Exhibit 10.39

 

HEXCEL CORPORATION

2009 EMPLOYEE STOCK PURCHASE PLAN

 

1.             Purpose.  The Plan is intended to provide Employees (as defined
herein) of the Company and its Designated Subsidiaries, with the opportunity to
apply a portion of their compensation to the purchase of Common Stock of the
Company in accordance with the terms of the Plan, to promote and increase the
ownership of Common Stock by such Employees and to better align the interests of
the Employees and the Company’s stockholders and to thereby increase overall
stockholder value.  The Plan is intended to be qualified for purposes of
Section 423 of the Code.  The provisions of the Plan shall, accordingly, be
construed so as to extend and limit participation in a manner consistent with
the requirements of that section of the Code.

 

2.             Definitions.

 

(a)           “Board” means the Board of Directors of the Company.

 

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

 

(c)           “Committee” means the Compensation Committee of the Board or its
authorized delegate.

 

(d)           “Common Stock” means the Common Stock, $0.01 par value, of the
Company.

 

(e)           “Company” means Hexcel Corporation, a Delaware corporation.

 

(f)            “Compensation” means the base salary, straight time gross
earnings, overtime, shift premium, cash bonuses and commissions paid to an
Employee, including an Employee’s portion of any elective deferral contributed
on the Employee’s behalf to a plan described in Section 401(k) of the Code, any
amount excludable pursuant to Section 125 or 132(f) of the Code and any
compensation deferral made under the Hexcel Nonqualified Deferred Compensation
Plan.

 

(g)           “Continuous Status as an Employee” means the absence of any
interruption or termination of service as an Employee other than ordinary
vacation and short-term disability absences. Continuous Status as an Employee
shall not be considered interrupted in the case of a leave of absence agreed to
in writing by the Company, provided that such leave is for a period of not more
than 90 days or reemployment upon the expiration of such leave is guaranteed by
contract or statute.

 

(h)           “Contributions” means all amounts credited to the Plan Account of
a Participant pursuant to the Plan.

 

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(i)            “Custodial Account” means a master custodial account at the
Custodian that is established to hold title to all shares of Common Stock
purchased for the benefit of all Participants under the Plan.

 

(j)            “Custodian” means any custodian selected by the Company, from
time to time, to manage the Custodial Account for the Participants under the
Plan.

 

(k)           “Designated Subsidiaries” means the Subsidiaries, if any, which
have been designated by the Committee from time to time in its sole discretion
as eligible to participate in the Plan and which are listed in Appendix A.

 

(l)            “Employee” means any employee of the Company or one of its
Designated Subsidiaries (as determined under Code section 3401(c) and the
regulations thereunder) who is customarily employed by the Company or one of its
Designated Subsidiaries for more than (20) hours per week and more than five
months in a calendar year.  Notwithstanding the foregoing, any employee who is a
citizen or resident of a foreign jurisdiction (without regard to whether he or
she is also a citizen or resident alien of the United States) shall be excluded
from coverage under the Plan if the grant of an option under the Plan to such
employee is prohibited under the laws of such jurisdiction or if compliance with
the laws of the foreign jurisdiction would cause the plan to violate the
requirements of Code section 423.

 

(m)          “Enrollment Date” means the first business day of each Offering
Period under the Plan.

 

(n)           “Exchange Act” means the Securities Exchange Act of 1934, as
amended.

 

(o)           “Exercise Date” means the last business day of each Offering
Period of the Plan.

 

(p)           “Offering” means the offer for sale to eligible Employees of the
Company and its Designated Subsidiaries of shares of Common Stock at the price
and subject to the other terms and conditions determined by the Committee in
accordance with the terms of the Plan.  The right to purchase shares of Common
Stock pursuant to an Offering is sometimes referred to below as an option, and
the commencement of an individual’s participation in an Offering is sometimes
referred to as the granting of an option to such individual.

