EXHIBIT 10.1

 

2U, INC.

 

AMENDED AND RESTATED 2014 EQUITY INCENTIVE PLAN

 

ADOPTED BY THE BOARD OF DIRECTORS: JANUARY 30, 2014

APPROVED BY THE STOCKHOLDERS:  FEBRUARY 11, 2014

EFFECTIVE DATE: FEBRUARY 11, 2014

AMENDED AND RESTATED: JUNE 27, 2018

 

1.                                      GENERAL.

 

(a)                                 Successor to and Continuation of Prior
Plan.  The Plan is intended as the successor to and continuation of the 2U, Inc.
2008 Fourth Amended and Restated 2008 Stock Incentive Plan, as amended (the
“Prior Plan”).  From and after 12:01 a.m. Eastern time on the Effective Date, no
additional stock awards will be granted under the Prior Plan.  All Awards
granted on or after 12:01 a.m. Eastern Time on the Effective Date will be
granted under this Plan.  All stock awards granted under the Prior Plan will
remain subject to the terms of the Prior Plan.

 

(i)                                     Any shares that would otherwise remain
available for future grants under the Prior Plan as of 12:01 a.m. Eastern Time
on the Effective Date (the “Prior Plan’s Available Reserve”) will cease to be
available under the Prior Plan at such time.  Instead, that number of shares of
Common Stock equal to the Prior Plan’s Available Reserve will be added to the
Share Reserve (as further described in Section 3(a) below) and be then
immediately available for grants and issuance pursuant to Stock Awards
hereunder, up to the maximum number set forth in Section 3(a) below.

 

(ii)                                  In addition, from and after 12:01
a.m. Eastern time on the Effective Date, with respect to the aggregate number of
shares subject, at such time, to outstanding stock awards granted under the
Prior Plan that (A) expire or terminate for any reason prior to exercise or
settlement; (B) are forfeited because of the failure to meet a contingency or
condition required to vest such shares or otherwise return to the Company; or
(C) are reacquired, withheld (or not issued) to satisfy a tax withholding
obligation in connection with an award or to satisfy the purchase price or
exercise price of a stock award (such shares the “Returning Shares”) will
immediately be added to the Share Reserve (as further described in
Section 3(a) below) as and when such a share becomes a Returning Share, up to
the maximum number set forth in Section 3(a) below.

 

(b)                                 Eligible Award Recipients.  Employees,
Directors and Consultants are eligible to receive Awards.

 

(c)                                  Available Awards.  The Plan provides for
the grant of the following Awards: (i) Incentive Stock Options,
(ii) Nonstatutory Stock Options, (iii) Stock Appreciation Rights,
(iv) Restricted Stock Awards, (v) Restricted Stock Unit Awards, (vi) Performance
Stock Awards, (vii) Performance Cash Awards, and (viii) Other Stock Awards.

 

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(d)                                 Purpose.  The Plan, through the grant of
Awards, is intended to help the Company secure and retain the services of
eligible award recipients, provide incentives for such persons to exert maximum
efforts for the success of the Company and any Affiliate, and provide a means by
which the eligible recipients may benefit from increases in value of the Common
Stock.

 

2.                                      ADMINISTRATION.

 

(a)                                 Administration by Board.  The Board will
administer the Plan.  The Board may delegate administration of the Plan to a
Committee or Committees, as provided in Section 2(c).

 

(b)                                 Powers of Board.  The Board will have the
power, subject to, and within the limitations of, the express provisions of the
Plan:

 

(i)                                     To determine: (A) who will be granted
Awards; (B) when and how each Award will be granted; (C) what type of Award will
be granted; (D) the provisions of each Award (which need not be identical),
including when a person will be permitted to exercise or otherwise receive cash
or Common Stock under the Award; (E) the number of shares of Common Stock
subject to, or the cash value of, an Award; and (F) the Fair Market Value
applicable to a Stock Award.

 

(ii)                                  To construe and interpret the Plan and
Awards granted under it, and to establish, amend and revoke rules and
regulations for administration of the Plan and Awards.  The Board, in the
exercise of these powers, may correct any defect, omission or inconsistency in
the Plan or in any Award Agreement or in the written terms of a Performance Cash
Award, in a manner and to the extent it will deem necessary or expedient to make
the Plan or Award fully effective.

 

(iii)          To settle all controversies regarding the Plan and Awards granted
under it.

 

(iv)                              To accelerate, in whole or in part, the time
at which an Award may be exercised or vest (or the time at which cash or shares
of Common Stock may be issued in settlement thereof).

 

(v)                                 To suspend or terminate the Plan at any
time.  Except as otherwise provided in the Plan or an Award Agreement,
suspension or termination of the Plan will not materially impair a Participant’s
rights under the Participant’s then-outstanding Award without the Participant’s
written consent, except as provided in subsection (viii) below.

 

(vi)                              To amend the Plan in any respect the Board
deems necessary or advisable, including, without limitation, by adopting
amendments relating to Incentive Stock Options and certain nonqualified deferred
compensation under Section 409A of the Code and/or bringing the Plan or Awards
granted under the Plan into compliance with the requirements for Incentive Stock
Options or ensuring that they are exempt from, or compliant with, the
requirements for nonqualified deferred compensation under Section

 

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409A of the Code, subject to the limitations, if any, of applicable law.  If
required by applicable law or listing requirements, and except as provided in
Section 9(a) relating to Capitalization Adjustments, the Company will seek
stockholder approval of any amendment of the Plan that (A) materially increases
the number of shares of Common Stock available for issuance under the Plan,
(B) materially expands the class of individuals eligible to receive Awards under
the Plan, (C) materially increases the benefits accruing to Participants under
the Plan, (D) materially reduces the price at which shares of Common Stock may
be issued or purchased under the Plan, (E) materially extends the term of the
Plan, or (F) materially expands the types of Awards available for issuance under
the Plan.  Except as otherwise provided in the Plan or an Award Agreement, no
amendment of the Plan will materially impair a Participant’s rights under an
outstanding Award without the Participant’s written consent.

 

(vii)                           To submit any amendment to the Plan for
stockholder approval, including, but not limited to, amendments to the Plan
intended to satisfy the requirements of (A) Section 162(m) of the Code regarding
the exclusion of performance-based compensation from the limit on corporate
deductibility of compensation paid to Covered Employees, (B) Section 422 of the
Code regarding “incentive stock options” or (C) Rule 16b-3.

 

(viii)                        To approve forms of Award Agreements for use under
the Plan and to amend the terms of any one or more Awards, including, but not
limited to, amendments to provide terms more favorable to the Participant than
previously provided in the Award Agreement, subject to any specified limits in
the Plan that are not subject to Board discretion; provided, however, that a
Participant’s rights under any Award will not be impaired by any such amendment
unless (A) the Company requests the consent of the affected Participant, and
(B) such Participant consents in writing.  Notwithstanding the foregoing, (x) a
Participant’s rights will not be deemed to have been impaired by any such
amendment if the Board, in its sole discretion, determines that the amendment,
taken as a whole, does not materially impair the Participant’s rights, and
(y) subject to the limitations of applicable law, if any, the Board may amend
the terms of any one or more Awards without the affected Participant’s consent
(1) to maintain the qualified status of the Award as an Incentive Stock Option
under Section 422 of the Code; (2) to change the terms of an Incentive Stock
Option, if such change results in impairment of the Award solely because it
impairs the qualified status of the Award as an Incentive Stock Option under
Section 422 of the Code; (3) to clarify the manner of exemption from, or to
bring the Award into compliance with, Section 409A of the Code; or (4) to comply
with other applicable laws or listing requirements.

 

(ix)                              Generally, to exercise such powers and to
perform such acts as the Board deems necessary or expedient to promote the best
interests of the Company and that are not in conflict with the provisions of the
Plan or Awards.

 

(x)                                 To adopt such procedures and sub-plans as
are necessary or appropriate to permit participation in the Plan by Employees,
Directors or Consultants who are foreign nationals or employed outside the
United States (provided that Board approval will not be necessary for immaterial
modifications to the Plan or any Award

 

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Agreement that are required for compliance with the laws of the relevant foreign
jurisdiction).

 

(xi)                              To effect, with the consent of any adversely
affected Participant, (A) the reduction of the exercise, purchase or strike
price of any outstanding Stock Award; (B) the cancellation of any outstanding
Stock Award and the grant in substitution therefor of a new (1) Option or SAR,
(2)  Restricted Stock Award, (3) Restricted Stock Unit Award, (4) Other Stock
Award, (5) cash and/or (6) other valuable consideration determined by the Board,
in its sole discretion, with any such substituted award (x) covering the same or
a different number of shares of Common Stock as the cancelled Stock Award and
(y) granted under the Plan or another equity or compensatory plan of the
Company; or (C) any other action that is treated as a repricing under generally
accepted accounting principles.

 

(c)                                  Delegation to Committee.

 

(i)                                     General.  The Board may delegate some or
all of the administration of the Plan to a Committee or Committees.  If
administration of the Plan is delegated to a Committee, the Committee will have,
in connection with the administration of the Plan, the powers theretofore
possessed by the Board that have been delegated to the Committee, including the
power to delegate to a subcommittee of the Committee any of the administrative
powers the Committee is authorized to exercise (and references in this Plan to
the Board will thereafter be to the Committee or subcommittee, as applicable). 
Any delegation of administrative powers will be reflected in resolutions, not
inconsistent with the provisions of the Plan, adopted from time to time by the
Board or Committee (as applicable).  The Board may retain the authority to
concurrently administer the Plan with the Committee and may, at any time, revest
in the Board some or all of the powers previously delegated.

 

(ii)                                  Section 162(m) and Rule 16b-3 Compliance. 
The Committee shall consist of (A) solely of two or more individuals who are
Outside Directors to the extent required with respect to an Award intended to
satisfy the provisions of Section 162(m) of the Code regarding the exclusion of
performance-based compensation from the limit on corporate deductibility of
compensation paid to Covered Employees, if available, and (B) solely of two or
more individuals who are Non-Employee Directors to the extent required for
compliance with Rule 16b-3 who, for the avoidance of doubt, may but are not
required to be the individuals referenced in clause (A).

 

(d)                                 Delegation to an Officer.  The Board may
delegate to one (1) or more Officers the authority to do one or both of the
following (i) designate Employees who are not Officers to be recipients of
Options and SARs (and, to the extent permitted by applicable law, other Stock
Awards) and, to the extent permitted by applicable law, the terms of such
Awards, and (ii) determine the number of shares of Common Stock to be subject to
such Stock Awards granted to such Employees; provided, however, that the Board
resolutions regarding such delegation will specify the total number of shares of
Common Stock that may be subject to the Stock Awards granted by such Officer and
that such Officer may not grant a Stock Award to himself or herself.  Any such
Stock Awards will be granted on the form of Stock Award

 

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Agreement most recently approved for use by the Committee or the Board, unless
otherwise provided in the resolutions approving the delegation authority.  The
Board may not delegate authority to an Officer who is acting solely in the
capacity of an Officer (and not also as a Director) to determine the Fair Market
Value pursuant to Section 13(y)(iii) below.

