PLANTRONICS, INC.

2003 STOCK PLAN

 

 

PURPOSES AND DEFINITIONS

Purposes of the Plan. The purposes of this 2003 Stock Plan are:

    to attract and retain the best available personnel for positions of
    substantial responsibility,

 A. to provide additional incentive to Employees, Directors and Consultants, and
 B. 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. The
Administrator may also grant Restricted Stock Awards under the Plan.
Definitions. As used herein, the following definitions shall apply:
 A.  "Administrator" means the Board or any Committees as shall be administering
     the Plan, in accordance with Section 2.2.
 B.  "Applicable Laws" means the requirements relating to the administration of
     stock option plans under U.S. state corporate laws, U.S. federal and state
     securities laws, the Code, any stock exchange or quotation system on which
     the Common Stock is listed or quoted and the applicable laws of any foreign
     country or jurisdiction where Options or Restricted Stock Awards are, or
     will be, granted under the Plan.
 C.  "Board" means the Board of Directors of the Company.
 D.  "Change in Control" means the occurrence of any of the following events:
      i.   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 13d3
           of the Exchange Act), directly or indirectly, of securities of the
           Company representing fifty percent (50%) or more of the total voting
           power represented by the Company's then outstanding voting
           securities; or
      ii.  The consummation of the sale or disposition by the Company of all or
           substantially all of the Company's assets;
      iii. A change in the composition of the Board occurring within a two-year
           period, as a result of which fewer than a majority of the Directors
           are Incumbent Directors. "Incumbent Directors" means Directors who
           either (A) are Directors as of the effective date of the Plan, or (B)
           are elected, or nominated for election, to the Board with the
           affirmative votes of at least a majority of the Incumbent Directors
           at the time of such election or nomination (but will not include an
           individual whose election or nomination is in connection with an
           actual or threatened proxy contest relating to the election of
           Directors to the Company); or
      iv.  The consummation of a merger or consolidation of the Company with any
           other corporation, other than a merger or consolidation which would
           result in the voting securities of the Company outstanding
           immediately prior thereto continuing to represent (either by
           remaining outstanding or by being converted into voting securities of
           the surviving entity or its parent) at least fifty percent (50%) of
           the total voting power represented by the voting securities of the
           Company or such surviving entity or its parent outstanding
           immediately after such merger or consolidation.

 E.  "Code" means the Internal Revenue Code of 1986, as amended.
 F.  "Committee" means a committee of individuals appointed by the Board in
     accordance with Section 2.2.
 G.  "Common Stock" means the common stock of the Company.
 H.  "Company" means Plantronics, Inc., a Delaware corporation.
 I.  "Consultant" means any natural person, including an advisor, engaged by the
     Company or a Parent or Subsidiary to render services to such entity.
 J.  "Director" means a member of the Board.
 K.  "Disability" means total and permanent disability as defined in Section
     22(e)(3) of the Code.
 L.  "Employee" means any person, including Officers and Directors, employed by
     the Company or any Parent or Subsidiary of the Company. A Service Provider
     shall not cease to be an Employee in the case of (i) any leave of absence
     approved by the Company or (ii) transfers between locations of the Company
     or between the Company, its Parent, any Subsidiary, or any successor. For
     purposes of Incentive Stock Options, no such leave may exceed ninety days,
     unless reemployment upon expiration of such leave is guaranteed by statute
     or contract. If reemployment upon expiration of a leave of absence approved
     by the Company is not so guaranteed, then three (3) months following the
     91st day of such leave any Incentive Stock Option held by the Participant
     shall cease to be treated as an Incentive Stock Option and shall be treated
     for tax purposes as a Nonstatutory Stock Option. Neither service as a
     Director nor payment of a Director's fee by the Company shall be sufficient
     to constitute "employment" by the Company.
 M.  "Exchange Act" means the Securities Exchange Act of 1934, as amended.
 N.  "Fair Market Value" means, as of any date, the value of Common Stock
     determined as follows:
      i.   If the Common Stock is listed on any established stock exchange or a
           national market system, including without limitation the New York
           Stock Exchange (NYSE), its Fair Market Value shall be the closing
           sales price for such stock (or the closing bid, if no sales were
           reported) as quoted on such exchange or system for the last market
           trading day prior to the time of determination, as reported in The
           Wall Street Journal or such other source as the Administrator deems
           reliable;
      ii.  If the Common Stock is regularly quoted by a recognized securities
           dealer but selling prices are not reported, the Fair Market Value of
           a Share of Common Stock shall be the mean between the high bid and
           low asked prices for the Common Stock on the last market trading day
           prior to the day of determination, as reported in The Wall Street
           Journal or such other source as the Administrator deems reliable; or
      iii. In the absence of an established market for the Common Stock, the
           Fair Market Value shall be determined in good faith by the
           Administrator.

