Exhibit 10.1

 

SSTL, INC.2015

STOCK OPTION PLAN

 

1.            Purposes of the Plan. The purposes of this Stock Option Plan are
to attract and retain the best available personnel for positions of substantial
responsibility, to provide additional incentive to Employees and Consultants,
and to promote the success of the Company’s business. Options granted under the
Plan may be Incentive Stock Options or Nonstatutory Stock Options, as determined
by the Administrator at the time of grant of an Option and subject to the
applicable provisions of Section 422 of the Code and the regulations promulgated
thereunder. Restricted Stock may also be granted under the Plan.

 

2.            Definitions. As used herein, the following definitions shall
apply:

 

(a)“Administrator” means the Board or a Committee.

 

(b)“Affiliate” means (i) an entity other than a Subsidiary which, together with
the Company, is under common control of a third person or entity and (ii) an
entity other than a Subsidiary in which the Company and /or one or more
Subsidiaries own a controlling interest.

 

(c)“Applicable Laws” means all applicable laws, rules, regulations and
requirements, including, but not limited to, all applicable U.S. federal or
state laws, any Stock Exchange rules or regulations, and the applicable laws,
rules or regulations of any other country or jurisdiction where Options or
Restricted Stock are granted under the Plan or Participants reside or provide
services, as such laws, rules, and regulations shall be in effect from time to
time.

 

(d)“Award” means any award of an Option or Restricted Stock under the Plan.

 

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

 

(g)“Cashless Exercise” means a program approved by the Administrator in which
payment of the Option exercise price or tax withholding obligations or other
required deductions may be satisfied, in whole or in part, with Shares subject
to the Option, including by delivery of an irrevocable direction to a securities
broker (on a form prescribed by the Company) to sell Shares and to deliver all
or part of the sale proceeds to the Company in payment of such amount.

 

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(h)“Cause” for termination of a Participant’s Continuous Service Status will
exist (unless another definition is provided in an applicable Option Agreement,
Restricted Stock Purchase Agreement, employment agreement or other applicable
written agreement) if the Participant’s Continuous Service Status is terminated
for any of the following reasons: (i) a material breach by Participant of any
material written agreement between Participant and the Company and Participant’s
failure to cure such breach within 30 days after receiving written notice
thereof; (ii) any failure by Participant to comply with the Company’s material
written policies or rules as they may be in effect from time to time; (iii)
neglect or persistent unsatisfactory performance of Participant’s duties and
Participant’s failure to cure such condition within 30 days after receiving
written notice thereof; (iv) Participant’s repeated failure to follow reasonable
and lawful instructions from the Board or Chief Executive Officer and
Participant’s failure to cure such condition within 30 days after receiving
written notice thereof; (v) Participant’s conviction of, or plea of guilty or
nolo contendre to, any crime that results in, or is reasonably expected to
result in, material harm to the business or reputation of the Company; (vi)
Participant’s commission of or participation in an act of fraud against the
Company; (vii) Participant’s intentional material damage to the Company’s
business, property or reputation; or (viii) Participant’s unauthorized use or
disclosure of any proprietary information or trade secrets of the Company or any
other party to whom the Participant owes an obligation of nondisclosure as a
result of his or her relationship with the Company. For purposes of clarity, a
termination without “Cause” does not include any termination that occurs as a
result of Participant’s death or disability. The determination as to whether a
Participant’s Continuous Service Status has been terminated for Cause shall be
made in good faith by the Company and shall be final and binding on the
Participant. The foregoing definition does not in any way limit the Company’s
ability to terminate a Participant’s employment or consulting relationship at
any time, and the term “Company” will be interpreted to include any Subsidiary,
Parent, Affiliate, or any successor thereto, if appropriate.

(i)“Change of Control” means (unless another definition is provided in an
applicable Option Agreement, Restricted Stock Purchase Agreement, employment
agreement or other applicable written agreement) (i) a sale of all or
substantially all of the Company’s assets other than to an Excluded Entity (as
defined below), (ii) a merger, consolidation or other capital reorganization or
business combination transaction of the Company with or into another
corporation, limited liability company or other entity other than an Excluded
Entity, (iii) the consummation of a transaction, or series of related
transactions, in which any “person” (as such term is used in Sections 13(d) and
14(d) of the Exchange Act) becomes the “beneficial owner” (as defined in Rule
13d-3 of the Exchange Act), directly or indirectly, of all of the Company’s then
outstanding voting securities, or (iv) the Board determines in its sole
discretion that a Change in Control has occurred, whether or not any event
described above has occurred or is contemplated. Notwithstanding the foregoing,
a transaction shall not constitute a Change of Control if its purpose is to (A)
change the jurisdiction of the Company’s incorporation, (B) create a holding
company that will be owned in substantially the same proportions by the persons
who hold the Company’s securities immediately before such transaction, or (C)
obtain funding for the Company in a financing that is approved by the Company’s
Board. An “Excluded Entity” means a corporation or other entity of which the
holders of voting capital stock of the Company outstanding immediately prior to
such transaction are the direct or indirect holders of voting securities
representing at least a majority of the votes entitled to be cast by all of such
corporation’s or other entity’s voting securities outstanding immediately after
such transaction. In the event the Plan or any of the Options granted under the
Plan is or becomes subject to Section 409A of the Code, a Change in Control
shall be determined in a manner consistent with Code Section 409A of the Code
and Regulations thereunder.

