Exhibit 10.21

EXTREME NETWORKS, INC.

NOTICE OF GRANT OF PERFORMANCE STOCK UNITS

(For U.S. Participants)

 

Extreme Networks, Inc. (the “Company”) has granted to the Participant an award
(the “Award”) of certain units pursuant to the Extreme Networks, Inc. 2013
Equity Incentive Plan (the “Plan”), each of which represents the right to
receive on the applicable Settlement Date one (1) share of Stock on the terms
and conditions set forth herein and in the Performance Stock Units Agreement
attached hereto (the “Award Agreement”) and the Plan, which are incorporated
herein by reference. Unless otherwise defined herein, the terms defined in the
Plan shall have the same defined meanings in this Grant Notice and the Award
Agreement.

 

Participant:

 

%%FIRST_NAME%-% %%LAST_NAME%-%

Employee ID:

%%EMPLOYEE_IDENTIFIER%-%

Date of Grant:

 

%%OPTION_DATE%-%

Target Number of Units:

 

%%TOTAL_SHARES_GRANTED%-%, subject to adjustment as provided by the Award
Agreement.

Target Number of Stock Price Units:

 

One half of the Target Number of Units shall be “Stock Price Units” and shall be
earned and vest based on the price of the Stock, as set forth below.

Target Number of TSR Units:

 

One half of the Target Number of Units shall be “TSR Units” and shall be earned
and vest based on the Company’s relative total stockholder return, as set forth
below.

Performance Period:

 

Subject to Section 8.1 of the Award Agreement, the period beginning May 4, 2017
and ending May 4, 2020.

Earned Units:

 

 

Stock Price Units:

 

The number of Stock Price Units that become Earned Units, if any, shall be
determined as follows:

●   1/3rd of the Target Number of Stock Price Units shall become Earned Units if
the Company’s Ending Average Stock Price is at least $8.96 but less than $11.63;

●   2/3rds of the Target Number of Stock Price Units shall become Earned Units
if the Company’s Ending Average Stock Price is at least $11.63 but less than
$13.15;

●   100% of the Target Number of Stock Price Units shall become Earned Units if
the Company’s Ending Average Stock Price is at least $13.15 but less than
$16.56; and

●   1 and 1/3rds times the Target Number of Stock Price Units shall become
Earned Units if the Company’s Ending Average Stock Price equals or exceeds
$16.56.

For the purposes of this Award Agreement, the Company’s “Ending Average Stock
Price” shall mean the average adjusted closing stock price of the Stock for the
90 calendar days ending as of the last day of the Performance Period.

TSR Units:

 

The number of TSR Units that become Earned Units, if any, shall equal the
product of the Target Number of TSR Units and the “Performance Multiplier”,
calculated in accordance with Appendix A.

Vested Units:

 

Except as provided in the Award Agreement or a Superseding Agreement and
provided that the Participant’s Service has not terminated prior to the
Certification Date (as defined in the Award Agreement), the Earned Units for the
Performance Period (if any) shall become Vested Units on the Certification
Date.  Except as provided in the Award Agreement, any Units that do not become
Vested Units on the Certification Date shall be forfeited and cancelled for no
consideration.

Settlement Date:

 

Except as otherwise provided by the Award Agreement, for each Vested Unit, the
day of, or as soon as practicable following, the Certification Date, but in any
event no later than March 15, 2021.

Superseding Agreement:

 

 

 

 

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By the Company’s authorized signature below and the Participant’s by electronic
acceptance in a form authorized by the Company, the Company and the Participant
agree that the Award is governed by this Grant Notice and by the provisions of
the Award Agreement and the Plan, both of which are made a part of this
document, and by the Superseding Agreement, if any.  The Participant
acknowledges that copies of the Plan, the Award Agreement and the prospectus for
the Plan are available on the Company’s internal web site and may be viewed and
printed by the Participant for attachment to the Participant’s copy of this
Grant Notice.  The Participant represents that the Participant has read and is
familiar with the provisions of the Award Agreement and the Plan, and hereby
accepts the Award subject to all of their terms and conditions.

 

EXTREME NETWORKS, INC.

 

6480 Via Del Oro

 

San Jose, California 95119

 

 

ATTACHMENTS:

 

2013 Equity Incentive Plan, as amended to the Date of Grant; Performance Stock
Units Agreement and Plan Prospectus

 

 

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EXTREME NETWORKS, INC.