 O.  "Incentive Stock Option" means an Option intended to qualify as an
     incentive stock option within the meaning of Section 422 of the Code and
     the regulations promulgated thereunder.
 P.  "Nonstatutory Stock Option" means an Option not intended to qualify as an
     Incentive Stock Option.
 Q.  "Notice of Grant" means a written or electronic notice evidencing certain
     terms and conditions of the grant of an individual Option or a Restricted
     Stock Award. The Notice of Grant is part of the agreement evidencing the
     terms and conditions of a specific grant.
 R.  "Officer" means a person who is an officer of the Company within the
     meaning of Section 16 of the Exchange Act and the rules and regulations
     promulgated thereunder.
 S.  "Option" means a stock option granted pursuant to the Plan, as evidenced by
     a Notice of Grant.
 T.  "Option Agreement" means an agreement between the Company and a Participant
     evidencing the terms and conditions of an individual Option grant. The
     Option Agreement is subject to the terms and conditions of the Plan.
 U.  "Optioned Stock" means the Common Stock subject to an Option.
 V.  "Outside Director" means a Director who is not an Employee.
 W.  "Parent" means a "parent corporation," whether now or hereafter existing,
     as defined in Section 424(e) of the Code.
 X.  "Participant" means the holder of an outstanding Option or Restricted Stock
     Award granted under the Plan.
 Y.  "Plan" means this 2003 Stock Plan.
 Z.  "Restricted Stock" means shares of Common Stock acquired pursuant to a
     grant of Restricted Stock Award under Article IV.
 AA. "Restricted Stock Award" means a grant of Restricted Stock pursuant to the
     Plan, as evidenced by a Notice of Grant.
 AB. "Restricted Stock Award Agreement" means a written agreement between the
     Company and a Participant evidencing the terms and restrictions applying to
     stock granted under a Restricted Stock Award. The Restricted Stock Award
     Agreement is subject to the terms and conditions of the Plan and the Notice
     of Grant.
 AC. "Rule 16b-3" means Rule 16b-3 of the Exchange Act or any successor to Rule
     16b-3, as in effect when discretion is being exercised with respect to the
     Plan.
 AD. "Section 16(b) " means Section 16(b) of the Exchange Act.
 AE. "Securities Act" means the Securities Act of 1933, as amended.
 AF. "Service Provider" means an Employee, Director or Consultant.
 AG. "Share" means a share of the Common Stock, as adjusted in accordance with
     Section 5.3.
 AH. "Subsidiary" means a "subsidiary corporation", whether now or hereafter
     existing, as defined in Section 424(f) of the Code.

ADMINISTRATION Stock Subject to the Plan.
 A. Subject to the provisions of Section 5.3, the maximum aggregate number of
    Shares that may be optioned and sold under the Plan is 1,000,000 Shares.
    Notwithstanding the foregoing, the Company may not grant more than 20% of
    the total Shares reserved for issuance hereunder pursuant to Restricted
    Stock Awards.
 B. If an Option or Restricted Stock Award expires or becomes unexercisable
    without having been exercised in full, or is otherwise surrendered to the
    Company prior to having been exercised in full, the unpurchased Shares which
    were subject thereto shall become available for future grant or sale under
    the Plan (unless the Plan has terminated); provided, however, that Shares
    that have actually been issued under the Plan, whether upon exercise of an
    Option or Restricted Stock Award, shall not be returned to the Plan and
    shall not become available for future distribution under the Plan, except
    that if Shares of Restricted Stock are repurchased by the Company at their
    original purchase price, such Shares shall become available for future grant
    under the Plan.