 

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

 

(k)“Committee” means one or more committees or subcommittees of the Board
consisting of two (2) or more Directors (or such lesser or greater number of
Directors as shall constitute the minimum number permitted by Applicable Laws to
establish a committee or sub-committee of the Board) appointed by the Board to
administer the Plan in accordance with Section 4 below.

 

(l)“Common Stock” means the Company’s common stock.

 

(m)“Company” means SSTL, Inc., a Nevada corporation.

 

(n)“Consultant” means any person or entity, including an advisor but not an
Employee, that renders, or has rendered, services to the Company, or any Parent,
Subsidiary or Affiliate and is compensated for such services, and any Director
whether compensated for such services or not.

 

(o)“Continuous Service Status” means the absence of any interruption or
termination of service as an Employee or Consultant. Continuous Service Status
as an Employee or Consultant shall not be considered interrupted or terminated
in the case of: (i) Company approved sick leave; (ii) military leave; (iii) any
other bona fide leave of absence approved by the Company, provided that, if an
Employee is holding an Incentive Stock Option and such leave exceeds 3 months
then, for purposes of Incentive Stock Option status only, such Employee’s
service as an Employee shall be deemed terminated on the 1st day following such
3-month period and the Incentive Stock Option shall thereafter automatically
become a Nonstatutory Stock Option in accordance with Applicable Laws, unless
reemployment upon the expiration of such leave is guaranteed by contract or
statute, or unless provided otherwise pursuant to a written Company policy.
Also, Continuous Service Status as an Employee or Consultant shall not be
considered interrupted or terminated in the case of a transfer between locations
of the Company or between the Company, its Parents, Subsidiaries or Affiliates,
or their respective successors, or a change in status from an Employee to a
Consultant or from a Consultant to an Employee.

 

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(p)“Director” means a member of the Board.

 

(q)“Disability” means “disability” within the meaning of Section 22(e)(3) of the
Code.

 

(r)“Employee” means any person employed by the Company, or any Parent,
Subsidiary or Affiliate, with the status of employment determined pursuant to
such factors as are deemed appropriate by the Company in its sole discretion,
subject to any requirements of Applicable Laws, including the Code. The payment
by the Company of a director’s fee shall not be sufficient to constitute
“employment” of such director by the Company or any Parent, Subsidiary or
Affiliate.

 

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

 

(t)“Fair Market Value” means, as of any date, the per share fair market value of
the Common Stock, as determined by the Administrator in good faith on such basis
as it deems appropriate and applied consistently with respect to Participants.
Whenever possible, the determination of Fair Market Value shall be based upon
the per share closing price for the Shares as reported in The Wall Street
Journal for the applicable date.

 

(u)“Family Members” means any child, stepchild, grandchild, parent, stepparent,
grandparent, spouse, former spouse, sibling, niece, nephew, mother-in-law,
father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law
(including adoptive relationships) of the Participant, any person sharing the
Participant’s household (other than a tenant or employee), a trust in which
these persons (or the Participant) have more than 50% of the beneficial
interest, a foundation in which these persons (or the Participant) control the
management of assets, and any other entity in which these persons (or the
Participant) own more than 50% of the voting interests.

 

(v)“Incentive Stock Option” means an Option intended to, and which does, in
fact, qualify as an incentive stock option within the meaning of Section 422 of
the Code.

 

(w)“Involuntary Termination” means (unless another definition is provided in the
applicable Option Agreement, Restricted Stock Purchase Agreement, employment
agreement or other applicable written agreement) the termination of a
Participant’s Continuous Service Status other than for (i) death, (ii)
Disability or (iii) for Cause by the Company or a Parent, Subsidiary, Affiliate
or successor thereto, as appropriate.

 

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(x)“Listed Security” means any security of the Company that is listed or
approved for listing on a national securities exchange or designated or approved
for designation as a national market system security on an interdealer quotation
system by the Financial Industry Regulatory Authority (or any successor
thereto).

 

(y)“Nonstatutory Stock Option” means an Option that is not intended to, or does
not, in fact, qualify as an Incentive Stock Option.

 

(z)“Option” means a stock option granted pursuant to the Plan.

 

(aa)“Option Agreement” means a written document, the form(s) of which shall be
approved from time to time by the Administrator, reflecting the terms of an
Option granted under the Plan and includes any documents attached to or
incorporated into such Option Agreement, including, but not limited to, a notice
of stock option grant and a form of exercise notice.

 

(bb)“Option Exchange Program” means a program approved by the Administrator
whereby outstanding Options (i) are exchanged for Options with a lower exercise
price, Restricted Stock, cash or other property or (ii) are amended to decrease
the exercise price as a result of a decline in the Fair Market Value.

 

(cc)“Optioned Stock” means Shares that are subject to an Option or that were
issued pursuant to the exercise of an Option.

 

(dd)“Optionee” means an Employee or Consultant who receives an Option.

 

(ee)“Parent” means any corporation (other than the Company) in an unbroken chain
of corporations ending with the Company if, at the time of grant of the Award,
each of the corporations other than the Company owns stock possessing 50% or
more of the total combined voting power of all classes of stock in one of the
other corporations in such chain. A corporation that attains the status of a
Parent on a date after the adoption of the Plan shall be considered a Parent
commencing as of such date.

 

(ff)“Participant” means any holder of one or more Awards or Shares issued
pursuant to an Award.

