Exhibit 10.1
CONEXANT HOLDINGS, INC.
 
2011 INCENTIVE COMPENSATION PLAN
 

 

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CONEXANT HOLDINGS, INC.
 
2011 INCENTIVE COMPENSATION PLAN
 
TABLE OF CONTENTS

         
ARTICLE I PURPOSE
    1  
ARTICLE II DEFINITIONS
    1  
ARTICLE III ADMINISTRATION
    6  
ARTICLE IV SHARE LIMITATION
    9  
ARTICLE V ELIGIBILITY
    11  
ARTICLE VI STOCK OPTIONS
    11  
ARTICLE VII CHANGE IN CONTROL PROVISIONS
    15  
ARTICLE VIII TERMINATION OR AMENDMENT OF PLAN
    16  
ARTICLE IX COMPANY CALL RIGHTS; RIGHTS OF FIRST REFUSAL
    17  
ARTICLE X UNFUNDED STATUS OF PLAN
    18  
ARTICLE XI GENERAL PROVISIONS
    18  
ARTICLE XII EFFECTIVE DATE OF PLAN
    22  
ARTICLE XIII TERM OF PLAN
    22  
ARTICLE XIV NAME OF PLAN
    22  

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CONEXANT HOLDINGS, INC.
 
2011 INCENTIVE COMPENSATION PLAN
 
ARTICLE I
PURPOSE
     The purpose of this Conexant Holdings, Inc. 2011 Incentive Compensation
Plan is to enhance the profitability and value of the Company for the benefit of
its stockholders by enabling the Company to offer Eligible Individuals cash and
stock-based incentives in order to attract, retain and reward such individuals
and strengthen the mutuality of interests between such individuals and the
Company’s stockholders. The Plan is effective as of the date set forth in
Article XII.
ARTICLE II
DEFINITIONS
     For purposes of this Plan, the following terms shall have the following
meanings:
     2.1 “Acquisition Event” has the meaning set forth in Section 4.2(d).
     2.2 “Affiliate” means each of the following: (a) any Subsidiary; (b) any
Parent; (c) any corporation, trade or business (including, without limitation, a
partnership or limited liability company) which is directly or indirectly
controlled 50% or more (whether by ownership of stock, assets or an equivalent
ownership interest or voting interest) by the Company or one of its Affiliates;
(d) any trade or business (including, without limitation, a partnership or
limited liability company) which directly or indirectly controls 50% or more
(whether by ownership of stock, assets or an equivalent ownership interest or
voting interest) of the Company; and (e) any other entity in which the Company
or any of its Affiliates has a material equity interest and which is designated
as an “Affiliate” by resolution of the Committee.
     2.3 “Award” means any award under the Plan of any Stock Option. All Awards
shall be granted by, confirmed by, and subject to (i) the terms of, a written
agreement executed by the Company and the Participant, and (ii) approval of the
Committee.
     2.4 “Award Agreement” means the written agreement setting forth the terms
and conditions applicable to an Award.
     2.5 “Board” means the Board of Directors of the Company.
     2.6 “Cause” means, unless otherwise determined by the Committee in the
applicable Award Agreement, with respect to a Participant’s Termination of
Employment or Termination of

 

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     Consultancy, the following: (a) in the case where there is no employment
agreement, consulting agreement, change in control agreement or similar
agreement in effect between the Company or an Affiliate and the Participant at
the time of the grant of the Award (or where there is such an agreement but it
does not define “cause” (or words of like import)), termination due to such
Participant’s (i) commission of a felony or any other act or omission involving
dishonesty, disloyalty, moral turpitude, willful misconduct or fraud with
respect to the Company or any of its Affiliates, (ii) conduct tending to bring
the Company or any of its Affiliates into substantial public disgrace or
disrepute, (iii) substantial and repeated failure to perform his or her duties
or responsibilities as reasonably directed by the Board or its designees,
(iv) breach of fiduciary duty, gross negligence or willful misconduct with
respect to the Company or any of its Affiliates, (v) an act or omission aiding
or abetting a competitor, supplier or customer of the Company or any of its
Subsidiaries to the disadvantage or detriment of the Company or any of its
Subsidiaries, or (vi) any other breach of any written agreement between such
Participant and the Company or any agreement involving the Company to which such
Participant is bound (including, for the avoidance of doubt, any written
agreement governing the employment relationship between such Participant and the
Company or any of its subsidiaries), in each case as determined by the Committee
in its sole discretion; or (b) in the case where there is an employment
agreement, consulting agreement, change in control agreement or similar
agreement in effect between the Company or an Affiliate and the Participant at
the time of the grant of the Award that defines “cause” (or words of like
import), “cause” as defined under such agreement; provided, however, that with
regard to any agreement under which the definition of “cause” only applies on
occurrence of a change in control, such definition of “cause” shall not apply
until a change in control actually takes place and then only with regard to a
termination thereafter. With respect to a Participant’s Termination of
Directorship, “cause” means an act or failure to act that constitutes cause for
removal of a director under applicable Delaware law.
     2.7 “Change in Control” has the meaning set forth in Section 7.2.
     2.8 “Change in Control Price” has the meaning set forth in Section 7.1(b).
     2.9 “Code” means the Internal Revenue Code of 1986, as amended. Any
reference to any section of the Code shall also be a reference to any successor
provision and any Treasury Regulation promulgated thereunder.
     2.10 “Committee” means any committee of the Board duly authorized by the
Board to administer the Plan. If no committee is duly authorized by the Board to
administer the Plan, the term “Committee” shall be deemed to refer to the Board
for all purposes under the Plan.
     2.11 “Common Stock” means the Class A Common Stock, $0.01 par value per
share, of the Company, and such other series or class of common stock of the
Company as the Board may designate from time to time by duly promulgated
resolution.
     2.12 “Company” means Conexant Holdings, Inc., a Delaware corporation, and
its successors by operation of law.
     2.13 “Consultant” means any natural person who is an advisor or consultant
to the Company or its Affiliates.