 

(e)                                  Effect of Board’s Decision.  All
determinations, interpretations and constructions made by the Board in good
faith will not be subject to review by any person and will be final, binding and
conclusive on all persons.

 

3.                                      SHARES SUBJECT TO THE PLAN.

 

(a)                                 Share Reserve.  Subject to
Section 9(a) relating to Capitalization Adjustments after the Adoption Date, and
the following sentence regarding the annual “evergreen” increase, the aggregate
number of shares of Common Stock that may be issued pursuant to Stock Awards
will not exceed the sum of (i) 2,800,000 shares, plus, (ii) 256,130 shares
subject to the Prior Plan’s Available Reserve, plus (iii) the number of shares
that are Returning Shares, as such shares become available from time to time in
an amount not to exceed 5,687,218 shares (such aggregate amount, the “Share
Reserve”).  In addition, the Share Reserve will automatically increase on
January 1st of each year, for a period of not more than ten years, commencing on
January 1, 2015, and ending on (and including) January 1, 2024, in an amount
equal to 5% of the total number of shares of Capital Stock outstanding on
December 31st of the preceding calendar year.  Notwithstanding the foregoing,
the Board may act prior to January 1st of a given year to provide that there
will be no January 1st increase in the Share Reserve for such year or that the
increase in the Share Reserve for such year will be a lesser number of shares of
Common Stock than would otherwise occur pursuant to the preceding sentence.  For
clarity, the Share Reserve in this Section 3(a) is a limitation on the number of
shares of Common Stock that may be issued pursuant to the Plan.  Accordingly,
this Section 3(a) does not limit the granting of Stock Awards except as provided
in Section 7(a).  Any Shares may be issued in connection with a merger or
acquisition as permitted by NASDAQ Listing Rule 5635(c) or, if applicable, NYSE
Listed Company Manual Section 303A.08, AMEX Company Guide Section 711 or any
other applicable rule, and such issuance will not reduce the number of shares
available for issuance under the Plan.

 

(b)                                 Reversion of Shares to the Share Reserve. 
If a Stock Award or any portion thereof (i) expires or otherwise terminates
without all of the shares covered by such Stock Award having been issued or
(ii) is settled in cash (i.e., the Participant receives cash rather than stock),
such expiration, termination or settlement will not reduce (or otherwise offset)
the number of shares of Common Stock that may be available for issuance under
the Plan.  If any shares of Common Stock issued pursuant to a Stock Award are
forfeited back to or repurchased by the Company because of the failure to meet a
contingency or condition required to vest such shares in the Participant, then
the shares that are forfeited or repurchased will revert to and again become
available for issuance under the Plan.  Any shares reacquired by the Company in
satisfaction of tax withholding obligations on a Stock Award or as consideration
for the exercise or purchase price of a Stock Award will again become available
for issuance under the Plan.

 

(c)                                  Incentive Stock Option Limit.  Subject to
the provisions of Section 9(a) relating to Capitalization Adjustments after the
Adoption Date, the aggregate maximum number

 

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of shares of Common Stock that may be issued pursuant to the exercise of
Incentive Stock Options will be 17,486,696 shares of Common Stock.

 

(d)                                 Section 162(m) Limitations.  Subject to the
provisions of Section 9(a) relating to Capitalization Adjustments after the
Adoption Date, and to the extent required with respect to an Award intended to
satisfy the provisions of Section 162(m) of the Code regarding the exclusion of
performance-based compensation from the limit on corporate deductibility of
compensation paid to Covered Employees, if available, at such time as the
Company may be subject to the applicable provisions of Section 162(m) of the
Code, the following limitations will apply.

 

(i)                                     A maximum of 3,100,000 shares of Common
Stock subject to Options, SARs and Other Stock Awards whose value is determined
by reference to an increase over an exercise or strike price of at least 100% of
the Fair Market Value on the date the Stock Award is granted may be granted to
any one Participant during any one calendar year.  Notwithstanding the
foregoing, if any additional Options, SARs or Other Stock Awards whose value is
determined by reference to an increase over an exercise or strike price of at
least 100% of the Fair Market Value on the date the Stock Award are granted to
any Participant during any calendar year, compensation attributable to the
exercise of such additional Stock Awards will not satisfy the requirements to be
considered “qualified performance-based compensation” under Section 162(m) of
the Code unless such additional Stock Award is approved by the Company’s
stockholders.

 

(ii)                                  A maximum of 3,100,000 shares of Common
Stock subject to Performance Stock Awards may be granted to any one Participant
during any one calendar year (whether the grant, vesting or exercise is
contingent upon the attainment during the Performance Period of the Performance
Goals).

 

(iii)                               A maximum of $3,000,000 may be granted as a
Performance Cash Award to any one Participant during any one calendar year.

 

(e)                                  Source of Shares.  The stock issuable under
the Plan will be shares of authorized but unissued or reacquired Common Stock,
including shares repurchased by the Company on the open market or otherwise.

 

4.                                      ELIGIBILITY.

 

(a)                                 Eligibility for Specific Stock Awards. 
Incentive Stock Options may be granted only to employees of the Company or a
“parent corporation” or “subsidiary corporation” thereof (as such terms are
defined in Sections 424(e) and 424(f) of the Code).  Stock Awards other than
Incentive Stock Options may be granted to Employees, Directors and Consultants;
provided, however, that Stock Awards may not be granted to Employees, Directors
and Consultants who are providing Continuous Service only to any “parent” of the
Company, as such term is defined in Rule 405 of the Securities Act, unless
(i) the stock underlying such Stock Awards is treated as “service recipient
stock” under Section 409A of the Code (for example, because the Stock Awards are
granted pursuant to a corporate transaction such as a spin off transaction),
(ii) the Company, in consultation with its legal counsel, has determined that
such

 

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Stock Awards are otherwise exempt from Section 409A of the Code, or (iii) the
Company, in consultation with its legal counsel, has determined that such Stock
Awards comply with the distribution requirements of Section 409A of the Code.

 

(b)                                 Ten Percent Stockholders.  A Ten Percent
Stockholder will not be granted an Incentive Stock Option unless the exercise
price of such Option is at least 110% of the Fair Market Value on the date of
grant and the Option is not exercisable after the expiration of five years from
the date of grant.

 

5.                                      PROVISIONS RELATING TO OPTIONS AND STOCK
APPRECIATION RIGHTS.

 

Each Option or SAR will be in such form and will contain such terms and
conditions as the Board deems appropriate.  All Options will be separately
designated Incentive Stock Options or Nonstatutory Stock Options at the time of
grant, and, if certificates are issued, a separate certificate or certificates
will be issued for shares of Common Stock purchased on exercise of each type of
Option.  If an Option is not specifically designated as an Incentive Stock
Option, or if an Option is designated as an Incentive Stock Option but some
portion or all of the Option fails to qualify as an Incentive Stock Option under
the applicable rules, then the Option (or portion thereof) will be a
Nonstatutory Stock Option. The provisions of separate Options or SARs need not
be identical; provided, however, that each Award Agreement will conform to
(through incorporation of provisions of this Plan by reference in the applicable
Award Agreement or otherwise) the substance of each of the following provisions:

 

(a)                                 Term.  Subject to the provisions of
Section 4(b) regarding Ten Percent Stockholders, no Option or SAR will be
exercisable after the expiration of ten years from the date of its grant or such
shorter period specified in the Award Agreement.

 

(b)                                 Exercise Price.  Subject to the provisions
of Section 4(b) regarding Ten Percent Stockholders, the exercise or strike price
of each Option or SAR will be not less than 100% of the Fair Market Value of the
Common Stock subject to the Option or SAR on the date the Award is granted.
 Notwithstanding the foregoing, an Option or SAR may be granted with an exercise
or strike price lower than 100% of the Fair Market Value of the Common Stock
subject to the Award if such Award is granted pursuant to an assumption of or
substitution for another option or stock appreciation right pursuant to a
Corporate Transaction and in a manner consistent with the provisions of
Section 409A and, if applicable, Section 424(a) of the Code.  Each SAR will be
denominated in shares of Common Stock equivalents.

 

(c)                                  Purchase Price for Options.  The purchase
price of Common Stock acquired pursuant to the exercise of an Option may be
paid, to the extent permitted by applicable law and as determined by the Board
in its sole discretion, by any combination of the methods of payment set forth
below.  The Board will have the authority to grant Options that do not permit
all of the following methods of payment (or otherwise restrict the ability to
use certain methods) and to grant Options that require the consent of the
Company to use a particular method of payment.  The permitted methods of payment
are as follows:

 

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(i)                                     by cash, check, bank draft or money
order payable to the Company;

 

(ii)                                  pursuant to a program that, prior to the
issuance of the stock subject to the Option, results in either the receipt of
cash (or check) by the Company or the receipt of irrevocable instructions to pay
the aggregate exercise price to the Company from the sales proceeds;

 

(iii)                               by delivery to the Company (either by actual
delivery or attestation) of shares of Common Stock;

 

(iv)                              if an Option is a Nonstatutory Stock Option,
by a “net exercise” arrangement pursuant to which the Company will reduce the
number of shares of Common Stock issuable upon exercise by the largest whole
number of shares with a Fair Market Value that does not exceed the aggregate
exercise price; provided, however, that the Company will accept a cash or other
payment from the Participant to the extent of any remaining balance of the
aggregate exercise price not satisfied by such reduction in the number of whole
shares to be issued.  Shares of Common Stock will no longer be subject to an
Option and will not be exercisable thereafter to the extent that (A) shares
issuable upon exercise are used to pay the exercise price pursuant to the “net
exercise,” (B) shares are delivered to the Participant as a result of such
exercise, and (C) shares are withheld to satisfy tax withholding obligations; or

 

(v)                                 in any other form of legal consideration
that may be acceptable to the Board and specified in the applicable Award
Agreement.

 

(d)                                 Exercise and Payment of a SAR.  To exercise
any outstanding SAR, the Participant must provide written notice of exercise to
the Company in compliance with the provisions of the Stock Appreciation Right
Agreement evidencing such SAR.  The appreciation distribution payable on the
exercise of a SAR will be not greater than an amount equal to the excess of
(A) the aggregate Fair Market Value (on the date of the exercise of the SAR) of
a number of shares of Common Stock equal to the number of Common Stock
equivalents in which the Participant is vested under such SAR, and with respect
to which the Participant is exercising the SAR on such date, over (B) the
aggregate strike price of the number of Common Stock equivalents with respect to
which the Participant is exercising the SAR on such date.  The appreciation
distribution may be paid in Common Stock, in cash, in any combination of the two
or in any other form of consideration, as determined by the Board and contained
in the Award Agreement evidencing such SAR.