 

(gg)“Plan” means this SSTL, Inc. 2015 Stock Option Plan.

 

(hh)“Restricted Stock” means Shares acquired pursuant to a right to purchase or
receive Common Stock granted pursuant to Section 8 below.

 

(ii)“Restricted Stock Purchase Agreement” means a written document, the form(s)
of which shall be approved from time to time by the Administrator, reflecting
the terms of Restricted Stock granted under the Plan and includes any documents
attached to such agreement.

 

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(jj)“Rule 16b-3” means Rule 16b-3 promulgated under the Exchange Act, as amended
from time to time, or any successor provision.

 

(kk)“Share” means a share of Common Stock, as adjusted in accordance with
Section 10 below.

 

(ll)“Stock Exchange” means any stock exchange or consolidated stock price
reporting system on which prices for the Common Stock are quoted at any given
time.

(mm)“Subsidiary” means any corporation (other than the Company) in an unbroken
chain of corporations beginning with the Company if, at the time of grant of the
Award, each of the corporations other than the last corporation in the unbroken
chain owns stock possessing 50% or more of the total combined voting power of
all classes of stock in one of the other corporations in such chain. A
corporation that attains the status of a Subsidiary on a date after the adoption
of the Plan shall be considered a Subsidiary commencing as of such date.

 

(nn)“Ten Percent Holder” means a person who owns stock representing more than
10% of the voting power of all classes of stock of the Company or any Parent or
Subsidiary measured as of an Award’s date of grant.

 

3.            Stock Subject to the Plan. Subject to the provisions of Section 10
below, the maximum aggregate number of Shares that may be issued under the Plan
is 10,000,000 Shares, all of which Shares may be issued under the Plan pursuant
to Incentive Stock Options. The Shares issued under the Plan may be authorized,
but unissued, or reacquired Shares. If an Award should expire or become
unexercisable for any reason without having been exercised in full, or is
surrendered pursuant to an Option Exchange Program, the unissued Shares that
were subject thereto shall, unless the Plan shall have been terminated, continue
to be available under the Plan for issuance pursuant to future Awards. In
addition, any Shares which are retained by the Company upon exercise of an Award
in order to satisfy the exercise or purchase price for such Award or any
withholding taxes due with respect to such Award shall be treated as not issued
and shall continue to be available under the Plan for issuance pursuant to
future Awards. Shares issued under the Plan and later forfeited to the Company
due to the failure to vest or repurchased by the Company at the original
purchase price paid to the Company for the Shares (including, without
limitation, upon forfeiture to or repurchase by the Company in connection with
the termination of a Participant’s Continuous Service Status) shall again be
available for future grant under the Plan. Notwithstanding the foregoing,
subject to the provisions of Section 10 below, in no event shall the maximum
aggregate number of Shares that may be issued under the Plan pursuant to
Incentive Stock Options exceed the number set forth in the first sentence of
this Section 3 plus, to the extent allowable under Section 422 of the Code and
the Treasury Regulations promulgated there under, any Shares that again become
available for issuance pursuant to the remaining provisions of this Section 3.

 

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4.            Administration of the Plan.

 

(a)General. The Plan shall be administered by the Board, a Committee appointed
by the Board, or any combination thereof, as determined by the Board. The Plan
may be administered by different administrative bodies with respect to different
classes of Participants and, if permitted by Applicable Laws, the Board may
authorize one or more officers of the Company to make Awards under the Plan to
Employees and Consultants (who are not subject to Section 16 of the Exchange
Act) within parameters specified by the Board.

 

(b)Committee Composition. If a Committee has been appointed pursuant to this
Section 4, such Committee shall continue to serve in its designated capacity
until otherwise directed by the Board. From time to time the Board may increase
the size of any Committee and appoint additional members thereof, remove members
(with or without cause) and appoint new members in substitution therefor, fill
vacancies (however caused) and dissolve a Committee and thereafter directly
administer the Plan, all to the extent permitted by Applicable Laws and, in the
case of a Committee administering the Plan in accordance with the requirements
of Rule 16b-3 or Section 162(m) of the Code, to the extent permitted or required
by such provisions.

 

(c)Powers of the Administrator. Subject to the provisions of the Plan and, in
the case of a Committee, the specific duties delegated by the Board to such
Committee, the Administrator shall have the authority, in its sole discretion:

 

(i)to determine the Fair Market Value in accordance with Section 2(t) above,
provided that such determination shall be applied consistently with respect to
Participants under the Plan;

 

(ii)to select the Employees and Consultants to whom Awards may from time to time
be granted;

 

(iii)to determine the number of Shares to be covered by each Award;

 

(iv)to approve the form(s) of agreement(s) and other related documents used
under the Plan;

 

(v)to determine the terms and conditions, not inconsistent with the terms of the
Plan, of any Award granted hereunder, which terms and conditions include but are
not limited to the exercise or purchase price, the time or times when Awards may
vest and/or be exercised (which may be based on performance criteria), the
circumstances (if any) when vesting will be accelerated or forfeiture
restrictions will be waived, and any restriction or limitation regarding any
Award, Optioned Stock, or Restricted Stock;

 

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(vi)to amend any outstanding Award or agreement related to any Optioned Stock or
Restricted Stock, including any amendment adjusting vesting (e.g., in connection
with a change in the terms or conditions under which such person is providing
services to the Company), provided that no amendment shall be made that would
materially and adversely affect the rights of any Participant without his or her
consent;