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     2.14 “Detrimental Activity” means, unless otherwise determined by the
Committee, in the applicable Award Agreement: (a) the disclosure to anyone
outside the Company or its Affiliates, or the use in any manner other than in
the furtherance of the Company’s or its Affiliate’s business, without written
authorization from the Company, of any confidential information, trade secrets
or proprietary information, relating to the business of the Company or its
Affiliates that is acquired by a Participant prior to the Participant’s
Termination; (b) activity while employed or performing services that results, or
if known could result, in the Participant’s Termination that is classified by
the Company as a termination for Cause; (c) any attempt, directly or indirectly,
to solicit, induce or hire (or the identification for solicitation, inducement
or hiring of) any employee of the Company or its Affiliates to be employed by,
or to perform services for, the Participant or any person or entity with which
the Participant is associated (including, but not limited to, due to the
Participant’s employment by, consultancy for, equity interest in, or creditor
relationship with such person or entity) or any person or entity from which the
Participant receives direct or indirect compensation or fees as a result of such
solicitation, inducement or hire (or the identification for solicitation,
inducement or hire) without, in all cases, written authorization from the
Company; (d) any attempt, directly or indirectly, to solicit in a competitive
manner any customer or prospective customer of the Company or its Affiliates at
the time of a Participant’s Termination, without, in all cases, written
authorization from the Company; (e) the Participant’s Disparagement, or
inducement of others to do so, of the Company or its Affiliates or their past
and present officers, directors, employees or products; (f) the rendering of
services for any organization, or engaging, directly or indirectly, in any
business, which is competitive with the Company or its Affiliates, or the
rendering of services to such organization or business if such organization or
business is otherwise prejudicial to or in conflict with the interests of the
Company or its Affiliates; provided, however, that competitive activities shall
only be those competitive with any business unit or Affiliate of the Company
with regard to which the Participant performed services at any time within the
two years prior to the Participant’s Termination; or (g) breach of any agreement
between the Participant and the Company or an Affiliate (including, without
limitation, any employment agreement or noncompetition or nonsolicitation
agreement). For purposes of sub-sections (a), (c), (d) and (f) above, the Board,
the President or the Secretary of the Company shall have authority to provide
the Participant, except for himself or herself, with written authorization to
engage in the activities contemplated thereby and no other person shall have
authority to provide the Participant with such authorization.
     2.15 “Disability” means, unless otherwise determined by the Committee in
the applicable Award Agreement, with respect to a Participant’s Termination, a
permanent and total disability as defined in Section 22(e)(3) of the Code. A
Disability shall only be deemed to occur at the time of the determination by the
Committee of the Disability.
     2.16 “Disparagement” means making comments or statements to the press, the
Company’s or its Affiliates’ employees, consultants or any individual or entity
with whom the Company or its Affiliates has a business relationship which could
reasonably be expected to adversely affect in any manner: (a) the conduct of the
business of the Company or its Affiliates (including, without limitation, any
products or business plans or prospects); or (b) the business reputation of the
Company or its Affiliates, or any of their products, or their past or present
officers, directors or employees.
     2.17 “Effective Date” means the effective date of the Plan as defined in
Article XII.

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     2.18 “Eligible Employee” means each employee of the Company or an
Affiliate.
     2.19 “Eligible Individual” means an Eligible Employee, Non-Employee
Director or Consultant who is designated by the Committee in its discretion as
eligible to receive Awards subject to the conditions set forth herein.
     2.20 “Exchange Act” means the Securities Exchange Act of 1934, as amended.
Reference to a specific section of the Exchange Act or regulation thereunder
shall include such section or regulation, any valid regulation or interpretation
promulgated under such section, and any comparable provision of any future
legislation or regulation amending, supplementing or superseding such section or
regulation.
     2.21 “Fair Market Value” means, for purposes of the Plan, unless otherwise
required by any applicable provision of the Code or any regulations issued
thereunder, as of any date and except as provided below: (a) the last sales
price reported for the applicable Common Stock on the applicable date as
reported on the principal national securities exchange in the United States on
which it is then traded or (b) if the applicable Common Stock is not traded,
listed or otherwise reported or quoted, the price determined in good faith by
the Committee in whatever manner it considers appropriate. For purposes of the
grant of any Award, the applicable date shall be the trading day immediately
prior to the date on which the Award is granted. For purposes of the exercise of
any Award, the applicable date shall be the date a notice of exercise is
received by the Committee or, if not a day on which the applicable market is
open, the next day that it is open.
     2.22 “Family Group” means a Participant’s spouse, descendants (whether
natural or adopted) and any trust solely for the benefit of such Participant
and/or such Participant’s spouse or descendants.
     2.23 “Lead Underwriter” has the meaning set forth in Section 11.20.
     2.24 “Lock-Up Period” has the meaning set forth in Section 11.20.
     2.25 “Merger Event” has the meaning set forth in Section 4.2(b).
     2.26 “Non-Employee Director” means a director or a member of the Board of
the Company or any Affiliate who is not an active employee of the Company or any
Affiliate.
     2.27 “Non-Qualified Stock Option” means any Stock Option awarded under the
Plan.
     2.28 “Other Extraordinary Event” has the meaning set forth in
Section 4.2(b).
     2.29 “Parent” means any parent corporation of the Company within the
meaning of Section 424(e) of the Code.
     2.30 “Participant” means an Eligible Individual to whom an Award has been
granted pursuant to the Plan.
     2.31 “Plan” means this Conexant Holdings, Inc. 2011 Incentive Compensation
Plan, as amended from time to time.

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     2.32 “Registration Date” means the date on which the Company sells its
Common Stock in a bona fide, firm commitment underwriting pursuant to a
registration statement under the Securities Act.
     2.33 “Reloads” has the meaning set forth in Section 6.3(o).
     2.34 “Rule 16b-3” means Rule 16b-3 under Section 16(b) of the Exchange Act
as then in effect or any successor provision.
     2.35 “Section 4.2 Event” has the meaning set forth in Section 4.2(b).
     2.36 “Section 409A of the Code” means the nonqualified deferred
compensation rules under Section 409A of the Code and any applicable treasury
regulations and other official guidance thereunder.
     2.37 “Securities Act” means the Securities Act of 1933, as amended and all
rules and regulations promulgated thereunder. Reference to a specific section of
the Securities Act or regulation thereunder shall include such section or
regulation, any valid regulation or interpretation promulgated under such
section, and any comparable provision of any future legislation or regulation
amending, supplementing or superseding such section or regulation.
     2.38 “Stock Option” or ”Option” means any option to purchase shares of
Common Stock granted to Eligible Individuals granted pursuant to Article VI.
     2.39 “Subsidiary” means any subsidiary corporation of the Company within
the meaning of Section 424(f) of the Code.
     2.40 “Termination” means a Termination of Consultancy, Termination of
Directorship or Termination of Employment, as applicable.
     2.41 “Termination of Consultancy” means: (a) that the Consultant is no
longer acting as a consultant to the Company or a Subsidiary; or (b) when an
entity which is retaining a Participant as a Consultant ceases to be a
Subsidiary unless the Participant otherwise is, or thereupon becomes, a
Consultant to the Company or another Subsidiary at the time the entity ceases to
be a Subsidiary; or (c) when an entity which is retaining a Participant as a
Consultant ceases to be an Affiliate with respect to the Company or a
Subsidiary. In the event that a Consultant becomes an Eligible Employee or a
Non-Employee Director upon the termination of his or her consultancy, unless
otherwise determined by the Committee, in its sole discretion, no Termination of
Consultancy shall be deemed to occur until such time as such Consultant is no
longer a Consultant, an Eligible Employee or a Non-Employee Director.
Notwithstanding the foregoing, the Committee may otherwise define Termination of
Consultancy in the Award Agreement or, if no rights of a Participant are
reduced, may otherwise define Termination of Consultancy thereafter.
     2.42 “Termination of Directorship” means that the Non-Employee Director has
ceased to be a director of the Company; except that if a Non-Employee Director
becomes an Eligible Employee or a Consultant upon the termination of his or her
directorship, his or her ceasing to be a director of the Company shall not be
treated as a Termination of Directorship

