Exhibit 10.1
ACTEL CORPORATION
1986 EQUITY INCENTIVE PLAN
Amended and Restated Effective June 3, 2005
     1. Purposes of the Plan. The purposes of this Equity Incentive Plan are to
attract and retain the best available personnel for positions of substantial
responsibility, to provide additional incentive to the Employees and Consultants
of the Company and to promote the success of the Company’s business.
     Awards granted hereunder may be Incentive Stock Options, Nonstatutory Stock
Options, Restricted Stock, Stock Appreciation Rights, Performance Shares,
Performance Units or Restricted Stock Units, at the discretion of the
Administrator and as reflected in the terms of the written option agreement.
     2. Definitions. As used herein, the following definitions shall apply:
     (a) “Administrator” shall mean the Board or any of its Committees as shall
be administering the Plan, in accordance with Section 4 of the Plan.
     (b) “Annual Revenue” shall mean the Company’s or a business unit’s net
sales for the Fiscal Year, determined in accordance with generally accepted
accounting principles.
     (c) “Applicable Laws” shall mean the legal requirements relating to the
administration of equity incentive plans under California corporate and
securities laws and the Code.
     (d) “Award” shall mean, individually or collectively, a grant under the
Plan of Options, Restricted Stock, Stock Appreciation Rights, Performance
Shares, Performance Units or Restricted Stock Units.
     (e) “Award Agreement” shall mean the written or electronic agreement
setting forth the terms and provisions applicable to each Award granted under
the Plan. The Award Agreement is subject to the terms and conditions of the
Plan.
     (f) “Awarded Stock” shall mean the Common Stock subject to an Award.
     (g) “Board” shall mean the Board of Directors of the Company.
     (h) “Cash Position” shall mean the Company’s level of cash and cash
equivalents.
     (i) “Common Stock” shall mean the Common Stock of the Company.
     (j) “Committee” shall mean the Committee appointed by the Board of
Directors in accordance with paragraph (a) of Section 4 of the Plan, if one is
appointed.
     (k) “Company” shall mean Actel Corporation, a California corporation.
     (l) “Consultant” shall mean any person, including an advisor, engaged by
the Company or a Parent or Subsidiary to render services and who is compensated
for such services, provided that the term “Consultant” shall not include
Directors who are paid only a director’s fee by the Company or who are not
compensated by the Company for their services as Directors.

 

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     (m) “Continuous Status as an Employee or Consultant” shall mean that the
employment or consulting relationship is not interrupted or terminated by the
Company, any Parent or Subsidiary. Continuous Status as an Employee or
Consultant shall not be considered interrupted in the case of: (i) any leave of
absence approved by the Board, including sick leave, military leave, or any
other personal leave; provided, however, that for purposes of Incentive Stock
Options, any such leave may not exceed ninety (90) days, unless reemployment
upon the expiration of such leave is guaranteed by contract (including certain
Company policies) or statute; or (ii) transfers between locations of the Company
or between the Company, its Parent, its Subsidiaries or its successor.
     (n) “Director” shall mean a member of the Board.
     (o) “Dividend Equivalent” shall mean a credit, payable in cash, made at the
discretion of the Administrator, to the account of a Participant in an amount
equal to the cash dividends paid on one Share for each Share represented by an
Award held by such Participant. Dividend Equivalents may be subject to the same
vesting restrictions as the related Shares subject to an Award, at the
discretion of the Administrator.
     (p) “Earnings Per Share” shall mean as to any Fiscal Year, the Company’s or
a business unit’s Net Income, divided by a weighted average number of common
shares outstanding and dilutive common equivalent shares deemed outstanding,
determined in accordance with generally accepted accounting principles.
     (q) “Employee” shall mean any person, including officers and directors,
employed by the Company or any Parent or Subsidiary of the Company. The payment
of a director’s fee by the Company shall not be sufficient to constitute
“employment” by the Company.
     (r) “Exchange Act” shall mean the Securities Exchange Act of 1934, as
amended.
     (s) “Fair Market Value” shall mean, as of any date, the value of Common
Stock determined as follows:
     (i) If the Common Stock is listed on a stock exchange, the fair market
value per Share shall be the closing price on such exchange, as reported in the
Wall Street Journal on the date of determination or, if the date of
determination is not a trading day, the immediately preceding trading day;
     (ii) If there is a public market for the Common Stock, the fair market
value per Share shall be the mean of the bid and asked prices, or closing price
in the event quotations for the Common Stock are reported on the National Market
System, of the Common Stock on the date of determination, as reported in the
Wall Street Journal (or, if not so reported, as otherwise reported by the
National Association of Securities Dealers Automated Quotation (NASDAQ) System);
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.
     (t) “Fiscal Year” shall mean a fiscal year of the Company.
     (u) “Incentive Stock Option” shall mean an Option intended to qualify as an
incentive stock option within the meaning of Section 422 of the Internal Revenue
Code of 1986, as amended.
     (v) “Individual Performance Objective” shall mean any individual Company
business-related objective that is objectively determinable within the meaning
of Code Section 162(m) and the Treasury Regulations promulgated thereunder.
Individual Performance Objectives shall include, but not be limited