 

(vii)to determine whether and under what circumstances an Option may be settled
in cash under Section 7(c)(iii) below instead of Common Stock;

(viii)subject to Applicable Laws, to implement an Option Exchange Program and
establish the terms and conditions of such Option Exchange Program without
consent of the holders of capital stock of the Company, provided that no
amendment or adjustment to an Option that would materially and adversely affect
the rights of any Participant shall be made without his or her consent;

(ix)to approve addenda pursuant to Section 18 below or to grant Awards to, or to
modify the terms of, any outstanding Option Agreement or Restricted Stock
Purchase Agreement or any agreement related to any Optioned Stock or Restricted
Stock held by Participants who are foreign nationals or employed outside of the
United States with such terms and conditions as the Administrator deems
necessary or appropriate to accommodate differences in local law, tax policy or
custom which deviate from the terms and conditions set forth in this Plan to the
extent necessary or appropriate to accommodate such differences; and

(x)to construe and interpret the terms of the Plan, any Option Agreement or
Restricted Stock Purchase Agreement, and any agreement related to any Optioned
Stock or Restricted Stock, which constructions, interpretations and decisions
shall be final and binding on all Participants.

 

(d)Indemnification. To the maximum extent permitted by Applicable Laws, each
member of the Committee (including officers of the Company, if applicable), or
of the Board, as applicable, shall be indemnified and held harmless by the
Company against and from (i) any loss, cost, liability, or expense that may be
imposed upon or reasonably incurred by him or her in connection with or
resulting from any claim, action, suit, or proceeding to which he or she may be
a party or in which he or she may be involved by reason of any action taken or
failure to act under the Plan or pursuant to the terms and conditions of any
Award except for actions taken in bad faith or failures to act in bad faith, and
(ii) any and all amounts paid by him or her in settlement thereof, with the
Company’s approval, or paid by him or her in satisfaction of any judgment in any
such claim, action, suit, or proceeding against him or her, provided that such
member shall give the Company an opportunity, at its own expense, to handle and
defend any such claim, action, suit or proceeding before he or she undertakes to
handle and defend it on his or her own behalf. The foregoing right of
indemnification shall not be exclusive of any other rights of indemnification to
which such persons may be entitled under the Company’s Certificate of
Incorporation or Bylaws, by contract, as a matter of law, or otherwise, or under
any other power that the Company may have to indemnify or hold harmless each
such person.

 

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5.            Eligibility.

 

(a)Recipients of Grants. Nonstatutory Stock Options and Restricted Stock may be
granted to Employees and Consultants. Incentive Stock Options may be granted
only to Employees, provided that Employees of Affiliates shall not be eligible
to receive Incentive Stock Options.

 

(b)Type of Option. Each Option shall be designated in the Option Agreement as
either an Incentive Stock Option or a Nonstatutory Stock Option.

 

(c)ISO $100,000 Limitation. Notwithstanding any designation under Section 5(b)
above, to the extent that the aggregate Fair Market Value of Shares with respect
to which options designated as incentive stock options are exercisable for the
first time by any Optionee during any calendar year (under all plans of the
Company or any Parent or Subsidiary) exceeds $100,000, such excess options shall
be treated as nonstatutory stock options. For purposes of this Section 5(c),
incentive stock options shall be taken into account in the order in which they
were granted, and the Fair Market Value of the Shares subject to an incentive
stock option shall be determined as of the date of the grant of such option.

 

(d)No Employment Rights. Neither the Plan nor any Award shall confer upon any
Employee or Consultant any right with respect to continuation of an employment
or consulting relationship with the Company (any Parent, Subsidiary or
Affiliate), nor shall it interfere in any way with such Employee’s or
Consultant’s right or the Company’s (Parent’s, Subsidiary’s or Affiliate’s)
right to terminate his or her employment or consulting relationship at any time,
with or without cause.

 

6.            Term of Plan. The Plan shall become effective upon its adoption by
the Board and shall continue in effect for a term of 10 years unless terminated
sooner under Section 14 below.

 

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7.            Options.

 

(a)Term of Option. The term of each Option shall be the term stated in the
Option Agreement; provided that the term shall be no more than 10 years from the
date of grant thereof or such shorter term as may be provided in the Option
Agreement and provided further that, in the case of an Incentive Stock Option
granted to a person who at the time of such grant is a Ten Percent Holder, the
term of the Option shall be 5 years from the date of grant thereof or such
shorter term as may be provided in the Option Agreement.

 

(b)Option Exercise Price and Consideration.

 

(i)Exercise Price. The per Share exercise price for the Shares to be issued
pursuant to the exercise of an Option shall be such price as is determined by
the Administrator and set forth in the Option Agreement, but shall be subject to
the following:

 

(1)In the case of an Incentive Stock Option

 

a.granted to an Employee who at the time of grant is a Ten Percent Holder, the
per Share exercise price shall be no less than 110% of the Fair Market Value on
the date of grant;

 

b.granted to any other Employee, the per Share exercise price shall be no less
than 100% of the Fair Market Value on the date of grant;

 

(2)Except as provided in subsection (3) below, in the case of a Nonstatutory
Stock Option the per Share exercise price shall be such price as is determined
by the Administrator, provided that, if the per Share exercise price is less
than 100% of the Fair Market Value on the date of grant, it shall otherwise
comply with all Applicable Laws, including Section 409A of the Code; and

 

(3)Notwithstanding the foregoing, Options may be granted with a per Share
exercise price other than as required above pursuant to a merger or other
corporate transaction.