 

(q)           “Offering Date” means, with respect to an Offering, the date on
which the Company completes the corporate action constituting an offer of stock
for sale to an Employee, as determined under Section 1.421-1(c) of the U.S.
Treasury Regulations, but without regard to the requirement that the minimum
exercise price must be fixed or determinable in order for the corporate action
to be considered complete.  The Offering Date with respect to an Offering will
be the same as the Enrollment Date for such Offering, provided the terms of the
Offering designate, as of the Enrollment Date, a maximum number of shares of
Common Stock or a formula for establishing the maximum number of shares of
Common Stock that may be purchased by each Employee during the Offering.  Unless
the Committee specifies otherwise with respect to an Offering, the maximum
number of shares of Common Stock that may be purchased by each Employee during
an Offering shall be two thousand five hundred (2500) shares, subject to the
limitation described in Section 5(c) below.  If the terms of an Offering do not
designate, as of the Enrollment Date, a maximum number of shares of Common Stock
or a formula for establishing the maximum number of shares of Common Stock that
may be purchased by

 

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each Employee during the Offering, the Offering Date will be the same as the
Exercise Date.

 

(r)            “Offering Period” means a period of up to twenty-seven (27)
calendar months commencing on the Enrollment Date during which an Offering is
made.  The length of an Offering Period with respect to a particular Offering
under the Plan shall be determined by the Committee in its discretion.

 

(s)           “Participant” means any Employee who is eligible to participate in
an Offering pursuant to Section 3, who has delivered a Subscription Agreement to
the Company with respect to such Offering, whose Continuous Status as an
Employee has not terminated prior to the Exercise Date with respect to such
Offering and who has not delivered to the Company a Participation Termination
Notice at least ten (10) days prior to the Exercise Date with respect to such
Offering.

 

(t)            “Participation Termination Notice” has the meaning given thereto
in Section 10 hereof.

 

(u)           “Plan” means this Employee Stock Purchase Plan.

 

(v)           “Plan Account” means, with respect to each Participant, an account
established by the Custodian to record Contributions to the Plan made by such
Participant and the use of such Contributions as they are either (i) applied by
the Company for the purchase of Common Stock under the Plan for the account of
such Participant or (ii) repaid to such Participant pursuant to the Plan.

 

(w)          “Subsidiary” shall mean any corporation (other than the Company) in
an unbroken chain of corporations beginning with the Company if, at the time of
granting an option, each of the corporations other than the last corporation in
the unbroken chain owns shares possessing fifty percent (50%) or more of the
total combined voting power of all classes of shares in one of the other
corporations in such chain.

 

3.             Eligibility.

 

(a)           With respect to any Offering under the Plan, any person whose
Continuous Status as an Employee has been uninterrupted for the six (6)-month
period immediately prior to the Enrollment Date with respect to such Offering
and who has reached the age of majority in the state of his or her residence as
of the Enrollment Date with respect to such Offering shall be eligible to
participate in such Offering, subject to the requirements of Section 5(a).  An
otherwise eligible Employee who has acquired less than six (6) months of
uninterrupted Continuous Status as an Employee as of any Enrollment Date shall
not be eligible to participate until the start of the next available Offering,
even if such person should acquire six (6) months of uninterrupted Continuous
Status as an Employee during the course of the current Offering.

 

(b)           Notwithstanding Section 3(a) or any provision of the Plan to the
contrary, no Employee shall be granted an option under the Plan to the extent
that immediately after the grant, such Employee (or any other person whose stock
would be attributed to such Employee pursuant to Section 424(d) of the Code)
would own stock and/or hold outstanding options to purchase stock possessing
five percent (5%) or more of the total combined voting power or value of all
classes of stock of the Company or of any Subsidiary of the Company.

 

4.             Offering Periods; Terms Relating to Offerings.

 

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(a)           The Plan shall be implemented by a series of consecutive Offering
Periods.  The first Offering Period shall be for a period of three
(3) consecutive months and shall commence on July 1, 2009.  Unless otherwise
determined by the Committee, each subsequent Offering Period shall also be a for
a period of three (3) consecutive months and shall commence on the first day of
each succeeding calendar quarter.  The Committee shall have the power to change
the duration and/or the frequency of Offering Periods with respect to future
Offerings and shall use its best efforts to announce such change at least
fifteen (15) calendar days prior to the scheduled Enrollment Date of the first
Offering Period to be affected.  The Plan shall continue until terminated in
accordance with Section 22 below.