PERFORMANCE STOCK UNITS AGREEMENT

(For U.S. Participants)

 

Extreme Networks, Inc. has granted to the Participant named in the Notice of
Grant of Performance Stock Units (the “Grant Notice”) to which this Performance
Stock Units Agreement (the “Agreement”) is attached an Award consisting of
Performance Stock Units (each a “Unit”) subject to the terms and conditions set
forth in the Grant Notice and this Agreement.  The Award has been granted
pursuant to and shall in all respects be subject to the terms and conditions of
the Extreme Networks, Inc. 2013 Equity Incentive Plan (the “Plan”), as amended
to the Date of Grant, the provisions of which are incorporated herein by
reference.  By signing the Grant Notice, the Participant: (a) acknowledges
receipt of and represents that the Participant has read and is familiar with the
Grant Notice, this Agreement, the Plan and a prospectus for the Plan prepared in
connection with the registration with the Securities and Exchange Commission of
the shares issuable pursuant to the Award (the “Plan Prospectus”), (b) accepts
the Award subject to all of the terms and conditions of the Grant Notice, this
Agreement and the Plan and (c) agrees to accept as binding, conclusive and final
all decisions or interpretations of the Committee upon any questions arising
under the Grant Notice, this Agreement or the Plan.

1.Definitions and Construction.

1.1Definitions.  Unless otherwise defined herein, capitalized terms shall have
the meanings assigned to such terms in the Grant Notice or the Plan.

(a)“Average Closing Index Value” means the average of the daily closing index
values of the Benchmark Index for all trading days falling within an applicable
90 calendar day period described in Section 1.1(e).

(b)“Average Per Share Closing Price” means the average of the daily closing
prices per share of Stock as reported on the securities exchange constituting
the primary market for the Stock for all trading days falling within an
applicable 90 calendar day period described in Section 1.1(d).

(c)“Benchmark Index” means the S&P Small Cap 600 Capped Information Technology
(sector) index.

(d)“Benchmark Index Total Return” means the percentage point increase or
decrease in (i) the Average Closing Index Value for the 90 calendar days ending
on the last day of the Performance Period over (ii) the Average Closing Index
Value for the 90 calendar days ending on the last day immediately preceding the
first day of the Performance Period.

(e)“Company Total Stockholder Return” means the percentage point increase or
decrease in (i) the Average Per Share Closing Price for the 90 calendar days
ending on the last day of the Performance Period over (ii) the Average Per Share
Closing Price for the

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90 calendar days ending on the last day immediately preceding the first day of
the Performance Period.

1.2Construction.  Captions and titles contained herein are for convenience only
and shall not affect the meaning or interpretation of any provision of this
Agreement.  Except when otherwise indicated by the context, the singular shall
include the plural and the plural shall include the singular.  Use of the term
“or” is not intended to be exclusive, unless the context clearly requires
otherwise.

2.The Award.

2.1Grant of Units.  The Company hereby grants to the Participant the Award set
forth in the Grant Notice, which, depending on the extent to which a performance
goal is attained during the Performance Period, may result in the Participant
earning as little as zero (0) Units or as many as the Maximum Number of Units.
Subject to the terms of this Agreement and the Plan, each Unit, to the extent it
is earned and becomes a Vested Unit, represents a right to receive on the
applicable Settlement Date one (1) share of Stock. Unless and until a Unit has
been determined to be an Earned Unit and has vested and become a Vested Unit as
set forth in the Grant Notice and this Agreement, the Participant will have no
right to settlement of such Unit. Prior to settlement of any earned and vested
Units, such Units will represent an unfunded and unsecured obligation of the
Company.

2.2No Monetary Payment Required.  The Participant is not required to make any
monetary payment (other than applicable tax withholding, if any) as a condition
to receiving the Units or shares of Stock issued upon settlement of the Units,
the consideration for which shall be past services actually rendered or future
services to be rendered to a Participating Company or for its
benefit.  Notwithstanding the foregoing, if required by applicable law, the
Participant shall furnish consideration in the form of cash or past services
rendered to a Participating Company or for its benefit having a value not less
than the par value of the shares of Stock issued upon settlement of the Units.

3.Committee Certification of Vested Units.

3.1Certification of Ending Average Stock Price. As soon as practicable following
completion of the Performance Period, but no later than thirty (30) days
following such completion except as provided in Section 8.1, the Committee shall
determine and certify in writing the Ending Average Stock Price and the
Performance Multiplier attained for the Performance Period and the resulting
number of Units which have become Earned Units (the date of such certification
being the “Certification Date”).