 

(e)                                  Transferability of Options and SARs.  The
Board may, in its sole discretion, impose such limitations on the
transferability of Options and SARs as the Board will determine.  In the absence
of such a determination by the Board to the contrary, the following restrictions
on the transferability of Options and SARs will apply:

 

(i)                                     Restrictions on Transfer.  An Option or
SAR will not be transferable except by will or by the laws of descent and
distribution (or pursuant to subsections (ii) and (iii) below), and will be
exercisable during the lifetime of the

 

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Participant only by the Participant.  The Board may permit transfer of the
Option or SAR in a manner that is not prohibited by applicable tax and
securities laws.  Except as explicitly provided in the Plan, neither an Option
nor a SAR may be transferred for consideration.

 

(ii)                                  Domestic Relations Orders.  Subject to the
approval of the Board or a duly authorized Officer, an Option or SAR may be
transferred pursuant to the terms of a domestic relations order, official
marital settlement agreement or other divorce or separation instrument as
permitted by Treasury Regulations Section 1.421-1(b)(2).  If an Option is an
Incentive Stock Option, such Option may be deemed to be a Nonstatutory Stock
Option as a result of such transfer.

 

(iii)                               Beneficiary Designation.  Subject to the
approval of the Board or a duly authorized Officer, a Participant may, by
delivering written notice to the Company, in a form approved by the Company (or
the designated broker), designate a third party who, on the death of the
Participant, will thereafter be entitled to exercise the Option or SAR and
receive the Common Stock or other consideration resulting from such exercise. 
In the absence of such a designation, upon the death of the Participant, the
executor or administrator of the Participant’s estate will be entitled to
exercise the Option or SAR and receive the Common Stock or other consideration
resulting from such exercise.  However, the Company may prohibit designation of
a beneficiary at any time, including due to any conclusion by the Company that
such designation would be inconsistent with the provisions of applicable laws.

 

(f)                                   Vesting Generally.  The total number of
shares of Common Stock subject to an Option or SAR may vest and become
exercisable in periodic installments that may or may not be equal.  The Option
or SAR may be subject to such other terms and conditions on the time or times
when it may or may not be exercised (which may be based on the satisfaction of
Performance Goals or other criteria) as the Board may deem appropriate.  The
vesting provisions of individual Options or SARs may vary.  The provisions of
this Section 5(f) are subject to any Option or SAR provisions governing the
minimum number of shares of Common Stock as to which an Option or SAR may be
exercised.

 

(g)                                  Termination of Continuous Service.  Except
as otherwise provided in the applicable Award Agreement or other agreement
between the Participant and the Company, if a Participant’s Continuous Service
terminates (other than for Cause and other than upon the Participant’s death or
Disability), the Participant may exercise his or her Option or SAR (to the
extent that the Participant was entitled to exercise such Award as of the date
of termination of Continuous Service) within the period of time ending on the
earlier of (i) the date three months following the termination of the
Participant’s Continuous Service (or such longer or shorter period specified in
the applicable Award Agreement), and (ii) the expiration of the term of the
Option or SAR as set forth in the Award Agreement.  If, after termination of
Continuous Service, the Participant does not exercise his or her Option or SAR
(as applicable) within the applicable time frame, the Option or SAR will
terminate.

 

(h)                                 Extension of Termination Date.  If the
exercise of an Option or SAR following the termination of the Participant’s
Continuous Service (other than for Cause and other

 

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than upon the Participant’s death or Disability) would be prohibited at any time
solely because the issuance of shares of Common Stock would violate the
registration requirements under the Securities Act, then the Option or SAR will
terminate on the earlier of (i) the expiration of a total period of time (that
need not be consecutive) equal to the applicable post termination exercise
period after the termination of the Participant’s Continuous Service during
which the exercise of the Option or SAR would not be in violation of such
registration requirements, and (ii) the expiration of the term of the Option or
SAR as set forth in the applicable Award Agreement.  In addition, unless
otherwise provided in a Participant’s Award Agreement, if the sale of any Common
Stock received on exercise of an Option or SAR following the termination of the
Participant’s Continuous Service (other than for Cause) would violate the
Company’s insider trading policy, then the Option or SAR will terminate on the
earlier of (x) the expiration of a period of months (that need not be
consecutive) equal to the applicable post-termination exercise period after the
termination of the Participant’s Continuous Service during which the sale of the
Common Stock received upon exercise of the Option or SAR would not be in
violation of the Company’s insider trading policy, or (y) the expiration of the
term of the Option or SAR as set forth in the applicable Award Agreement.

 

(i)                                     Disability of Participant.  Except as
otherwise provided in the applicable Award Agreement or other agreement between
the Participant and the Company, if a Participant’s Continuous Service
terminates as a result of the Participant’s Disability, the Participant may
exercise his or her Option or SAR (to the extent that the Participant was
entitled to exercise such Option or SAR as of the date of termination of
Continuous Service), but only within such period of time ending on the earlier
of (i) the date 12 months following such termination of Continuous Service (or
such longer or shorter period specified in the Award Agreement), and (ii) the
expiration of the term of the Option or SAR as set forth in the Award
Agreement.  If, after termination of Continuous Service, the Participant does
not exercise his or her Option or SAR within the applicable time frame, the
Option or SAR (as applicable) will terminate.

 

(j)                                    Death of Participant.  Except as
otherwise provided in the applicable Award Agreement or other agreement between
the Participant and the Company, if (i) a Participant’s Continuous Service
terminates as a result of the Participant’s death, or (ii) the Participant dies
within the period (if any) specified in the Award Agreement for exercisability
after the termination of the Participant’s Continuous Service for a reason other
than death, then the Option or SAR may be exercised (to the extent the
Participant was entitled to exercise such Option or SAR as of the date of death)
by the Participant’s estate, by a person who acquired the right to exercise the
Option or SAR by bequest or inheritance or by a person designated to exercise
the Option or SAR upon the Participant’s death, but only within the period
ending on the earlier of (x) the date 18 months following the date of death (or
such longer or shorter period specified in the Award Agreement), and (y) the
expiration of the term of such Option or SAR as set forth in the Award
Agreement.  If, after the Participant’s death, the Option or SAR is not
exercised within the applicable time frame, the Option or SAR (as applicable)
will terminate.

 

(k)                                 Termination for Cause.  Except as explicitly
provided otherwise in a Participant’s Award Agreement or other individual
written agreement between the Company or any Affiliate and the Participant, if a
Participant’s Continuous Service is terminated for Cause, the entire vested and
unvested Option or SAR will terminate immediately upon such

 

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Participant’s termination of Continuous Service, and the Participant will be
prohibited from exercising his or her Option or SAR from and after the date of
such termination of Continuous Service.

 

6.                                      PROVISIONS OF STOCK AWARDS OTHER THAN
OPTIONS AND SARS.

 

(a)                                 Restricted Stock Awards.  Each Restricted
Stock Award Agreement will be in such form and will contain such terms and
conditions as the Board will deem appropriate.  To the extent consistent with
the Company’s bylaws, at the Board’s election, shares of Common Stock may be
(x) held in book entry form subject to the Company’s instructions until any
restrictions relating to the Restricted Stock Award lapse; or (y) evidenced by a
certificate, which certificate will be held in such form and manner as
determined by the Board.  The terms and conditions of Restricted Stock Award
Agreements may change from time to time, and the terms and conditions of
separate Restricted Stock Award Agreements need not be identical.  Each
Restricted Stock Award Agreement will conform to (through incorporation of the
provisions of this Plan by reference in the agreement or otherwise) the
substance of each of the following provisions:

 

(i)                                     Consideration.  A Restricted Stock Award
may be awarded in consideration for (A) cash, check, bank draft or money order
payable to the Company, (B) past services to the Company or an Affiliate, or
(C) any other form of legal consideration that may be acceptable to the Board,
in its sole discretion, and permissible under applicable law.

 

(ii)                                  Vesting.  Shares of Common Stock awarded
under the Restricted Stock Award Agreement may be subject to forfeiture to the
Company in accordance with a vesting schedule to be determined by the Board.

 

(iii)                               Termination of Participant’s Continuous
Service.  If a Participant’s Continuous Service terminates, the Company may
receive through a forfeiture condition or a repurchase right any or all of the
shares of Common Stock held by the Participant that have not vested as of the
date of termination of Continuous Service under the terms of the Restricted
Stock Award Agreement.

 

(iv)                              Transferability.  Rights to acquire shares of
Common Stock under the Restricted Stock Award Agreement will be transferable by
the Participant only upon such terms and conditions as are set forth in the
Restricted Stock Award Agreement, as the Board will determine in its sole
discretion, so long as Common Stock awarded under the Restricted Stock Award
Agreement remains subject to the terms of the Restricted Stock Award Agreement.

 

(v)                                 Dividends.  A Restricted Stock Award
Agreement may provide that any dividends paid on Restricted Stock will be
subject to the same vesting and forfeiture restrictions as apply to the shares
subject to the Restricted Stock Award to which they relate.

 

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(b)                                 Restricted Stock Unit Awards.  Each
Restricted Stock Unit Award Agreement will be in such form and will contain such
terms and conditions as the Board will deem appropriate.  The terms and
conditions of Restricted Stock Unit Award Agreements may change from time to
time, and the terms and conditions of separate Restricted Stock Unit Award
Agreements need not be identical.  Each Restricted Stock Unit Award Agreement
will conform to (through incorporation of the provisions of this Plan by
reference in the Agreement or otherwise) the substance of each of the following
provisions:

 

(i)                                     Consideration.  At the time of grant of
a Restricted Stock Unit Award, the Board will determine the consideration, if
any, to be paid by the Participant upon settlement of the Restricted Stock Unit
Award, which may be paid in any form of legal consideration acceptable to the
Board, in its sole discretion, and permissible under applicable law.

 

(ii)                                  Vesting.  At the time of the grant of a
Restricted Stock Unit Award, the Board may impose such restrictions on or
conditions to the vesting of the Restricted Stock Unit Award as it, in its sole
discretion, deems appropriate.

 

(iii)                               Payment.  A Restricted Stock Unit Award may
be settled by the delivery of shares of Common Stock, their cash equivalent, any
combination thereof or in any other form of consideration, as determined by the
Board and contained in the Restricted Stock Unit Award Agreement.

 

(iv)                              Additional Restrictions.  At the time of the
grant of a Restricted Stock Unit Award, the Board, as it deems appropriate, may
impose such restrictions or conditions that delay the delivery of the shares of
Common Stock (or their cash equivalent) subject to a Restricted Stock Unit Award
to a time after the vesting of such Restricted Stock Unit Award.

