Exhibit 10.24
Anadys Pharmaceuticals, Inc.
2004 Non-Employee Directors’ Stock Option Plan
Adopted January 29, 2004
Approved by Stockholders February 24, 2004
Effective Date: March 25, 2004
Amended by Board of Directors on March 25, 2008
1. Purposes.
     (a) Eligible Option Recipients. The persons eligible to receive Options are
the Non-Employee Directors of the Company.
     (b) Available Options. The purpose of the Plan is to provide a means by
which Non-Employee Directors may be given an opportunity to benefit from
increases in value of the Common Stock through the granting of Nonstatutory
Stock Options.
     (c) General Purpose. The Company, by means of the Plan, seeks to retain the
services of its Non-Employee Directors, to secure and retain the services of new
Non-Employee Directors and to provide incentives for such persons to exert
maximum efforts for the success of the Company and its Affiliates.
2. Definitions.
     (a) “Accountant” means the independent public accountants of the Company.
     (b) “Affiliate” means any parent corporation or subsidiary corporation of
the Company, whether now or hereafter existing, as those terms are defined in
Sections 424(e) and (f), respectively, of the Code.
     (c) “Annual Grant” means an Option granted annually to all Non-Employee
Directors who meet the specified criteria pursuant to Section 6(b).
     (d) “Annual Meeting” means the annual meeting of the stockholders of the
Company.
     (e) “Board” means the Board of Directors of the Company.
     (f) “Capitalization Adjustment” has the meaning ascribed to that term in
Section 11(a).
     (g) “Change in Control” means the occurrence, in a single transaction or in
a series of related transactions, of any one or more of the following events:

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          (i) any Exchange Act Person becomes the Owner, directly or indirectly,
of securities of the Company representing more than fifty percent (50%) of the
combined voting power of the Company’s then outstanding securities other than by
virtue of a merger, consolidation or similar transaction. Notwithstanding the
foregoing, a Change in Control shall not be deemed to occur (A) on account of
the acquisition of securities of the Company by an investor, any affiliate
thereof or any other Exchange Act Person from the Company in a transaction or
series of related transactions the primary purpose of which is to obtain
financing for the company through the issuance of equity securities or
(B) solely because the level of Ownership held by any Exchange Act Person (the
“Subject Person”) exceeds the designated percentage threshold of the outstanding
voting securities as a result of a repurchase or other acquisition of voting
securities by the Company reducing the number of shares outstanding, provided
that if a Change in Control would occur (but for the operation of this sentence)
as a result of the acquisition of voting securities by the Company, and after
such share acquisition, the Subject Person becomes the Owner of any additional
voting securities that, assuming the repurchase or other acquisition had not
occurred, increases the percentage of the then outstanding voting securities
Owned by the Subject Person over the designated percentage threshold, then a
Change in Control shall be deemed to occur;
          (ii) there is consummated a merger, consolidation or similar
transaction involving (directly or indirectly) the Company if, immediately after
the consummation of such merger, consolidation or similar transaction, the
stockholders of the Company immediately prior thereto do not Own, directly or
indirectly, either (A) outstanding voting securities representing more than
fifty percent (50%) of the combined outstanding voting power of the surviving
Entity in such merger, consolidation or similar transaction or (B) more than
fifty percent (50%) of the combined outstanding voting power of the parent of
the surviving Entity in such merger, consolidation or similar transaction, in
each case in substantially the same proportion as their Ownership of the
outstanding voting securities of the Company immediately prior to such
transaction;
          (iii) the stockholders of the Company approve or the Board approves a
plan of complete dissolution or liquidation of the Company, or a complete
dissolution or liquidation of the Company shall otherwise occur;
          (iv) there is consummated a sale, lease, license or other disposition
of all or substantially all of the consolidated assets of the Company and its
Subsidiaries, other than a sale, lease, license or other disposition of all or
substantially all of the consolidated assets of the Company and its Subsidiaries
to an Entity, more than fifty percent (50%) of the combined voting power of the
voting securities of which are Owned by stockholders of the Company in
substantially the same proportion as their Ownership of the outstanding voting
securities of the Company immediately prior to such sale, lease, license or
other disposition; or
          (v) individuals who, on the date this Plan is adopted by the Board,
are members of the Board (the “Incumbent Board”) cease for any reason to
constitute at least a majority of the members of the Board; provided, however,
that any new Board member shall, for purposes of this Plan, be considered as a
member of the Incumbent Board if the appointment or election (or nomination for
election) of such new Board member was approved or recommended by at least fifty
percent (50%) of the members of the Incumbent Board, provided that the