 

(b)           The Committee shall set the terms and conditions of the Offering
with respect to each Offering Period, consistent with the terms of the Plan. 
The terms and conditions of each Offering shall be communicated to the Employees
eligible to participate in the Offering at least fifteen (15) calendar days in
advance of the Enrollment Date with respect to the Offering.  With respect to
any Offering, options may be granted under the Offering only to eligible
Employees and only to purchase Common Stock.  With respect to any Offering, if
any eligible Employee of the Company is granted an option under the Offering
then all eligible Employees of the Company shall be granted options under the
same Offering, and if any eligible Employee of a Designated Subsidiary is
granted an option under the Offering then all eligible Employees of such
Designated Subsidiary shall be granted options under the same Offering.  Except
as otherwise specifically permitted under Section 1.423-2(f) of the U.S.
Treasury Regulations and the Plan, all Employees granted options under any
Offering shall have the same rights and privileges, and the provisions applying
to any one option under an Offering (including without limitation the provisions
relating to the method of payment for the Common Stock and the determination of
the applicable exercise price) shall be the same as the provisions which apply
to any other option granted under the same Offering.

 

5.             Participation.

 

(a)           An Employee who is eligible to participate in the Plan pursuant to
Section 3 hereof may become a participant in the Plan by completing a
subscription agreement in the form provided by the Company (a “Subscription
Agreement”) and filing it with the appropriate representative of the Company or
the Designated Subsidiary that employs such Employee in accordance with the
terms of the Subscription Agreement not later than fifteen (15) calendar days
prior to any Enrollment Date, unless a later time for filing Subscription
Agreements is established by the Committee for all eligible Employees with
respect to a given Offering. Each Subscription Agreement shall authorize the
payroll deductions to be made by the Company (if the Company is the Employee’s
employer) or Designated Subsidiary (if the Designated Subsidiary is the
Employee’s employer) from the Employee’s Compensation as Contributions to the
Plan as provided in Section 6(a).  Each Subscription Agreement shall constitute
the Employee’s (i) election to participate in the Plan for the current and all
subsequent Offering Periods until such time as (1) the Company has received
Participation Termination Notice from such Employee pursuant to Section 10,
(2) a new Subscription Agreement designating a different level of participation
is delivered to the Company by such Employee or (3) the termination of such
Employee’s Continuous Status as an Employee, and (ii) authorization for the
Company to withhold (in the manner determined by the Company or the applicable
Designated Subsidiary) any taxes or other payroll deductions that are required
to be withheld by the Company or the applicable Designated Subsidiary due to the
Employee’s participation in the Plan or the exercise of any option or purchase
of any Common Stock under the Plan.

 

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(b)           Payroll deductions with respect to each Participant shall commence
on the first payday following the first Enrollment Date following the Company’s
receipt of the applicable Subscription Agreement and shall end on the last
payday on or prior to the termination of such Employee’s Continuous Status as an
Employee, unless sooner terminated by the Participant as provided in Section 10.
 To the extent that the Participant elects to have a percentage of his or her
Compensation deducted, payroll deductions shall automatically be increased or
decreased to reflect changes in Compensation during such Offering Period, but a
Participant shall not otherwise be entitled to increase or decrease his or her
contribution rate during an Offering Period.

 

(c)           Notwithstanding the foregoing or any other provision of the Plan
to the contrary, no Employee shall be granted an option under the Plan to the
extent that such Employee’s right to purchase stock under all employee stock
purchase plans of the Company and any Subsidiary of Company, including this
Plan, accrues at a rate which exceeds twenty-five thousand dollars ($25,000) of
the Fair Market Value of such stock for any calendar year in which such option
would be outstanding at any time.  For purposes of this limit, the Fair Market
Value of the stock shall equal the closing price of the stock as determined from
the New York Stock Exchange Consolidated Transaction Tape on the Offering Date
on which the option is granted.  To the extent necessary to comply with the
preceding sentence, the Committee may reduce or stop a Participant’s
Contributions at any time during an Offering Period.  The Participant’s
Contributions shall recommence at the rate provided in such Participant’s
Subscription Agreement at the beginning of the first Offering Period which is
scheduled to end in the following calendar year, unless terminated earlier as
provided in Section 10 hereof.