 

(v)                                 Dividend Equivalents.  Dividend equivalents
may be credited in respect of shares of Common Stock covered by a Restricted
Stock Unit Award, as determined by the Board and contained in the Restricted
Stock Unit Award Agreement.  At the sole discretion of the Board, such dividend
equivalents may be converted into additional shares of Common Stock covered by
the Restricted Stock Unit Award in such manner as determined by the Board.  Any
additional shares covered by the Restricted Stock Unit Award credited by reason
of such dividend equivalents will be subject to all of the same terms and
conditions of the underlying Restricted Stock Unit Award Agreement to which they
relate.

 

(vi)                              Termination of Participant’s Continuous
Service.  Except as otherwise provided in the applicable Restricted Stock Unit
Award Agreement, any portion of the Restricted Stock Unit Award that has not
vested as of the Participant’s termination of Continuous Service will be
forfeited at such time.

 

(c)                                  Performance Awards.

 

(i)                                     Performance Stock Awards.  A Performance
Stock Award is a Stock Award (covering a number of shares not in excess of that
set forth in Section 3(d)

 

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above) that is payable (including that may be granted, may vest or may be
exercised) contingent upon the attainment during a Performance Period of certain
Performance Goals.  A Performance Stock Award may, but need not, require the
Participant’s completion of a specified period of Continuous Service.  The
length of any Performance Period, the Performance Goals to be achieved during
the Performance Period, and the measure of whether and to what degree such
Performance Goals have been attained will be conclusively determined by the
Committee (or, if not required for compliance with Section 162(m) of the Code
regarding the exclusion of performance-based compensation from the limit on
corporate deductibility of compensation paid to Covered Employees, the Board),
in its sole discretion.  In addition, to the extent permitted by applicable law
and the applicable Award Agreement, the Board may determine that cash may be
used in payment of Performance Stock Awards.

 

(ii)                                  Performance Cash Awards.  A Performance
Cash Award is a cash award (for a dollar value not in excess of that set forth
in Section 3(d) above) that is payable contingent upon the attainment during a
Performance Period of certain Performance Goals.  A Performance Cash Award may
also require the completion of a specified period of Continuous Service.  At the
time of grant of a Performance Cash Award, the length of any Performance Period,
the Performance Goals to be achieved during the Performance Period, and the
measure of whether and to what degree such Performance Goals have been attained
will be conclusively determined by the Committee (or, if not required for
compliance with Section 162(m) of the Code regarding the exclusion of
performance-based compensation from the limit on corporate deductibility of
compensation paid to Covered Employees, the Board), in its sole discretion.  The
Board may specify the form of payment of Performance Cash Awards, which may be
cash or other property, or may provide for a Participant to have the option for
his or her Performance Cash Award, or such portion thereof as the Board may
specify, to be paid in whole or in part in cash or other property.

 

(iii)                               Board Discretion.  The Board retains the
discretion to reduce or eliminate the compensation or economic benefit due upon
attainment of Performance Goals and to define the manner of calculating the
Performance Criteria it selects to use for a Performance Period.  Partial
achievement of the specified criteria may result in the payment or vesting
corresponding to the degree of achievement as specified in the Stock Award
Agreement or the written terms of a Performance Cash Award.

 

(iv)                              Section 162(m) Compliance.  To the extent
required with respect to an Award intended to satisfy the provisions of
Section 162(m) of the Code regarding the exclusion of performance-based
compensation from the limit on corporate deductibility of compensation paid to
Covered Employees, if available, the Committee will establish the Performance
Goals applicable to, and the formula for calculating the amount payable under,
the Award no later than the earlier of (a) the date 90 days after the
commencement of the applicable Performance Period, and (b) the date on which 25%
of the Performance Period has elapsed, and in any event at a time when the
achievement of the applicable Performance Goals remains substantially
uncertain.  Prior to the payment of any compensation under an Award intended to
qualify as “performance-based compensation” under Section 162(m) of the Code,
the Committee will certify the extent

 

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to which any Performance Goals and any other material terms under such Award
have been satisfied (other than in cases where such Performance Goals relate
solely to the increase in the value of the Common Stock).  Notwithstanding
satisfaction of, or completion of any Performance Goals, the number of shares of
Common Stock, Options, cash or other benefits granted, issued, retainable and/or
vested under an Award on account of satisfaction of such Performance Goals may
be reduced by the Committee on the basis of such further considerations as the
Committee, in its sole discretion, will determine.

 

(d)                                 Other Stock Awards.  Other forms of Stock
Awards valued in whole or in part by reference to, or otherwise based on, Common
Stock, including the appreciation in value thereof (e.g., options or stock
rights with an exercise price or strike price less than 100% of the Fair Market
Value of the Common Stock at the time of grant) may be granted either alone or
in addition to Stock Awards provided for under Section 5 and the preceding
provisions of this Section 6.  Subject to the provisions of the Plan, the Board
will have sole and complete authority to determine the persons to whom and the
time or times at which such Other Stock Awards will be granted, the number of
shares of Common Stock (or the cash equivalent thereof) to be granted pursuant
to such Other Stock Awards and all other terms and conditions of such Other
Stock Awards.

 

7.                                      COVENANTS OF THE COMPANY.

 

(a)                                 Availability of Shares.  The Company will
keep available at all times the number of shares of Common Stock reasonably
required to satisfy then-outstanding Awards.

 

(b)                                 Securities Law Compliance.  The Company will
seek to obtain from each regulatory commission or agency having jurisdiction
over the Plan such authority as may be required to grant Stock Awards and to
issue and sell shares of Common Stock upon exercise of the Stock Awards;
provided, however, that this undertaking will not require the Company to
register under the Securities Act the Plan, any Stock Award or any Common Stock
issued or issuable pursuant to any such Stock Award.  If, after reasonable
efforts and at a reasonable cost, the Company is unable to obtain from any such
regulatory commission or agency the authority that counsel for the Company deems
necessary for the lawful issuance and sale of Common Stock under the Plan, the
Company will be relieved from any liability for failure to issue and sell Common
Stock upon exercise of such Stock Awards unless and until such authority is
obtained. A Participant will not be eligible for the grant of an Award or the
subsequent issuance of cash or Common Stock pursuant to the Award if such grant
or issuance would be in violation of any applicable securities law.

 

(c)                                  No Obligation to Notify or Minimize Taxes. 
The Company will have no duty or obligation to any Participant to advise such
holder as to the time or manner of exercising such Stock Award.  Furthermore,
the Company will have no duty or obligation to warn or otherwise advise such
holder of a pending termination or expiration of an Award or a possible period
in which the Award may not be exercised.  The Company has no duty or obligation
to minimize the tax consequences of an Award to the holder of such Award.

 

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8.                                      MISCELLANEOUS.

 

(a)                                 Use of Proceeds from Sales of Common Stock. 
Proceeds from the sale of shares of Common Stock pursuant to Awards will
constitute general funds of the Company.

 

(b)                                 Corporate Action Constituting Grant of
Awards.  Corporate action constituting a grant by the Company of an Award to any
Participant will be deemed completed as of the date of such corporate action,
unless otherwise determined by the Board, regardless of when the instrument,
certificate, or letter evidencing the Award is communicated to, or actually
received or accepted by, the Participant.  In the event that the corporate
records (e.g., Board consents, resolutions or minutes) documenting the corporate
action constituting the grant contain terms (e.g., exercise price, vesting
schedule or number of shares) that are inconsistent with those in the Award
Agreement or related grant documents as a result of a clerical error in the
papering of the Award Agreement or related grant documents, the corporate
records will control and the Participant will have no legally binding right to
the incorrect term in the Award Agreement or related grant documents.

 

(c)                                  Stockholder Rights.  No Participant will be
deemed to be the holder of, or to have any of the rights of a holder with
respect to, any shares of Common Stock subject to an Award unless and until
(i) such Participant has satisfied all requirements for exercise of, or the
issuance of shares of Common Stock under, the Award pursuant to its terms, and
(ii) the issuance of the Common Stock subject to such Award has been entered
into the books and records of the Company.

 

(d)                                 No Employment or Other Service Rights. 
Nothing in the Plan, any Award Agreement or any other instrument executed
thereunder or in connection with any Award granted pursuant thereto will confer
upon any Participant any right to continue to serve the Company or an Affiliate
in the capacity in effect at the time the Award was granted or will affect the
right of the Company or an Affiliate to terminate (i) the employment of an
Employee with or without notice and with or without cause, (ii) the service of a
Consultant pursuant to the terms of such Consultant’s agreement with the Company
or an Affiliate, or (iii) the service of a Director pursuant to the bylaws of
the Company or an Affiliate, and any applicable provisions of the corporate law
of the state in which the Company or the Affiliate is incorporated, as the case
may be.

 

(e)                                  Change in Time Commitment.  In the event a
Participant’s regular level of time commitment in the performance of his or her
services for the Company and any Affiliates is reduced (for example, and without
limitation, if the Participant is an Employee of the Company and the Employee
has a change in status from a full-time Employee to a part-time Employee or
takes an extended leave of absence) after the date of grant of any Award to the
Participant, the Board has the right in its sole discretion to (x) make a
corresponding reduction in the number of shares or cash amount subject to any
portion of such Award that is scheduled to vest or become payable after the date
of such change in time commitment, and (y) in lieu of or in combination with
such a reduction, extend the vesting or payment schedule applicable to such
Award.  In the event of any such reduction, the Participant will have no right
with respect to any portion of the Award that is so reduced or extended.

 

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(f)                                   Incentive Stock Option Limitations.  To
the extent that the aggregate Fair Market Value (determined at the time of
grant) of Common Stock with respect to which Incentive Stock Options are
exercisable for the first time by any Optionholder during any calendar year
(under all plans of the Company and any Affiliates) exceeds $100,000 (or such
other limit established in the Code) or otherwise does not comply with the
rules governing Incentive Stock Options, the Options or portions thereof that
exceed such limit (according to the order in which they were granted) or
otherwise do not comply with such rules will be treated as Nonstatutory Stock
Options, notwithstanding any contrary provision of the applicable Option
Agreement(s).

 

(g)                                  Withholding Obligations.  Unless prohibited
by the terms of an Award Agreement, the Company may, in its sole discretion,
satisfy any federal, state or local tax withholding obligation relating to an
Award by any of the following means or by a combination of such means:
(i) causing the Participant to tender a cash payment; (ii) withholding shares of
Common Stock from the shares of Common Stock issued or otherwise issuable to the
Participant in connection with the Award; provided, however, that no shares of
Common Stock are withheld with a value exceeding the statutory maximum rate of
tax required to be withheld by law (or such lesser amount as may be necessary to
avoid classification of the Stock Award as a liability for financial accounting
purposes); (iii) withholding cash from an Award settled in cash;
(iv) withholding payment from any amounts otherwise payable to the Participant;
or (v) by such other method as may be set forth in the Award Agreement.