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to, improvement in customer satisfaction and similar objectively determinable
performance objectives related to the Participant’s job responsibilities with
the Company.
     (w) “Net Income” shall mean as to any Fiscal Year, the income after taxes
of the Company for the Fiscal Year determined in accordance with generally
accepted accounting principles.
     (x) “Nonstatutory Stock Option” shall mean an Option not intended to
qualify as an Incentive Stock Option.
     (y) “Officer” shall mean 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.
     (z) “Operating Cash Flow” shall mean the Company’s or a business unit’s sum
of Net Income plus depreciation and amortization less capital expenditures plus
changes in working capital comprised of accounts receivable, inventories, other
current assets, trade accounts payable, accrued expenses, product warranty,
advance payments from customers and long-term accrued expenses, determined in
accordance with generally acceptable accounting principles.
     (aa) “Operating Income” shall mean the Company’s or a business unit’s
income from operations determined in accordance with generally accepted
accounting principles.
     (bb) “Option” shall mean a stock option granted pursuant to the Plan.
     (cc) “Optioned Stock” shall mean the Common Stock subject to an Option.
     (dd) “Parent” shall mean a “parent corporation”, whether now or hereafter
existing, as defined in Section 424(e) of the Internal Revenue Code of 1986, as
amended.
     (ee) “Participant” shall mean an Employee or Consultant who receives an
Award.
     (ff) “Performance Goals” shall mean the goal(s) (or combined goal(s))
determined by the Committee (in its discretion) to be applicable to a
Participant with respect to an Award. As determined by the Committee, the
Performance Goals applicable to an Award may provide for a targeted level or
levels of achievement using one or more of the following measures: (a) Annual
Revenue, (b) Cash Position, (c) Earnings Per Share, (d) Net Income,
(e) Operating Cash Flow, (f) Operating Income, (g) Return on Assets, (h) Return
on Equity, (i) Return on Sales, (j) Total Stockholder Return, and (k) Individual
Performance Objectives. The Performance Goals may differ from Participant to
Participant and from Award to Award. The Administrator shall appropriately
adjust any evaluation of performance under a Performance Goal to exclude (i) any
extraordinary non-recurring items as described in Accounting Principles Board
Opinion No. 30 and/or in management’s discussion and analysis of financial
conditions and results of operations appearing in the Company’s annual report to
shareholders for the applicable year, or (ii) the effect of any changes in
accounting principles affecting the Company’s or a business units’ reported
results.
     (gg) “Performance Share” shall mean a performance share Award granted to a
Participant pursuant to Section 12.
     (hh) “Performance Unit” means a performance unit Award granted to a
Participant pursuant to Section 13.
     (ii) “Plan” shall mean this 1986 Equity Incentive Plan, as amended.

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     (jj) “Restricted Stock” shall mean a restricted stock Award granted to a
Participant pursuant to Section 10.
     (kk) “Restricted Stock Unit” shall mean a bookkeeping entry representing an
amount equal to the Fair Market Value of one Share, granted pursuant to
Section 11. Each Restricted Stock Unit represents an unfunded and unsecured
obligation of the Company.
     (ll) “Return on Assets” shall mean the percentage equal to the Company’s or
a business unit’s Operating Income before incentive compensation, divided by
average net Company or business unit, as applicable, assets, determined in
accordance with generally accepted accounting principles.
     (mm) “Return on Equity” shall mean the percentage equal to the Company’s
Net Income divided by average shareholder’s equity, determined in accordance
with generally accepted accounting principles.
     (nn) “Return on Sales” shall mean the percentage equal to the Company’s or
a business unit’s Operating Income before incentive compensation, divided by the
Company’s or the business unit’s, as applicable, revenue, determined in
accordance with generally accepted accounting principles.
     (oo) “Rule 16b-3” shall mean 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.
     (pp) “Section 16(b)” shall mean Section 16(b) of the Exchange Act.
     (qq) “Share” shall mean a share of the Common Stock, as adjusted in
accordance with Section 18 of the Plan.
     (rr) “Stock Appreciation Right” or “SAR” shall mean a stock appreciation
right granted pursuant to Section 8 below.
     (ss) “Subsidiary” shall mean a “subsidiary corporation”, whether now or
hereafter existing, as defined in Section 424(f) of the Internal Revenue Code of
1986, as amended.
     (tt) “Total Stockholder Return” shall mean the total return (change in
share price plus reinvestment of any dividends) of a share of the Company’s
common stock.
     3. Stock Subject to the Plan. Subject to the provisions of Section 18 of
the Plan, the maximum aggregate number of shares which may be optioned and sold
under the Plan is 5,497,897 shares of Common Stock, increased annually on the
first day of each of the Company’s fiscal years during the term of the Plan (and
subsequent to the May 2, 1996, amendment to and restatement of the Plan) in an
amount equal to 5% of the Company’s common stock issued and outstanding at the
close of business on the last day of the immediately preceding fiscal year (the
“Annual Replenishment”), with only the 5,497,897 shares and subsequent annual
increases in an amount equal to the lesser of (i) 885,931 shares and (ii) the
number of shares subject to the Annual Replenishment to be available for
issuance as “incentive stock options” qualified under Section 422 of the
Internal Revenue Code. All of the shares issuable under the Plan may be
authorized, but unissued, or reacquired Common Stock.
     Any Shares subject to Options or SARs shall be counted against the
numerical limits of this Section 3 as one Share for every Share subject thereto.
With respect to Awards granted on or after the date of receiving shareholder
approval of the amended Plan in 2005, any Shares subject to Performance Shares,
Restricted Stock or Restricted Stock Units with a per share or unit purchase
price lower than 100% of Fair Market Value on the date of grant shall be counted
against the numerical limits of this Section 3 as two Shares for every one Share
subject thereto. To the extent that a Share that was subject to an Award that
counted as two Shares against the Plan reserve pursuant to the preceding
sentence is recycled back into the Plan under the next paragraph of this
Section 3, the Plan shall be credited with two Shares.