 

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(ii)Permissible Consideration. The consideration to be paid for the Shares to be
issued upon exercise of an Option, including the method of payment, shall be
determined by the Administrator (and, in the case of an Incentive Stock Option
and to the extent required by Applicable Laws, shall be determined at the time
of grant) and may consist entirely of (1) cash; (2) check; (3) to the extent
permitted under, and in accordance with, Applicable Laws, delivery of a
promissory note with such recourse, interest, security and redemption provisions
as the Administrator determines to be appropriate (subject to the provisions of
Section 152 of the General Corporation Law); (4) cancellation of indebtedness;
(5) other previously owned Shares that have a Fair Market Value on the date of
surrender equal to the aggregate exercise price of the Shares as to which the
Option is exercised; (6) a Cashless Exercise; (7) such other consideration and
method of payment permitted under Applicable Laws; or (8) any combination of the
foregoing methods of payment. In making its determination as to the type of
consideration to accept, the Administrator shall consider if acceptance of such
consideration may be reasonably expected to benefit the Company and the
Administrator may, in its sole discretion, refuse to accept a particular form of
consideration at the time of any Option exercise.

 

(c)Exercise of Option.

 

(i)General.

 

(1)Exercisability. Any Option granted hereunder shall be exercisable at such
times and under such conditions as determined by the Administrator, consistent
with the terms of the Plan and reflected in the Option Agreement, including
vesting requirements and/or performance criteria with respect to the Company,
and Parent, Subsidiary or Affiliate, and/or the Optionee.

 

(2)Leave of Absence. The Administrator shall have the discretion to determine
whether and to what extent the vesting of Options shall be tolled during any
leave of absence; provided, however, that in the absence of such determination,
vesting of Options shall continue during any paid leave and shall be tolled
during any unpaid leave (unless otherwise required by Applicable Laws).
Notwithstanding the foregoing, in the event of military leave, vesting shall
toll during any unpaid portion of such leave, provided that, upon an Optionee’s
returning from military leave (under conditions that would entitle him or her to
protection upon such return under the Uniform Services Employment and
Reemployment Rights Act), he or she shall be given vesting credit with respect
to Options to the same extent as would have applied had the Optionee continued
to provide services to the Company (or any Parent, Subsidiary or Affiliate, if
applicable) throughout the leave on the same terms as he or she was providing
services immediately prior to such leave.

 

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(3)Minimum Exercise Requirements. An Option may not be exercised for a fraction
of a Share. The Administrator may require that an Option be exercised as to a
minimum number of Shares, provided that such requirement shall not prevent an
Optionee from exercising the full number of Shares as to which the Option is
then exercisable.

 

(4)Procedures for and Results of Exercise. An Option shall be deemed exercised
when written notice of such exercise has been received by the Company in
accordance with the terms of the Option Agreement by the person entitled to
exercise the Option and the Company has received full payment for the Shares
with respect to which the Option is exercised and has paid, or made arrangements
to satisfy, any applicable taxes, withholding, required deductions or other
required payments in accordance with Section 9 below. The exercise of an Option
shall result in a decrease in the number of Shares that thereafter may be
available, both for purposes of the Plan and for sale under the Option, by the
number of Shares as to which the Option is exercised.

 

(5)Rights as Holder of Capital Stock. Until the issuance of the Shares (as
evidenced by the appropriate entry on the books of the Company or of a duly
authorized transfer agent of the Company), no right to vote or receive dividends
or any other rights as a holder of capital stock shall exist with respect to the
Optioned Stock, notwithstanding the exercise of the Option. No adjustment will
be made for a dividend or other right for which the record date is prior to the
date the stock is issued, except as provided in Section 10 below.

 

(ii)Termination of Continuous Service Status. The Administrator shall establish
and set forth in the applicable Option Agreement the terms and conditions upon
which an Option shall remain exercisable, if at all, following termination of an
Optionee’s Continuous Service Status, which provisions may be waived or modified
by the Administrator at any time. To the extent that an Option Agreement does
not specify the terms and conditions upon which an Option shall terminate upon
termination of an Optionee’s Continuous Service Status, the following provisions
shall apply:

 

(1)General Provisions. If the Optionee (or other person entitled to exercise the
Option) does not exercise the Option to the extent so entitled within the time
specified below, the Option shall terminate and the Optioned Stock underlying
the unexercised portion of the Option shall revert to the Plan. In no event may
any Option be exercised after the expiration of the Option term as set forth in
the Option Agreement (and subject to this Section 7).

 

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(2)Termination other than Upon Disability or Death or for Cause. In the event of
termination of an Optionee’s Continuous Service Status other than under the
circumstances set forth in the subsections (3) through (5) below, such Optionee
may exercise any outstanding Option at any time within three (3) months
following such termination to the extent the Optionee is vested in the Optioned
Stock.

 

(3)Disability of Optionee. In the event of termination of an Optionee’s
Continuous Service Status as a result of his or her Disability, such Optionee
may exercise any outstanding Option at any time within twelve (12) months
following such termination to the extent the Optionee is vested in the Optioned
Stock.