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unless and until the Participant has a Termination of Employment or Termination
of Consultancy, as the case may be. Notwithstanding the foregoing, the Committee
may otherwise define Termination of Directorship in the Award Agreement, or if
no rights of a Participant are reduced, may otherwise define Termination of
Directorship thereafter.
     2.43 “Termination of Employment” means: (a) a termination of employment
(for reasons other than a military or personal leave of absence granted by the
Company) of a Participant from the Company and its Subsidiary; or (b) when an
entity which is employing a Participant ceases to be a Subsidiary, unless the
Participant otherwise is, or thereupon becomes, employed by the Company or
another Subsidiary at the time the entity ceases to be a Subsidiary. In the
event that an Eligible Employee becomes a Consultant or a Non-Employee Director
upon the termination of his or her employment, unless otherwise determined by
the Committee, in its sole discretion, no Termination of Employment shall be
deemed to occur until such time as such Eligible Employee is no longer an
Eligible Employee, a Consultant or a Non-Employee Director. Notwithstanding the
foregoing, the Committee may otherwise define Termination of Employment in the
Award Agreement or, if no rights of a Participant are reduced, may otherwise
define Termination of Employment thereafter.
     2.44 “Transfer” means: (a) when used as a noun, any direct or indirect
transfer, sale, assignment, pledge, hypothecation, encumbrance or other
disposition (including the issuance of equity in any entity), whether for value
or no value and whether voluntary or involuntary (including by operation of
law), and (b) when used as a verb, to directly or indirectly transfer, sell,
assign, pledge, encumber, charge, hypothecate or otherwise dispose of (including
the issuance of equity in any entity) whether for value or for no value and
whether voluntarily or involuntarily (including by operation of law).
“Transferred” and “Transferable” shall have a correlative meaning.
ARTICLE III
ADMINISTRATION
     3.1 The Committee. The Plan shall be administered and interpreted by the
Committee. To the extent required by applicable law, rule or regulation, it is
intended that each member of the Committee shall qualify as (a) a “non-employee
director” under Rule 16b-3, (b) an “outside director” under Code Section 162(m)
and (c) an “independent director” under the rules of any national securities
exchange or national securities association, as applicable. If it is later
determined that one or more members of the Committee do not so qualify, actions
taken by the Committee prior to such determination shall be valid despite such
failure to qualify. In the event that any member of the Committee does not
qualify as a “non-employee director” for purposes of Section 16 of the Exchange
Act, then all compensation that is intended to be exempt from Section 16 will
also be approved by the Board or a subcommittee made up of members of the Board
who qualify as non-employee directors. In the event that any member of the
Committee does not qualify as an “outside director” for purposes of Section
162(m) of the Code, then all compensation that is intended to be exempt from
Section 162(m) of the Code will also be approved by a subcommittee made up of
members of the Board who qualify as outside directors.

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     3.2 Grants of Awards. The Committee shall have full authority to grant,
pursuant to the terms of this Plan Stock Options to Eligible Individuals. In
particular, the Committee shall have the authority:
          (a) to select the Eligible Individuals to whom Awards may from time to
time be granted hereunder;
          (b) to determine whether and to what extent Awards are to be granted
hereunder to one or more Eligible Individuals;
          (c) to determine the number of shares of Common Stock to be covered by
each Award granted hereunder;
          (d) to determine the terms and conditions, not inconsistent with the
terms of the Plan, of any Award granted hereunder (including, but not limited
to, the exercise or purchase price (if any), any restriction or limitation, any
vesting schedule or acceleration thereof, or any forfeiture restrictions or
waiver thereof, regarding any Award and the shares of Common Stock relating
thereto, based on such factors, if any, as the Committee shall determine, in its
sole discretion);
          (e) to determine whether, to what extent and under what circumstances
grants of Awards under the Plan are to operate on a tandem basis and/or in
conjunction with or apart from other awards made by the Company outside of this
Plan;
          (f) to determine whether and under what circumstances a Stock Option
may be settled in cash and/or Common Stock under Section 6.3(d);
          (g) to determine whether to require a Participant, as a condition of
the granting of any Award, to not sell or otherwise dispose of shares acquired
pursuant to the exercise of an Award for a period of time as determined by the
Committee, in its sole discretion, following the date of the acquisition of such
Award;
          (h) to modify, extend or renew an Award, subject to Article VIII and
Section 6.3(k); and
          (i) solely to the extent permitted by applicable law, to determine
whether, to what extent and under what circumstances to provide loans (which may
be on a recourse basis and shall bear interest at the rate the Committee shall
provide) to Participants in order to exercise Options under the Plan.
     3.3 Guidelines. Subject to Article VIII hereof, the Committee shall have
the authority to adopt, alter and repeal such administrative rules, guidelines
and practices governing the Plan and perform all acts, including the delegation
of its responsibilities (to the extent permitted by applicable law and
applicable stock exchange rules), as it shall, from time to time, deem
advisable; to construe and interpret the terms and provisions of the Plan and
any Award issued under the Plan (and any agreements relating thereto); and to
otherwise supervise the administration of the Plan. The Committee may correct
any defect, supply any omission or reconcile any inconsistency in the Plan or in
any agreement relating thereto in the manner and to

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the extent it shall deem necessary to effectuate the purpose and intent of the
Plan. The Committee may adopt special guidelines and provisions for persons who
are residing in or employed in, or subject to the taxes of, any domestic or
foreign jurisdictions to comply with applicable tax and securities laws of such
domestic or foreign jurisdictions. Notwithstanding the foregoing, no action of
the Committee under this Section shall impair the rights of any Participant
under an Award Agreement or Award without the Participant’s consent. To the
extent applicable, this Plan is intended to comply with the applicable
requirements of Rule 16b-3, and the Plan shall be limited, construed and
interpreted in a manner so as to comply therewith.
     3.4 Decisions Final. Any decision, interpretation or other action made or
taken in good faith by or at the direction of the Company, the Board or the
Committee (or any of its members) arising out of or in connection with the Plan
shall be within the absolute discretion of all and each of them, as the case may
be, and shall be final, binding and conclusive on the Company and all employees
and Participants and their respective heirs, executors, administrators,
successors and assigns.
     3.5 Procedures. The Committee shall hold meetings, subject to the By-Laws
of the Company, at such times and places as it shall deem advisable, including,
without limitation, by telephone conference or by written consent to the extent
permitted by applicable law. A majority of the Committee members shall
constitute a quorum. All determinations of the Committee shall be made by a
majority of its members. Any decision or determination reduced to writing and
signed by all of the Committee members in accordance with the By-Laws of the
Company, shall be fully effective as if it had been made by a vote at a meeting
duly called and held. The Committee shall keep minutes of its meetings and shall
make such rules and regulations for the conduct of its business as it shall deem
advisable.
     3.6 Designation of Consultants/Liability.
          (a) The Committee may designate employees of the Company and
professional advisors to assist the Committee in the administration of the Plan
and (to the extent permitted by applicable law and applicable exchange rules)
may grant authority to officers to grant Awards and/or execute agreements or
other documents on behalf of the Committee.
          (b) The Committee may employ such legal counsel, consultants and
agents as it may deem desirable for the administration of the Plan and may rely
upon any opinion received from any such counsel or consultant and any
computation received from any such consultant or agent. Expenses incurred by the
Committee or the Board in the engagement of any such counsel, consultant or
agent shall be paid by the Company. The Committee, its members and any person
designated pursuant to sub-section (a) above shall not be liable for any action
or determination made in good faith with respect to the Plan. To the maximum
extent permitted by applicable law, no officer of the Company or member or
former member of the Committee or of the Board shall be liable for any action or
determination made in good faith with respect to the Plan or any Award granted
under it.