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          If an Award expires or becomes unexercisable without having been
exercised in full, or, with respect to Restricted Stock, Performance Shares or
Restricted Stock Units, is forfeited to or repurchased by the Company at its
original purchase price due to such Award failing to vest, the unpurchased
Shares (or for Awards other than Options and SARs, the forfeited or repurchased
shares) which were subject thereto shall become available for future grant or
sale under the Plan (unless the Plan has terminated). With respect to SARs, when
an SAR is exercised, the shares subject to an SAR grant agreement shall be
counted against the numerical limits of Section 3 above, as one share for every
share subject thereto, regardless of the number of shares used to settle the SAR
upon exercise (i.e., shares withheld to satisfy the exercise price of an SAR
shall not remain available for issuance under the Plan). Shares that have
actually been issued under the Plan under any Award shall not be returned to the
Plan and shall not become available for future distribution under the Plan;
provided, however, that if Shares of Restricted Stock, Performance Shares or
Restricted Stock Units are repurchased by the Company at their original purchase
price or are forfeited to the Company due to such Awards failing to vest, such
Shares shall become available for future grant under the Plan. Shares used to
pay the exercise price of an Option shall not become available for future grant
or sale under the Plan. Shares used to satisfy tax withholding obligations shall
not become available for future grant or sale under the Plan. To the extent an
Award under the Plan is paid out in cash rather than stock, such cash payment
shall not reduce the number of Shares available for issuance under the Plan. Any
payout of Dividend Equivalents or Performance Units, because they are payable
only in cash, shall not reduce the number of Shares available for issuance under
the Plan. Conversely, any forfeiture of Dividend Equivalents or Performance
Units shall not increase the number of Shares available for issuance under the
Plan.
     4. Administration of the Plan.
          (a) Procedure.
     (i) Multiple Administrative Bodies. If permitted by Rule 16b-3, the Plan
may be administered by different bodies with respect to Directors, Officers who
are not Directors, and Employees who are neither Directors nor Officers.
     (ii) Section 162(m). To the extent that the Administrator determines it to
be desirable to qualify Awards granted hereunder as “performance-based
compensation” within the meaning of Section 162(m) of the Code, the Plan shall
be administered by a Committee consisting solely of two or more “outside
directors” within the meaning of Section 162(m) of the Code.
     (iii) Administration With Respect to Directors and Officers Subject to
Section 16(b). With respect to Option grants made to Employees who are also
Officers or Directors subject to Section 16(b) of the Exchange Act, the Plan
shall be administered by (A) the Board, if the Board may administer the Plan in
compliance with Rule 16b-3, or (B) a committee designated by the Board to
administer the Plan, which committee shall be constituted to comply with
Rule 16b-3. Once appointed, 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 the Committee and appoint additional members,
remove members (with or without cause) and substitute new members, fill
vacancies (however caused), and remove all members of the Committee and
thereafter directly administer the Plan, all to the extent permitted by
Rule 16b-3.
     (iv) Administration With Respect to Other Persons. With respect to Option
grants made to Employees or Consultants who are neither Directors nor Officers
of the Company, the Plan shall be administered by (A) the Board or (B) a
committee designated by the Board, which committee shall be constituted to
satisfy Applicable Laws. Once appointed, such Committee shall serve in its
designated capacity until otherwise directed by the Board. The Board may
increase the size of the Committee and appoint additional members, remove
members (with or without cause) and substitute new members, fill vacancies
(however caused), and remove all members of the Committee and thereafter
directly administer the Plan, all to the extent permitted by Applicable Laws.