 

6.             Method of Payment of Contributions.

 

(a)           The Participant shall elect to have payroll deductions made on
each payday during the Offering Period either (1) in a whole percentage amount
of between one percent (1%) and not more than ten percent (10%) of such
Participant’s Compensation on each such payday or (2) in a whole dollar amount
(that shall be not less than $5.00 and not more than an amount equal to 10% of
such Participant’s Compensation) of such Participant’s Compensation on each such
payday. All payroll deductions made with respect to a Participant shall be
credited to his or her Plan Account. A Participant may not make any additional
payments into his or her Plan Account.

 

(b)           A Participant may discontinue his or her participation in an
Offering as provided in Section 10. A Participant may increase or decrease the
rate of his or her Contributions for future Offerings by completing and filing
with the Company a new Subscription Agreement no later than fifteen (15)
calendar days prior to the Enrollment Date for the Offering for which such
change will become effective. Subject to the prior sentence, the change in rate
shall be effective as of the first pay period ending in the first new Offering
Period following the date of filing of the new Subscription Agreement.

 

7.             Grant of Option. On the Enrollment Date with respect to each
Offering, each eligible Employee participating in such Offering shall be granted
an option to purchase on the Exercise Date with respect to such Offering a
number of shares of Common Stock determined by dividing such Employee’s
Contributions accumulated during the Offering Period prior to such Exercise Date
and retained in the Participant’s Plan Account as of the Exercise Date by the
applicable option exercise price for the Offering, as determined by the
Committee.  The applicable option exercise price with respect to the first
Offering shall be eighty-five percent (85%) of the closing price of the Common
Stock as determined from the New York Stock Exchange Consolidated Transaction
Tape on the Offering Date or the Exercise Date for that Offering, whichever is

 

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lower, or, if there were no sales of Common Stock on one or both of such dates,
on the next preceding date prior to either such date on which such closing price
was recorded.  Unless otherwise determined by the Committee, the applicable
option exercise price for each subsequent Offering shall be the same as
described in the preceding sentence.  The Committee shall have the power to
change the option exercise price with respect to future Offerings and shall use
its best efforts to announce such change at least fifteen (15) calendar days
prior to the scheduled Enrollment Date of the first Offering Period to be
affected.  Notwithstanding the foregoing, the applicable option exercise price
with respect to any Offering shall not be less than eighty-five percent (85%) of
the closing price of the Common Stock as determined from the New York Stock
Exchange Consolidated Transaction Tape on the Offering Date (if different than
the Exercise Date) or the Exercise Date for that Offering, whichever is lower,
or, if there were no sales of Common Stock on one or both of such dates, on the
next preceding date prior to either such date on which such closing price was
recorded.

 

8.             Exercise of Option.

 

(a)           Unless a Participant withdraws from the Plan as provided in
Section 10, each Participant’s option for the purchase of shares for a
particular Offering will be exercised automatically on the Exercise Date of the
Offering Period with respect to such Offering, and the maximum number of whole
and fractional shares subject to the option will be purchased for the
Participant at the applicable exercise price described in Section 7 with the
Contributions which were made to the Participant’s Plan Account during such
Offering Period.  The shares of Common Stock purchased upon exercise of an
option hereunder shall be deemed to be transferred to the Participant’s Plan
Account on the Exercise Date.  Any amounts remaining in a Participant’s Plan
Account not applied to the purchase of Common Stock pursuant to this Section 8
shall be refunded on or promptly after the applicable Exercise Date. 
Participants will have no interest (including any interest in any ordinary or
special dividends) or voting right in shares of Common Stock that are subject to
any option until such option has been exercised.

 

(b)           As promptly as reasonably practicable following each Exercise
Date, the Company shall cause the shares purchased by each Participant to be
credited to such Participant’s Plan Account. The Company will deliver to the
Custodian or its nominee appropriate documentation or other evidence
representing all of the full and fractional shares that are to be allocated to
each Participant’s Plan Account.  New fractional shares shall be added to
fractional shares previously allocated to the Participant’s Plan Account to form
new whole shares.  Upon delivery to the Participant pursuant to Section 9, any
fractional shares then allocated to the Participant’s Plan Account shall be paid
to the Participant in cash, based on the closing price per share of the Common
Stock on the date on which the shares are delivered.  The Company shall pay to
the Custodian an amount in cash equal to the value of the fractional share that
would otherwise be delivered for payment to the Participant.  Upon termination
of the Plan, the Custodian shall redeliver to the Company all shares (including
fractional shares) of Common Stock and any other asserts in the Custodial
Account that have not been allocated to Participants’ Plan Accounts. The whole
shares of Common Stock in each Participant’s Plan Account shall be voted in
accordance with the Participant’s signed proxy instructions duly delivered to
the Custodian by mail or otherwise, in accordance with the rules applicable to
stock listed on the New York Stock Exchange.