Administration of the Plan.
 A. Procedure.
     i.   Multiple Administrative Bodies. Different Committees with respect to
          different groups of Service Providers may administer the Plan.
     ii.  Section 162(m). To the extent that the Administrator determines it to
          be desirable to qualify Options or Restricted Stock Awards as
          "performance based compensation" within the meaning of Section 162(m)
          of the Code, the Plan shall be administered by a Committee of two or
          more "outside directors" within the meaning of Section 162(m) of the
          Code.
     iii. Rule 16b-3. To the extent desirable to qualify transactions hereunder
          as exempt under Rule 16b-3, the transactions contemplated hereunder
          shall be structured to satisfy the requirements for exemption under
          Rule 16b-3.
     iv.  Other Administration. Other than as provided above, the Plan shall be
          administered by (A) the Board or (B) a Committee, which committee
          shall be constituted to satisfy Applicable Laws.

 B. Powers of the Administrator. Subject to the provisions of the Plan, and in
    the case of a Committee, subject to the specific duties delegated by the
    Board to such Committee, the Administrator shall have the authority, in its
    discretion:
     i.    to determine the Fair Market Value;
     ii.   to select the Service Providers to whom Options and Restricted Stock
           Awards may be granted hereunder;
     iii.  to determine the number of shares of Common Stock to be covered by
           each Option and Restricted Stock Award granted hereunder;
     iv.   to approve forms of agreement for use under the Plan;
     v.    to determine the terms and conditions of any Option or Restricted
           Stock Award in accordance with the provisions of the Plan;
     vi.   to construe and interpret the terms of the Plan and awards granted
           pursuant to the Plan;
     vii.  to prescribe, amend and rescind rules and regulations relating to the
           Plan, including rules and regulations relating to subplans
           established for the purpose of satisfying applicable foreign laws;
     viii. to modify or amend each Option or Restricted Stock Award (subject to
           Section 5.5(C)), including the discretionary authority to extend the
           post-termination exercisability period of awards longer than is
           otherwise provided for in the Plan;
     ix.   to allow Participants to satisfy withholding tax obligations by
           electing to have the Company withhold from the Shares to be issued
           upon exercise of an Option or Restricted Stock Award that number of
           Shares having a Fair Market Value equal to the minimum amount
           required to be withheld. The Fair Market Value of the Shares to be
           withheld shall be determined on the date that the amount of tax to be
           withheld is to be determined. All elections by the Participant to
           have Shares withheld for this purpose shall be made in such form and
           under such conditions as the Administrator may deem necessary or
           advisable;
     x.    to authorize any person to (i) make decisions, determinations and
           interpretations on behalf of the Administrator to the extent allowed
           under Applicable Laws, and (ii) execute on behalf of the Company any
           instrument required to effect the grant of an Option or Restricted
           Stock Award previously granted by the Administrator; and
     xi.   to make all other determinations deemed necessary or advisable for
           administering the Plan.

 C. Effect of Administrator's Decision. The Administrator's decisions,
    determinations and interpretations, and those of any person authorized by
    the Administrator to make decisions, determinations and interpretations on
    behalf of the Administrator, shall be final and binding on all Participants
    and any other holders of Options or Restricted Stock Awards.

Eligibility. Nonstatutory Stock Options and Restricted Stock Awards may be
granted to Service Providers. Incentive Stock Options may be granted only to
Employees. STOCK OPTIONS Limitations.
 A. Each Option shall be designated in the Option Agreement as either an
    Incentive Stock Option or a Nonstatutory Stock Option. However,
    notwithstanding such designation, to the extent that the aggregate Fair
    Market Value of the Shares with respect to which Incentive Stock Options are
    exercisable for the first time by the Participant during any calendar year
    (under all plans of the Company and any Parent or Subsidiary) exceeds
    $100,000, such Options shall be treated as Nonstatutory Stock Options. For
    purposes of this Section 3.1, Incentive Stock Options shall be taken into
    account in the order in which they were granted. The Fair Market Value of
    the Shares shall be determined as of the time the Option with respect to
    such Shares is granted.
 B. The following limitations shall apply to grants of Options:
     i.   No Participant shall be granted, in any fiscal year of the Company,
          Options to purchase more than 500,000 Shares.
     ii.  In connection with his or her initial service, a Participant may be
          granted Options to purchase up to an additional 500,000 Shares, which
          shall not count against the limit set forth in Section 3.1(B)(i).
     iii. The foregoing limitations shall be adjusted proportionately in
          connection with any change in the Company's capitalization as
          described in Section 5.3.
     iv.  If an Option is cancelled in the same fiscal year of the Company in
          which it was granted (other than in connection with a transaction
          described in Section 5.3), the cancelled Option will be counted
          against the limits set forth in Sections 3.1(B)(i) and (ii).