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     (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 in accordance with Section 2(s) of
the Plan;
     (ii) to select the Consultants and Employees to whom Awards may be granted
hereunder;
     (iii) to determine whether and to what extent Awards are granted hereunder;
     (iv) to determine the number of shares of Common Stock to be covered by
each Award granted hereunder;
     (v) to approve forms of agreement for use under the Plan;
     (vi) to determine the terms and conditions, not inconsistent with the terms
of the Plan, of any award granted hereunder. Such terms and conditions include,
but are not limited to, the exercise price, the time or times when Awards may be
exercised (which may be based on performance criteria), any vesting acceleration
or waiver of forfeiture restrictions, and any restriction or limitation
regarding any Award or the shares of Common Stock relating thereto, based in
each case on such factors as the Administrator, in its sole discretion, shall
determine;
     (vii) to construe and interpret the terms of the Plan and awards granted
pursuant to the Plan;
     (viii) to prescribe, amend and rescind rules and regulations relating to
the Plan;
     (ix) to modify or amend each Award (subject to Section 21(c) of the Plan);
     (x) to authorize any person to execute on behalf of the Company any
instrument required to effect the grant of an Award previously granted by the
Administrator;
     (xi) to determine the terms and restrictions applicable to Awards;
     (xii) to determine whether Awards will be adjusted for Dividend Equivalents
and whether such Dividend Equivalents shall be subject to vesting; and
     (xiii) to make all other determinations deemed necessary or advisable for
administering the Plan.
     (c) Effect of Administrator’s Decision. All decisions, determinations and
interpretations of the Administrator shall be final and binding on all
Participants and any other holders of any Awards granted under the Plan.
     5. Eligibility. Awards may be granted only to Employees and Consultants.
Incentive Stock Options may be granted only to Employees. An Employee or
Consultant who has been granted an Award may, if he or she is otherwise
eligible, be granted an additional Award or Awards.
     6. Code Section 162(m) Provisions.
     (a) Option and SAR Annual Share Limit. No Participant shall be granted, in
any Fiscal Year, Options and Stock Appreciation Rights to purchase more than
500,000 Shares; provided, however, that such limit shall be 1,000,000 Shares in
the Participant’s first Fiscal Year of Company service.

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     (b) Restricted Stock, Performance Share and Restricted Stock Unit Annual
Limit. No Participant shall be granted, in any Fiscal Year, more than 250,000
Shares in the aggregate of the following: (i) Restricted Stock, (ii) Performance
Shares, or (iii) Restricted Stock Units; provided, however, that such limit
shall be 500,000 Shares in the Participant’s first Fiscal Year of Company
service.
     (c) Performance Units Annual Limit. No Participant shall receive
Performance Units, in any Fiscal Year, having an initial value greater than
$500,000, provided, however, that such limit shall be $1,000,000 in the
Participant’s first Fiscal Year of Company service.
     (d) Section 162(m) Performance Restrictions. For purposes of qualifying
grants of Restricted Stock, Performance Shares, Performance Units or Restricted
Stock Units as “performance-based compensation” under Section 162(m) of the
Code, the Administrator, in its discretion, may set restrictions based upon the
achievement of Performance Goals. The Performance Goals shall be set by the
Administrator on or before the latest date permissible to enable the Restricted
Stock, Performance Shares, Performance Units or Restricted Stock Units to
qualify as “performance-based compensation” under Section 162(m) of the Code. In
granting Restricted Stock, Performance Shares, Performance Units or Restricted
Stock Units which are intended to qualify under Section 162(m) of the Code, the
Administrator shall follow any procedures determined by it from time to time to
be necessary or appropriate to ensure qualification of the Award under Section
162(m) of the Code (e.g., in determining the Performance Goals).
     (e) Changes in Capitalization. The numerical limitations in Sections 6(a)
and (b) shall be adjusted proportionately in connection with any change in the
Company’s capitalization as described in Section 16(a).
     7. Stock Options
     (a) Type of Option. Each Option shall be designated in the Award Agreement
as either an Incentive Stock Option or a Nonstatutory Stock Option. However,
notwithstanding such designations, to the extent that the aggregate Fair Market
Value of Shares subject to a Participant’s incentive stock options granted by
the Company, any Parent or Subsidiary, that become exercisable for the first
time 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 7(a), incentive stock
options shall be taken into account in the order in which they were granted, and
the Fair Market Value of the Shares shall be determined as of the time of grant.
     (b) Option Repricing. The Administrator shall not substitute new Options or
SARs for previously granted Options or SARs or amend any Option or SAR to reduce
the exercise price without first obtaining shareholder approval.
     (c) Term of Option. The term of each Option shall be stated in the Notice
of Grant; provided, however, that in the case of an Incentive Stock Option, the
term shall be ten (10) years from the date of grant or such shorter term as may
be provided in the Notice of Grant. 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 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 Notice of Grant.