3.2Adjustment for Leave of Absence or Part-Time Work. Unless otherwise required
by law or Company policy, if the Participant takes one or more unpaid leaves of
absence in excess of thirty (30) days in the aggregate during the Performance
Period, the number of Units which would otherwise become Earned Units for the
Performance Period shall be prorated on the basis of the number of days of the
Participant’s Service during the Performance Period during which the Participant
was not on an unpaid leave of absence. Unless otherwise required by law or
Company policy, if the Participant commences working on a part-

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time basis during the Performance Period, the Committee may, in its discretion,
reduce on a pro rata basis (reflecting the portion of the Performance Period
worked by the Participant on a full-time equivalent basis) the number of Units
which would otherwise become Earned Units for the Performance Period, or provide
that the number of Units which would otherwise become Earned Units for the
Performance Period shall be reduced as provided by the terms of an agreement
between the Participant and the Company pertaining to the Participant’s
part-time schedule.

4.Vesting of Units.

4.1Normal Vesting. Except as otherwise provided by this Agreement, Earned Units
shall vest and become Vested Units as provided in the Grant Notice.

4.2Effect of Termination of Service upon Vesting. Except as provided by Section
4.4 or a Superseding Agreement, if any, if the Participant’s Service terminates
for any reason, all Units subject to the Award which have not become Vested
Units as of the time of such termination of Service shall be subject to the
Company Reacquisition Right (as defined by Section 5.1).

4.3Vesting Upon a Change in Control. In the event of a Change in Control, the
vesting of Earned Units shall be determined in accordance with Section 8.1.

4.4Vesting Upon Termination Upon a Change in Control. In the event of the
Participant’s “Termination Upon a Change in Control” (as defined by the the
Extreme Networks, Inc. Executive Change in Control Severance Plan, as amended or
its successor (the “Change in Control Plan”), the vesting of Earned Units
subject to a Time-Vesting Unit Award shall be determined in accordance with
Section 8.2.

5.Company Reacquisition Right.

5.1Grant of Company Reacquisition Right.  Except to the extent otherwise
provided by Section 4.4 or a Superseding Agreement, if any, in the event that
the Participant’s Service terminates for any reason or no reason, with or
without cause, the Participant shall forfeit and the Company shall automatically
reacquire all Units which are not, as of the time of such termination, Vested
Units (“Unvested Units”), and the Participant shall not be entitled to any
payment therefor (the “Company Reacquisition Right”).

5.2Ownership Change Event, Non-Cash Dividends, Distributions and
Adjustments.  Upon the occurrence of an Ownership Change Event, a dividend or
distribution to the stockholders of the Company paid in shares of Stock or other
property, or any other adjustment upon a change in the capital structure of the
Company as described in Section 9, any and all new, substituted or additional
securities or other property (other than regular, periodic cash dividends paid
on Stock pursuant to the Company’s dividend policy) to which the Participant is
entitled by reason of the Participant’s ownership of Unvested Units shall be
immediately subject to the Company Reacquisition Right and included in the terms
“Units” and “Unvested Units” for all purposes of the Company Reacquisition Right
with the same force and effect as the Unvested Units immediately prior to the
Ownership Change Event, dividend, distribution or adjustment, as the case may
be.  For purposes of determining the number of Vested Units following an
Ownership Change Event, dividend, distribution or adjustment,

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credited Service shall include all Service with any corporation which is a
Participating Company at the time the Service is rendered, whether or not such
corporation is a Participating Company both before and after any such event.

6.Settlement of the Award.

6.1Issuance of Shares of Stock.  Subject to the provisions of Section 6.3, the
Company shall issue to the Participant on the Settlement Date with respect to
each Vested Unit to be settled on such date one (1) share of Stock.  The
Settlement Date with respect to a Unit shall be the date on which such Unit
becomes a Vested Unit  as provided by the Grant Notice (an “Original Settlement
Date”); provided, however, that if the Original Settlement Date would occur on a
date on which a sale by the Participant of the shares to be issued in settlement
of the Vested Units would violate the Trading Compliance Policy of the Company,
the Settlement Date for such Vested Units shall be deferred until the next day
on which the sale of such shares would not violate the Trading Compliance
Policy, but in any event on or before the 15th day of the third calendar month
following calendar year of the Original Settlement Date.  Shares of Stock issued
in settlement of Units shall not be subject to any restriction on transfer other
than any such restriction as may be required pursuant to Section 6.3, Section 7
or the Company’s Trading Compliance Policy.

6.2Beneficial Ownership of Shares; Certificate Registration.  The Participant
hereby authorizes the Company, in its sole discretion, to deposit any or all
shares acquired by the Participant pursuant to the settlement of the Award with
the Company’s transfer agent, including any successor transfer agent, to be held
in book entry form, or to deposit such shares for the benefit of the Participant
with any broker with which the Participant has an account relationship of which
the Company has notice.  Except as provided by the foregoing, a certificate for
the shares acquired by the Participant shall be registered in the name of the
Participant, or, if applicable, in the names of the heirs of the Participant.