 

(4)Death of Optionee. In the event of the death of an Optionee during the period
of Continuous Service Status since the date of grant of any outstanding Option,
or within three (3) month(s) following termination of the Optionee’s Continuous
Service Status, the Option may be exercised by any beneficiaries designated in
accordance with Section 16 below, or if there are no such beneficiaries, by the
Optionee’s estate, or by a person who acquired the right to exercise the Option
by bequest or inheritance, at any time within twelve (12) months following the
date the Optionee’s Continuous Service Status terminated, but only to the extent
the Optionee is vested in the Optioned Stock.

 

(5)Termination for Cause. In the event of termination of an Optionee’s
Continuous Service Status for Cause, any outstanding Option (including any
vested portion thereof) held by such Optionee shall immediately terminate in its
entirety upon first notification to the Optionee of termination of the
Optionee’s Continuous Service Status for Cause. If an Optionee’s Continuous
Service Status is suspended pending an investigation of whether the Optionee’s
Continuous Service Status will be terminated for Cause, all the Optionee’s
rights under any Option, including the right to exercise the Option, shall be
suspended during the investigation period. Nothing in this Section 7(c)(ii)(5)
shall in any way limit the Company’s right to purchase unvested Shares issued
upon exercise of an Option as set forth in the applicable Option Agreement,
Restricted Stock Purchase Agreement, employment agreement or other applicable
written agreement.

 

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(iii)Buyout Provisions. The Administrator may at any time offer to buy out for a
payment in cash or Shares an Option previously granted under the Plan based on
such terms and conditions as the Administrator shall establish and communicate
to the Optionee at the time that such offer is made.

 

8.Restricted Stock.

 

(a)Rights to Purchase. When a right to purchase or receive Restricted Stock is
granted under the Plan, the Company shall advise the recipient in writing of the
terms, conditions and restrictions related to the offer, including the number of
Shares that such person shall be entitled to purchase, the price to be paid, if
any (which shall be as determined by the Administrator, subject to Applicable
Laws, including any applicable securities laws), and the time within which such
person must accept such offer. The permissible consideration for Restricted
Stock shall be determined by the Administrator and shall be the same as is set
forth in Section 7(b)(ii) above with respect to exercise of Options. The offer
to purchase Shares shall be accepted by execution of a Restricted Stock Purchase
Agreement in the form determined by the Administrator.

 

(b)Repurchase Option.

 

(i)General. Unless the Administrator determines otherwise, the Restricted Stock
Purchase Agreement shall grant the Company a repurchase option exercisable upon
the voluntary or involuntary termination of the Participant’s Continuous Service
Status for any reason (including death or Disability) at a purchase price for
Shares equal to the original purchase price paid by the purchaser to the Company
for such Shares and may be paid by cancellation of any indebtedness of the
purchaser to the Company. The repurchase option shall lapse at such rate as the
Administrator may determine.

 

(ii)Leave of Absence. The Administrator shall have the discretion to determine
whether and to what extent the lapsing of Company repurchase rights shall
continue during any paid leave and shall be tolled during any unpaid leave of
absence; provided, however, that in the absence of such determination, such
lapsing shall be tolled during any leave (unless otherwise required by
Applicable Laws). Notwithstanding the foregoing, in the event of military leave,
the lapsing of Company repurchase rights shall toll during any unpaid portion of
such leave, provided that, upon a Participant’s returning from military leave
(under conditions that would entitle him or her to protection upon such return
under the Uniform Services Employment and Reemployment Rights Act), he or she
shall be given vesting credit with respect to Shares purchased pursuant to the
Restricted Stock Purchase Agreement to the same extent as would have applied had
the Participant continued to provide services to the Company (or any Parent,
Subsidiary or Affiliate, if applicable) throughout the leave on the same terms
as he or she was providing services immediately prior to such leave.

 

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(c)Other Provisions. The Restricted Stock Purchase Agreement shall contain such
other terms, provisions and conditions not inconsistent with the Plan as may be
determined by the Administrator in its sole discretion. In addition, the
provisions of Restricted Stock Purchase Agreements need not be the same with
respect to each Participant.

 

(d)Rights as a Holder of Capital Stock. Once the Restricted Stock is purchased,
the Participant shall have the rights equivalent to those of a holder of capital
stock, and shall be a record holder when his or her purchase and the issuance of
the Shares is entered upon the records of the duly authorized transfer agent of
the Company. No adjustment will be made for a dividend or other right for which
the record date is prior to the date the Restricted Stock is purchased, except
as provided in Section 10 below.

 

9.Taxes.

 

(a)As a condition of the grant, vesting and exercise of an Award, the
Participant (or in the case of the Participant’s death or a permitted
transferee, the person holding or exercising the Award) shall make such
arrangements as the Administrator may require for the satisfaction of any
applicable U.S. federal, state, local or foreign tax, withholding, and any other
required deductions or payments that may arise in connection with such Award.
The Company shall not be required to issue any Shares under the Plan until such
obligations are satisfied.

 

(b)The Administrator may, to the extent permitted under Applicable Laws, permit
a Participant (or in the case of the Participant’s death or a permitted
transferee, the person holding or exercising the Award) to satisfy all or part
of his or her tax, withholding, or any other required deductions or payments by
Cashless Exercise or by surrendering Shares (either directly or by stock
attestation) that he or she previously acquired; provided that, unless
specifically permitted by the Company, any such Cashless Exercise must be an
approved broker-assisted Cashless Exercise or the Shares withheld in the
Cashless Exercise must be limited to avoid financial accounting charges under
applicable accounting guidance and any such surrendered Shares must have been
previously held for any minimum duration required to avoid financial accounting
charges under applicable accounting guidance. Any payment of taxes by
surrendering Shares to the Company may be subject to restrictions, including,
but not limited to, any restrictions required by rules of the Securities and
Exchange Commission.

