         resulting or acquiring corporation in such Business
                         Combination (which shall include, without limitation, a
                         corporation which as a result of such transaction owns
                         the Company or substantially all of the Company's
                         assets either directly or through one or more
                         subsidiaries) (such resulting or acquiring corporation
                         is referred to herein as the "Acquiring Corporation")
                         in substantially the same proportions as their
                         ownership of the Outstanding Company Common Stock and
                         Outstanding Company Voting Securities, respectively,
                         immediately prior to such Business Combination and (y)
                         no Person (excluding the Acquiring Corporation or any
                         employee benefit plan (or related trust) maintained or
                         sponsored by the Company or by the Acquiring
                         Corporation) beneficially owns, directly or indirectly,
                         30% or more of the then-outstanding shares of common
                         stock of the Acquiring Corporation, or of the combined
                         voting power of the then-outstanding securities of such
                         corporation entitled to vote generally in the election
                         of directors (except to the extent that such ownership
                         existed prior to the Business Combination).

          (2) EFFECT ON OPTIONS

               (a)  ACQUISITION EVENT. Upon the occurrence of an Acquisition
                    Event (regardless of whether such event also constitutes a
                    Change in Control Event), or the execution by the Company of
                    any agreement with respect to an Acquisition Event
                    (regardless of whether such event will result in a Change in
                    Control Event), the Board shall


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<PAGE>


                    provide that all outstanding Options shall be assumed, or
                    equivalent options shall be substituted, by the acquiring or
                    succeeding corporation (or an affiliate thereof); provided
                    that if such Acquisition Event also constitutes a Change in
                    Control Event, except to the extent specifically provided to
                    the contrary in the instrument evidencing any Option or any
                    other agreement between a Participant and the Company, such
                    assumed or substituted options shall be immediately
                    exercisable in full upon the occurrence of such Acquisition
                    Event. For purposes hereof, an Option shall be considered to
                    be assumed if, following consummation of the Acquisition
                    Event, the Option confers the right to purchase, for each
                    share of Common Stock subject to the Option immediately
                    prior to the consummation of the Acquisition Event, the
                    consideration (whether cash, securities or other property)
                    received as a result of the Acquisition Event by holders of
                    Common Stock for each share of Common Stock held immediately
                    prior to the consummation of the Acquisition Event (and if
                    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 the consideration received as a result of the Acquisition
                    Event is not solely common stock of the acquiring or
                    succeeding corporation (or an affiliate thereof), the
                    Company may, with the consent of the acquiring or succeeding
                    corporation, provide for the consideration to be received
                    upon the exercise of Options to consist solely of common
                    stock of the acquiring or succeeding corporation (or an
                    affiliate thereof) equivalent in fair market value to the
                    per share consideration received by holders of outstanding
                    shares of Common Stock as a result of the Acquisition Event.

                    Notwithstanding the foregoing, if the acquiring or
                    succeeding corporation (or an affiliate thereof) does not
                    agree to assume, or substitute for, such Options, then the
                    Board shall, upon written notice to the Participants,
                    provide that all then unexercised Options will become
                    exercisable in full as of a specified time prior to the
                    Acquisition Event and will terminate immediately prior to
                    the consummation of such Acquisition Event, except to the
                    extent exercised by the Participants before the consummation
                    of such Acquisition Event; provided, however, in the event
                    of an Acquisition Event under the terms of which holders of
                    Common Stock will receive upon consummation thereof a cash
                    payment for each share of Common Stock surrendered pursuant
                    to such Acquisition Event (the "Acquisition Price"), then
                    the Board may instead provide that all outstanding Options
                    shall terminate upon consummation of such Acquisition Event
                    and that each Participant shall receive, in exchange
                    therefor, a cash payment equal to the amount (if any) by
                    which (A) the Acquisition Price multiplied by



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                    the number of shares of Common Stock subject to such
                    outstanding Options (whether or not then exercisable),
                    exceeds (B) the aggregate exercise price of such Options.

               (b)  CHANGE IN CONTROL EVENT THAT IS NOT AN ACQUISITION EVENT.
                    Upon the occurrence of a Change in Control Event that does
                    not also constitute an Acquisition Event, except to the
                    extent specifically provided to the contrary in the
                    instrument evidencing any Option or any other agreement
                    between a Participant and the Company, all Options
                    then-outstanding shall automatically become immediately
                    exercisable in full.