6.3Restrictions on Grant of the Award and Issuance of Shares.  The grant of the
Award and issuance of shares of Stock upon settlement of the Award shall be
subject to compliance with all applicable requirements of federal, state or
foreign law with respect to such securities.  No shares of Stock may be issued
hereunder if the issuance of such shares would constitute a violation of any
applicable federal, state or foreign securities laws or other law or regulations
or the requirements of any stock exchange or market system upon which the Stock
may then be listed.  The inability of the Company to obtain from any regulatory
body having jurisdiction the authority, if any, deemed by the Company’s legal
counsel to be necessary to the lawful issuance of any shares subject to the
Award shall relieve the Company of any liability in respect of the failure to
issue such shares as to which such requisite authority shall not have been
obtained.  As a condition to the settlement of the Award, the Company may
require the Participant to satisfy any qualifications that may be necessary or
appropriate, to evidence compliance with any applicable law or regulation and to
make any representation or warranty with respect thereto as may be requested by
the Company.

6.4Fractional Shares.  The Company shall not be required to issue fractional
shares upon the settlement of the Award.

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7.Tax Withholding.

7.1In General.  At the time the Grant Notice is executed, or at any time
thereafter as requested by a Participating Company, the Participant hereby
authorizes withholding from payroll and any other amounts payable to the
Participant, and otherwise agrees to make adequate provision for, any sums
required to satisfy the federal, state, local and foreign tax (including any
social insurance) withholding obligations of the Participating Company, if any,
which arise in connection with the Award, the vesting of Units or the issuance
of shares of Stock in settlement thereof.  The Company shall have no obligation
to deliver shares of Stock until the tax withholding obligations of the
Participating Company have been satisfied by the Participant.

7.2Assignment of Sale Proceeds.  Subject to compliance with applicable law and
the Company’s Trading Compliance Policy, if permitted by the Company, the
Participant may satisfy the Participating Company’s tax withholding obligations
in accordance with procedures established by the Company providing for delivery
by the Participant to the Company or a broker approved by the Company of
properly executed instructions, in a form approved by the Company, providing for
the assignment to the Company of the proceeds of a sale with respect to some or
all of the shares being acquired upon settlement of Units.

7.3Withholding in Shares.  The Company shall have the right, but not the
obligation, to require the Participant to satisfy all or any portion of a
Participating Company’s tax withholding obligations by deducting from the shares
of Stock otherwise deliverable to the Participant in settlement of the Award a
number of whole shares having a fair market value, as determined by the Company
as of the date on which the tax withholding obligations arise, not in excess of
the amount of such tax withholding obligations determined by the applicable
minimum statutory withholding rates.

8.Effect of Change in Control.

In the event of a Change in Control, this Section 8 shall determine the
treatment of the Units which have not otherwise become Vested Units.

 

8.1 Effect of Change in Control on Award. In the event of a Change in Control
that occurs following the end of the Performance Period, the number of Earned
Units shall, if not previously certified by the Committee in accordance with
Section 3.1 and settled in accordance with Section 6, be determined and
certified by the Committee in accordance with Section 3.1 and settled in
accordance with Section 6 prior to the effective time of the Change in
Control.  In the event of a Change in Control that occurs prior to the end of
the Performance Period, the Performance Period shall be deemed to end on the day
immediately preceding the Change in Control (the “Adjusted Performance Period”),
and the number of Earned Units and the vesting thereof shall be determined for
the Adjusted Performance Period in accordance with the following:

 

(a) Earned Units. The Committee shall determine and certify in writing no later
than the day immediately preceding the Change in Control the number of Earned
Units for the Adjusted Performance Period, provided that:

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(i) for the Stock Price Units, the Ending Average Stock Price shall be deemed to
be the price per share of Stock to be paid to the holder thereof in accordance
with the definitive agreement governing the transaction constituting the Change
in Control (or, in the absence of such agreement, the closing price per share of
Stock on the last trading day of the Adjusted Performance Period as reported on
the securities exchange constituting the primary market for the Stock) (the
“Transaction Price”); and

(ii) for the TSR Units, (A) the Company Total Stockholder Return shall be
determined as provided by Section 1.1, except that the Average Share Closing
Price for the 90 calendar days ending on the last day of the Adjusted
Performance Period shall be replaced with the Transaction Price and (B) the
Benchmark Index Total Return shall be determined as provided by Section 1.1,
except that the Average Closing Index Value shall be determined for the 90
calendar days ending on the last market trading day of the Adjusted Performance
Period.

 

Immediately following the Committee’s determination pursuant to this Section
8.1(a), all Units subject to the Award which are not Earned Units (the “Unearned
Units”) shall terminate and the Award, to the extent of the Unearned Units,
shall cease to be outstanding.