 

(h)                                 Electronic Delivery.  Any reference in this
Plan to a “written” agreement or document will include any agreement or document
delivered electronically, filed publicly at www.sec.gov (or any successor
website thereto) or posted on the Company’s intranet (or other shared electronic
medium controlled by the Company to which the Participant has access).

 

(i)                                     Deferrals.  To the extent permitted by
applicable law, the Board, in its sole discretion, may determine that the
delivery of Common Stock or the payment of cash, upon the exercise, vesting or
settlement of all or a portion of any Award may be deferred and may establish
programs and procedures for deferral elections to be made by Participants. 
Deferrals by Participants will be made in accordance with Section 409A of the
Code.  Consistent with Section 409A of the Code, the Board may provide for
distributions while a Participant is still an employee or otherwise providing
services to the Company.  The Board is authorized to make deferrals of Awards
and determine when, and in what annual percentages, Participants may receive
payments, including lump sum payments, following the Participant’s termination
of Continuous Service, and implement such other terms and conditions consistent
with the provisions of the Plan and in accordance with applicable law.

 

(j)                                    Compliance with Section 409A of the
Code.  Unless otherwise expressly provided for in an Award Agreement, the Plan
and Award Agreements will be interpreted to the greatest extent possible in a
manner that makes the Plan and the Awards granted under this Plan exempt from
Section 409A of the Code, and, to the extent not so exempt, in compliance with
Section 409A of the Code.  If the Board determines that any Award granted under
this Plan is not exempt from and is therefore subject to Section 409A of the
Code, the Award Agreement evidencing such Award will incorporate the terms and
conditions necessary to avoid the consequences specified in
Section 409A(a)(1) of the Code, and to the extent an Award

 

16

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Agreement is silent on terms necessary for compliance, such terms are hereby
incorporated by reference into the Award Agreement.  Notwithstanding anything to
the contrary in this Plan (and unless the Award Agreement specifically provides
otherwise), if a Participant holding an Award that constitutes “deferred
compensation” under Section 409A of the Code is a “specified employee” for
purposes of Section 409A of the Code, no distribution or payment of any amount
that is due because of a “separation from service” (as defined in Section 409A
of the Code without regard to alternative definitions thereunder) will be issued
or paid before the date that is six months following the date of such
Participant’s “separation from service” (as defined in Section 409A of the Code
without regard to alternative definitions thereunder) or, if earlier, the date
of the Participant’s death, unless such distribution or payment can be made in a
manner that complies with Section 409A of the Code, and any amounts so deferred
will be paid in a lump sum on the day after such six month period elapses (or as
soon as practicable following the Participant’s death, if applicable), with the
balance paid thereafter on the original schedule.

 

(k)                                 Clawback/Recovery.  All Awards granted under
the Plan will be subject to recoupment in accordance with any clawback policy
that the Company is required to adopt pursuant to the listing standards of any
national securities exchange or association on which the Company’s securities
are listed or as is otherwise required by the Dodd-Frank Wall Street Reform and
Consumer Protection Act or other applicable law.  In addition, the Board may
impose such other clawback, recovery or recoupment provisions in an Award
Agreement as the Board determines necessary or appropriate, including but not
limited to a reacquisition right in respect of previously acquired shares of
Common Stock or other cash or property upon the occurrence of an event
constituting Cause.  No recovery of compensation under such a clawback policy
will be an event giving rise to a right to resign for “good reason” or
“constructive termination” (or similar term) under any agreement with the
Company.

 

9.                                      ADJUSTMENTS UPON CHANGES IN COMMON
STOCK; OTHER CORPORATE EVENTS.

 

(a)                                 Capitalization Adjustments.  In the event of
a Capitalization Adjustment, the Board will appropriately and proportionately
adjust: (i) the class(es) and maximum number of securities subject to the Plan
pursuant to Section 3(a), (ii) the class(es) and maximum number of securities
that may be issued pursuant to the exercise of Incentive Stock Options pursuant
to Section 3(c), (iii) the class(es) and maximum number of securities that may
be awarded to any person pursuant to Section 3(d), and (iv) the class(es) and
number of securities and price per share of stock subject to outstanding Stock
Awards.  The Board will make such adjustments, and its determination will be
final, binding and conclusive.

 

(b)                                 Dissolution or Liquidation.  Except as
otherwise provided in the Stock Award Agreement, in the event of a dissolution
or liquidation of the Company, all outstanding Stock Awards (other than Stock
Awards consisting of vested and outstanding shares of Common Stock not subject
to a forfeiture condition) will terminate immediately prior to the completion of
such dissolution or liquidation, and the shares of Common Stock subject to a
forfeiture condition may be reacquired by the Company notwithstanding the fact
that the holder of such Stock Award is providing Continuous Service; provided,
however, that the Board may, in its sole discretion, cause some or all Stock
Awards to become fully vested, exercisable and/or no longer subject to

 

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forfeiture (to the extent such Stock Awards have not previously expired or
terminated) before the dissolution or liquidation is completed but contingent on
its completion.

 

(c)                                  Corporate Transaction.  The following
provisions will apply to Stock Awards in the event of a Corporate Transaction
unless otherwise provided in the instrument evidencing the Stock Award or any
other written agreement between the Company or any Affiliate and the Participant
or unless otherwise expressly provided by the Board at the time of grant of a
Stock Award.  In the event of a Corporate Transaction, then, notwithstanding any
other provision of the Plan, the Board will take one or more of the following
actions with respect to Stock Awards, contingent upon the closing or completion
of the Corporate Transaction:

 

(i)                                     arrange for the surviving corporation or
acquiring corporation (or the surviving or acquiring corporation’s parent
company) to assume or continue the Stock Award or to substitute a similar stock
award for the Stock Award (including, but not limited to, an award to acquire
the same consideration paid to the stockholders of the Company pursuant to the
Corporate Transaction);

 

(ii)                                  arrange for the assignment of any
reacquisition or repurchase rights held by the Company in respect of Common
Stock issued pursuant to the Stock Award to the surviving corporation or
acquiring corporation (or the surviving or acquiring corporation’s parent
company);

 

(iii)                               accelerate the vesting, in whole or in part,
of the Stock Award (and, if applicable, the time at which the Stock Award may be
exercised) to a date prior to the effective time of such Corporate Transaction
as the Board determines (or, if the Board does not determine such a date, to the
date that is five days prior to the effective date of the Corporate
Transaction), with such Stock Award terminating if not exercised (if applicable)
at or prior to the effective time of the Corporate Transaction;

 

(iv)                              arrange for the lapse, in whole or in part, of
any reacquisition or repurchase rights held by the Company with respect to the
Stock Award;

 

(v)                                 cancel or arrange for the cancellation of
the Stock Award, to the extent not vested or not exercised prior to the
effective time of the Corporate Transaction, in exchange for such cash
consideration, if any (and, for clarity, the cash consideration may be zero), as
the Board, in its sole discretion, may consider appropriate; and

 

(vi)                              make a payment, in such form as may be
determined by the Board equal to the excess, if any, of (A) the value of the
property the Participant would have received upon the exercise of the Stock
Award immediately prior to the effective time of the Corporate Transaction, over
(B) any exercise price payable by such holder in connection with such exercise.

 

The Board need not take the same action or actions with respect to all Stock
Awards or portions thereof or with respect to all Participants. The Board may
take different actions with respect to the vested and unvested portions of a
Stock Award.

 

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(d)                                 Change in Control.  A Stock Award may be
subject to additional acceleration of vesting and exercisability upon or after a
Change in Control as may be provided in the Stock Award Agreement for such Stock
Award or as may be provided in any other written agreement between the Company
or any Affiliate and the Participant, but in the absence of such provision, no
such acceleration will occur.

 

10.                               PLAN TERM; EARLIER TERMINATION OR SUSPENSION
OF THE PLAN.

 

The Board may suspend or terminate the Plan at any time.  No Incentive Stock
Options may be granted after the tenth anniversary of the Adoption Date.  No
Awards may be granted under the Plan while the Plan is suspended or after it is
terminated.

 

11.                               EXISTENCE OF THE PLAN.

 

The Plan came into existence on the Adoption Date.  The stockholders of the
Company approved the Plan on February 11, 2014.  The Plan was amended and
restated effective as of June 27, 2018.

 

12.                               CHOICE OF LAW.

 

The law of the State of Delaware will govern all questions concerning the
construction, validity and interpretation of this Plan, without regard to that
state’s conflict of laws rules.

 

13.                               DEFINITIONS.

 

As used in the Plan, the following definitions will apply to the capitalized
terms indicated below:

 

(a)                                 “Affiliate” means, at the time of
determination, any “parent” or “subsidiary” of the Company as such terms are
defined in Rule 405 of the Securities Act.  The Board will have the authority to
determine the time or times at which “parent” or “subsidiary” status is
determined within the foregoing definition.

 

(b)                                 “Adoption Date” means January 30, 2014.

 

(c)                                  “Award” means a Stock Award or a
Performance Cash Award.

 

(d)                                 “Award Agreement” means a written agreement
between the Company and a Participant evidencing the terms and conditions of an
Award.

 

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

 

(f)                                   “Capital Stock” means each and every class
of common stock of the Company, regardless of the number of votes per share.

 

(g)                                  “Capitalization Adjustment” means any
change that is made in, or other events that occur with respect to, the Common
Stock subject to the Plan or subject to any Stock

 

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Award after the Adoption Date without the receipt of consideration by the
Company through merger, consolidation, reorganization, recapitalization,
reincorporation, stock dividend, dividend in property other than cash, large
nonrecurring cash dividend, stock split, reverse stock split, liquidating
dividend, combination of shares, exchange of shares, change in corporate
structure or any similar equity restructuring transaction, as that term is used
in Statement of Financial Accounting Standards Board Accounting Standards
Codification Topic 718 (or any successor thereto).  Notwithstanding the
foregoing, the conversion of any convertible securities of the Company will not
be treated as a Capitalization Adjustment.

 

(h)                                 “Cause” will have the meaning ascribed to
such term in any written agreement between the Participant and the Company
defining such term and, in the absence of such agreement, such term means, with
respect to a Participant, the occurrence of any of the following events: 
(i) such Participant’s commission of any felony or any crime involving fraud,
dishonesty or moral turpitude under the laws of the United States or any state
thereof; (ii) such Participant’s attempted commission of, or participation in, a
fraud or act of dishonesty against the Company; (iii) such Participant’s
intentional, material violation of any contract or agreement between the
Participant and the Company or of any statutory duty owed to the Company;
(iv) such Participant’s unauthorized use or disclosure of the Company’s
confidential information or trade secrets; or (v) such Participant’s gross
misconduct.  The determination that a termination of the Participant’s
Continuous Service is either for Cause or without Cause will be made by the
Company, in its sole discretion.  Any determination by the Company that the
Continuous Service of a Participant was terminated with or without Cause for the
purposes of outstanding Awards held by such Participant will have no effect upon
any determination of the rights or obligations of the Company or such
Participant for any other purpose.