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ARTICLE IV
SHARE LIMITATION
     4.1 Shares. (a) Subject to any increase or decrease pursuant to
Section 4.2, the aggregate number of shares of Common Stock that may be issued
or used for reference purposes or with respect to which Awards may be granted
under the Plan shall not exceed twenty-five million (25,000,000) shares. Such
shares may be either authorized and unissued Common Stock or Common Stock held
in or acquired for the treasury of the Company or both. If any Option granted
under the Plan expires, terminates or is canceled for any reason without having
been exercised in full, the number of shares of Common Stock underlying any
unexercised Award shall again be available for the purpose of Awards under the
Plan. In addition, any shares of Common Stock exchanged by a Participant or
withheld from a Participant as full or partial payment to the Company of the
exercise price or tax withholding upon exercise or payment of an Award under the
Plan shall be added back to the foregoing maximum share limitation and may be
made subject to Awards under the Plan pursuant to such limitation. Any Award
under the Plan settled in cash shall not be counted against the foregoing
maximum share limitations.
     4.2 Changes.
          (a) The existence of the Plan and the Awards granted hereunder shall
not affect in any way the right or power of the Board or the stockholders of the
Company to make or authorize (i) any adjustment, recapitalization,
reorganization or other change in the Company’s capital structure or its
business, (ii) any merger or consolidation of the Company or any Affiliate,
(iii) any issuance of bonds, debentures, preferred or prior preference stock
ahead of or affecting the Common Stock, (iv) the dissolution or liquidation of
the Company or any Affiliate, (v) any sale or transfer of all or part of the
assets or business of the Company or any Affiliate or (vi) any other corporate
act or proceeding.
          (b) Subject to the provisions of Section 4.2(d), in the event of a
dividend or other distribution (whether in the form of cash, Common Stock, other
securities, or other property) other than regular cash dividends,
recapitalization, stock split, reverse stock split, reorganization, merger,
consolidation, split-up, spin-off, combination, Change in Control or exchange of
Common Stock or other securities of the Company, or other corporate transaction
or event affects the Common Stock such that an adjustment is necessary or
appropriate in order to prevent dilution or enlargement of benefits or potential
benefits intended to be made available under the Plan (a “Section 4.2 Event”),
the Committee shall equitably adjust (i) the number of shares of Common Stock or
other securities of the Company (or number and kind of other securities or
property) with respect to which Awards may be granted under the Plan, (ii) the
maximum share limitation applicable to each type of Award that may be granted to
any individual participant in any calendar year, (iii) the number of shares of
Common Stock or other securities of the Company (or number and kind of other
securities or property) subject to outstanding Awards, and (iv) the exercise
price with respect to any Stock Option. Any such adjustment determined by the
Committee shall be final, binding and conclusive on the Company and all
Participants and their respective heirs, executors, administrators, successors
and permitted assigns. If the Company enters into or is involved in any merger,
recapitalization, consolidation, reorganization, Change in Control or other
business combination with any person or entity (a “Merger Event”), the Committee
may, prior to such Merger Event and effective upon such Merger Event, take such
action as it deems appropriate, including, but not limited to, replacing Awards
with substitute Awards in respect of the shares, other securities or other
property of the surviving corporation or any affiliate of the surviving
corporation on such terms and conditions, as to the number of shares, pricing
and

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otherwise, which shall substantially preserve the value, rights and benefits of
any affected Awards granted hereunder as of the date of the consummation of the
Merger Event. Upon receipt by any affected Participant of any such substitute
Award (or payment) as a result of any such Merger Event, such Participant’s
affected Awards for which such substitute Awards (or payment) were received
shall be thereupon cancelled without the need for obtaining the consent of any
such affected Participant. In addition, subject to Section 4.2(d), if there
shall occur any change in the capital structure or the business of the Company
that is not a Section 4.2 Event or Merger Event (an “Other Extraordinary
Event”), then the Committee, in its sole discretion, may adjust any Award and
make such other adjustments to the Plan. Except as expressly provided in this
Section 4.2 or in the applicable Award Agreement, a Participant shall have no
rights by reason of any Section 4.2 Event, Merger Event, or any Other
Extraordinary Event.
          (c) Fractional shares of Common Stock resulting from any adjustment in
Awards pursuant to Section 4.2(a) or 4.2(b) shall be aggregated until, and
eliminated at, the time of exercise by rounding-down for fractions less than
one-half and rounding-up for fractions equal to or greater than one-half. No
cash settlements shall be made with respect to fractional shares eliminated by
rounding. Notice of any adjustment shall be given by the Committee to each
Participant whose Award has been adjusted and such adjustment (whether or not
such notice is given) shall be effective and binding for all purposes of the
Plan.
          (d) Unless otherwise expressly determined by the Committee in the
applicable Award Agreement or other written agreement approved by the Committee,
in the event of a Merger Event in which the Company is not the surviving entity
or in the event of any transaction that results in the acquisition of
substantially all of the Company’s outstanding Common Stock by a single person
or entity or by a group of persons and/or entities acting in concert, or in the
event of the sale or transfer of all or substantially all of the Company’s
assets (all of the foregoing being referred to as an “Acquisition Event”), then:
               (i) The Committee may, in its sole discretion, terminate all
outstanding and unexercised Stock Options (whether or not vested), effective as
of the date of the Acquisition Event, by delivering notice of termination to
each Participant at least seven days prior to the date of consummation of the
Acquisition Event, in which case during the period from the date on which such
notice of termination is delivered to the consummation of the Acquisition Event,
each such Participant shall have the right to exercise in full all of his or her
Awards that are then outstanding and vested, but any such exercise may be
indicated as contingent on the occurrence of the Acquisition Event, and,
provided that, if the Acquisition Event does not take place within a specified
period after giving such notice for any reason whatsoever, any such notice and
contingent exercise pursuant thereto shall be null and void. If an Acquisition
Event occurs but the Committee does not terminate the outstanding Awards
pursuant to this Section 4.2(d), then the provisions of Section 4.2(b) and
Article VII shall apply.
               (ii) Each Participant shall vote for, consent to and raise no
objections against such Acquisition Event. If the Acquisition Event is
structured as (i) a Merger Event, each Participant shall waive any dissenter’s
rights, appraisal rights or similar rights in connection with such merger or
consolidation or (ii) a sale of capital stock, each Participant shall agree to
sell all of his or her Awards and rights to acquire Awards on the

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terms and conditions approved by the Board and/or the Committee. Each
Participant shall take all necessary or desirable actions in connection with the
consummation of the Acquisition Event or any public offering of the Common Stock
as requested by the Company and/or the Committee.
               (iii) If the Company or the holders of the Company’s securities
enter into any negotiation or transaction for which Rule 506 (or any similar
rule then in effect) promulgated by the Securities and Exchange Commission may
be available with respect to such negotiation or transaction (including a
merger, consolidation or other reorganization), each Participant shall, at the
request of the Company, appoint a purchaser representative (as such term is
defined in Rule 501 promulgated by the Securities and Exchange Commission)
reasonably acceptable to the Company. If any Participant appoints a purchaser
representative designated by the Company, the Company shall pay the fees of such
purchaser representative, but if any Participant declines to appoint the
purchaser representative designated by the Company, such Participant shall
appoint another purchaser representative, and such Participant shall be
responsible for the fees of the purchaser representative so appointed.
     4.3 Minimum Purchase Price. Notwithstanding any provision of the Plan to
the contrary, if authorized but previously unissued shares of Common Stock are
issued under the Plan, such shares shall not be issued for a consideration that
is less than as permitted under applicable law.
ARTICLE V
ELIGIBILITY
     5.1 General Eligibility. All current and prospective Eligible Individuals
are eligible to be granted Awards. Eligibility for the grant of Awards and
actual participation in the Plan shall be determined by the Committee in its
sole discretion.
     5.2 General Requirement. The vesting and exercise of Awards granted to a
prospective Eligible Individual are conditioned upon such individual actually
becoming an Eligible Employee, Consultant or Non-Employee Director,
respectively.
ARTICLE VI
STOCK OPTIONS
     6.1 Options. Stock Options may be granted alone or in addition to other
Awards (if any) granted under the Plan. Each Stock Option granted under the Plan
shall be a Non-Qualified Stock Option.
     6.2 Grants. The Committee shall have the authority to grant to any Eligible
Employee one or more Non-Qualified Stock Options. The Committee shall have the
authority to grant any Consultant or Non-Employee Director one or more
Non-Qualified Stock Options.
     6.3 Terms of Options. Options granted under the Plan shall be subject to
the following terms and conditions and shall be in such form and contain such
additional terms and conditions, not inconsistent with the terms of the Plan, as
the Committee shall deem desirable:

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          (a) Exercise Price. The exercise price per share of Common Stock
subject to a Stock Option shall be determined by the Committee at the time of
grant.
          (b) Stock Option Term. The term of each Stock Option shall be fixed by
the Committee; provided, however, that no Stock Option shall be exercisable
after August 26, 2021.
          (c) Exercisability. Unless otherwise provided by the Committee in
accordance with the provisions of this Section 6.3, Stock Options granted under
the Plan shall be exercisable at such time or times and subject to such terms
and conditions as shall be determined by the Committee at the time of grant. If
the Committee provides, in its discretion, that any Stock Option is exercisable
subject to certain limitations (including, without limitation, that such Stock
Option is exercisable only in installments or within certain time periods), the
Committee may waive such limitations on the exercisability at any time at or
after the time of grant in whole or in part (including, without limitation,
waiver of the installment exercise provisions or acceleration of the time at
which such Stock Option may be exercised), based on such factors, if any, as the
Committee shall determine, in its sole discretion. Unless otherwise determined
by the Committee at the time of grant, the Option agreement shall provide that
(i) in the event that the Participant engages in Detrimental Activity prior to
any exercise of the Stock Option (whether vested or unvested), all Stock Options
held by the Participant shall thereupon terminate and expire, (ii) as a
condition of the exercise of a Stock Option, the Participant shall be required
to certify (or shall be deemed to have certified) at the time of exercise in a
manner acceptable to the Company that the Participant is in compliance with the
terms and conditions of the Plan and that the Participant has not engaged in,
and does not intend to engage in, any Detrimental Activity, and (iii) in the
event that the Participant engages in Detrimental Activity during the one-year
period commencing on the date that the Stock Option is exercised or becomes
vested, the Company shall be entitled to recover from the Participant at any
time within one year after such exercise or vesting, and the Participant shall
pay over to the Company, an amount equal to any gain realized as a result of the
exercise (whether at the time of exercise or thereafter).
          (d) Method of Exercise. Subject to whatever installment exercise and
waiting period provisions apply under Section 6.3(c), to the extent vested,
Stock Options may be exercised in whole or in part at any time during the Option
term, by giving written notice of exercise to the Company specifying the number
of shares of Common Stock to be purchased. Such notice shall be accompanied by
payment in full of the purchase price as follows: (i) in cash or by check, bank
draft or money order payable to the order of the Company; (ii) solely to the
extent permitted by applicable law, if the Common Stock is traded on a national
securities exchange, and the Committee authorizes, through a procedure whereby
the Participant delivers irrevocable instructions to a broker reasonably
acceptable to the Committee to deliver promptly to the Company an amount equal
to the purchase price; or (iii) on such other terms and conditions as may be
acceptable to the Committee (including, without limitation, having the Company
withhold shares of Common Stock issuable upon exercise of the Stock Options or
by payment in full or in part in the form of Common Stock owned by the
Participant based on the Fair Market Value of the Common Stock on the payment
date as determined by the Committee). No shares of Common Stock shall be issued
until payment therefore, as provided herein, has been made or provided for.
          (e) Non-Transferability of Options. No Stock Option shall be
Transferable by the Participant other than by will or by the laws of descent and
distribution, and all Stock Options

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shall be exercisable, during the Participant’s lifetime, only by the
Participant. Notwithstanding the foregoing, the Committee may determine, in its
sole discretion, at the time of grant or thereafter that a Non-Qualified Stock
Option that is otherwise not Transferable pursuant to this Section is
Transferable to a Family Member in whole or in part and in such circumstances,
and under such conditions, as specified by the Committee. A Non-Qualified Stock
Option that is Transferred to a Family Member pursuant to the preceding sentence
(i) may not be subsequently Transferred otherwise than by will or by the laws of
descent and distribution and (ii) remains subject to the terms of this Plan and
the applicable Award Agreement. Any shares of Common Stock acquired upon the
exercise of a Non-Qualified Stock Option by a permissible transferee of a
Non-Qualified Stock Option or a permissible transferee pursuant to a Transfer
after the exercise of the Non-Qualified Stock Option shall be subject to the
terms of this Plan and the applicable Award Agreement.
          (f) Termination by Death or Disability. Unless otherwise determined by
the Committee at the time of grant, or if no rights of the Participant are
reduced, thereafter, if a Participant’s Termination is by reason of death or
Disability, all Stock Options that are held by such Participant that are vested
and exercisable at the time of the Participant’s Termination may be exercised by
the Participant at any time within a period of six (6)-month from the date of
such Termination (or in the case of death, by the legal representative of the
Participant’s estate), but in no event beyond the expiration of the stated term
of such Stock Options; provided, however, that, in the case of a Termination due
to Disability, if the Participant dies within such exercise period, all
unexercised Stock Options held by such Participant shall thereafter be
exercisable, to the extent to which they were exercisable at the time of death,
for a period of one year from the date of such death, but in no event beyond the
expiration of the stated term of such Stock Options.
          (g) Involuntary Termination Without Cause. Unless otherwise determined
by the Committee at the time of grant, or if no rights of the Participant are
reduced, thereafter, if a Participant’s Termination is by involuntary
termination without Cause, all Stock Options that are held by such Participant
that are vested and exercisable at the time of the Participant’s Termination may
be exercised by the Participant at any time within a period of 30 days from the
date of such Termination, but in no event beyond the expiration of the stated
term of such Stock Options.
          (h) Voluntary Termination. Unless otherwise determined by the
Committee at the time of grant, or if no rights of the Participant are reduced,
thereafter, if a Participant’s Termination is voluntary (other than a voluntary
termination described in Section 6.3(i)(y) hereof), all Stock Options that are
held by such Participant that are vested and exercisable at the time of the
Participant’s Termination may be exercised by the Participant at any time within
a period of seven days from the date of such Termination, but in no event beyond
the expiration of the stated term of such Stock Options.
          (i) Termination for Cause. Unless otherwise determined by the
Committee at the time of grant, or if no rights of the Participant are reduced,
thereafter, if a Participant’s Termination (x) is for Cause or (y) is a
voluntary Termination (as provided in Section 6.3(h)) after the occurrence of an
event that would be grounds for a Termination for Cause, all Stock Options,
whether vested or not vested, that are held by such Participant shall thereupon
terminate and expire as of the date of such Termination.