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     (d) Exercise Price and Consideration.
     (i) The per Share exercise price for the Shares to be issued pursuant to
exercise of an Option shall be such price as is determined by the Administrator,
but shall be subject to the following:
     (A) 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, the per Share exercise price shall be no less
than 100% of the Fair Market Value per Share on the date of grant.
     (B) 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.
     (ii) 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 may consist entirely of cash; check; promissory note; other
Shares which (A) in the case of Shares acquired upon exercise of an option, have
been owned by the Participant for more than six months on the date of surrender,
and (B) have a Fair Market Value on the date of surrender equal to the aggregate
exercise price of the Shares as to which said Option shall be exercised; for
options granted subsequent to the effective date of the 1993 amendments to the
Plan, delivery of a properly executed exercise notice together with such other
documentation as the Committee and the broker, if applicable, shall require to
effect an exercise of the option and delivery to the Company of the sale
proceeds required; or any combination of such methods of payment, or such other
consideration and method of payment for the issuance of Shares to the extent
permitted under Applicable Law.
8. Stock Appreciation Rights.
     (a) Grant of SARs. Subject to the terms and conditions of the Plan, SARs
may be granted to Participants at any time and from time to time as shall be
determined by the Administrator, in its sole discretion. Subject to Section 6(a)
hereof, the Administrator shall have complete discretion to determine the number
of SARs granted to any Participant.
     (b) Exercise Price and other Terms. The per share exercise price for the
Shares to be issued pursuant to exercise of an SAR shall be determined by the
Administrator and shall be no less than 100% of the Fair Market Value per share
on the date of grant. Otherwise, subject to Section 6(a) of the Plan, the
Administrator, subject to the provisions of the Plan, shall have complete
discretion to determine the terms and conditions of SARs granted under the Plan;
provided, however, that no SAR may have a term of more than ten (10) years from
the date of grant.
     (c) Payment of SAR Amount. Upon exercise of a SAR, a Participant shall be
entitled to receive payment from the Company in an amount determined by
multiplying:
     (i) The difference between the Fair Market Value of a Share on the date of
exercise over the exercise price; times
     (ii) The number of Shares with respect to which the SAR is exercised.

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     (d) Payment upon Exercise of SAR. At the discretion of the Administrator,
and as specified in the Award Agreement, payment for a SAR may be in cash,
Shares or a combination thereof.
     (e) SAR Agreement. Each SAR grant shall be evidenced by an Award Agreement
that shall specify the exercise price, the term of the SAR, the conditions of
exercise, whether it may be settled in cash, Shares or a combination thereof,
and such other terms and conditions as the Administrator, in its sole
discretion, shall determine.
     (f) Expiration of SARs. A SAR granted under the Plan shall expire upon the
date determined by the Administrator, in its sole discretion, and set forth in
the Award Agreement.
     9. Exercise of Option or SAR.
     (a) Procedure for Exercise; Rights as a Shareholder. Any Option or SAR
granted hereunder shall be exercisable at such times and under such conditions
as determined by the Administrator, including performance criteria with respect
to the Company and/or the Participant, and as shall be permissible under the
terms of the Plan.
          An Option or SAR may not be exercised for a fraction of a Share.
          An Option or SAR shall be deemed to be exercised when written notice
of such exercise has been given to the Company in accordance with the terms of
the Option or SAR by the person entitled to exercise the Option or SAR and, with
respect to Options only, full payment for the Shares with respect to which the
Option is exercised has been received by the Company. With respect to Options
only, full payment may, as authorized by the Administrator, consist of any
consideration and method of payment allowable under Section 7(d) of the Plan.
Until the issuance (as evidenced by the appropriate entry on the books of the
Company or of a duly authorized transfer agent of the Company) of the stock
certificate evidencing such Shares, no right to vote or receive dividends or any
other rights as a shareholder 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
certificate is issued, except as provided in Section 18 of the Plan.
     (b) Termination of Status as an Employee or Consultant. If an Employee or
Consultant ceases to serve as an Employee or Consultant, he or she may, but only
within 90 days (or such other period of time as is determined by the
Administrator) after the date he or she ceases to be an Employee or Consultant
(as the case may be) of the Company, exercise his or her Option or SAR to the
extent that he or she was entitled to exercise it at the date of such
termination. To the extent that he or she was not entitled to exercise the
Option or SAR at the date of such termination, or if he or she does not exercise
such Option or SAR (which he or she was entitled to exercise) within the time
specified herein, the Option or SAR shall terminate.
     (c) Disability of Participant. Notwithstanding the provisions of Section
9(b) above, in the event an Employee or Consultant is unable to continue his or
her employment or consulting relationship with the Company as a result of his or
her total and permanent disability (as defined in Section 22(e)(3) of the
Internal Revenue Code), he or she may, but only within six (6) months (or such
other period of time as is determined by the Administrator) from the date of
termination, exercise his or her Option or SAR to the extent he or she was
entitled to exercise it at the date of such termination (or to such greater
extent as the Administrator may provide). To the extent that he or she was not
entitled to exercise the Option or SAR at the date of termination, or if he or
she does not exercise such Option or SAR (which he or she was entitled to
exercise) within the time specified herein, the Option or SAR shall terminate.
     (d) Death of Participant. In the event of the death of a Participant while
in Continuous Status as an Employee or Consultant, the entire Option or SAR may
be exercised at any time within twelve (12) months following the date of death
(but in no event later than the expiration of the term of such Option