 

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10.           Adjustments Upon Changes in Capitalization, Merger or Certain
Other Transactions.

 

(a)Changes in Capitalization. Subject to any action required under Applicable
Laws by the holders of capital stock of the Company, (i) the numbers and class
of Shares or other stock or securities: (x) available for future Awards under
Section 3 above and (y) covered by each outstanding Award, (ii) the exercise
price per Share of each such outstanding Option, and (iii) any repurchase price
per Share applicable to Shares issued pursuant to any Award, shall be
automatically proportionately adjusted in the event of a stock split, reverse
stock split, stock dividend, combination, consolidation, reclassification of the
Shares or subdivision of the Shares. In the event of any increase or decrease in
the number of issued Shares effected without receipt of consideration by the
Company, a declaration of an extraordinary dividend with respect to the Shares
payable in a form other than Shares in an amount that has a material effect on
the Fair Market Value, a recapitalization (including a recapitalization through
a large nonrecurring cash dividend), a rights offering, a reorganization,
merger, a spin-off, split-up, change in corporate structure or a similar
occurrence, the Administrator shall make appropriate adjustments, in its
discretion, in one or more of (i) the numbers and class of Shares or other stock
or securities: (x) available for future Awards under Section 3 above and (y)
covered by each outstanding Award, (ii) the exercise price per Share of each
outstanding Option and (iii) any repurchase price per Share applicable to Shares
issued pursuant to any Award, and any such adjustment by the Administrator shall
be made in the Administrator’s sole and absolute discretion and shall be final,
binding and conclusive. Except as expressly provided herein, no issuance 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 subject to an Award. If,
by reason of a transaction described in this Section 10(a) or an adjustment
pursuant to this Section 10(a), a Participant’s Award agreement or agreement
related to any Optioned Stock or Restricted Stock covers additional or different
shares of stock or securities, then such additional or different shares, and the
Award agreement or agreement related to the Optioned Stock or Restricted Stock
in respect thereof, shall be subject to all of the terms, conditions and
restrictions which were applicable to the Award, Optioned Stock and Restricted
Stock prior to such adjustment.

 

(b)Dissolution or Liquidation. In the event of the dissolution or liquidation of
the Company, each Award will terminate immediately prior to the consummation of
such action, unless otherwise determined by the Administrator.

 

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(c)Corporate Transactions. In the event of (i) a transfer of all or
substantially all of the Company’s assets, (ii) a merger, consolidation or other
capital reorganization or business combination transaction of the Company with
or into another corporation, entity or person, or (iii) the consummation of a
transaction, or series of related transactions, in which any “person” (as such
term is used in Sections 13(d) and 14(d) of the Exchange Act) becomes the
“beneficial owner” (as defined in Rule 13d-3 of the Exchange Act), directly or
indirectly, of more than 50% of the Company’s then outstanding capital stock (a
“Corporate Transaction”), each outstanding Award (vested or unvested) will be
treated as the Administrator determines, which determination may be made without
the consent of any Participant and need not treat all outstanding Awards (or
portion thereof) in an identical manner. Such determination, without the consent
of any Participant, may provide (without limitation) for one or more of the
following in the event of a Corporate Transaction: (A) the continuation of such
outstanding Awards by the Company (if the Company is the surviving corporation);
(B) the assumption of such outstanding Awards by the surviving corporation or
its parent; (C) the substitution by the surviving corporation or its parent of
new options or equity awards for such Awards; (D) the cancellation of such
Awards in exchange for a payment to the Participants equal to the excess of (1)
the Fair Market Value of the Shares subject to such Awards as of the closing
date of such Corporate Transaction over (2) the exercise price or purchase price
paid or to be paid for the Shares subject to the Awards; or (E) the cancellation
of any outstanding Options or an outstanding right to purchase Restricted Stock,
in either case, for no consideration.

 

11.           Non-Transferability of Awards.

 

(a)General. Except as set forth in this Section 11, Awards may not be sold,
pledged, assigned, hypothecated, transferred or disposed of in any manner other
than by will or by the laws of descent or distribution. The designation of a
beneficiary by a Participant will not constitute a transfer. An Option may be
exercised, during the lifetime of the holder of the Option, only by such holder
or a transferee permitted by this Section 11.

 

(b)Limited Transferability Rights. Notwithstanding anything else in this Section
11, the Administrator may in its sole discretion provide that any Nonstatutory
Stock Options may be transferred by instrument to an inter vivos or testamentary
trust in which the Options are to be passed to beneficiaries upon the death of
the trustor (settlor) or by gift to Family Members. Further, beginning with (i)
the period when the Company begins to rely on the exemption described in Rule
12h-1(f)(1) promulgated under the Exchange Act, as determined by the Board in
its sole discretion, and (ii) ending on the earlier of (A) the date when the
Company ceases to rely on such exemption, as determined by the Board in its sole
discretion, or (B) the date when the Company becomes subject to the reporting
requirements of Section 13 or 15(d) of the Exchange Act, an Option, or prior to
exercise, the Shares subject to the Option, may not be pledged, hypothecated or
otherwise transferred or disposed of, in any manner, including by entering into
any short position, any “put equivalent position” or any “call equivalent
position” (as defined in Rule 16a-1(h) and Rule 16a-1(b) of the Exchange Act,
respectively), other than to (i) persons who are Family Members through gifts or
domestic relations orders, or (ii) to an executor or guardian of the Participant
upon the death or disability of the Participant. Notwithstanding the foregoing
sentence, the Board, in its sole discretion, may permit transfers of
Nonstatutory Stock Options to the Company or in connection with a Change of
Control or other acquisition transactions involving the Company to the extent
permitted by Rule 12h-1(f).