 

9.             Delivery.  Upon the written request of a Participant delivered to
the Custodian, the Custodian will (i) cause any number of whole shares held in
the Participant’s Plan Account at the time of such notice that the Participant
has requested to receive to be (a) issued to an account established in the
Participant’s name with the

 

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Company’s transfer agent via the Direct Registration System (“DRS”), or
(b) transferred electronically to a brokerage account designated by the
Participant and, (ii) pay to the Participant in cash an amount equal to the
value of any fractional shares held in the Participant’s Plan Account at the
time of such notice that the Participant has requested to receive.  Upon
termination of a Participant’s Continuous Status as an Employee with the Company
or one of its Designated Subsidiaries for any reason, the Company will (i) cause
any number of whole shares held in the Participant’s Plan Account as of the date
of such termination to be (a) issued to an account established in the
Participant’s name with the Company’s transfer agent via DRS, or (b) transferred
electronically to a brokerage account designated by the Participant and,
(ii) pay to the Participant in cash an amount equal to the value of any
fractional shares held in the Participant’s Plan Account as of the date of such
termination.  All amounts to be paid to an Employee pursuant to this Section 9
with respect to fractional shares shall be determined by reference to the
closing price of the Common Stock determined from the New York Stock Exchange
Consolidated Transaction Tape on the date of the Participant’s notice to the
Company or termination, as applicable, or, if there were no sales of the Common
Stock on such date, on the next preceding day on which such closing price was
recorded.

 

10.           Withdrawal; Termination of Employment.

 

(a)           A Participant may cease participation in any Offering by
withdrawing all but not less than all the Contributions credited to his or her
Plan Account, which have not been applied to the purchase of Common Stock, prior
to the Exercise Date of the Offering Period, by giving written notice to the
Company (a “Participation Termination Notice”) not less than ten (10) calendar
days prior to the Exercise Date of the Offering Period. Any Participation
Termination Notice delivered subsequent to the tenth calendar day prior to any
Exercise Date shall not be effective during the Offering Period during which it
was delivered, but will be effective as of the first day of the immediately
succeeding Offering Period. Upon the effectiveness of an Employee’s
Participation Termination Notice, all of the Participant’s Contributions
credited to his or her Plan Account, which have not been applied to the purchase
of Common Stock, and any taxes that the Company or a Designated Subsidiary
withheld in connection therewith, will be paid promptly to the Participant,
without interest, and his or her outstanding option will automatically
terminate. An Employee who terminates his or her participation in an Offering
will not be again eligible to participate until the Enrollment Date for the
first Offering Period following the expiration of the Offering Period during
which the Participant’s Participation Termination Notice becomes effective.

 

(b)           Upon termination of a Participant’s Continuous Status as an
Employee prior to the Exercise Date of the then current Offering Period for any
reason, including retirement or death, the Contributions credited to his or her
Plan Account which have not been applied to the purchase of Common Stock,
together with all taxes that the Company or a Designated Subsidiary has withheld
in connection therewith, will be returned to him or her or, in the case of his
or her death, to the person or persons entitled thereto under Section 14,
without interest, and his or her outstanding option and future participation in
the Plan will automatically terminate.

 

(c)           Other than as set forth in Section 10(a), a Participant’s
withdrawal from an Offering under the Plan, whether voluntary or involuntary,
will not affect his or her eligibility to participate in any Offering under the
Plan in the future should he or she again qualify for participation in the
Offering or in any offering under a similar plan which may hereafter be adopted
by the Company.

 

11.           Interest and Dividends.  No interest shall accrue on the
Contributions of a

 

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Participant in the plan or any taxes withheld in connection therewith.  A
Participant shall not be entitled to any ordinary or special dividends paid with
respect to shares of Common Stock that are subject to any option until such
option has been exercised.  The Company shall cause any ordinary or special
dividends paid with respect to shares of Common Stock credited to Participants’
Plan Accounts to be credited to each Participant’s Plan Account as promptly as
reasonably practicable following the dividend record date, and shall deliver
appropriate documentation or pay appropriate cash amounts to the Custodian
representing the shares of Common Stock or cash amounts, respectively,
creditable with respect to any such dividend.