          (3) EFFECT ON RESTRICTED STOCK AWARDS

               (a)  ACQUISITION EVENT THAT IS NOT A CHANGE IN CONTROL EVENT.
                    Upon the occurrence of an Acquisition Event that is not a
                    Change in Control Event, the repurchase and other rights of
                    the Company under each outstanding Restricted Stock Award
                    shall inure to the benefit of the Company's successor and
                    shall apply to the cash, securities or other property which
                    the Common Stock was converted into or exchanged for
                    pursuant to such Acquisition Event in the same manner and to
                    the same extent as they applied to the Common Stock subject
                    to such Restricted Stock Award.

               (b)  CHANGE IN CONTROL EVENT. Upon the occurrence of a Change in
                    Control Event (regardless of whether such event also
                    constitutes an Acquisition Event), except to the extent
                    specifically provided to the contrary in the instrument
                    evidencing any Restricted Stock Award or any other agreement
                    between a Participant and the Company, all restrictions and
                    conditions on all Restricted Stock Awards then-outstanding
                    shall automatically be deemed terminated or satisfied.

          (4) EFFECT ON OTHER AWARDS

               (a)  ACQUISITION EVENT THAT IS NOT A CHANGE IN CONTROL EVENT. The
                    Board shall specify the effect of an Acquisition Event that
                    is not a Change in Control Event on any other Award granted
                    under the Plan at the time of the grant of such Award.

               (b)  CHANGE IN CONTROL EVENT. Upon the occurrence of a Change in
                    Control Event (regardless of whether such event also
                    constitutes an Acquisition Event), except to the extent
                    specifically provided to the contrary in the instrument
                    evidencing any other Award or any other agreement between a
                    Participant and the Company, all other Awards shall become
                    exercisable, realizable or vested in full, or shall be free
                    of all conditions or restrictions, as applicable to each
                    such Award.


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<PAGE>

9. GENERAL PROVISIONS APPLICABLE TO AWARDS

     (a) TRANSFERABILITY OF AWARDS. Except as the Board may otherwise determine
or provide in an Award, Awards shall not be sold, assigned, transferred, pledged
or otherwise encumbered by the person to whom they are granted, either
voluntarily or by operation of law, except by will or the laws of descent and
distribution, and, during the life of the Participant, shall be exercisable only
by the Participant. References to a Participant, to the extent relevant in the
context, shall include references to authorized transferees.

     (b) DOCUMENTATION. Each Award shall be evidenced in such form (written,
electronic or otherwise) as the Board shall determine. Each Award may contain
terms and conditions in addition to those set forth in the Plan.

     (c) BOARD DISCRETION. Except as otherwise provided by the Plan, each Award
may be made alone or in addition or in relation to any other Award. The terms of
each Award need not be identical, and the Board need not treat Participants
uniformly.

     (d) TERMINATION OF STATUS. The Board shall determine the effect on an Award
of the disability, death, retirement, authorized leave of absence or other
change in the employment or other status of a Participant and the extent to
which, and the period during which, the Participant, the Participant's legal
representative, conservator, guardian or Designated Beneficiary may exercise
rights under the Award.

     (e) WITHHOLDING. Each Participant shall pay to the Company, or make
provision satisfactory to the Board for payment of, any taxes required by law to
be withheld in connection with Awards to such Participant no later than the date
of the event creating the tax liability. Except as the Board may otherwise
provide in an Award, when the Common Stock is registered under the Exchange Act,
Participants may, to the extent permitted under applicable law, satisfy such tax
obligations in whole or in part by delivery of shares of Common Stock, including
shares retained from the Award creating the tax obligation, valued at their Fair
Market Value; provided, however, that the total tax withholding where stock is
being used to satisfy such tax obligations cannot exceed the Company's minimum
statutory withholding obligations (based on minimum statutory withholding rates
for federal and state tax purposes, including payroll taxes, that are applicable
to such supplemental taxable income). The Company may, to the extent permitted
by law, deduct any such tax obligations from any payment of any kind otherwise
due to a Participant.