Grants of Options to Outside Directors
 A. Procedure for Grants. All grants of Options to Outside Directors under this
    Plan shall be automatic and non-discretionary and shall be made strictly in
    accordance with the following provisions:
     i.   No person shall have any discretion to select which Outside Directors
          shall be granted Options or to determine the number of Shares to be
          covered by Options granted to Outside Directors.
     ii.  All Options granted pursuant to this Section shall be Nonstatutory
          Stock Options and, except as otherwise provided herein, shall be
          subject to the other terms and conditions of the Plan.
     iii. Each person who first becomes an Outside Director following the
          effective date of this Plan shall be automatically granted an option
          to purchase 12,000 Shares (the "First Option") on the date on which
          such person first becomes an Outside Director, whether through
          election by the stockholders of the Company or appointment by the
          Board to fill a vacancy.
     iv.  After the First Option has been granted to an Outside Director, such
          Outside Director shall thereafter be automatically granted an Option
          to purchase 3,000 Shares (a "Subsequent Option") on January 15 of each
          year, if on such date, he or she shall have served on the Board for at
          least the preceding six (6) months.
     v.   Notwithstanding the provisions of subsections (iii) and (iv) hereof,
          in the event that a grant would cause the number of Shares subject to
          outstanding Options and Restricted Stock Awards plus the number of
          Shares previously purchased upon exercise of Options and Restricted
          Stock Awards to exceed the number of Shares available for issuance
          under the Plan, then each such automatic grant shall be for that
          number of Shares determined by dividing the total number of Shares
          remaining available for grant by the number of Outside Directors on
          the automatic grant date. Any further grants shall then be deferred
          until such time, if any, as additional Shares become available for
          grant under the Plan through action of the stockholders to increase
          the number of Shares which may be issued under the Plan or through
          cancellation or expiration of Options previously granted hereunder.

 B. The terms of an Option granted to an Outside Director shall be as follows:
     i.   the term of the Option shall be seven (7) years;.
     ii.  the Option shall be exercisable only while the Outside Director
          remains a Director of the Company;
     iii. the exercise price per Share shall be 100% of the Fair Market Value
          per Share on the date of grant of the Option; and
     iv.  subject to accelerated vesting upon a merger or Change in Control as
          specified in Section 5.3(C), the Option shall vest and become
          exercisable as to 25% of the Shares subject to the Option on the first
          anniversary of the date of grant of the Option and shall vest and
          become exercisable as to 6.25% of the Shares subject to the Option at
          the end of each three-month period thereafter, if on such dates
          Participant has remained in continuous status as a Director.

 C. The Plan shall not confer upon any Outside Director any right with respect
    to continuation of service as a Director or nomination to serve as a
    Director, nor shall it interfere in any way with any rights which the
    Director or the Company may have to terminate his or her directorship at any
    time.

Term of Option. The term of each Option shall be stated in the Option Agreement.
In the case of an Incentive Stock Option, the term shall be seven (7) years from
the date of grant or such shorter term as may be provided in the Option
Agreement. Moreover, in the case of an Incentive Stock Option granted to a
Participant who, at the time the Incentive Stock Option is granted, owns stock
representing more than ten percent (10%) of the total combined voting power of
all classes of stock of the Company or any Parent or Subsidiary, the term of the
Incentive Stock Option shall be five (5) years from the date of grant or such
shorter term as may be provided in the Option Agreement. Option Exercise Price
and Consideration.
 A. Exercise Price. The per share exercise price for the Shares to be issued
    pursuant to exercise of an Option shall be determined by the Administrator,
    subject to the following:
     i.  In the case of an Incentive Stock Option
          1. granted to an Employee who, at the time the Incentive Stock Option
             is granted, owns stock representing more than ten percent (10%) of
             the voting power of all classes of stock of the Company or any
             Parent or Subsidiary, the per Share exercise price shall be no less
             than 110% of the Fair Market Value per Share on the date of grant.
          2. granted to any Employee other than an Employee described in Section
             3.4(A)(i)(1), the per Share exercise price shall be no less than
             100% of the Fair Market Value per Share on the date of grant.
    