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          (j) Unvested Stock Options. Unless otherwise determined by the
Committee at the time of grant, or if no rights of the Participant are reduced,
thereafter, Stock Options that are not vested as of the date of a Participant’s
Termination for any reason shall terminate and expire as of the date of such
Termination.
          (k) Form, Modification, Extension and Renewal of Stock Options.
Subject to the terms and conditions and within the limitations of the Plan,
Stock Options shall be evidenced by such form of agreement or grant as is
approved by the Committee, and the Committee may (i) modify, extend or renew
outstanding Stock Options granted under the Plan (provided that the rights of a
Participant are not reduced without his or her consent), and (ii) accept the
surrender of outstanding Stock Options (up to the extent not theretofore
exercised) and authorize the granting of new Stock Options in substitution
therefor (to the extent not theretofore exercised). Notwithstanding anything
herein to the contrary, unless otherwise provided in the Award Agreement, the
Committee may, at its sole and absolute discretion, (i) lower the strike price
of a Stock Option after it is granted, or take any other action with the effect
of lowering the strike price of a Stock Option after it is granted, or
(ii) permit the cancellation of a Stock Option in exchange for another Award.
          (l) Deferred Delivery of Common Stock. The Committee may in its
discretion permit Participants to defer delivery of Common Stock acquired
pursuant to a Participant’s exercise of an Option in accordance with the terms
and conditions established by the Committee in the applicable Award Agreement.
          (m) Early Exercise. The Committee may elect to provide that a Stock
Option include a written provision whereby the Participant may elect at any time
before the Participant’s Termination to exercise the Stock Option as to any part
or all of the shares of Common Stock subject to the Stock Option prior to the
full vesting of the Stock Option. Unvested shares of Common Stock so purchased
may be subject to a repurchase option in favor of the Company or to any other
restriction the Committee determines to be appropriate.
          (n) Cashing-Out of Stock Options. Unless otherwise provided in the
Award Agreement, on receipt of written notice of exercise, the Committee may
elect to cash-out all or part of the portion of the shares for which an Option
is being exercised by paying the optionee an amount, in cash or shares of Common
Stock, equal to the excess of the Fair Market Value of the shares of Common
Stock over the exercise price multiplied by the number of shares of Common Stock
for which the Option is being exercised on the effective date of such cash-out.
          (o) Other Terms and Conditions. Stock Options may contain such other
provisions, which shall not be inconsistent with any of the terms of the Plan,
as the Committee shall deem appropriate including, without limitation,
permitting “reloads” such that the same number of Stock Options are granted as
the number of Stock Options exercised, shares used to pay for the exercise price
of Stock Options or shares used to pay withholding taxes (“Reloads”). With
respect to Reloads, the exercise price of the new Stock Option shall be the Fair
Market Value on the date of the “reload” and the term of the Stock Option shall
be the same as the remaining term of the Stock Options that are exercised, if
applicable, or such other exercise price and term as determined by the
Committee.

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ARTICLE VII
CHANGE IN CONTROL PROVISIONS
     7.1 Benefits. In the event of a Change in Control of the Company (as
defined below), and except as otherwise provided by the Committee in an Award
Agreement, a Participant’s unvested Award shall not vest and a Participant’s
Award shall be treated in accordance with one of the following methods as
determined by the Committee:
          (a) Awards, whether or not then vested, shall be continued, assumed,
have new rights substituted therefor or be treated in accordance with
Section 4.2(d) hereof, as determined by the Committee, and restrictions to which
any Award granted prior to the Change in Control are subject shall not lapse
upon a Change in Control and the Award shall, where appropriate in the sole
discretion of the Committee, receive the same distribution as other Common Stock
of the same class or series on such terms as determined by the Committee;
provided, however, that the Committee may decide to award additional Awards in
lieu of any cash distribution.
          (b) The Committee, in its sole discretion, may provide for the
purchase of any Awards by the Company or an Affiliate for an amount of cash
equal to the excess (if any) of the Change in Control Price (as defined below)
of the shares of Common Stock covered by such Awards, over the aggregate
exercise price of such Awards. For purposes of this Section 7.1, “Change in
Control Price” shall mean the highest price per share of Common Stock paid in
any transaction related to a Change in Control of the Company.
          (c) Notwithstanding any other provision herein to the contrary, the
Committee may, in its sole discretion, provide for accelerated vesting or lapse
of restrictions, of an Award at any time.
     7.2 Change in Control. Unless otherwise determined by the Committee in the
applicable Award Agreement or other written agreement approved by the Committee,
a “Change in Control” shall be deemed to occur if:
          (a) any “person,” as such term is used in Sections 13(d) and 14(d) of
the Exchange Act (other than the Company, any trustee or other fiduciary holding
securities under any employee benefit plan of the Company, or any company owned,
directly or indirectly, by the stockholders of the Company in substantially the
same proportions as their ownership of Common Stock of the Company), becoming
the beneficial owner (as defined in Rule 13d-3 under the Exchange Act), directly
or indirectly, of securities of the Company representing 50% or more of the
combined voting power of the Company’s then outstanding securities;
          (b) during any period of two consecutive years, individuals who at the
beginning of such period constitute the Board, and any new director (other than
a director designated by a person who has entered into an agreement with the
Company to effect a transaction described in paragraph (a), (c), or (d) of this
Section 7.2 or a director whose initial assumption of office occurs as a result
of either an actual or threatened election contest (as such term is used in
Rule 14a-11 of Regulation 14A promulgated under the Exchange Act) or other
actual or threatened solicitation of proxies or consents by or on behalf of a
person other than the

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Board) whose election by the Board or nomination for election by the Company’s
stockholders was approved by a vote of at least two-thirds of the directors then
still in office who either were directors at the beginning of the two-year
period or whose election or nomination for election was previously so approved,
cease for any reason to constitute at least a majority of the Board;
          (c) a merger or consolidation of the Company with any other
corporation, other than a merger or consolidation which would result in the
voting securities of the Company outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity) more than 50% of the combined
voting power of the voting securities of the Company or such surviving entity
outstanding immediately after such merger or consolidation; provided, however,
that a merger or consolidation effected to implement a recapitalization of the
Company (or similar transaction) in which no person (other than those covered by
the exceptions in Section 7.2(a)) acquires more than 50% of the combined voting
power of the Company’s then outstanding securities shall not constitute a Change
in Control of the Company; or
          (d) a complete liquidation or dissolution of the Company or the
consummation of a sale or disposition by the Company of all or substantially all
of the Company’s assets other than the sale or disposition of all or
substantially all of the assets of the Company to a person or persons who
beneficially own, directly or indirectly, 50% or more of the combined voting
power of the outstanding voting securities of the Company at the time of the
sale.
     7.3 Initial Public Offering not a Change in Control. Notwithstanding the
foregoing, for purposes of the Plan, the occurrence of the Registration Date or
any change in the composition of the Board within one year following the
Registration Date shall not be considered a Change in Control.
ARTICLE VIII
TERMINATION OR AMENDMENT OF PLAN
     8.1 Termination or Amendment. Notwithstanding any other provision of the
Plan, the Board may at any time, and from time to time, amend, in whole or in
part, any or all of the provisions of the Plan (including any amendment deemed
necessary to ensure that the Company may comply with any regulatory requirement
referred to in Article XI), or suspend or terminate it entirely, retroactively
or otherwise; provided, however, that, unless otherwise required by law or
specifically provided herein, the rights of a Participant with respect to Awards
granted prior to such amendment, suspension or termination, may not be impaired
without the consent of such Participant and; provided, further, that without the
approval of the holders of the Company’s Common Stock entitled to vote in
accordance with applicable law, no amendment may be made that would (i) increase
the aggregate number of shares of Common Stock that may be issued under the Plan
(except by operation of Section 4.2); (ii) change the classification of
individuals eligible to receive Awards under the Plan; or (iii) extend the
maximum option period under Section 6.3. Notwithstanding anything herein to the
contrary, the Board may amend the Plan or any Award Agreement at any time
without a Participant’s consent to comply with applicable law.
     The Committee may amend the terms of any Award theretofore granted,
prospectively or retroactively, but, subject to Article IV or as otherwise
specifically provided herein, no such