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or SAR as set forth in the Notice of Grant) by the Participant’s estate or by a
person who acquired the right to exercise the Option or SAR by bequest or
inheritance. If, after death, the Participant’s estate or a person who acquired
the right to exercise the Option or SAR by bequest or inheritance does not
exercise the Option or SAR within the time specified herein, the Option or SAR
shall terminate, and the Shares covered by such Option shall revert to the Plan.
     10. Restricted Stock.
     (a) Grant of Restricted Stock. Subject to the terms and conditions of the
Plan, Restricted Stock may be granted to Participants at any time as shall be
determined by the Administrator, in its sole discretion. Subject to Section 6(b)
hereof, the Administrator shall have complete discretion to determine (i) the
number of Shares subject to a Restricted Stock award granted to any Participant,
and (ii) the conditions that must be satisfied, which typically will be based
principally or solely on continued provision of services but may include a
performance-based component, upon which is conditioned the grant, vesting or
issuance of Restricted Stock.
     (b) Other Terms. The Administrator, subject to the provisions of the Plan,
shall have complete discretion to determine the terms and conditions of
Restricted Stock granted under the Plan. Restricted Stock grants shall be
subject to the terms, conditions, and restrictions determined by the
Administrator at the time the stock or the restricted stock unit is awarded. The
Administrator may require the recipient to sign a Restricted Stock Award
agreement as a condition of the award. Any certificates representing the Shares
of stock awarded shall bear such legends as shall be determined by the
Administrator.
     (c) Restricted Stock Award Agreement. Each Restricted Stock grant shall be
evidenced by an agreement that shall specify the purchase price (if any) and
such other terms and conditions as the Administrator, in its sole discretion,
shall determine; provided; however, that if the Restricted Stock grant has a
purchase price, such purchase price must be paid no more than ten (10) years
following the date of grant.
     11. Restricted Stock Units.
     (a) Grant. Restricted Stock Units may be granted at any time and from time
to time as determined by the Administrator. After the Administrator determines
that it will grant Restricted Stock Units under the Plan, it shall advise the
Participant in writing or electronically of the terms, conditions, and
restrictions related to the grant, including the number of Restricted Stock
Units and the form of payout, which, subject to Section 6(b) hereof, may be left
to the discretion of the Administrator.
     (b) Vesting Criteria and Other Terms. The Administrator shall set vesting
criteria in its discretion, which, depending on the extent to which the criteria
are met, will determine the number of Restricted Stock Units that will be paid
out to the Participant. The Administrator may set vesting criteria based upon
the achievement of Company-wide, business unit, or individual goals (including,
but not limited to, continued employment), or any other basis determined by the
Administrator in its discretion.
     (c) Earning Restricted Stock Units. Upon meeting the applicable vesting
criteria, the Participant shall be entitled to receive a payout as specified in
the Restricted Stock Unit Award Agreement. Notwithstanding the foregoing, at any
time after the grant of Restricted Stock Units, the Administrator, in its sole
discretion, may reduce or waive any vesting criteria that must be met to receive
a payout.
     (d) Form and Timing of Payment. Payment of earned Restricted Stock Units
shall be made as soon as practicable after the date(s) set forth in the
Restricted Stock Unit Award Agreement. The Administrator, in its sole discretion
and as specified in the Award Agreement, may pay earned Restricted Stock Units
in cash, Shares, or a combination thereof.