 

(b) Vested Units. As of the last day of the Adjusted Performance Period and
provided that the Participant’s Service has not terminated prior to such date,
except as otherwise provided by a Superseding Agreement, a portion of the Earned
Units determined in accordance with Section 8.1(a) shall become Vested Units
(the “Accelerated Units”), with such portion determined by multiplying the total
number of Earned Units by a fraction, the numerator of which equals the number
of days contained in the Adjusted Performance Period and the denominator of
which equals the number of days contained in the original Performance Period
determined without regard to this Section. The Accelerated Units shall be
settled in accordance Section 6 immediately prior to the effective time of the
Change in Control.

 

(c) Unvested Units. Except as otherwise provided by Section 8.2, with respect to
each Adjusted Performance Period, that portion of the Earned Units determined in
accordance with Section 8.1(a) in excess of the number of Accelerated Units
(such excess portion, a “Time-Vesting Unit Award”) shall become Vested Units in
equal monthly installments determined from the effective date of the Change in
Control (each of which shall be a “Vesting Date” for this purpose) over the
remainder of the original Performance Period determined without regard to this
Section, provided that the Participant’s Service has not terminated prior to the
applicable Vesting Date. The Units subject to the Time-Vesting Unit Award which
become Vested Units shall be settled on the applicable Settlement Date in
accordance with Section 6, provided that payment for each Vested Unit shall be
made in the amount and in the form of the consideration (whether stock, cash,
other securities or property or a combination thereof) to which a holder of a
share of Stock on the effective date of the Change in Control was entitled (and
if holders were offered a choice of consideration, the type of consideration
chosen by the holders of a majority of the outstanding shares of Stock). For the
purposes of this Section 8.1(c), the Settlement Date shall occur upon or as soon
as practicable following the applicable Vesting Date, but in any event no later
than the 15th day of the third calendar month following the end of the calendar
year in which the Vesting Date occurs.

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8.2 Involuntary Termination Following Change in Control. This Section 8.2 shall
apply only if the Participant is a participant in the Change in Control Plan. In
the event that the Participant’s Service terminates due to “Termination Upon a
Change in Control” (as such term or similar term is defined by the Change in
Control Plan), then the vesting of each Time-Vesting Unit Award determined in
accordance with Section 8.1(c) shall be accelerated, and the Units subject to
such Time-Vesting Unit Award shall become Vested Units to the extent provided by
the Change in Control Plan and the Participant’s Participation Agreement in such
plan effective as of the date of the Participant’s termination of Service.
Consistent with Section 8.1(a) and notwithstanding any provision of the Change
in Control Plan or such Participation Agreement to the contrary, the provisions
of the Change in Control Plan shall not apply to the Unearned Units, with
respect to which the Award will have ceased to be outstanding as of the Change
in Control. The Vested Units determined in accordance with this Section 8.2
shall be settled in accordance with Section 6, treating the date of the
Participant’s termination of Service as the Vesting Date, provided that payment
for each Vested Unit shall be made in the amount and in the form of the
consideration (whether stock, cash, other securities or property or a
combination thereof) to which a holder of a share of Stock on the effective date
of the Change in Control was entitled (and if holders were offered a choice of
consideration, the type of consideration chosen by the holders of a majority of
the outstanding shares of Stock). For the purposes of this Section 8.2, the
Settlement Date shall occur upon or as soon as practicable following the Vesting
Date, but in any event no later than the 15th day of the third calendar month
following the end of the calendar year in which the Vesting Date occurs.

9.Adjustments for Changes in Capital Structure.

Subject to any required action by the stockholders of the Company and the
requirements of Section 409A of the Code to the extent applicable, in the event
of any change in the Stock effected without receipt of consideration by the
Company, whether through merger, consolidation, reorganization, reincorporation,
recapitalization, reclassification, stock dividend, stock split, reverse stock
split, split-up, split-off, spin-off, combination of shares, exchange of shares,
or similar change in the capital structure of the Company, or in the event of
payment of a dividend or distribution to the stockholders of the Company in a
form other than Stock (other than regular, periodic cash dividends paid on Stock
pursuant to the Company’s dividend policy) that has a material effect on the
Fair Market Value of shares of Stock, appropriate and proportionate adjustments
shall be made in the number of Units subject to the Award and/or the number and
kind of shares or other property to be issued in settlement of the Award, in
order to prevent dilution or enlargement of the Participant’s rights under the
Award.  For purposes of the foregoing, conversion of any convertible securities
of the Company shall not be treated as “effected without receipt of
consideration by the Company.”  Any and all new, substituted or additional
securities or other property (other than regular, periodic cash dividends paid
on Stock pursuant to the Company’s dividend policy) to which the Participant is
entitled by reason of ownership of Units acquired pursuant to this Award will be
immediately subject to the provisions of this Award on the same basis as all
Units originally acquired hereunder.  Any fractional Unit or share resulting
from an adjustment pursuant to this Section shall be rounded down to the nearest
whole number.  Such adjustments shall be determined by the Committee, and its
determination shall be final, binding and conclusive.