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amendment or other action by the Committee shall impair the rights of any holder
without the holder’s consent.
ARTICLE IX
COMPANY CALL RIGHTS; RIGHTS OF FIRST REFUSAL
     9.1 Company Call Rights.
          (a) In the event of a Participant’s Termination for Cause, a
Participant’s voluntary Termination after the occurrence of an event that would
be grounds for a Termination for Cause, or the discovery that a Participant
engaged in Detrimental Activity, the Company may, at any time following (i) the
later of the date of Termination and the date that is more than one hundred
eighty (180) days following the date on which such Participant acquired the
applicable shares of Common Stock or (ii) such discovery that the Participant
engaged in Detrimental Activity, repurchase from the Participant such previously
acquired shares of Common Stock at a repurchase price equal to the lesser of
(i) the original purchase price or exercise price (as applicable), if any, and
(ii) Fair Market Value as of the date of repurchase.
          (b) In the event of a Participant’s Termination for any reason other
than as described in Section 9.1(a) above, the Company may, at any time
following the later of (i) the date of Termination and (ii) the date that is
more than one hundred eighty (180) days following the date on which such
Participant acquired the applicable shares of Common Stock through the exercise,
grant or payment of an Award under the Plan, repurchase from the Participant any
shares of Common Stock at a repurchase price equal to Fair Market Value as of
the date of repurchase.
          (c) If the Company elects to exercise the rights under this
Section 9.1, the Company shall do so by delivering to the Participant a notice
of such election, specifying the number of shares to be purchased and the
closing date and time of such purchase. Such closing shall take place within
thirty (30) days following such notice at the Company’s principal executive
offices. At such closing, the Company shall pay the Participant the repurchase
price as specified in this Section 9.1 in cash or by cancellation of
indebtedness of the Participant. The Company will be entitled to receive (and
the Participant shall, and hereby does, deliver) customary representations and
warranties from the Participant regarding the Common Stock being repurchased
including, but not limited to, the representation that the Participant has good
and marketable title to the Common Stock to be repurchased free and clear of all
liens, claims and other encumbrances.
          (d) All repurchases shall be subject to applicable restrictions
contained in the Delaware General Corporation Law and in the Company’s and its
Subsidiaries’ debt financing agreements. If any such restrictions prohibit the
repurchase of Common Stock for cash, the Company shall have the right to
deliver, as payment of the repurchase price, a subordinated note or notes
payable in up to five equal annual installments beginning on the first
anniversary of the repurchase closing and bearing interest at a rate per annum
equal to the greater of the prime rate then in effect and 5% (provided that such
notes shall accelerate and be payable in full once the Company is permitted to
repurchase the Common Stock or repay such notes under the debt financing
agreements or, if earlier, upon a Change in Control). Any such notes issued by
the

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Company shall be subject to any restrictive covenants in debt financing
agreements to which the Company is subject at the time of the repurchase
closing. If any such restrictions prohibit the repurchase of Common Stock for
such subordinated notes, then the time periods provided herein for repurchases
shall be suspended, and the Company may make such repurchases as soon as it is
permitted to do so under such restrictions.
     9.2 Right of First Refusal. No Participant shall, directly or indirectly,
Transfer any shares of Common Stock acquired by the Participant (or the
Participant’s estate or legal representative) pursuant to an Award under the
Plan, unless in each such instance the Participant (or the Participant’s estate
or legal representative) shall have first offered the Common Stock proposed to
be Transferred pursuant to a bona fide offer by a third party to the Company.
The right of first refusal must be exercised by the Company by delivering to the
Participant (or the Participant’s estate or legal representative) written notice
of such exercise within twenty (20) business days of the Company’s receipt of
written notification of the proposed sale. Upon the exercise of a right of first
refusal, the Common Stock proposed to be sold shall be purchased by the Company
at the price per share offered to be paid by the prospective transferee, subject
to Section 9.1 hereof in the case of a Participant’s Termination. The notice of
exercise of the right of first refusal shall specify the date and location for
the closing of such purchase.
ARTICLE X
UNFUNDED STATUS OF PLAN
     The Plan is intended to constitute an “unfunded” plan for incentive and
deferred compensation. With respect to any payment as to which a Participant has
a fixed and vested interest but which are not yet made to a Participant by the
Company, nothing contained herein shall give any such Participant any right that
is greater than those of a general unsecured creditor of the Company.
ARTICLE XI
GENERAL PROVISIONS
     11.1 Legend. The Committee may require each person receiving shares of
Common Stock pursuant to a Stock Option or other Award under the Plan to
represent to and agree with the Company in writing that the Participant is
acquiring the shares without a view to distribution thereof. In addition to any
legend required by the Plan, the certificates for such shares may include any
legend that the Committee deems appropriate to reflect any restrictions on
Transfer. All certificates for shares of Common Stock delivered under the Plan
shall be subject to such stop transfer orders and other restrictions as the
Committee may deem advisable under the rules, regulations and other requirements
of the Securities and Exchange Commission, any stock exchange upon which the
Common Stock is then listed or any national securities exchange system upon
whose system the Common Stock is then quoted, any applicable federal or state
securities law, and any applicable corporate law, and the Committee may cause a
legend or legends to be put on any such certificates to make appropriate
reference to such restrictions.
     11.2 Other Plans. Nothing contained in the Plan shall prevent the Board
from adopting other or additional compensation arrangements, subject to
stockholder approval if such approval is

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required, and such arrangements may be either generally applicable or applicable
only in specific cases.
     11.3 No Right to Employment/Directorship/Consultancy. Neither the Plan nor
the grant of any Option or other Award hereunder shall give any Participant or
other employee, Consultant or Non-Employee Director any right with respect to
continuance of employment, consultancy or directorship by the Company or any
Affiliate, nor shall there be a limitation in any way on the right of the
Company or any Affiliate by which an employee is employed or a Consultant or
Non-Employee Director is retained to terminate his or her employment,
consultancy or directorship at any time.
     11.4 Withholding of Taxes. The Company shall have the right to deduct from
any payment to be made pursuant to the Plan, or to otherwise require, prior to
the issuance or delivery of shares of Common Stock or the payment of any cash
hereunder, payment by the Participant of, any federal, state or local taxes
required by law to be withheld. Upon the vesting of Awards that are taxable upon
vesting, or upon making an election under Section 83(b) of the Code, a
Participant shall pay all required withholding to the Company. Any statutorily
required withholding obligation with regard to any Participant may be satisfied,
subject to the consent of the Committee, by reducing the number of shares of
Common Stock otherwise deliverable or by delivering shares of Common Stock
already owned. Any fraction of a share of Common Stock required to satisfy such
tax obligations shall be disregarded and the amount due shall be paid instead in
cash by the Participant.
     11.5 No Assignment of Benefits. No Award or other benefit payable under the
Plan shall, except as otherwise specifically provided by law or permitted by the
Committee, be Transferable in any manner, and any attempt to Transfer any such
benefit shall be void, and any such benefit shall not in any manner be liable
for or subject to the debts, contracts, liabilities, engagements or torts of any
person who shall be entitled to such benefit, nor shall it be subject to
attachment or legal process for or against such person.
     11.6 Listing and Other Conditions.
          (a) Unless otherwise determined by the Committee, if and as long as
the Common Stock is listed on a national securities exchange or system sponsored
by a national securities association, the issuance of shares of Common Stock
pursuant to an Award shall be conditioned upon such shares being listed on such
exchange or system.
          (b) If at any time counsel to the Company shall be of the opinion that
any sale or delivery of shares of Common Stock pursuant to an Option or other
Award is or may in the circumstances be unlawful or result in the imposition of
excise taxes on the Company under the statutes, rules or regulations of any
applicable jurisdiction, the Company shall have no obligation to make such sale
or delivery, or to make any application or to effect or to maintain any
qualification or registration under the Securities Act or otherwise, with
respect to shares of Common Stock or Awards, and the right to exercise any
Option or other Award shall be suspended until, in the opinion of said counsel,
such sale or delivery shall be lawful or will not result in the imposition of
excise taxes on the Company.