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     (e) Cancellation. On the date set forth in the Restricted Stock Unit Award
Agreement, all unearned Restricted Stock Units shall be forfeited to the
Company.
     12. Performance Shares.
     (a) Grant of Performance Shares. Subject to the terms and conditions of the
Plan, Performance Shares may be granted to Participants at any time as shall be
determined by the Administrator, in its sole discretion. Subject to Section 6(b)
hereof, the Administrator shall have complete discretion to determine (i) the
number of Shares subject to a Performance Share award granted to any
Participant, and (ii) the conditions that must be satisfied, which typically
will be based principally or solely on achievement of performance milestones but
may include a service-based component, upon which is conditioned the grant or
vesting of Performance Shares. Performance Shares shall be granted in the form
of units to acquire Shares. Each such unit shall be the equivalent of one Share
for purposes of determining the number of Shares subject to an Award. Until the
Shares are issued, no right to vote or receive dividends or any other rights as
a shareholder shall exist with respect to the units to acquire Shares.
     (b) Other Terms. The Administrator, subject to the provisions of the Plan,
shall have complete discretion to determine the terms and conditions of
Performance Shares granted under the Plan. Performance Share grants shall be
subject to the terms, conditions, and restrictions determined by the
Administrator at the time the stock is awarded, which may include such
performance-based milestones as are determined appropriate by the Administrator.
The Administrator may require the recipient to sign a Performance Shares Award
Agreement as a condition of the award. Any certificates representing the Shares
of stock awarded shall bear such legends as shall be determined by the
Administrator.
     (c) Performance Share Award Agreement. Each Performance Share grant shall
be evidenced by an Award Agreement that shall specify such other terms and
conditions as the Administrator, in its sole discretion, shall determine.
     13. Performance Units.
     (a) Grant of Performance Units. Performance Units are similar to
Performance Shares, except that they shall be settled in a cash equivalent to
the Fair Market Value of the underlying Shares, determined as of the vesting
date. Subject to the terms and conditions of the Plan, Performance Units may be
granted to Participants at any time and from time to time as shall be determined
by the Administrator, in its sole discretion. The Administrator shall have
complete discretion to determine the conditions that must be satisfied, which
typically will be based principally or solely on achievement of performance
milestones but may include a service-based component, upon which is conditioned
the grant or vesting of Performance Units. Performance Units shall be granted in
the form of units to acquire Shares. Each such unit shall be the cash equivalent
of one Share of Common Stock. No right to vote or receive dividends or any other
rights as a shareholder shall exist with respect to Performance Units or the
cash payable thereunder.
     (b) Number of Performance Units. Subject to Section 6(c) hereof, the
Administrator will have complete discretion in determining the number of
Performance Units granted to any Participant.
     (c) Other Terms. The Administrator, subject to the provisions of the Plan,
shall have complete discretion to determine the terms and conditions of
Performance Units granted under the Plan. Performance Unit grants shall be
subject to the terms, conditions, and restrictions determined by the
Administrator at the time the grant is awarded, which may include such
performance-based milestones as are determined appropriate by the Administrator.
The Administrator may require the recipient to sign a Performance Unit agreement
as a condition of the award. Any certificates representing the units awarded
shall bear such legends as shall be determined by the Administrator.

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     (d) Performance Unit Award Agreement. Each Performance Unit grant shall be
evidenced by an agreement that shall specify such terms and conditions as the
Administrator, in its sole discretion, shall determine.
     14. Death of Participant. In the event a Participant dies while in
Continuous Status as an Employee or Participant, his or her Award shall vest in
full.
     15. Non-Transferability of Awards. Except as determined otherwise by the
Administrator in its sole discretion (but never a transfer in exchange for
value), 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 and may be exercised, during the lifetime of the Participant, only
by the Participant, without the prior written consent of the Administrator.
     16. Stock Withholding to Satisfy Withholding Tax Obligations. When a
Participant incurs tax liability in connection with the exercise, vesting or
payout, as applicable, of an Award, which tax liability is subject to tax
withholding under applicable tax laws, and the Participant is obligated to pay
the Company an amount required to be withheld under applicable tax laws, the
Participant may satisfy the withholding tax obligation by electing to have the
Company withhold from the Shares to be issued upon exercise of the Option or SAR
or the Shares to be issued upon payout or vesting of the other Award, if any,
that number of Shares having a Fair Market Value equal to the 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
(the “Tax Date”).
          All elections by a Participant to have Shares withheld for this
purpose shall be made in writing in a form acceptable to the Administrator and
shall be subject to the following restrictions:
     (a) the election must be made on or prior to the applicable Tax Date; and
     (b) all elections shall be subject to the consent or disapproval of the
Administrator.
          In the event the election to have Shares subject to an Award withheld
is made by a Participant and the Tax Date is deferred under Section 83 of the
Code because no election is filed under Section 83(b) of the Code, the
Participant shall receive the full number of Shares with respect to which the
Option or SAR is exercised or other Award is vested but such Participant shall
be unconditionally obligated to tender back to the Company the proper number of
Shares on the Tax Date.
     17. Leaves of Absence. Unless the Administrator provides otherwise or
except as otherwise required by Applicable Laws, vesting of Awards granted
hereunder shall cease commencing on the first day of any unpaid leave of
absence, or on the ninety-first day in the case of any leave of absence approved
by the Board, and shall only recommence upon return to active service.
     18. Adjustments Upon Changes in Capitalization, Dissolution, Merger or
Asset Sale.
     (a) Changes in Capitalization. Subject to any required action by the
shareholders of the Company, the number of shares of Common Stock covered by
each outstanding Award, and the number of shares of Common Stock which have been
authorized for issuance under the Plan but as to which no Awards have yet been
granted or which have been returned to the Plan upon cancellation or expiration
of an Award, as well as the price per share of Common Stock covered by each such
outstanding Award and the annual share limitations under Sections 6(a) and
(b) hereof, 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