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10.Rights as a Stockholder, Director, Employee or Consultant.

The Participant shall have no rights as a stockholder with respect to any shares
which may be issued in settlement of this Award until the date of the issuance
of such shares (as evidenced by the appropriate entry on the books of the
Company or of a duly authorized transfer agent of the Company).  No adjustment
shall be made for dividends, distributions or other rights for which the record
date is prior to the date the shares are issued, except as provided in
Section 9.  If the Participant is an Employee, the Participant understands and
acknowledges that, except as otherwise provided in a separate, written
employment agreement between a Participating Company and the Participant, the
Participant’s employment is “at will” and is for no specified term.  Nothing in
this Agreement shall confer upon the Participant any right to continue in the
Service of a Participating Company or interfere in any way with any right of the
Participating Company Group to terminate the Participant’s Service at any time.

11.Legends.

The Company may at any time place legends referencing any applicable federal,
state or foreign securities law restrictions on all certificates representing
shares of stock issued pursuant to this Agreement.  The Participant shall, at
the request of the Company, promptly present to the Company any and all
certificates representing shares acquired pursuant to this Award in the
possession of the Participant in order to carry out the provisions of this
Section.

12.Compliance with Section 409A.

It is intended that any election, payment or benefit which is made or provided
pursuant to or in connection with this Award that may result in Section 409A
Deferred Compensation shall comply in all respects with the applicable
requirements of Section 409A (including applicable regulations or other
administrative guidance thereunder, as determined by the Committee in good
faith) to avoid the unfavorable tax consequences provided therein for
non‑compliance.  In connection with effecting such compliance with Section 409A,
the following shall apply:

12.1Separation from Service; Required Delay in Payment to Specified
Employee.  Notwithstanding anything set forth herein to the contrary, no amount
payable pursuant to this Agreement on account of the Participant’s termination
of Service which constitutes a “deferral of compensation” within the meaning of
the Treasury Regulations issued pursuant to Section 409A of the Code (the
“Section 409A Regulations”) shall be paid unless and until the Participant has
incurred a “separation from service” within the meaning of the Section 409A
Regulations.  Furthermore, to the extent that the Participant is a “specified
employee” within the meaning of the Section 409A Regulations as of the date of
the Participant’s separation from service, no amount that constitutes a deferral
of compensation which is payable on account of the Participant’s separation from
service shall be paid to the Participant before the date (the “Delayed Payment
Date”) which is first day of the seventh month after the date of the
Participant’s separation from service or, if earlier, the date of the
Participant’s death following such separation from service.  All such amounts
that would, but for this Section, become payable prior to the Delayed Payment
Date will be accumulated and paid on the Delayed Payment Date.

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12.2Other Changes in Time of Payment.  Neither the Participant nor the Company
shall take any action to accelerate or delay the payment of any benefits under
this Agreement in any manner which would not be in compliance with the Section
409A Regulations.

12.3Amendments to Comply with Section 409A; Indemnification.  Notwithstanding
any other provision of this Agreement to the contrary, the Company is authorized
to amend this Agreement, to void or amend any election made by the Participant
under this Agreement and/or to delay the payment of any monies and/or provision
of any benefits in such manner as may be determined by the Company, in its
discretion, to be necessary or appropriate to comply with the Section 409A
Regulations without prior notice to or consent of the Participant.  The
Participant hereby releases and holds harmless the Company, its directors,
officers and stockholders from any and all claims that may arise from or relate
to any tax liability, penalties, interest, costs, fees or other liability
incurred by the Participant in connection with the Award, including as a result
of the application of Section 409A.

12.4Advice of Independent Tax Advisor.  The Company has not obtained a tax
ruling or other confirmation from the Internal Revenue Service with regard to
the application of Section 409A to the Award, and the Company does not represent
or warrant that this Agreement will avoid adverse tax consequences to the
Participant, including as a result of the application of Section 409A to the
Award.  The Participant hereby acknowledges that he or she has been advised to
seek the advice of his or her own independent tax advisor prior to entering into
this Agreement and is not relying upon any representations of the Company or any
of its agents as to the effect of or the advisability of entering into this
Agreement.

13.Miscellaneous Provisions.