 

(i)                                     “Change in Control” means the
occurrence, in a single transaction or in a series of related transactions, of
any one or more of the following events:

 

(i)                                     any Exchange Act Person becomes the
Owner, directly or indirectly, of securities of the Company representing more
than 50% of the combined voting power of the Company’s then outstanding
securities other than by virtue of a merger, consolidation or similar
transaction.  Notwithstanding the foregoing, a Change in Control will not be
deemed to occur (A) on account of the acquisition of securities of the Company
directly from the Company, (B) on account of the acquisition of securities of
the Company by an investor, any affiliate thereof or any other Exchange Act
Person that acquires the Company’s securities in a transaction or series of
related transactions the primary purpose of which is to obtain financing for the
Company through the issuance of equity securities, (C) on account of the
acquisition of securities of the Company by any individual who was, on March 28,
2014, either an executive officer or a Director (either, an “IPO Investor”)
and/or any entity in which an IPO Investor has a direct or indirect interest
(whether in the form of voting rights or participation in profits or capital
contributions) of more than 50% (collectively, the “IPO Entities”) or on account
of the IPO Entities continuing to hold shares that come to represent more than
50% of the combined voting power of the Company’s then outstanding securities as
a result of the conversion of any class of the Company’s securities into another
class of the Company’s securities having a different number of votes per share,
or (D) solely because the level of Ownership held by any Exchange Act Person
(the “Subject Person”) exceeds the

 

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designated percentage threshold of the outstanding voting securities as a result
of a repurchase or other acquisition of voting securities by the Company
reducing the number of shares outstanding, provided that if a Change in Control
would occur (but for the operation of this sentence) as a result of the
acquisition of voting securities by the Company, and after such share
acquisition, the Subject Person becomes the Owner of any additional voting
securities that, assuming the repurchase or other acquisition had not occurred,
increases the percentage of the then outstanding voting securities Owned by the
Subject Person over the designated percentage threshold, then a Change in
Control will be deemed to occur;

 

(ii)                                  there is consummated a merger,
consolidation or similar transaction involving (directly or indirectly) the
Company and, immediately after the consummation of such merger, consolidation or
similar transaction, the stockholders of the Company immediately prior thereto
do not Own, directly or indirectly, either (A) outstanding voting securities
representing more than 50% of the combined outstanding voting power of the
surviving Entity in such merger, consolidation or similar transaction or
(B) more than 50% of the combined outstanding voting power of the parent of the
surviving Entity in such merger, consolidation or similar transaction, in each
case in substantially the same proportions as their Ownership of the outstanding
voting securities of the Company immediately prior to such transaction;
provided, however, that a merger, consolidation or similar transaction will not
constitute a Change in Control under this prong of the definition if the
outstanding voting securities representing more than 50% of the combined voting
power of the surviving Entity or its parent are owned by the IPO Entities;

 

(iii)                               there is consummated a sale, lease,
exclusive license or other disposition of all or substantially all of the
consolidated assets of the Company and its Subsidiaries, other than a sale,
lease, license or other disposition of all or substantially all of the
consolidated assets of the Company and its Subsidiaries to an Entity, more than
50% of the combined voting power of the voting securities of which are Owned by
stockholders of the Company in substantially the same proportions as their
Ownership of the outstanding voting securities of the Company immediately prior
to such sale, lease, license or other disposition; provided, however, that a
sale, lease, exclusive license or other disposition of all or substantially all
of the consolidated assets of the Company and its Subsidiaries will not
constitute a Change in Control under this prong of the definition if the
outstanding voting securities representing more than 50% of the combined voting
power of the acquiring Entity or its parent are owned by the IPO Entities; or

 

(iv)                              individuals who, on the Adoption Date, are
members of the Board (the “Incumbent Board”) cease for any reason to constitute
at least a majority of the members of the Board; provided, however, that if the
appointment or election (or nomination for election) of any new Board member was
approved or recommended by a majority vote of the members of the Incumbent Board
then still in office, such new member will, for purposes of this Plan, be
considered as a member of the Incumbent Board.

 

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Notwithstanding the foregoing definition or any other provision of the Plan, the
term Change in Control will not include a sale of assets, merger or other
transaction effected exclusively for the purpose of changing the domicile of the
Company and the definition of Change in Control (or any analogous term) in an
individual written agreement between the Company or any Affiliate and the
Participant will supersede the foregoing definition with respect to Awards
subject to such agreement; provided, however, that if no definition of Change in
Control or any analogous term is set forth in such an individual written
agreement, the foregoing definition will apply.  To the extent necessary to
avoid the imposition of adverse taxation under Section 409A of the Code, in no
event will a Change in Control be deemed to have occurred if such transaction is
not also a “change in the ownership or effective control of” the Company or “a
change in the ownership of a substantial portion of the assets of” the Company
as determined under Treasury Regulation Section 1.409A-3(i)(5) (without regard
to any alternative definition thereunder).  The Board may, in its sole
discretion and without a Participant’s consent, amend the definition of “Change
in Control” to conform to the definition of “Change in Control” under
Section 409A of the Code, and the regulations thereunder.

 

(j)                                    “Code” means the Internal Revenue Code of
1986, as amended, including any applicable regulations and guidance thereunder.

 

(k)                                 “Committee” means a committee of one or more
Directors to whom authority has been delegated by the Board in accordance with
Section 2(c).

 

(l)                                     “Common Stock” means the common stock of
the Company, having one vote per share.

 

(m)                             “Company” means 2U, Inc., a Delaware
corporation.

 

(n)                                 “Consultant” means any person, including an
advisor, who is (i) engaged by the Company or an Affiliate to render consulting
or advisory services and is compensated for such services, or (ii) serving as a
member of the board of directors of an Affiliate and is compensated for such
services.  However, service solely as a Director, or payment of a fee for such
service, will not cause a Director to be considered a “Consultant” for purposes
of the Plan.  Notwithstanding the foregoing, a person is treated as a Consultant
under this Plan only if a Form S-8 Registration Statement under the Securities
Act is available to register either the offer or the sale of the Company’s
securities to such person.

 

(o)                                 “Continuous Service” means that the
Participant’s service with the Company or an Affiliate, whether as an Employee,
Director or Consultant, is not interrupted or terminated.  A change in the
capacity in which the Participant renders service to the Company or an Affiliate
as an Employee, Consultant or Director or a change in the entity for which the
Participant renders such service, provided that there is no interruption or
termination of the Participant’s service with the Company or an Affiliate, will
not terminate a Participant’s Continuous Service; provided, however, that if the
Entity for which a Participant is rendering services ceases to qualify as an
Affiliate, as determined by the Board, in its sole discretion, such
Participant’s Continuous Service will be considered to have terminated on the
date such Entity ceases to qualify as an Affiliate.  To the extent permitted by
law, the Board or the chief executive officer of the Company, in that party’s
sole discretion, may determine whether Continuous

 

22

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Service will be considered interrupted in the case of (i) any leave of absence
approved by the Board or chief executive officer, including sick leave, military
leave or any other personal leave, or (ii) transfers between the Company, an
Affiliate, or their successors.  Notwithstanding the foregoing, a leave of
absence will be treated as Continuous Service for purposes of vesting in an
Award only to such extent as may be provided in the Company’s or Affiliate’s
leave of absence policy, in the written terms of any leave of absence agreement
or policy applicable to the Participant, or as otherwise required by law.  In
addition, to the extent required for exemption from or compliance with
Section 409A of the Code, the determination of whether there has been a
termination of Continuous Service, will be made, and such term will be
construed, in a manner that is consistent with the definition of “separation
from service” as defined under Treasury Regulation Section 1.409A-1(h) (without
regard to any alternative definition thereunder).

 

(p)                                 “Corporate Transaction” means the
consummation, in a single transaction or in a series of related transactions, of
any one or more of the following events:

 

(i)                                     a sale or other disposition of all or
substantially all, as determined by the Board, in its sole discretion, of the
consolidated assets of the Company and its Subsidiaries;

 

(ii)                                  a sale or other disposition of at least
50% of the outstanding securities of the Company;

 

(iii)                               a merger, consolidation or similar
transaction following which the Company is not the surviving corporation; or

 

(iv)                              a merger, consolidation or similar transaction
following which the Company is the surviving corporation but the shares of
Common Stock outstanding immediately preceding the merger, consolidation or
similar transaction are converted or exchanged by virtue of the merger,
consolidation or similar transaction into other property, whether in the form of
securities, cash or otherwise.

 

To the extent necessary to avoid the imposition of adverse taxation under
Section 409A of the Code, in no event will an event be deemed a Corporate
Transaction if such transaction is not also a “change in the ownership or
effective control of” the Company or “a change in the ownership of a substantial
portion of the assets of” the Company as determined under Treasury Regulation
Section 1.409A-3(i)(5) (without regard to any alternative definition
thereunder).

 

(q)                                 “Covered Employee” will have the meaning
provided in Section 162(m)(3) of the Code.

 

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

 

(s)                                   “Disability” means, with respect to a
Participant, the inability of such Participant to engage in any substantial
gainful activity by reason of any medically determinable physical or mental
impairment that can be expected to result in death or that has lasted or can be
expected to last for a continuous period of not less than 12 months, as provided
in Sections 22(e)(3) and 409A(a)(2)(c)(i) of the Code, and will be determined by
the Board on the basis of such medical evidence as the Board deems warranted
under the circumstances.

 

23

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(t)                                    “Effective Date” means the Adoption Date.

 

(u)                                 “Employee” means any person employed by the
Company or an Affiliate.  However, service solely as a Director, or payment of a
fee for such services, will not cause a Director to be considered an “Employee”
for purposes of the Plan.

 

(v)                                 “Entity” means a corporation, partnership,
limited liability company or other entity.

 

(w)                               “Exchange Act” means the Securities Exchange
Act of 1934, as amended, and the rules and regulations promulgated thereunder.

 

(x)                                 “Exchange Act Person” means any natural
person, Entity or “group” (within the meaning of Section 13(d) or 14(d) of the
Exchange Act), except that “Exchange Act Person” will not include (i) the
Company or any Subsidiary of the Company, (ii) any employee benefit plan of the
Company or any Subsidiary of the Company or any trustee or other fiduciary
holding securities under an employee benefit plan of the Company or any
Subsidiary of the Company, (iii) an underwriter temporarily holding securities
pursuant to a registered public offering of such securities, (iv) an Entity
Owned, directly or indirectly, by the stockholders of the Company in
substantially the same proportions as their Ownership of stock of the Company;
or (v) any natural person, Entity or “group” (within the meaning of
Section 13(d) or 14(d) of the Exchange Act) that, as of the Effective Date, is
the Owner, directly or indirectly, of securities of the Company representing
more than 50% of the combined voting power of the Company’s then outstanding
securities.