 

12.           Stock.  The maximum number of shares of Common Stock which shall
be reserved for sale under the Plan shall be two hundred and fifty thousand
(250,000) shares, subject, however, to adjustment upon changes in capitalization
of the Company as provided in Section 18.  Such shares shall be reserved from
the Company’s authorized but unissued shares and/or treasury shares that are not
otherwise reserved for issuance under any other plan or with respect to any
convertible security.  If the total number of shares which would otherwise be
subject to options granted pursuant to Section 7 hereof on the Enrollment Date
of an Offering Period exceeds the number of shares then available under the Plan
(after deduction of all shares for which options have been exercised or are then
outstanding), the Committee shall make a pro rata allocation of the shares
remaining available for option grants in as uniform a manner as shall be
practicable and as it shall determine to be equitable.  In such event, the
Company shall give written notice of such reduction of the number of shares
subject to the option to each Employee affected thereby and shall reduce or
cease future withholdings and Contributions under the Plan, if necessary.  Only
the number of shares that are issued pursuant to exercised options shall reduce
the number of shares available under the Plan. Shares that become subject to
options which are later terminated shall again be available under the Plan.

 

13.           Administration.

 

(a)           Except as otherwise determined by the Board, the Committee shall
administer the Plan. The Committee shall have the authority in its discretion,
subject to and not inconsistent with the express provisions of the Plan and the
determinations of the Board, to administer the Plan and to exercise all powers
and authorities either specifically granted to it under the Plan or necessary or
advisable in the administration of the Plan, including, without limitation, the
authority to determine, from time to time, eligible Employees; to interpret and
construe the Plan and the provisions of the Subscription Agreements; to
prescribe, amend and rescind rules and regulations relating to the Plan; to
determine the terms and provisions of the Offerings and Subscription Agreements
and to cancel or suspend the participation of any Employee or group of
Employees, and to make all other determinations deemed necessary or advisable
for the administration of the Plan.

 

(b)           The Board shall fill all vacancies, however caused, in the
Committee. The Board may from time to time appoint additional members to the
Committee, and may at any time remove one or more Committee members and
substitute others. The Committee may appoint a chairperson and a secretary and
make such rules and regulations for the conduct of its business as it shall deem
advisable, and shall keep minutes of its meetings. The Committee shall hold its
meetings at such times and places (and its telephonic meetings at such times) as
it shall deem advisable. The Committee may delegate to one or more of its
members or to one or more agents such administrative duties as it may deem
advisable, and the Committee or any person to whom it has delegated duties as
aforesaid may employ one or more persons to render advice with respect to any
responsibility the Committee or such person may have under the Plan. Except to
the extent otherwise determined by the Board, all decisions, determinations and
interpretations of the

 

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Committee shall be final and binding on all persons, including, without
limitation, the Company, the Participants (or any person claiming any rights
under the Plan from or through any Participant) and any stockholder.

 

(c)           No member of the Board or of the Committee shall be liable for any
action or determination made in good faith, and the members of the Board or of
the Committee shall be entitled to indemnification and reimbursement in the
manner provided in the Company’s Certificate of Incorporation, as it may be
amended from time to time.

 

14.           Designation of Beneficiary.

 

(a)           A Participant may file a written designation of a beneficiary who
is to receive any shares of Common Stock and cash, if any, from the
Participant’s Plan Account in the event of such Participant’s death by
delivering notice of such beneficiary to the Company. If a Participant is
married and the designated beneficiary is not the spouse, spousal consent shall
be required for such designation to be effective.

 

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

 

15.           Transferability. Neither Contributions credited to a Participant’s
Plan Account nor any rights with regard to the exercise of an option or to
receive shares under the Plan may be assigned, transferred, pledged or otherwise
disposed of in any way (other than by will, the laws of descent and distribution
or as provided in Section 14 hereof) by the Participant. Any such attempt at
assignment, transfer, pledge or other disposition shall be without effect,
except that the Company may treat such act as an election to withdraw funds in
accordance with Section 10. No Contribution made under this Plan or amount
representing a Participant’s Plan Account balance shall be subject to execution,
attachment or process.  A Participant’s option to purchase shares of Common
Stock under the Plan may be exercised during the Participant’s lifetime only by
the Participant.