     ii. In the case of a Nonstatutory Stock Option, the per Share exercise
         price shall be no less than 100% of the Fair Market Value per Share on
         the date of grant.

Waiting Period and Exercise Dates. At the time an Option is granted, the
Administrator shall fix the period within which the Option may be exercised and
shall determine any conditions that must be satisfied before the Option may be
exercised. Form of Consideration. The Administrator shall determine the
acceptable form of consideration for exercising an Option, including the method
of payment. In the case of an Incentive Stock Option, the Administrator shall
determine the acceptable form of consideration at the time of grant. Such
consideration may consist, subject to Applicable Laws, entirely of:
 A. cash;
 B. check;
 C. promissory note;
 D. other Shares, including reservation by the Company of Shares issuable to the
    Participant upon exercise of an Option, which have a Fair Market Value on
    the date of surrender or reservation equal to the aggregate exercise price
    of the Shares as to which such Option shall be exercised;
 E. consideration received by the Company under a cashless exercise program
    implemented by the Company in connection with the Plan;
 F. a reduction in the amount of any Company liability to the Participant,
    including any liability attributable to the Participant's participation in
    any Company sponsored deferred compensation program or arrangement;
 G. any combination of the foregoing methods of payment; or
 H. such other consideration and method of payment for the issuance of Shares to
    the extent permitted by Applicable Laws.

Exercise of Option.
 A. Procedure for Exercise; Rights as a Stockholder. Any Option granted
    hereunder shall be exercisable according to the terms of the Plan and at
    such times and under such conditions as determined by the Administrator and
    set forth in the Option Agreement. Unless the Administrator provides
    otherwise, vesting of Options granted hereunder shall be suspended during
    any unpaid leave of absence. An Option may not be exercised for a fraction
    of a Share.
     i.  An Option shall be deemed exercised when the Company receives: (x)
         written or electronic notice of exercise (in accordance with the Option
         Agreement) from the person entitled to exercise the Option, and (y)
         full payment for the Shares with respect to which the Option is
         exercised. Full payment may consist of any consideration and method of
         payment authorized by the Administrator and permitted by the Option
         Agreement and the Plan. Shares issued upon exercise of an Option shall
         be issued in the name of the Participant or, if requested by the
         Participant, in the name of the Participant and his or her spouse.
         Until the Shares are issued (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 stockholder shall exist with respect to the Optioned Stock,
         notwithstanding the exercise of the Option. The Company shall issue (or
         cause to be issued) such Shares promptly after the Option is exercised.
         No adjustment will be made for a dividend or other right for which the
         record date is prior to the date the Shares are issued, except as
         provided in Section 5.3.
     ii. Exercising an Option in any manner shall decrease the number of Shares
         thereafter 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.