 

(y)                                 “Fair Market Value” means, as of any date,
the value of the Common Stock determined as follows:

 

(i)                                     If the Common Stock is listed on any
established stock exchange or traded on any established market, the Fair Market
Value of a share of Common Stock will be, unless otherwise determined by the
Board, the closing sales price for such stock as quoted on such exchange or
market (or the exchange or market with the greatest volume of trading in the
Common Stock) on the date of determination, as reported in a source the Board
deems reliable.

 

(ii)                                  Unless otherwise provided by the Board, if
there is no closing sales price for the Common Stock on the date of
determination, then the Fair Market Value will be the closing selling price on
the last preceding date for which such quotation exists.

 

(iii)                               In the absence of such markets for the
Common Stock, the Fair Market Value will be determined by the Board in good
faith and in a manner that complies with Sections 409A and 422 of the Code.

 

(z)                                  “Good Reason” will have the meaning
ascribed to such term in any written agreement between the Participant and the
Company defining such term and, in the absence of such agreement, such term
means, with respect to a Participant who is an Employee, the occurrence of any
of the following events without the Participant’s express written consent: 
(i) the assignment to the Participant of any duties or responsibilities that
results in a material

 

24

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diminution in the Participant’s function as in effect immediately prior to the
effective date of the Change in Control; provided, however, that a change in the
Participant’s title or reporting relationships shall not provide the basis for a
voluntary termination with Good Reason; (ii) a material reduction by the Company
in the Participant’s annual base salary, as in effect on the effective date of
the Change in Control or as increased thereafter; provided, however, that Good
Reason shall not be deemed to have occurred in the event of a reduction in the
Participant’s annual base salary that is pursuant to a salary reduction program
affecting substantially all of the employees of the Company and that does not
adversely affect the Participant to a greater extent than other similarly
situated employees; (iii) any failure by the Company to continue in effect any
benefit plan or program, including incentive plans or plans with respect to the
receipt of securities of the Company, in which the Participant was participating
immediately prior to the effective date of the Change in Control (hereinafter
referred to as “Benefit Plans”), or the taking of any action by the Company that
would adversely affect the Participant’s participation in or reduce his or her
benefits under the Benefit Plans or deprive the Participant of any fringe
benefit that they enjoyed immediately prior to the effective date of the Change
in Control; provided, however, that Good Reason shall not be deemed to have
occurred if the Company provides for the Participant’s participation in benefit
plans and programs that, taken as a whole, are comparable to the Benefit Plans;
(iv) a relocation of the Participant’s business office to a location more than
fifty (50) miles from the location at which he or she performed their duties as
of the effective date of the Change in Control, except for required travel by
the Participant on the Company’s business to an extent substantially consistent
with the Participant’s business travel obligations prior to the effective date
of the Change in Control; or (v) a material breach by the Company of any
provision of the Plan or the Option Agreement or any other material agreement
between the Participant and the Company concerning the terms and conditions of
employment.

 

(aa)                          “Incentive Stock Option” means an option granted
pursuant to Section 5 that is intended to be, and qualifies as, an “incentive
stock option” within the meaning of Section 422 of the Code.

 

(bb)                          “Non-Employee Director” means a Director who
either (i) is not a current employee or officer of the Company or an Affiliate,
does not receive compensation, either directly or indirectly, from the Company
or an Affiliate for services rendered as a consultant or in any capacity other
than as a Director (except for an amount as to which disclosure would not be
required under Item 404(a) of Regulation S-K promulgated pursuant to the
Securities Act (“Regulation S-K”)), does not possess an interest in any other
transaction for which disclosure would be required under Item 404(a) of
Regulation S-K, and is not engaged in a business relationship for which
disclosure would be required pursuant to Item 404(b) of Regulation S-K; or
(ii) is otherwise considered a “non-employee director” for purposes of
Rule 16b-3.

 

(cc)                            “Nonstatutory Stock Option” means any Option
granted pursuant to Section 5 that does not qualify as an Incentive Stock
Option.

 

(dd)                          “Officer” means a person who is an officer of the
Company within the meaning of Section 16 of the Exchange Act.

 

(ee)                            “Option” means an Incentive Stock Option or a
Nonstatutory Stock Option to purchase shares of Common Stock granted pursuant to
the Plan.

 

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(ff)                              “Option Agreement” means a written agreement
between the Company and an Optionholder evidencing the terms and conditions of
an Option grant.  Each Option Agreement will be subject to the terms and
conditions of the Plan.

 

(gg)                            “Optionholder” means a person to whom an Option
is granted pursuant to the Plan or, if applicable, such other person who holds
an outstanding Option.

 

(hh)                          “Other Stock Award” means an award based in whole
or in part by reference to the Common Stock which is granted pursuant to the
terms and conditions of Section 6(d).

 

(ii)                                  “Other Stock Award Agreement” means a
written agreement between the Company and a holder of an Other Stock Award
evidencing the terms and conditions of an Other Stock Award grant.  Each Other
Stock Award Agreement will be subject to the terms and conditions of the Plan.

 

(jj)                                “Outside Director” means a Director who
either (i) is not a current employee of the Company or an “affiliated
corporation” (within the meaning of Treasury Regulations promulgated under
Section 162(m) of the Code), is not a former employee of the Company or an
“affiliated corporation” who receives compensation for prior services (other
than benefits under a tax-qualified retirement plan) during the taxable year,
has not been an officer of the Company or an “affiliated corporation,” and does
not receive remuneration from the Company or an “affiliated corporation,” either
directly or indirectly, in any capacity other than as a Director, or (ii) is
otherwise considered an “outside director” for purposes of Section 162(m) of the
Code.

 

(kk)                          “Own,” “Owned,” “Owner,” “Ownership” means a
person or Entity will be deemed to “Own,” to have “Owned,” to be the “Owner” of,
or to have acquired “Ownership” of securities if such person or Entity, directly
or indirectly, through any contract, arrangement, understanding, relationship or
otherwise, has or shares voting power, which includes the power to vote or to
direct the voting, with respect to such securities.

 

(ll)                                  “Participant” means a person to whom an
Award is granted pursuant to the Plan or, if applicable, such other person who
holds an outstanding Stock Award.

 

(mm)                  “Performance Cash Award” means an award of cash granted
pursuant to the terms and conditions of Section 6(c)(ii).

 

(nn)                          “Performance Criteria” means the one or more
criteria that the Board will select for purposes of establishing the Performance
Goals for a Performance Period.  The Performance Criteria that will be used to
establish such Performance Goals may be based on any one of, or combination of,
the following as determined by the Board: (i) earnings (including earnings per
share and net earnings); (ii) earnings before interest, taxes and depreciation;
(iii) earnings before interest, taxes, depreciation and amortization;
(iv) earnings before interest, taxes, depreciation, amortization and legal
settlements; (v) earnings before interest, taxes, depreciation, amortization,
legal settlements and other income (expense); (vi) earnings before interest,
taxes, depreciation, amortization, legal settlements, other income (expense) and
stock-based compensation; (vii) earnings before interest, taxes, depreciation,
amortization, legal settlements,

 

26

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other income (expense), stock-based compensation and changes in deferred
revenue; (viii) total stockholder return; (ix) return on equity or average
stockholder’s equity; (x) return on assets, investment, or capital employed;
(xi) stock price; (xii) margin (including gross margin); (xiii) income (before
or after taxes); (xiv) operating income; (xv) operating income after taxes;
(xvi) pre-tax profit; (xvii) operating cash flow; (xviii) sales or revenue
targets; (xix) increases in revenue or product revenue; (xx) expenses and cost
reduction goals; (xxi) improvement in or attainment of working capital levels;
(xxii) economic value added (or an equivalent metric); (xxiii) market share;
(xxiv) cash flow; (xxv) cash flow per share; (xxvi) share price performance;
(xxvii) debt reduction; (xxviii) implementation or completion of projects or
processes; (xxix) employee retention; (xxx) stockholders’ equity; (xxxi) capital
expenditures; (xxxii) debt levels; (xxxiii) operating profit or net operating
profit; (xxxiv) workforce diversity; (xxxv) growth of net income or operating
income; (xxxvi) billings; (xxxvii) bookings; (xxxviii) the number of users,
including but not limited to unique users; (xxxix) employee retention; (xxxx)
user satisfaction; and (xxxxi) to the extent an Award is not intended to satisfy
the provisions of Section 162(m) of the Code regarding the exclusion of
performance-based compensation from the limit on corporate deductibility of
compensation paid to Covered Employees, other measures of performance selected
by the Board.

 

(oo)                          “Performance Goals” means, for a Performance
Period, the one or more goals established by the Board for the Performance
Period based upon the Performance Criteria.  Performance Goals may be based on a
Company-wide basis, with respect to one or more business units, divisions,
Affiliates, or business segments, and in either absolute terms or relative to
the performance of one or more comparable companies or the performance of one or
more relevant indices.  Unless specified otherwise by the Board (i) in the Award
Agreement at the time the Award is granted or (ii) in such other document
setting forth the Performance Goals at the time the Performance Goals are
established, the Board will appropriately make adjustments in the method of
calculating the attainment of Performance Goals for a Performance Period as
follows: (1) to exclude restructuring and/or other nonrecurring charges; (2) to
exclude exchange rate effects; (3) to exclude the effects of changes to
generally accepted accounting principles; (4) to exclude the effects of any
statutory adjustments to corporate tax rates; (5) to exclude the effects of any
“extraordinary items” as determined under generally accepted accounting
principles; (6) to exclude the dilutive effects of acquisitions or joint
ventures; (7) to assume that any business divested by the Company achieved
performance objectives at targeted levels during the balance of a Performance
Period following such divestiture; (8) to exclude the effect of any change in
the outstanding shares of common stock of the Company by reason of any stock
dividend or split, stock repurchase, reorganization, recapitalization, merger,
consolidation, spin-off, combination or exchange of shares or other similar
corporate change, or any distributions to common stockholders other than regular
cash dividends; (9) to exclude the effects of stock based compensation and the
award of bonuses under the Company’s bonus plans; (10) to exclude costs incurred
in connection with potential acquisitions or divestitures that are required to
be expensed under generally accepted accounting principles; (11) to exclude the
goodwill and intangible asset impairment charges that are required to be
recorded under generally accepted accounting principles; (12) to exclude the
effect of any other unusual, non-recurring gain or loss or other extraordinary
item; and (13) to the extent an Award is not intended to satisfy the provisions
of Section 162(m) of the Code regarding the exclusion of performance-based
compensation from the limit on corporate deductibility of compensation paid to
Covered Employees, other adjustments selected by the Board.  In addition, the
Board retains the discretion to reduce or

 

27

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eliminate the compensation or economic benefit due upon attainment of
Performance Goals and to define the manner of calculating the Performance
Criteria it selects to use for such Performance Period. Partial achievement of
the specified criteria may result in the payment or vesting corresponding to the
degree of achievement as specified in the Stock Award Agreement or the written
terms of a Performance Cash Award.