 

16.           Use of Funds.  The Participants’ rights with respect to
Contributions made to the Plan and the balances, from time to time, in their
respective Plan Accounts shall be those of general creditors of the Company or
of the applicable Designated Subsidiary.  All Contributions received or held by
the Company or a Designated Subsidiary under the Plan may be used for any
corporate purpose, and the Company or Designated Subsidiary, as applicable,
shall not be obligated to segregate such Contributions.

 

17.           Reports and Fees of Plan Accounts. Individual Plan Accounts will
be maintained for each Participant. Statements of account will be given to
Participants promptly following each Exercise Date, which statements will set
forth the total amount of Contributions to the Plan Account during the most
recently completed Offering Period, the per share purchase price and the number
of shares purchased on the most recent Exercise Date, and the total number of
shares and fractional shares represented by such Participant’s Plan Account. The
Company shall pay the annual and any extraordinary maintenance fees for the
Custodial Account and each Plan Account.  The Participant will be responsible
for

 

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paying all transaction fees not paid by the Company pursuant to the preceding
sentence.

 

18.           Adjustments Upon Changes in Capitalization.

 

(a)           The number of shares of Common Stock covered by each unexercised
option under the Plan and the number of shares of Common Stock which have been
authorized for issuance under the Plan but which have not yet been issued and
are not subject of an unexercised option (collectively, the “Reserves”), as well
as the price per share of Common Stock covered by each option under the Plan for
which the exercise price has been determined but which has not yet been
exercised, shall be proportionately adjusted for any increase or decrease in the
number of issued shares of Common Stock resulting from a stock split, reverse
stock split, stock dividend, combination or reclassification of the Common
Stock, or any other increase or decrease in the number of shares of Common Stock
effected without receipt of consideration by the Company; provided, however,
that conversion of any convertible securities of the Company shall not be deemed
to have been “effected without receipt of consideration”. Such adjustments shall
be made by the Board, whose determination in that respect shall be final,
binding and conclusive. Except as expressly provided herein, no issue by the
Company of shares of stock of any class, or securities convertible into shares
of stock of any class, shall affect, and no adjustment by reason thereof shall
be made with respect to, the number or price of shares of Common Stock subject
to an option.

 

(b)           In the event of the proposed dissolution or liquidation of the
Company, the then current Offering Period will terminate immediately prior to
the consummation of such proposed action, unless otherwise provided by the
Committee. In the event of a proposed sale of all or substantially all of the
assets of the Company, or the merger of the Company with or into another
corporation, each option under the Plan shall be assumed or an equivalent option
shall be substituted by such successor corporation or a parent or subsidiary of
such successor corporation, unless the Committee determines, in the exercise of
its sole discretion and in lieu of such assumption or substitution, to shorten
the Offering Period then in progress by setting a new Exercise Date (the “New
Exercise Date”). If the Committee shortens the Offering Period then in progress
in lieu of assumption or substitution in the event of a merger or sale of
assets, the Committee shall use its best efforts to notify each participant in
writing, at least ten (10) days prior to the New Exercise Date, that the
Exercise Date for his or her option has been changed to the New Exercise Date
and that his or her option will be exercised automatically on the New Exercise
Date, unless prior to such date he or she has withdrawn from the Offering Period
as provided in Section 10. For purposes of this Section, an option granted under
the Plan shall be deemed to be assumed if, following the sale of assets or
merger, the option confers the right to purchase, for each share of Common Stock
subject to the option immediately prior to the sale of assets or merger, the
consideration (whether stock, cash or other securities or property) received in
the sale of assets or merger by holders of Common Stock for each share of Common
Stock held on the effective date of the transaction (and if such holders were
offered a choice of consideration, the type of consideration chosen by the
holders of a majority of the outstanding shares of Common Stock).