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members of the Incumbent Board, at the time of such election or nomination,
constitute a majority of the Board).
     (h) “Code” means the Internal Revenue Code of 1986, as amended.
     (i) “Committee” means a committee of one or more members of the Board
appointed by the Board in accordance with Section 3(c).
     (j) “Common Stock” means the common stock of the Company.
     (k) “Company” means Anadys Pharmaceuticals, Inc., a Delaware corporation.
     (l) “Consultant” means any person, including an advisor, (i) engaged by the
Company or an Affiliate to render consulting or advisory services and who is
compensated for such services or (ii) serving as a member of the Board of
Directors of an Affiliate. However, the term “Consultant” shall not include
either Directors of the Company who are not compensated by the Company for their
services as Directors or Directors of the Company who are merely paid a
director’s fee by the Company for their services as Directors.
     (m) “Continuous Service” means that the Optionholder’s service with the
Company or an Affiliate, whether as an Employee, Director or Consultant, is not
interrupted or terminated. The Optionholder’s Continuous Service shall not be
deemed to have terminated merely because of a change in the capacity in which
the Optionholder renders service to the Company or an Affiliate as an Employee,
Consultant or Director or a change in the entity for which the Optionholder
renders such service, provided that there is no interruption or termination of
the Optionholder’s Continuous Service. For example, a change in status from a
Non-Employee Director of the Company to a Consultant of an Affiliate or an
Employee of the Company will not constitute an interruption of Continuous
Service. The Board or the chief executive officer of the Company, in that
party’s sole discretion, may determine whether Continuous Service shall be
considered interrupted in the case of any leave of absence approved by that
party, including sick leave, military leave or any other personal leave.
     (n) “Corporate Transaction” means the occurrence, in a single transaction
or in a series of related transactions, of any one or more of the following
events:
          (i) a sale or other disposition of all or substantially all, as
determined by the Board in its discretion, of the consolidated assets of the
Company and its Subsidiaries;
          (ii) a sale or other disposition of at least ninety percent (90%) of
the outstanding securities of the Company;
          (iii) a merger, consolidation or similar transaction following which
the Company is not the surviving corporation; or
          (iv) a merger, consolidation or similar transaction following which
the Company is the surviving corporation but the shares of Common Stock
outstanding immediately preceding the merger, consolidation or similar
transaction are converted or exchanged by virtue