 

(pp)                          “Performance Period” means the period of time
selected by the Board over which the attainment of one or more Performance Goals
will be measured for the purpose of determining a Participant’s right to and the
payment of a Stock Award or a Performance Cash Award.  Performance Periods may
be of varying and overlapping duration, at the sole discretion of the Board.

 

(qq)                          “Performance Stock Award” means a Stock Award
granted under the terms and conditions of Section 6(c)(i).

 

(rr)                                “Plan” means this 2U, Inc. Amended and
Restated 2014 Equity Incentive Plan.

 

(ss)                              “Restricted Stock Award” means an award of
shares of Common Stock which is granted pursuant to the terms and conditions of
Section 6(a).

 

(tt)                                “Restricted Stock Award Agreement” means a
written agreement between the Company and a holder of a Restricted Stock Award
evidencing the terms and conditions of a Restricted Stock Award grant.  Each
Restricted Stock Award Agreement will be subject to the terms and conditions of
the Plan.

 

(uu)                          “Restricted Stock Unit Award” means a right to
receive shares of Common Stock which is granted pursuant to the terms and
conditions of Section 6(b).

 

(vv)                          “Restricted Stock Unit Award Agreement” means a
written agreement between the Company and a holder of a Restricted Stock Unit
Award evidencing the terms and conditions of a Restricted Stock Unit Award
grant.  Each Restricted Stock Unit Award Agreement will be subject to the terms
and conditions of the Plan.

 

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

 

(xx)                          “Securities Act” means the Securities Act of 1933,
as amended.

 

(yy)                          “Stock Appreciation Right” or “SAR” means a right
to receive the appreciation on Common Stock that is granted pursuant to the
terms and conditions of Section 5.

 

(zz)                            “Stock Appreciation Right Agreement” means a
written agreement between the Company and a holder of a Stock Appreciation Right
evidencing the terms and conditions of a Stock Appreciation Right grant.  Each
Stock Appreciation Right Agreement will be subject to the terms and conditions
of the Plan.

 

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(aaa)                   “Stock Award” means any right to receive Common Stock
granted under the Plan, including an Incentive Stock Option, a Nonstatutory
Stock Option, a Restricted Stock Award, a Restricted Stock Unit Award, a Stock
Appreciation Right, a Performance Stock Award or any Other Stock Award.

 

(bbb)                   “Stock Award Agreement” means a written agreement
between the Company and a Participant evidencing the terms and conditions of a
Stock Award grant.  Each Stock Award Agreement will be subject to the terms and
conditions of the Plan.

 

(ccc)                      “Subsidiary” means, with respect to the Company,
(i) any corporation of which more than 50% of the outstanding capital stock
having ordinary voting power to elect a majority of the board of directors of
such corporation (irrespective of whether, at the time, stock of any other class
or classes of such corporation will have or might have voting power by reason of
the happening of any contingency) is at the time, directly or indirectly, Owned
by the Company, and (ii) any partnership, limited liability company or other
entity in which the Company has a direct or indirect interest (whether in the
form of voting or participation in profits or capital contribution) of more than
50%.

 

(ddd)                   “Ten Percent Stockholder” means a person who Owns (or is
deemed to Own pursuant to Section 424(d) of the Code) stock possessing more than
10% of the total combined voting power of all classes of stock of the Company or
any Affiliate.

 

29

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2U, INC.

AMENDED AND RESTATED 2014 EQUITY INCENTIVE PLAN

ADDENDUM FOR U.K. PARTICIPANTS

 

The 2U, Inc. Amended and Restated 2014 Equity Incentive Plan (the “Plan”) is
intended to comply with the applicable laws of any country or jurisdiction where
Awards are granted, and all provisions hereof shall be construed in a manner to
so comply.  The following provisions apply to Participants providing services to
the Company or its Affiliates in the United Kingdom (“U.K.”).  Capitalized terms
not defined herein shall have the meanings ascribed to them in the Plan. 
Section references are to the Plan unless otherwise stated.

 

1.              Section 1(b) (Eligible Award Recipients) shall be amended to
replace the phrase “Employees, Directors and Consultants” with the phrase
“Employees and Directors who are also Employees.”

 

2.              Section 4(a) (Eligibility for Specific Stock Awards) shall be
amended to replace the phrase “Employees, Directors and Consultants” with the
phrase “Employees and Directors who are also Employees” in two places.

 

3.              Section 8(d) (No Employment or Other Service Rights) shall be
amended to add the following language to the end thereof:

 

The Plan and any Award Agreement do not form part of any Participant’s contract
of employment.  If any Participant ceases to be employed or engaged by the
Company or any Affiliate for any reason (including as a result of a repudiatory
breach of contract by the Company or its Affiliate), the Participant shall not
be entitled, and by participating in the Plan the Participant shall be deemed
irrevocably to have waived any entitlement, by way of compensation for loss of
employment, breach of contract or otherwise to any sum or other benefit to
compensate the Participant for any rights or prospective rights under the Plan.
This exclusion applies equally (and without limitation) to any loss arising from
the way in which the discretion is (or is not) exercised under any Section of
the Plan even if the exercise (or non-exercise) of such discretion is, or
appears to be, irrational or perverse and/or breaches, or is claimed to breach
any implied term of the Plan or any other contract between the Participant and
the Participant’s employer. Participation in the Plan and any benefits provided
under it shall not be pensionable nor will they count as pay or remuneration
when calculating salary related benefits (including, but not limited to,
pension).

 

4.              A new Section 8(l) (Data Protection) shall be added with the
following language:

 

Data Protection.  By participating in the Plan, each Participant acknowledges
that the Company and its Affiliates may hold and process data relating to them
(including personal data) in relation to and as a consequence of their Awards
including for the purpose of administering their Awards and that such data may
be disclosed (even outside the European Union) to their employer, the Company or
its Affiliates, to any possible purchaser of their employer or its business or
of the Company or its business and its or their advisers in relation to the Plan
and the Award.

 

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5.              A new Section 8(m) (CRS and FATCA) shall be added with the
following language:

 

CRS and FATCA. By Participating in the Plan, each Participant agrees to give all
such assistance and representations and supply or procure to be supplied
(including by way of updates) all such information and execute and deliver (or
procure the execution and delivery of) all such documents that the Company
requests in writing for the purpose of enabling any member of the Group (or any
external administrator of the Plan from time to time) to comply with the US
Foreign Account Tax Compliance Act (“FATCA”), any exchange of information
agreement (“IGA”), the OECD Common Reporting Standard (“CRS”), or any similar,
equivalent or related applicable laws, rules or regulations in any
jurisdiction.   Each Participant further agrees and authorises any member of the
Group to disclose such information to any governmental authorities (including,
but not limited to, HMRC in the U.K. and the Internal Revenue Service in the
U.S.) if it is required to be disclosed pursuant to FATCA, any IGA, CRS, or any
similar, equivalent or related applicable laws, rules or regulations.

 

6.              Section 13(h) (“Cause”) shall be deleted in its entirety and
replaced with the following language:

 

“Cause” will have the meaning ascribed to such term in any written agreement
between the Participant and the Company or any of its Affiliates defining such
term and, in the absence thereof, such term means, with respect to a
Participant, the occurrence of any of the following events:  (i) such
Participant’s commission of any felony or any crime involving fraud, dishonesty
or moral turpitude under the laws of the United States or any state thereof or
crime in the U.K. that is punishable by a custodial sentence; (ii) such
Participant’s attempted commission of, or participation in, a fraud or act of
dishonesty against the Company or any of its Affiliates; (iii) such
Participant’s intentional, material violation of any contract or agreement
between the Participant and the Company or any of its Affiliates or of any
statutory duty owed to the Company or any of its Affiliates; (iv) such
Participant’s unauthorized use or disclosure of the Company’s or any of its
Affiliates’ confidential information or trade secrets; (v) such Participant’s
gross misconduct; or (vi) any other circumstances in which the Company or its
Affiliate that employs the Participant reasonably determines it has grounds to
dismiss the Participant without notice in accordance with the Participant’s
contract of employment.  The determination that a termination of the
Participant’s Continuous Service is either for Cause or without Cause will be
made by the Company, in its sole discretion.  Any determination by the Company
that the Continuous Service of a Participant was terminated with or without
Cause for the purposes of outstanding Awards held by such Participant will have
no effect upon any determination of the rights or obligations of the Company or
such Participant for any other purpose.

 

7.              Section 13(o) (“Continuous Service”) shall be deleted in its
entirety and replaced with the following language:

 

“Continuous Service” means that the Participant’s service with the Company or an
Affiliate, whether as an Employee or Director who is also an Employee, is not
interrupted

 

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or terminated.  A change in the capacity in which the Participant renders
service to the Company or an Affiliate as an Employee or Director who is also an
Employee or a change in the entity for which the Participant renders such
service, provided that there is no interruption or termination of the
Participant’s service with the Company or an Affiliate, will not terminate a
Participant’s Continuous Service; provided, however, that if the Entity for
which a Participant is rendering services ceases to qualify as an Affiliate, as
determined by the Board, in its sole discretion, such Participant’s Continuous
Service will be considered to have terminated on the date such Entity ceases to
qualify as an Affiliate and if the Participant is placed on garden leave in
accordance with the Participant’s contract of employment, the Participant’s
Continuous Service for the purpose of the Plan and any Award Agreement shall
terminate on the date that such garden leave commences.  To the extent permitted
by law, the Board or the chief executive officer of the Company, in that party’s
sole discretion, may determine whether Continuous Service will be considered
interrupted in the case of (i) any leave of absence approved by the Board or
chief executive officer, including sick leave, military leave or any other
personal leave, or (ii) transfers between the Company, an Affiliate, or their
successors.  Notwithstanding the foregoing, a leave of absence will be treated
as Continuous Service for purposes of vesting in an Award only to such extent as
may be provided in the Company’s or Affiliate’s leave of absence policy, in the
written terms of any leave of absence agreement or policy applicable to the
Participant, or as otherwise required by law.  In addition, to the extent
required for exemption from or compliance with Section 409A of the Code, the
determination of whether there has been a termination of Continuous Service,
will be made, and such term will be construed, in a manner that is consistent
with the definition of “separation from service” as defined under Treasury
Regulation Section 1.409A-1(h) (without regard to any alternative definition
thereunder).

 

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