13.1Administration. All questions of interpretation concerning the Grant Notice,
this Award Agreement, the Plan or any other form of agreement or other document
employed by the Company in the administration of the Plan or the Award shall be
determined by the Committee. All such determinations by the Committee shall be
final, binding and conclusive upon all persons having an interest in the Award,
unless fraudulent or made in bad faith. Any and all actions, decisions and
determinations taken or made by the Committee in the exercise of its discretion
pursuant to the Plan or the Award or other agreement thereunder (other than
determining questions of interpretation pursuant to the preceding sentence)
shall be final, binding and conclusive upon all persons having an interest in
the Award. Any Officer shall have the authority to act on behalf of the Company
with respect to any matter, right, obligation, or election which is the
responsibility of or which is allocated to the Company herein, provided the
Officer has apparent authority with respect to such matter, right, obligation,
or election.

13.2Termination or Amendment.  The Committee may terminate or amend the Plan or
this Agreement at any time; provided, however, that except as provided in
Section 8 in connection with a Change in Control, no such termination or
amendment may have a materially adverse effect on the Participant’s rights under
this Agreement without the consent of the Participant unless such termination or
amendment is necessary to comply with applicable law or government regulation,
including, but not limited to, Section 409A.  No amendment or addition to this
Agreement shall be effective unless in writing.

9

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13.3Nontransferability of the Award.  Prior to the issuance of shares of Stock
on the applicable Settlement Date, neither this Award nor any Units subject to
this Award shall be subject in any manner to anticipation, alienation, sale,
exchange, transfer, assignment, pledge, encumbrance, or garnishment by creditors
of the Participant or the Participant’s beneficiary, except transfer by will or
by the laws of descent and distribution.  All rights with respect to the Award
shall be exercisable during the Participant’s lifetime only by the Participant
or the Participant’s guardian or legal representative.

13.4Further Instruments.  The parties hereto agree to execute such further
instruments and to take such further action as may reasonably be necessary to
carry out the intent of this Agreement.

13.5Binding Effect.  This Agreement shall inure to the benefit of the successors
and assigns of the Company and, subject to the restrictions on transfer set
forth herein, be binding upon the Participant and the Participant’s heirs,
executors, administrators, successors and assigns.

13.6Delivery of Documents and Notices.  Any document relating to participation
in the Plan or any notice required or permitted hereunder shall be given in
writing and shall be deemed effectively given (except to the extent that this
Agreement provides for effectiveness only upon actual receipt of such notice)
upon personal delivery, electronic delivery at the e-mail address, if any,
provided for the Participant by a Participating Company, or upon deposit in the
U.S. Post Office or foreign postal service, by registered or certified mail, or
with a nationally recognized overnight courier service, with postage and fees
prepaid, addressed to the other party at the address of such party set forth in
the Grant Notice or at such other address as such party may designate in writing
from time to time to the other party.

(a)Description of Electronic Delivery.  The Plan documents, which may include
but do not necessarily include: the Plan, the Grant Notice, this Agreement, the
Plan Prospectus, and any reports of the Company provided generally to the
Company’s stockholders, may be delivered to the Participant electronically.  In
addition, if permitted by the Company, the Participant may deliver
electronically the Grant Notice to the Company or to such third party involved
in administering the Plan as the Company may designate from time to time.  Such
means of electronic delivery may include but do not necessarily include the
delivery of a link to a Company intranet or the Internet site of a third party
involved in administering the Plan, the delivery of the document via e-mail or
such other means of electronic delivery specified by the Company.

(b)Consent to Electronic Delivery.  The Participant acknowledges that the
Participant has read Section 13.6(a) of this Agreement and consents to the
electronic delivery of the Plan documents and, if permitted by the Company, the
delivery of the Grant Notice, as described in Section 13.6(a).  The Participant
acknowledges that he or she may receive from the Company a paper copy of any
documents delivered electronically at no cost to the Participant by contacting
the Company by telephone or in writing.  The Participant further acknowledges
that the Participant will be provided with a paper copy of any documents if the
attempted electronic delivery of such documents fails.  Similarly, the
Participant understands that the Participant must provide the Company or any
designated third party administrator with a

10

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paper copy of any documents if the attempted electronic delivery of such
documents fails.  The Participant may revoke his or her consent to the
electronic delivery of documents described in Section 13.6(a) or may change the
electronic mail address to which such documents are to be delivered (if
Participant has provided an electronic mail address) at any time by notifying
the Company of such revoked consent or revised e-mail address by telephone,
postal service or electronic mail.  Finally, the Participant understands that he
or she is not required to consent to electronic delivery of documents described
in Section 13.6(a).