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of the merger, consolidation or similar transaction into other property, whether
in the form of securities, cash or otherwise.
     (o) “Director” means a member of the Board of Directors of the Company.
     (p) “Disability” means the inability of a person, in the opinion of a
qualified physician acceptable to the Company, to perform the major duties of
that person’s position with the Company or an Affiliate of the Company because
of the sickness or injury of the person.
     (q) “Employee” means any person employed by the Company or an Affiliate.
Service as a Director or payment of a director’s fee by the Company or an
Affiliate shall not be sufficient to constitute “employment” by the Company or
an Affiliate.
     (r) “Entity” means a corporation, partnership or other entity.
     (s) “Exchange Act” means the Securities Exchange Act of 1934, as amended.
     (t) “Exchange Act Person” means any natural person, Entity or “group”
(within the meaning of Section 13(d) or 14(d) of the Exchange Act), except that
“Exchange Act Person” shall not include (A) the Company or any Subsidiary of the
Company, (B) any employee benefit plan of the Company or any Subsidiary of the
Company or any trustee or other fiduciary holding securities under an employee
benefit plan of the Company or any Subsidiary of the Company, (C) an underwriter
temporarily holding securities pursuant to an offering of such securities, or
(D) an Entity Owned, directly or indirectly, by the stockholders of the Company
in substantially the same proportions as their Ownership of stock of the
Company.
     (u) “Fair Market Value” means, as of any date, the value of the Common
Stock determined as follows:
          (i) If the Common Stock is listed on any established stock exchange or
traded on the Nasdaq National Market or the Nasdaq SmallCap Market, the Fair
Market Value of a share of Common Stock shall be the closing sales price for
such stock (or the closing bid, if no sales were reported) as quoted on such
exchange or market (or the exchange or market with the greatest volume of
trading in the Common Stock) on the last market trading day prior to the day of
determination, as reported in The Wall Street Journal or such other source as
the Board deems reliable.
          (ii) In the absence of such markets for the Common Stock, the Fair
Market Value shall be determined in good faith by the Board.
     (v) “Initial Grant” means an Option granted to a Non-Employee Director who
meets the specified criteria pursuant to Section 6(a).
     (w) “IPO Date” means the effective date of the initial public offering of
the Common Stock.
     (x) “Non-Employee Director” means a Director who is not an Employee.

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     (y) “Nonstatutory Stock Option” means an Option not intended to qualify as
an incentive stock option within the meaning of Section 422 of the Code and the
regulations promulgated thereunder.
     (z) “Officer” means a person who is an officer of the Company within the
meaning of Section 16 of the Exchange Act and the rules and regulations
promulgated thereunder.
     (aa) “Option” means a Nonstatutory Stock Option granted pursuant to the
Plan.
     (bb) “Option Agreement” means a written agreement between the Company and
an Optionholder evidencing the terms and conditions of an individual Option
grant. Each Option Agreement shall be subject to the terms and conditions of the
Plan.
     (cc) “Optionholder” means a person to whom an Option is granted pursuant to
the Plan or, if applicable, such other person who holds an outstanding Option.
     (dd) “Own,” “Owned,” “Owner,” “Ownership” A person or Entity shall be
deemed to “Own,” to have “Owned,” to be the “Owner” of, or to have acquired
“Ownership” of securities if such person or Entity, directly or indirectly,
through any contract, arrangement, understanding, relationship or otherwise, has
or shares voting power, which includes the power to vote or to direct the
voting, with respect to such securities.
     (ee) “Plan” means this Anadys Pharmaceuticals, Inc. 2004 Non-Employee
Directors’ Stock Option Plan.
     (ff) “Rule 16b-3” means Rule 16b-3 promulgated under the Exchange Act or
any successor to Rule 16b-3, as in effect from time to time.
     (gg) “Securities Act” means the Securities Act of 1933, as amended.
     (hh) “Subsidiary” means, with respect to the Company, (i) any corporation
of which more than fifty percent (50%) of the outstanding capital stock having
ordinary voting power to elect a majority of the board of directors of such
corporation (irrespective of whether, at the time, stock of any other class or
classes of such corporation shall have or might have voting power by reason of
the happening of any contingency) is at the time, directly or indirectly, Owned
by the Company, and (ii) any partnership in which the Company has a direct or
indirect interest (whether in the form of voting or participation in profits or
capital contribution) of more than fifty percent (50%).
3. Administration.
     (a) Administration by Board. The Plan shall be administered by the Board
unless and until the Board delegates administration of the Plan to a Committee,
as provided in Section 3(c).
     (b) Powers of Board. The Board shall have the power, subject to, and within
the limitations of, the express provisions of the Plan:

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          (i) To determine the provisions of each Option to the extent not
specified in the Plan.
          (ii) To construe and interpret the Plan and Options granted under it,
and to establish, amend and revoke rules and regulations for its administration.
The Board, in the exercise of this power, may correct any defect, omission or
inconsistency in the Plan or in any Option Agreement, in a manner and to the
extent it shall deem necessary or expedient to make the Plan fully effective.
          (iii) To amend the Plan or an Option as provided in Section 12.
          (iv) To terminate or suspend the Plan as provided in Section 13.
          (v) Generally, to exercise such powers and to perform such acts as the
Board deems necessary or expedient to promote the best interests of the Company
and that are not in conflict with the provisions of the Plan.
     (c) Delegation to Committee. The Board may delegate administration of the
Plan to a Committee or Committees of one or more members of the Board, and the
term “Committee” shall apply to any person or persons to whom such authority has
been delegated. If administration is delegated to a Committee, the Committee
shall have, in connection with the administration of the Plan, the powers
theretofore possessed by the Board, including the power to delegate to a
subcommittee any of the administrative powers the Committee is authorized to
exercise (and references in this Plan to the Board shall thereafter be to the
Committee or subcommittee), subject, however, to such resolutions, not
inconsistent with the provisions of the Plan, as may be adopted from time to
time by the Board. The Board may abolish the Committee at any time and revest in
the Board the administration of the Plan.
     (d) Effect of Board’s Decision. All determinations, interpretations and
constructions made by the Board in good faith shall not be subject to review by
any person and shall be final, binding and conclusive on all persons.
4. Shares Subject to the Plan.
     (a) Share Reserve. Subject to the provisions of Section 11 relating to
adjustments upon changes in the Common Stock, the Common Stock that may be
issued pursuant to Options shall not exceed in the aggregate one hundred
twenty-five thousand (125,000) shares of Common Stock, plus an annual increase
to be added once each calendar year on September 1 for a period of ten
(10) years, commencing with September 1, 2004 and ending on (and including)
September 1, 2013 (each such day, a “Calculation Date”), equal to the lesser of
(i) one-half of one percent (0.5%) of the shares of Common Stock outstanding on
each such Calculation Date (rounded down to the nearest whole share), (ii) three
hundred thousand (300,000) shares of Common Stock, or (iii) such number of
shares of Common Stock as the Board shall determine.
     (b) Reversion of Shares to the Share Reserve. If any Option shall for any
reason expire or otherwise terminate, in whole or in part, without having been
exercised in full, the shares of Common Stock not acquired under such Option
shall revert to and again become available for issuance under the Plan. If the
exercise price of any Option is satisfied by tendering

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shares of Common Stock held by the Optionholder (either by actual delivery or
attestation), then the number of such tendered shares shall revert to and again
become available for issuance under the Plan.
     (c) Source of Shares. The shares of Common Stock subject to the Plan may be
unissued shares or reacquired shares, bought on the market or otherwise.
5. Eligibility.
     The Options, as set forth in Section 6, automatically shall be granted
under the Plan to all Non-Employee Directors who meet the criteria specified in
Section 6.
6. Non-Discretionary Grants.
     (a) Initial Grants. Without any further action of the Board, each person
who after March 25, 2008 is elected or appointed for the first time to be a
Non-Employee Director automatically shall, upon the date of his or her initial
election or appointment to be a Non-Employee Director, be granted an Initial
Grant to purchase twenty-five thousand (25,000) shares of Common Stock on the
terms and conditions set forth herein.
     (b) Annual Grants. Without any further action of the Board, on the date of
each Annual Meeting, commencing with the Annual Meeting in 2008, each person who
is then a Non-Employee Director automatically shall be granted an Annual Grant
to purchase fifteen thousand (15,000) shares of Common Stock on the terms and
conditions set forth herein; provided, however, that if the person has not been
serving as a Non-Employee Director for the entire period since the preceding
Annual Meeting , then the number of shares subject to such Annual Grant shall be
reduced pro rata (rounded to the nearest whole share) for each day in the
preceding year (based on a 365 day year) during which such person did not serve
as a Non- Employee Director.
7. Option Provisions.
     Each Option shall be in such form and shall contain such terms and
conditions as required by the Plan. Each Option shall contain such additional
terms and conditions, not inconsistent with the Plan, as the Board shall deem
appropriate. Each Option shall include (through incorporation of provisions
hereof by reference in the Option or otherwise) the substance of each of the
following provisions:
     (a) Term. No Option shall be exercisable after the expiration of ten
(10) years from the date it was granted.
     (b) Exercise Price. The exercise price of each Option shall be one hundred
percent (100%) of the Fair Market Value of the stock subject to the Option on
the date the Option is granted.
     (c) Consideration. The purchase price of stock acquired pursuant to an
Option may be paid, to the extent permitted by applicable law, in any
combination of (i) cash or check, (ii) delivery to the Company of other Common
Stock or (iii) pursuant to a program developed under