     (f) AMENDMENT OF AWARD. The Board may amend, modify or terminate any
outstanding Award, including but not limited to, substituting therefor another
Award of the same or a different type and changing the date of exercise or
realization, provided that the Participant's consent to such action shall be
required unless the Board determines that the action, taking into account any
related action, would not materially and adversely affect the Participant.
Without intending to limit the generality of the preceding sentence, the Board
may, without amending the Plan, modify Awards granted to Participants who are
foreign nationals or employed outside the United States to recognize differences
in laws, rules, regulations or customers of such foreign jurisdiction with
respect to tax, securities, currency, employee benefits or other matters.


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     (g) CONDITIONS ON DELIVERY OF STOCK. The Company will not be obligated to
deliver any shares of Common Stock pursuant to the Plan or to remove
restrictions from shares previously delivered under the Plan until (i) all
conditions of the Award have been met or removed to the satisfaction of the
Company, (ii) in the opinion of the Company's counsel, all other legal matters
in connection with the issuance and delivery of such shares have been satisfied,
including any applicable securities laws and any applicable stock exchange or
stock market rules and regulations, and (iii) the Participant has executed and
delivered to the Company such representations or agreements as the Company may
consider appropriate to satisfy the requirements of any applicable laws, rules
or regulations.

     (h) ACCELERATION. The Board may at any time provide that any Award shall
become immediately exercisable in full or in part, free of some or all
restrictions or conditions, or otherwise realizable in full or in part, as the
case may be.

10. MISCELLANEOUS

     (a) NO RIGHT TO EMPLOYMENT OR OTHER STATUS. No person shall have any claim
or right to be granted an Award, and the grant of an Award shall not be
construed as giving a Participant the right to continued employment or any other
relationship with the Company. The Company expressly reserves the right at any
time to dismiss or otherwise terminate its relationship with a Participant free
from any liability or claim under the Plan, except as expressly provided in the
applicable Award.

     (b) NO RIGHTS AS STOCKHOLDER. Subject to the provisions of the applicable
Award, no Participant or Designated Beneficiary shall have any rights as a
stockholder with respect to any shares of Common Stock to be distributed with
respect to an Award until becoming the record holder of such shares.
Notwithstanding the foregoing, in the event the Company effects a split of the
Common Stock by means of a stock dividend and the exercise price of and the
number of shares subject to such Option are adjusted as of the date of the
distribution of the dividend (rather than as of the record date for such
dividend), then an optionee who exercises an Option between the record date and
the distribution date for such stock dividend shall be entitled to receive, on
the distribution date, the stock dividend with respect to the shares of Common
Stock acquired upon such Option exercise, notwithstanding the fact that such
shares were not outstanding as of the close of business on the record date for
such stock dividend.

     (c) EFFECTIVE DATE AND TERM OF PLAN. The Plan shall become effective on
February 21, 2002, the date on which it was adopted by the Board (the "Effective
Date"). No Awards shall be granted under the Plan after the completion of ten
years from the Effective Date, but Awards previously granted may extend beyond
that date.

     (d) AMENDMENT OF PLAN. The Board may amend, suspend or terminate the Plan
or any portion thereof at any time.

     (e) GOVERNING LAW. The provisions of the Plan and all Awards made hereunder
shall be governed by and interpreted in accordance with the laws of the State of
Delaware, without regard to any applicable conflicts of law.

            Adopted by the Board of Directors on February 21, 2002.


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                               AMENDMENT NO 1. TO
                            2002 STOCK INCENTIVE PLAN
                                       OF
                                  SEPRACOR INC.

     The 2002 Stock Incentive Plan (the "Plan") of Sepracor Inc. be, and hereby
is, amended as follows:

     1. Section 4 is deleted in its entirety and the following is substituted in
its place:

     "4. STOCK AVAILABLE FOR AWARDS. Subject to adjustment under Section 8,
Awards may be made under the Plan for up to 4,000,000 shares of common stock,
$0.10 par value per share, of the Company (the "Common Stock"). If any Award
expires or is terminated, surrendered or canceled without having been fully
exercised or is forfeited in whole or in part (including as the result of shares
of Common Stock subject to such Award being repurchased by the Company at the
original issuance price pursuant to a contractual repurchase right) or results
in any Common Stock not being issued, the unused Common Stock covered by such
Award shall again be available for the grant of Awards under the Plan. Shares
issued under the Plan may consist in whole or in part of authorized but unissued
shares or treasury shares."


               Adopted by the Board of Directors on June 13, 2002



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