13.7Integrated Agreement.  The Grant Notice, this Agreement and the Plan,
together with the Change in Control Plan and the Superseding Agreement, if any,
shall constitute the entire understanding and agreement of the Participant and
the Participating Company Group with respect to the subject matter contained
herein or therein and supersede any prior agreements, understandings,
restrictions, representations, or warranties among the Participant and the
Participating Company Group with respect to such subject matter.  To the extent
contemplated herein or therein, the provisions of the Grant Notice, this
Agreement and the Plan shall survive any settlement of the Award and shall
remain in full force and effect.

13.8Applicable Law.  This Agreement shall be governed by the laws of the State
of California as such laws are applied to agreements between California
residents entered into and to be performed entirely within the State of
California.

13.9Counterparts.  The Grant Notice may be executed in counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.

 

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APPENDIX A

 

TSR UNITS

ILLUSTRATION OF PERFORMANCE MULTIPLIER
AND RESULTING NUMBER OF EARNED UNITS

 

 

 

 

 

 

Percentage Point Difference of
Company Total Stockholder Return Over/Under the Benchmark Index Total Return

Performance Differential (Percentage Point Difference of
Company Total Stockholder Return Over/Under the Sum of the
Benchmark Index Total Return and 25 Percentage Points)

Performance Multiplier*

Earned Units
(Per 1,000 Target  TSR Units)

40%

15.0

130.0%

1,300

35%

10.0

130.0%

1,300

30%

5.0

115.0%

1,150

29%

4.0

112.0%

1,120

28%

3.0

109.0%

1,090

27%

2.0

106.0%

1,060

26%

1.0

103.0%

1,030

25.5%

0.5

101.5%

1,015

25.1%

0.1

100.3%

1,003

25%

0

100.0%

1,000

24.9%

-0.1

99.6%

996

24.5%

-0.5

98.0%

980

24%

-1.0

96.0%

960

23%

-2.0

92.0%

920

22%

-3.0

88.0%

880

21%

-4.0

84.0%

840

20%

-5.0

80.0%

800

15%

-10.0

60.0%

600

10%

-15.0

40.0%

400

5%

-20.0

20.0%

200

0%

-25.0

0.0%

0

-5%

-30.0

0.0%

0

 

*Notwithstanding the applicable performance multiplier as set forth above, for
purposes of the calculation of Earned Units, in the event that the Company Total
Stockholder Return is negative, the maximum number of TSR Units that shall
become Earned Units shall not exceed the Target Number of TSR Units as set forth
in the Award Agreement.

 

**Linear interpolation will be used to determine the Performance Multiplier for
percentage point differences achieved between the values listed in the
Percentage Point Difference of Company Total Stockholder Return Over/Under the
Benchmark Index Total Return column, provided that the Performance Multiplier
for a percentage point difference less than 0% shall be zero and in no event
shall the Performance Multiplier be in excess of 130%.

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ILLUSTRATIONS OF CALCULATION OF EARNED UNITS

PER 1,000 TARGET TSR UNITS

 

Company Total Stockholder Return Exceeds Target of Benchmark Index Total Return
+ 25%

 

 

 

 

 

Assumptions:

 

 

 

 

 

Extreme Networks, Inc.:

 

 

Average Per Share Closing Price (beginning)

 

 

$10.00

 

Average Per Share Closing Price (ending)

 

 

$15.00

 

 

 

 

S&P Small Cap 600 IT Index:

 

 

Average Closing Index Value (beginning)

 

500.00

 

Average Closing Index Value (ending)

 

600.00

 

 

 

 

Computations:

 

 

Company Total Stockholder Return

((15.00 / 10.00) - 1) x 100

50.0

%

Benchmark Index Total Return

((600 / 500) - 1) x 100

20.0

%

Performance Multiplier

100 + (3 x (50.0 – 20.0 – 25.0))

115.0

%

Earned Units

1,000 x 115.0%

1,150

 

 

Company Total Stockholder Return Is Less Than Target of Benchmark Index Total
Return + 25%

 

Assumptions:

 

 

 

 

 

Extreme Networks, Inc.:

 

 

Average Per Share Closing Price (beginning)

 

 

$10.00

 

Average Per Share Closing Price (ending)

 

 

$13.00

 

 

 

 

S&P Small Cap 600 IT Index:

 

 

Average Closing Index Value (beginning)

 

500.00

 

Average Closing Index Value (ending)

 

600.00

 

 

 

 

Computations:

 

 

Company Total Stockholder Return

((13 / 10.00) - 1) x 100

30.0

%

Benchmark Index Total Return

((600 / 500) - 1) x 100

20.0

%

Performance Multiplier

100 + (4 x (30.0 – 20.0 – 25.0)

40.0

%

Earned Units

1,000 x 40.0%

400

 

 

13