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Regulation T as promulgated by the Federal Reserve Board that, prior to the
issuance of Common Stock, results in either the receipt of cash (or check) by
the Company or the receipt of irrevocable instructions to pay the aggregate
exercise price to the Company from the sales proceeds. The purchase price of
Common Stock acquired pursuant to an Option that is paid by delivery to the
Company of other Common Stock acquired, directly or indirectly from the Company,
shall be paid only by shares of the Common Stock of the Company that have been
held for more than six (6) months (or such longer or shorter period of time
required to avoid a charge to earnings for financial accounting purposes).
     (d) Transferability. An Option is transferable by will or by the laws of
descent and distribution. An Option also may be transferable upon written
consent of the Company if, at the time of transfer, a Form S-8 registration
statement under the Securities Act is available for the exercise of the Option
and the subsequent resale of the underlying securities. In addition, an
Optionholder may, by delivering written notice to the Company, in a form
provided by or otherwise satisfactory to the Company, designate a third party
who, in the event of the death of the Optionholder, shall thereafter be entitled
to exercise the Option.
     (e) Vesting. The total number of shares of Common Stock subject to an
Option may, but need not, vest and therefore become exercisable in periodic
installments that may, but need not, be equal. The Option may be subject to such
other terms and conditions on the time or times when it may be exercised (which
may be based on performance or other criteria) as the Board may deem
appropriate. The vesting provisions of individual Options may vary. The
provisions of this Section 7(e) are subject to any Option provisions governing
the minimum number of shares of Common Stock as to which an Option may be
exercised.
     (f) Termination of Continuous Service. In the event an Optionholder’s
Continuous Service terminates for any reason, the Optionholder may exercise his
or her Option (to the extent that the Optionholder was entitled to exercise it
as of the date of termination) but only within such period of time ending on the
expiration of the term of the Option as set forth in the Option Agreement. If,
after termination, the Optionholder does not exercise his or her Option within
the time specified in the Option Agreement, the Option shall terminate.
8. Securities Law Compliance.
     The Company shall seek to obtain from each regulatory commission or agency
having jurisdiction over the Plan such authority as may be required to grant
Options and to issue and sell shares of Common Stock upon exercise of the
Options; provided, however, that this undertaking shall not require the Company
to register under the Securities Act the Plan, any Option or any stock issued or
issuable pursuant to any such Option. If, after reasonable efforts, the Company
is unable to obtain from any such regulatory commission or agency the authority
which counsel for the Company deems necessary for the lawful issuance and sale
of stock under the Plan, the Company shall be relieved from any liability for
failure to issue and sell stock upon exercise of such Options unless and until
such authority is obtained.