 B. Termination of Relationship as a Service Provider. If a Participant ceases
    to be a Service Provider, other than upon the Participant's death or
    Disability, the Participant may exercise his or her Option within such
    period of time as is specified in the Option Agreement to the extent that
    the Option is vested on the date of termination (but in no event later than
    the expiration of the term of such Option as set forth in the Option
    Agreement). In the absence of a specified time in the Option Agreement, the
    Option shall remain exercisable for three (3) months following the
    Participant's termination. If, on the date of termination, the Participant
    is not vested as to his or her entire Option, the Shares covered by the
    unvested portion of the Option shall revert to the Plan. If, after
    termination, the Participant does not exercise his or her Option within the
    time specified by the Administrator, the Option shall terminate, and the
    Shares covered by such Option shall revert to the Plan.
 C. Disability of Participant. If a Participant ceases to be a Service Provider
    as a result of the Participant's Disability, the Participant may exercise
    his or her Option within such period of time as is specified in the Option
    Agreement (of at least six (6) months) to the extent the Option is vested on
    the date of termination (but in no event later than the expiration of the
    term of such Option as set forth in the Option Agreement). In the absence of
    a specified time in the Option Agreement, the Option shall remain
    exercisable for twelve (12) months following the Participant's termination.
    If, on the date of termination, the Participant is not vested as to his or
    her entire Option, the Shares covered by the unvested portion of the Option
    shall revert to the Plan. If, after termination, the Participant does not
    exercise his or her Option within the time specified herein, the Option
    shall terminate, and the Shares covered by such Option shall revert to the
    Plan.
 D. Death of Participant. If a Participant dies while a Service Provider, the
    Option may be exercised following the Participant's death within such period
    of time as is specified in the Option Agreement to the extent that the
    Option is vested on the date of death (but in no event may the option be
    exercised later than the expiration of the term of such Option as set forth
    in the Option Agreement), by the Participant's designated beneficiary,
    provided such beneficiary has been designated prior to the Participant's
    death in a form acceptable to the Administrator. If no such beneficiary has
    been designated by the Participant, then such Option may be exercised by the
    personal representative of the Participant's estate or by the person(s) to
    whom the Option is transferred pursuant to the Participant's will or in
    accordance with the laws of descent and distribution. In the absence of a
    specified time in the Option Agreement, the Option shall remain exercisable
    for twelve (12) months following the Participant's death. If, at the time of
    death, a Participant is not vested as to his or her entire Option, the
    Shares covered by the unvested portion of the Option shall immediately
    revert to the Plan. If the Option is not so exercised within the time
    specified herein, the Option shall terminate, and the Shares covered by such
    Option shall revert to the Plan.