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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 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 a Participant to have the
right to exercise his or her Option or SAR until ten (10) days prior to such
transaction as to all of the Awarded Stock covered thereby, including Shares as
to which the Award would not otherwise be exercisable. In addition, the
Administrator may provide that any Company repurchase option or forfeiture
rights applicable to any Award shall lapse 100%, and that any Award vesting
shall accelerate 100%, 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 (with respect to Options and SARs) or vested (with respect
to other Awards), an Award will terminate immediately prior to the consummation
of such proposed action.
     (c) Merger or Asset Sale.
     (i) Stock Options and SARs. In the event of a merger of the Company with or
into another corporation, or the sale of substantially all of the assets of the
Company, each outstanding Option and SAR shall be assumed or an equivalent
option or SAR substituted by the successor corporation or a Parent or Subsidiary
of the successor corporation. In the event that the successor corporation
refuses to assume or substitute for the Option or SAR, the Participant shall
fully vest in and have the right to exercise the Option or SAR as to all of the
Awarded Stock, including Shares as to which it would not otherwise be vested or
exercisable. If an Option or SAR becomes fully vested and exercisable in lieu of
assumption or substitution in the event of a merger or asset sale, the
Administrator shall notify the Participant in writing or electronically that the
Option or SAR shall be fully vested and exercisable for a period of thirty
(30) days from the date of such notice, and the Option or SAR shall terminate
upon the expiration of such period.
     (ii) Restricted Stock, Restricted Stock Units, Performance Shares,
Performance Units and Dividend Equivalents. In the event of a merger of the
Company with or into another corporation, or the sale of substantially all of
the assets of the Company, each outstanding Restricted Stock, Restricted Stock
Unit, Performance Share and Performance Unit award and any related Dividend
Equivalent shall be assumed or an equivalent Restricted Stock, Restricted Stock
Unit, Performance Share, and Performance Unit award and any related Dividend
Equivalent substituted by the successor corporation or a Parent or Subsidiary of
the successor corporation. In the event that the successor corporation refuses
to assume or substitute for the Restricted Stock, Restricted Stock Unit,
Performance Share, Performance Unit award and any related Dividend Equivalent,
the Participant shall fully vest in the Restricted Stock, Restricted Stock Unit,
Performance Share, Performance Unit award and any related Dividend Equivalent,
including as to Shares (or with respect to Dividend Equivalents and Performance
Units, the cash equivalent thereof) which would not otherwise be vested. For the
purposes of this paragraph, a Restricted Stock, Restricted Stock Unit,
Performance Share, Performance Unit and Deferred shall be considered assumed if,
following the merger or asset sale, the award confers the right to purchase or
receive, for each Share (or with respect to Dividend Equivalents and Performance
Units, the cash equivalent thereof) subject to the Award immediately prior to
the merger or asset sale, the consideration (whether stock, cash, or other
securities or property) received in the merger or asset sale by holders of the
Company’s 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 asset
sale 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, for each Share and each unit/right to acquire
a Share

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subject to the Award (other than Dividend Equivalents and Performance Units) 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 the Company’s
common stock in the merger or asset sale.
     19. 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. Notice of the determination shall be given to each Employee
or Consultant to whom an Award is so granted within a reasonable time after the
date of such grant.
     20. Term of Plan. The Plan shall continue in effect until May 18, 2011.
     21. Amendment and Termination of the Plan.
     (a) Amendment and Termination. The Board may at any time amend, alter,
suspend or terminate the Plan.
     (b) Shareholder Approval. The Company shall obtain shareholder approval of
any Plan amendment to the extent necessary and desirable to comply with Rule
16b-3 or with Section 422 of the Code (or any successor rule or statute or other
applicable law, rule or regulation, including the requirements of any exchange
or quotation system on which the Common Stock is listed or quoted). Such
shareholder approval, if required, shall be obtained in such a manner and to
such a degree as is required by the applicable law, rule or regulation.
     (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.
     22. Conditions Upon Issuance of Shares. Shares shall not be issued pursuant
to the exercise of an Option unless the exercise of such Option and the issuance
and delivery of such Shares pursuant thereto shall comply with all relevant
provisions of law, including, without limitation, the Securities Act, the
Exchange Act, the rules and regulations promulgated thereunder, state securities
laws, and the requirements of any stock exchange upon which the Shares may then
be listed, and shall be further subject to the approval of counsel for the
Company with respect to such compliance.
          As a condition to the exercise or payout, as applicable, of an Award,
the Company may require the person exercising such Option or SAR, or in the case
of another Award (other than a Dividend Equivalent or Performance Unit), the
person receiving the Shares upon vesting, to render to the Company a written
statement containing such representations and warranties as, in the opinion of
counsel for the Company, may be required to ensure compliance with any of the
aforementioned relevant provisions of law, including a representation 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.
     23. 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. 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.

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