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9. Use of Proceeds from Stock.
     Proceeds from the sale of stock pursuant to Options shall constitute
general funds of the Company.
10. Miscellaneous.
     (a) Acceleration of Exercisability and Vesting. The Board shall have the
power to accelerate the time at which an Option may first be exercised or the
time during which an Option or any part thereof will vest in accordance with the
Plan, notwithstanding the provisions in the Plan or the Option stating the time
at which it may first be exercised or the time during which it will vest.
     (b) Stockholder Rights. No Optionholder shall be deemed to be the holder
of, or to have any of the rights of a holder with respect to, any shares subject
to such Option unless and until such Optionholder has satisfied all requirements
for exercise of the Option pursuant to its terms.
     (c) No Service Rights. Nothing in the Plan or any instrument executed or
Option granted pursuant thereto shall confer upon any Optionholder any right to
continue to serve the Company as a Non-Employee Director or shall affect the
right of the Company or an Affiliate to terminate (i) the employment of an
Employee with or without notice and with or without cause, (ii) the service of a
Consultant pursuant to the terms of such Consultant’s agreement with the Company
or an Affiliate or (iii) the service of a Director pursuant to the Bylaws of the
Company or an Affiliate, and any applicable provisions of the corporate law of
the state in which the Company or the Affiliate is incorporated, as the case may
be.
     (d) Investment Assurances. The Company may require an Optionholder, as a
condition of exercising or acquiring stock under any Option, (i) to give written
assurances satisfactory to the Company as to the Optionholder’s knowledge and
experience in financial and business matters and/or to employ a purchaser
representative reasonably satisfactory to the Company who is knowledgeable and
experienced in financial and business matters and that he or she is capable of
evaluating, alone or together with the purchaser representative, the merits and
risks of exercising the Option; and (ii) to give written assurances satisfactory
to the Company stating that the Optionholder is acquiring the stock subject to
the Option for the Optionholder’s own account and not with any present intention
of selling or otherwise distributing the stock. The foregoing requirements, and
any assurances given pursuant to such requirements, shall be inoperative if
(1) the issuance of the shares upon the exercise or acquisition of stock under
the Option has been registered under a then currently effective registration
statement under the Securities Act or (2) as to any particular requirement, a
determination is made by counsel for the Company that such requirement need not
be met in the circumstances under the then applicable securities laws. The
Company may, upon advice of counsel to the Company, place legends on stock
certificates issued under the Plan as such counsel deems necessary or
appropriate in order to comply with applicable securities laws, including, but
not limited to, legends restricting the transfer of the stock.

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     (e) Withholding Obligations. The Optionholder may satisfy any federal,
state or local tax withholding obligation relating to the exercise or
acquisition of stock under an Option by any of the following means (in addition
to the Company’s right to withhold from any compensation paid to the
Optionholder by the Company) or by a combination of such means: (i) tendering a
cash payment; (ii) authorizing the Company to withhold shares from the shares of
the Common Stock otherwise issuable to the Optionholder as a result of the
exercise or acquisition of stock under the Option; provided, however, that no
shares of Common Stock are withheld with a value exceeding the minimum amount of
tax required to be withheld by law; or (iii) delivering to the Company owned and
unencumbered shares of the Common Stock.
11. Adjustments upon Changes in Common Stock.
     (a) Capitalization Adjustments. If any change is made in, or other events
occur with respect to, the stock subject to the Plan, or subject to any Option,
without the receipt of consideration by the Company (through merger,
consolidation, reorganization, recapitalization, reincorporation, stock
dividend, dividend in property other than cash, stock split, liquidating
dividend, combination of shares, exchange of shares, change in corporate
structure or other transaction not involving the receipt of consideration by the
Company (each a “Capitalization Adjustment”)), the Plan will be appropriately
adjusted in the class(es) and maximum number of securities subject both to the
Plan pursuant to Section 4 and to the nondiscretionary Options specified in
Section 6, and the outstanding Options will be appropriately adjusted in the
class(es) and number of securities and price per share of stock subject to such
outstanding Options. The Board shall make such adjustments, and its
determination shall be final, binding and conclusive. (The conversion of any
convertible securities of the Company shall not be treated as a transaction
“without receipt of consideration” by the Company.)
     (b) Dissolution or Liquidation. In the event of a dissolution or
liquidation of the Company, then all outstanding Options shall terminate
immediately prior to the completion of such dissolution or liquidation.
     (c) Corporate Transaction. In the event of a Corporate Transaction, any
surviving corporation or acquiring corporation may assume any or all Options
outstanding under the Plan or may substitute similar stock options for Options
outstanding under the Plan (it being understood that similar stock options
include, but are not limited to, options to acquire the same consideration paid
to the stockholders of the Company, as the case may be, pursuant to the
Corporate Transaction). In the event that any surviving corporation or acquiring
corporation does not assume all such outstanding Options or substitute similar
stock options for such outstanding Options, then with respect to Options that
have been neither assumed nor substituted and that are held by Optionholders
whose Continuous Service has not terminated prior to the effective time of the
Corporate Transaction, the vesting of such Options (and, if applicable, the time
at which such Options may be exercised) shall (contingent upon the effectiveness
of the Corporate Transaction) be accelerated in full to a date prior to the
effective time of such Corporate Transaction as the Board shall determine (or,
if the Board shall not determine such a date, to the date that is five (5) days
prior to the effective time of the Corporate Transaction), and such Options
shall terminate on the date that is twelve (12) months after the effective time
of the Corporate Transaction if not exercised (if applicable) at or prior to
such date. With respect to any other Options outstanding under the Plan that
have been neither assumed nor substituted, the