RESTRICTED STOCK AWARDS

Restricted Stock Awards. Restricted Stock Awards may be issued either alone, in
addition to, or in tandem with other awards granted under the Plan and/or cash
awards made outside of the Plan. After the Administrator determines that it will
offer Restricted Stock Awards under the Plan, it shall advise the offeree in
writing or electronically, by means of a Notice of Grant, of the terms,
conditions and restrictions related to the offer, including the number of Shares
that the offeree shall be entitled to purchase, the price to be paid, and the
time within which the offeree must accept such offer. The offer shall be
accepted by execution of a Restricted Stock Purchase Agreement in the form
determined by the Administrator. Term of Restricted Stock Awards. The term of
each Restricted Stock Award shall be stated in the Restricted Stock Award
Agreement. Shares of Common Stock issued pursuant to a Restricted Stock Award
may, in the discretion of the Administrator, vest over the Participant's period
of Service or upon attainment of specified performance objectives.
Notwithstanding the foregoing, subject to Section 5.3(C), a Restricted Stock
Award may not vest at a rate faster than one third per year over the three years
following the date of grant. If a Restricted Stock Award is subject to
achievement of performance goals then, subject to Section 5.3(C), that award may
not vest prior to one year after the date of grant. Limitation on Restricted
Stock Award Grants. No Participant shall receive Restricted Stock Awards in any
fiscal year of the Company having an aggregate initial value greater than
$600,000, except that Restricted Stock Awards granted to a new Employee in the
fiscal year of the Company in which his or her service as an Employee first
commences shall not have an aggregate initial value greater than $1,000,000.
Repurchase Option. Unless the Administrator determines otherwise, the Restricted
Stock Award Agreement shall grant the Company a repurchase option exercisable
upon the voluntary or involuntary termination of the Participant's service with
the Company for any reason (including death or Disability). The purchase price
for Shares repurchased pursuant to the Restricted Stock Award Agreement shall be
the original price paid by the Participant and may be paid by cancellation of
any indebtedness of the purchaser to the Company. The repurchase option shall
lapse as the Restricted Stock Award vests. Other Provisions. The Restricted
Stock Award 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. Rights as a Stockholder. Once the Restricted Stock Award is
exercised, the Participant shall have the rights equivalent to those of a
stockholder, and shall be a stockholder when his or her purchase 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 Award is exercised, except as provided in Section
5.3. Cancellation of Restricted Stock Award. On the date set forth in the
Restricted Stock Award Agreement, all unearned or unvested Restricted Stock
shall be forfeited to the Company. GENERAL PROVISIONS Term of Plan. Subject to
Section 5.10, the Plan shall become effective on September 24, 2003. It shall
continue in effect for a term of ten (10) years unless terminated earlier under
Section 5.5. Transferability of Awards. Unless determined otherwise by the
Administrator, an Option or Restricted Stock Award 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 and may be exercised, during the
lifetime of the Participant, only by the Participant. If the Administrator, in
its sole discretion, makes an Option or Restricted Stock Award transferable,
such Option or Restricted Stock Award may only be transferred (i) by will, (ii)
by the laws of descent and distribution, or (iii) to family members (as such
term is defined in the general instructions to Form S-8 under the Securities
Act, or any successor thereto) through gifts or domestic relations orders, as
permitted by Rule 701 of the Securities Act. Adjustments Upon Changes in
Capitalization, Merger or Change in Control.
 A. Changes in Capitalization. Subject to any required action by the
    stockholders of the Company, the number of shares of Common Stock that have
    been authorized for issuance under the Plan but as to which no Options or
    Restricted Stock Awards have yet been granted or which have been returned to
    the Plan upon cancellation or expiration of an Option or Restricted Stock
    Award, and the number of shares of Common Stock as well as the price per
    share of Common Stock covered by each such outstanding Option or Restricted
    Stock Award, 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 issued
    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 adjustment shall be made by the Board, whose
    determination in that respect 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 of Common Stock subject to an Option or
    Restricted Stock Award.
 B. Dissolution or Liquidation. In the event of the proposed dissolution or
    liquidation of the Company, the Administrator shall notify each Participant
    as soon as practicable prior to the effective date of such proposed
    transaction. The Administrator in its discretion may provide for the
    Participant to have the right to exercise his or her Option or Restricted
    Stock Award until ten (10) days prior to such transaction as to all of the
    Shares covered thereby, including Shares as to which the Option or
    Restricted Stock Award would not otherwise be exercisable. In addition, the
    Administrator may provide that any Company repurchase option applicable to
    any Shares purchased upon exercise of an Option or Restricted Stock Award
    shall lapse as to all such Shares, provided the proposed dissolution or
    liquidation takes place at the time and in the manner contemplated. To the
    extent it has not been previously exercised, or earned, an Option or
    Restricted Stock Award will terminate immediately prior to the consummation
    of such proposed action.
 C. Merger or Change in Control.
     i. Options and Restricted Stock Awards. In the event of a merger of the
        Company with or into another corporation, or a Change in Control, each
        outstanding Option or Restricted Stock Award shall be assumed or an
        equivalent option or award substituted by the successor corporation or a
        Parent or Subsidiary of the successor corporation.
         1. In the event that the successor corporation refuses to assume or
            substitute for the Option or Restricted Stock Award, the Participant
            shall fully vest in and have the right to exercise the Option or
            Restricted Stock Award as to all of the Shares, including Shares as
            to which it would not otherwise be vested or exercisable. If an
            Option or Restricted Stock Award becomes fully vested and
            exercisable in lieu of assumption or substitution in the event of a
            merger or Change in Control, the Administrator shall notify the
            Participant in writing or electronically that the Option or
            Restricted Stock Award shall be fully vested and exercisable for a
            period of not less than fifteen (15) days from the date of such
            notice, and the Option or Restricted Stock Award shall terminate
            upon the expiration of such period.
         2. For the purposes of this Section 5.3(C)(i), the Option or Restricted
            Stock Award shall be considered assumed if, following the merger or
            Change in Control, the option or award confers the right to purchase
            or receive, for each Share of Optioned Stock subject to the Option
            or Restricted Stock subject to the Restricted Stock Award
            immediately prior to the merger or Change in Control, the
            consideration (whether stock, cash, or other securities or property)
            received in the merger or Change in Control by holders of Common
            Stock for each Share held on the effective date of the transaction
            (and if holders were offered a choice of consideration, the type of
            consideration chosen by the holders of a majority of the outstanding
            Shares); provided, however, that if such consideration received in
            the merger or Change in Control is not solely common stock of the
            successor corporation or its Parent, the Administrator may, with the
            consent of the successor corporation, provide for the consideration
            to be received upon the exercise of the Option or Restricted Stock
            Award, for each Share of Optioned Stock subject to the Option or
            Restricted Stock subject to the Restricted Stock Award, to be solely
            common stock of the successor corporation or its Parent equal in
            fair market value to the per share consideration received by holders
            of Common Stock in the merger or Change in Control.