 

19.           Amendment or Termination.

 

(a)           The Committee may at any time terminate the Plan or from time to
time make such modifications or amendments of the Plan as it may deem advisable;
provided, however, that no amendments to the Plan which require stockholder
approval under applicable law, rule or regulation shall become effective unless
the same shall be approved by the requisite vote of the Company’s stockholders. 
The Committee or the Board may make any modification or amendment to the Plan
that it deems necessary or advisable in

 

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order to implement the Plan in a manner consistent with any law or regulation
applicable to the Company or any Designated Subsidiary. The Committee shall
inform all Participants and Employees eligible to participate in the Plan, who
would be affected thereby, of any such modification or amendment. Except as
provided in Section 18, no such termination may affect options previously
granted, nor may an amendment make any change in any option theretofore granted
which adversely affects the rights of any Participant.

 

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

 

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

 

21.           Conditions Upon Issuance of Shares.

 

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

 

(b)           As a condition to the exercise of an option, the Company may
require the person exercising such option to represent and warrant at the time
of any such exercise that the shares are being purchased only for investment and
without any present intention to sell or distribute such shares if, in the
opinion of counsel for the Company, such a representation is required by any of
the aforementioned applicable provisions of law. If the issuance of any shares
of Common Stock pursuant to the Plan is not so registered under the Securities
Act, certificates for such shares shall bear a legend reciting the fact that
such shares may only be transferred pursuant to an effective registration
statement under the Securities Act or an opinion of counsel to the Company that
such registration is not required. The Company may also issue “stop transfer”
instructions with respect to such shares while they are subject to such
restrictions.

 

(c)           The Company shall use its best efforts to have the shares issued
under the Plan listed on each securities exchange on which the Common Stock is
then listed as promptly as possible. The Company shall not be obligated to issue
or sell any shares under the Plan until they have been listed on each securities
exchange on which the Common Stock is then listed.

 

(d)           The Company will promptly file with the Securities and Exchange

 

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Commission a registration statement on Form S-8 covering the issuance of the
shares of Common Stock pursuant to this Plan, cause such registration statement
to become effective, and keep such registration statement effective for the
period that this Plan is in effect.

 

22.           Term of Plan. The Plan became effective upon its approval by the
shareholders of the Company on May 7, 2009 and shall continue in effect until
the earliest to occur of (i) purchase of all shares of Common Stock subject to
the Plan, (ii) May 7, 2019, and (iii) the date the Plan is terminated pursuant
to Section 19.

 

23.           No Employment Rights.  Nothing in the Plan (or in any Subscription
Agreement or other document related to this Plan) will confer upon any Employee
or Participant any right to continue in the employ or other service of the
Company or any Subsidiary, constitute any contract or agreement of employment or
other service or effect an Employee’s status as an Employee at will, nor shall
interfere in any way with the right of the Company or any Subsidiary to change
such person’s compensation or other benefits or to terminate his or her
employment or other service, with or without cause. Nothing contained in this
Section 23, however, is intended to adversely affect any express independent
right of any such person under a separate employment or service contract other
than a Subscription Agreement.

 

24.           No Right to Assets of the Company. No Participant or other person
will have any right, title or interest in any fund or in any specific asset
(including shares of Common Stock) of the Company or any Subsidiary by reason of
any option granted hereunder. Neither the provisions of the Plan (or of any
Subscription Agreement or other document related to the Plan), nor the creation
or adoption of the Plan, nor any action taken pursuant to the provisions of the
Plan will create, or be construed to create, a trust of any kind or a fiduciary
relationship between the Company or any Subsidiary and any Participant,
beneficiary or other person. To the extent that a Participant, beneficiary or
other person acquires a right to receive payment pursuant to the Plan, such
right will be no greater than the right of any unsecured general creditor of the
Company.

 

25.           Governing Law. To the extent that federal laws do not otherwise
control, the Plan shall be construed in accordance with and governed by the laws
of the State of Delaware.

 

26.           Savings Clause. This Plan is intended to comply in all aspects
with applicable laws and regulations. In case any one or more of the provisions
of this Plan shall be held invalid, illegal or unenforceable in any respect
under applicable law and regulations, the validity, legality and enforceability
of the remaining provisions shall not in any way be affected or impaired thereby
and the invalid, illegal or unenforceable provisions shall be deemed null and
void; however, to the extent permissible by law, any provision which could be
deemed null and void shall first be construed, interpreted or revised
retroactively to permit this Plan to be construed in compliance with all
applicable laws so as to foster the intent of this Plan.

 

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