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vesting of such Options (and, if applicable, the time at which such Options may
be exercised) shall not be accelerated, unless otherwise provided in a written
agreement between the Company or any Affiliate and the holder of such Options,
and such Options shall terminate if not exercised (if applicable) prior to the
effective time of the Corporate Transaction.
     (d) Change of Control. Upon a Change in Control, the vesting of Options
that are held by Optionholders whose Continuous Service has not terminated prior
to the effective time of the Change in Control (and, if applicable, the time at
which such Options may be exercised) shall (contingent upon the effectiveness of
the Change in Control) be accelerated in full to a date prior to the effective
time of such Change in Control as the Board shall determine (or, if the Board
shall not determine such a date, to the date that is five (5) days prior to the
effective time of the Change in Control), and such Options shall terminate on
the date that is twelve (12) months after the effective time of the Change in
Control if not exercised (if applicable) at or prior to date. With respect to
any other Options outstanding under the Plan, the vesting of such Options (and,
if applicable, the time at which such Options may be exercised) shall not be
accelerated, unless otherwise provided in a written agreement between the
Company or any Affiliate and the holder of such Options, and such Options shall
terminate if not exercised (if applicable) prior to the effective time of the
Change in Control.
12. Amendment of the Plan and Options.
     (a) Amendment of Plan. The Board, at any time and from time to time, may
amend the Plan. However, except as provided in Section 11 relating to
adjustments upon changes in Common Stock, no amendment shall be effective unless
approved by the stockholders of the Company to the extent stockholder approval
is necessary to satisfy the requirements of applicable laws.
     (b) Stockholder Approval. The Board, in its sole discretion, may submit any
other amendment to the Plan for stockholder approval.
     (c) No Impairment of Rights. Rights under any Option granted before
amendment of the Plan shall not be impaired by any amendment of the Plan unless
(i) the Company requests the consent of the Optionholder and (ii) the
Optionholder consents in writing.
     (d) Amendment of Options. The Board, at any time, and from time to time,
may amend the terms of any one or more Options, including, but not limited to,
amendments to provide terms more favorable than previously provided in the
agreement evidencing an Option, subject to any specified limits in the Plan that
are not subject to Board discretion; provided, however, that the rights under
any Option shall not be impaired by any such amendment unless (i) the Company
requests the consent of the Optionholder and (ii) the Optionholder consents in
writing.
13. Termination or Suspension of the Plan.
     (a) Plan Term. The Board may suspend or terminate the Plan at any time. No
Options may be granted under the Plan while the Plan is suspended or after it is
terminated.

11.

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     (b) No Impairment of Rights. Suspension or termination of the Plan shall
not impair rights and obligations under any Option granted while the Plan is in
effect except with the written consent of the Optionholder.
14. Effective Date of Plan.
     The Plan shall become effective on the IPO Date, but no Option shall be
exercised unless and until the Plan has been approved by the stockholders of the
Company, which approval shall be within twelve (12) months before or after the
date the Plan is adopted by the Board.
15. Choice of Law.
     The law of the state of California shall govern all questions concerning
the construction, validity and interpretation of this Plan, without regard to
such state’s conflict of laws rules.

12.