 D. Outside Director Option Grants. Notwithstanding anything in Section
    5.3(C)(i) to the contrary, in the event of a merger of the Company with or
    into another corporation, or a Change in Control, in which an Outside
    Director is terminated or asked to resign, Options granted to such Outside
    Director under Section 3.2 shall vest 100% immediately prior to such merger
    or Change in Control. In the event of a merger or Change in Control in which
    an Outside Director is not terminated or asked to resign, such Outside
    Director's Options granted under Section 3.2 shall be treated under the
    terms of Section 5.3(C)(i).

Date of Grant. The date of grant of an Option or Restricted Stock Award shall
be, for all purposes, the date on which the Administrator makes the
determination granting such Option or Restricted Stock Award or such other later
date as is determined by the Administrator. Notice of the determination shall be
provided to each Participant within a reasonable time after the date of such
grant. Amendment and Termination of the Plan.
 A. Amendment and Termination. The Board may at any time amend, alter, suspend
    or terminate the Plan.
 B. Stockholder Approval. The Company shall obtain stockholder approval of any
    Plan amendment to the extent necessary and desirable to comply with
    Applicable Laws. Additionally, notwithstanding anything in the Plan to the
    contrary, the Board may not, without the approval of the Company's
    stockholders:
     i.   materially increase the number of shares of Common Stock issuable
          under the Plan, except for permissible adjustments in the event of
          certain changes in the Company's capitalization;
     ii.  materially modify the requirements for eligibility to participate in
          the Plan, or
     iii. reprice Options issued under the Plan by lowering the exercise price
          of a previously granted award, by canceling outstanding Options and
          issuing replacements, or by otherwise replacing existing Options with
          substitute Options with a lower exercise price.

 C. Effect of Amendment or Termination. No amendment, alteration, suspension or
    termination of the Plan shall impair the rights of any Participant, unless
    mutually agreed otherwise between the Participant and the Administrator,
    which agreement must be in writing and signed by the Participant and the
    Company. Termination of the Plan shall not affect the Administrator's
    ability to exercise the powers granted to it hereunder with respect to
    Options or Restricted Stock Awards granted under the Plan prior to the date
    of such termination.

Conditions Upon Issuance of Shares.
 A. Legal Compliance. Shares shall not be issued pursuant to the exercise of an
    Option or Restricted Stock Award unless the exercise of such Option or
    Restricted Stock Award and the issuance and delivery of such Shares shall
    comply with Applicable Laws and shall be further subject to the approval of
    counsel for the Company with respect to such compliance.
 B. Investment Representations. As a condition to the exercise of an Option or
    Restricted Stock Award, the Company may require the person exercising such
    Option or Restricted Stock Award 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.

Inability to Obtain Authority. The inability of the Company to obtain authority
from any regulatory body having jurisdiction, which authority is deemed by the
Company's counsel to be necessary to the lawful issuance and sale of any Shares
hereunder, shall relieve the Company of any liability in respect of the failure
to issue or sell such Shares as to which such requisite authority shall not have
been obtained. Reservation of Shares. The Company, during the term of this Plan,
will at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan. Participant's Relationship
with Company. Neither the Plan nor any Option or Restricted Stock Award shall
confer upon the Participant any right with respect to continuing the
Participant's relationship as a Service Provider with the Company, nor shall
they interfere in any way with the Participant's right or the Company's right to
terminate such relationship at any time, with or without cause. Stockholder
Approval. The Plan shall be subject to approval by the stockholders of the
Company within twelve (12) months after the date the Plan is adopted. Such
stockholder approval shall be obtained in the manner and to the degree required
under Applicable Laws.