 

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12.           Non-Transferability of Stock Underlying Awards.

 

(a)General. Notwithstanding anything to the contrary, no stockholder shall
transfer, whether by sale, gift or otherwise, any Shares acquired from any Award
(including, without limitation, Shares acquired upon exercise of an Option) to
any person or entity unless such transfer is approved by the Company prior to
such transfer, which approval may be granted or withheld in the Company’s sole
and absolute discretion. Any purported transfer effected in violation of this
Section 12 shall be null and void and shall have no force or effect and the
Company shall not be required (i) to transfer on its books any Shares that have
been sold or otherwise transferred in violation of any of the provisions of the
Plan or (ii) to treat as owner of such Shares or to accord the right to vote or
pay dividends to any purchaser or other transferee to whom such Shares shall
have been so transferred.

 

(b)Approval Process. Any stockholder seeking the approval of the Board to
transfer some or all of its Shares shall give written notice thereof to the
Secretary of the Company and such request for transfer shall be subject to such
right of first refusal, transfer provisions and any other terms and conditions
as may be set forth in the applicable Option Agreement, Restricted Stock
Purchase Agreement or other applicable written agreement.

 

13.              Time of Granting Awards. The date of grant of an Award shall,
for all purposes, be the date on which the Administrator makes the determination
granting such Award, or such other date as is determined by the Administrator.

 

14.              Amendment and Termination of the Plan. The Board may at any
time amend or terminate the Plan, but no amendment or termination shall be made
that would materially and adversely affect the rights of any Participant under
any outstanding Award, without his or her consent. In addition, to the extent
necessary and desirable to comply with Applicable Laws, the Company shall obtain
the approval of holders of capital stock with respect to any Plan amendment in
such a manner and to such a degree as required.

 

15.              Conditions Upon Issuance of Shares. Notwithstanding any other
provision of the Plan or any agreement entered into by the Company pursuant to
the Plan, the Company shall not be obligated, and shall have no liability for
failure, to issue or deliver any Shares under the Plan unless such issuance or
delivery would comply with Applicable Laws, with such compliance determined by
the Company in consultation with its legal counsel. As a condition to the
exercise of any Option or purchase of any Restricted Stock, the Company may
require the person exercising the Option or purchasing the Restricted Stock to
represent and warrant at the time of any such exercise or purchase 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 advisable or required by Applicable Laws. Shares issued
upon exercise of Options or purchase of Restricted Stock prior to the date, if
ever, on which the Common Stock becomes a Listed Security shall be subject to a
right of first refusal in favor of the Company pursuant to which the Participant
will be required to offer Shares to the Company before selling or transferring
them to any third party on such terms and subject to such conditions as is
reflected in the applicable Option Agreement or Restricted Stock Purchase
Agreement.

 

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16.              Beneficiaries. If permitted by the Company, a Participant may
designate one or more beneficiaries with respect to an Award by timely filing
the prescribed form with the Company. A beneficiary designation may be changed
by filing the prescribed form with the Company at any time before the
Participant’s death. Except as otherwise provided in an Award Agreement, if no
beneficiary was designated or if no designated beneficiary survives the
Participant, then after a Participant’s death any vested Award(s) shall be
transferred or distributed to the Participant’s estate or to any person who has
the right to acquire the Award by bequest or inheritance.

 

17.              Approval of Holders of Capital Stock. If required by Applicable
Laws, continuance of the Plan shall be subject to approval by the holders of
capital stock of the Company within 12 months before or after the date the Plan
is adopted or, to the extent required by Applicable Laws, any date the Plan is
amended. Such approval shall be obtained in the manner and to the degree
required under Applicable Laws.

 

18.              Addenda. The Administrator may approve such addenda to the Plan
as it may consider necessary or appropriate for the purpose of granting Awards
to Employees or Consultants, which Awards may contain such terms and conditions
as the Administrator deems necessary or appropriate to accommodate differences
in local law, tax policy or custom, which may deviate from the terms and
conditions set forth in this Plan. The terms of any such addenda shall supersede
the terms of the Plan to the extent necessary to accommodate such differences
but shall not otherwise affect the terms of the Plan as in effect for any other
purpose.

 

19.              Information to Holders of Options. In the event the Company is
relying on the exemption provided by Rule 12h-1(f) under the Exchange Act, the
Company shall provide the information described in Rule 701(e)(3), (4) and (5)
of the Securities Act of 1933, as amended, to all holders of Options in
accordance with the requirements thereunder until such time as the Company
becomes subject to the reporting requirements of Section 13 or 15(d) of the
Exchange Act. The Company may request that holders of Options agree to keep the
information to be provided pursuant to this Section confidential. If the holder
does not agree to keep the information to be provided pursuant to this Section
confidential, then the Company will not be required to provide the information
unless otherwise required pursuant to Rule 12h-1(f)(1) of the Exchange Act.

 

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