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          (c) Upon termination of any period of suspension under this
Section 11.6, any Award affected by such suspension which shall not then have
expired or terminated shall be reinstated as to all shares available before such
suspension and as to shares which would otherwise have become available during
the period of such suspension, but no such suspension shall extend the term of
any Award.
          (d) A Participant shall be required to supply the Company with
certificates, representations and information that the Company requests and
otherwise cooperate with the Company in obtaining any listing, registration,
qualification, exemption, consent or approval the Company deems necessary or
appropriate.
     11.7 Stockholders Agreement and Other Requirements. Notwithstanding
anything herein to the contrary, as a condition to the receipt of shares of
Common Stock pursuant to an Award under the Plan, to the extent required by the
Committee, the Other Stockholder shall execute and deliver a stockholder’s
agreement or such other documentation that shall set forth certain restrictions
on transferability of the shares of Common Stock acquired upon exercise or
purchase, and such other terms as the Board or Committee shall from time to time
establish. Such stockholder’s agreement or other documentation shall apply to
the Common Stock acquired under the Plan and covered by such stockholder’s
agreement or other documentation. The Company may require, as a condition of
exercise, the Other Stockholder to become a party to any other existing
stockholder agreement (or other agreement).
     11.8 Governing Law. The Plan and actions taken in connection herewith shall
be governed and construed in accordance with the laws of the State of Delaware
(regardless of the law that might otherwise govern under applicable Delaware
principles of conflict of laws).
     11.9 Jurisdiction; Waiver of Jury Trial. Any suit, action or proceeding
with respect to the Plan or any Award Agreement, or any judgment entered by any
court of competent jurisdiction in respect of any thereof, shall be resolved
only in the courts of the State of Delaware or the United States District Court
for the District of Delaware and the appellate courts having jurisdiction of
appeals in such courts. In that context, and without limiting the generality of
the foregoing, the Company and each Participant shall irrevocably and
unconditionally (a) submit in any proceeding relating to the Plan or any Award
Agreement, or for the recognition and enforcement of any judgment in respect
thereof (a “Proceeding”), to the exclusive jurisdiction of the courts of the
State of Delaware, the court of the United States of America for the District of
Delaware, and appellate courts having jurisdiction of appeals from any of the
foregoing, and agree that all claims in respect of any such Proceeding shall be
heard and determined in such Delaware State court or, to the extent permitted by
law, in such federal court, (b) consent that any such Proceeding may and shall
be brought in such courts and waives any objection that the Company and each
Participant may now or thereafter have to the venue or jurisdiction of any such
Proceeding in any such court or that such Proceeding was brought in an
inconvenient court and agree not to plead or claim the same, (c) waive all right
to trial by jury in any Proceeding (whether based on contract, tort or
otherwise) arising out of or relating to the Plan or any Award Agreement, (d)
agree that service of process in any such Proceeding may be effected by mailing
a copy of such process by registered or certified mail (or any substantially
similar form of mail), postage prepaid, to such party, in the case of a
Participant, at the Participant’s address shown in the books and records of the
Company or, in the case of the Company, at the Company’s principal

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offices, attention General Counsel, and (e) agree that nothing in the Plan shall
affect the right to effect service of process in any other manner permitted by
the laws of the State of Delaware.
     11.10 Construction. Wherever any words are used in the Plan in the
masculine gender they shall be construed as though they were also used in the
feminine gender in all cases where they would so apply, and wherever words are
used herein in the singular form they shall be construed as though they were
also used in the plural form in all cases where they would so apply.
     11.11 Other Benefits. No Award granted or paid out under the Plan shall be
deemed compensation for purposes of computing benefits under any retirement plan
of the Company or its Affiliates nor affect any benefit under any other benefit
plan now or subsequently in effect under which the availability or amount of
benefits is related to the level of compensation.
     11.12 Costs. The Company shall bear all expenses of the Company, the Board
and the Committee associated with administering this Plan, including expenses of
issuing Common Stock pursuant to Awards hereunder.
     11.13 No Right to Same Benefits. The provisions of Awards need not be the
same with respect to each Participant, and such Awards to individual
Participants need not be the same in subsequent years.
     11.14 Death/Disability. The Committee may in its discretion require the
transferee of a Participant to supply it with written notice of the
Participant’s death or Disability and to supply it with a copy of the will (in
the case of the Participant’s death) or such other evidence as the Committee
deems necessary to establish the validity of the transfer of an Award. The
Committee may also require that the agreement of the transferee to be bound by
all of the terms and conditions of the Plan.
     11.15 Section 16(b) of the Exchange Act. All elections and transactions
under the Plan by persons subject to Section 16 of the Exchange Act involving
shares of Common Stock are intended to comply with any applicable exemptive
condition under Rule 16b-3. The Committee may establish and adopt written
administrative guidelines, designed to facilitate compliance with Section 16(b)
of the Exchange Act, as it may deem necessary or proper for the administration
and operation of the Plan and the transaction of business thereunder.
     11.16 Section 409A of the Code. Neither the Company nor any of its
Affiliates makes any representations with respect to the application of
Section 409A of the Code to any Option granted under the Plan and, by the
acceptance of an Option, a Participant agrees to accept the potential
application of Section 409A of the Code to such Option and the tax consequences
of the issuance, vesting, ownership, modification, adjustment, exercise and
disposition of such Option.
     11.17 Successor and Assigns. The Plan shall be binding on all successors
and permitted assigns of a Participant, including, without limitation, the
estate of such Participant and the executor, administrator or trustee of such
estate.
     11.18 Severability of Provisions. If any provision of the Plan shall be
held invalid or unenforceable, such invalidity or unenforceability shall not
affect any other provisions hereof, and the Plan shall be construed and enforced
as if such provisions had not been included.

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     11.19 Payments to Minors, Etc. Any benefit payable to or for the benefit of
a minor, an incompetent person or other person incapable of receipt thereof
shall be deemed paid when paid to such person’s guardian or to the party
providing or reasonably appearing to provide for the care of such person, and
such payment shall fully discharge the Committee, the Board, the Company, its
Affiliates and their employees, agents and representatives with respect thereto.
     11.20 Lock-Up Agreements. As a condition to the grant of an Award, if
requested by the Company and the lead underwriter of any public offering of the
Common Stock (the “Lead Underwriter”), a Participant shall irrevocably agree not
to sell, contract to sell, grant any option to purchase, transfer the economic
risk of ownership in, make any short sale of, pledge or otherwise transfer or
dispose of, any interest in any Common Stock or any securities convertible into,
derivative of, or exchangeable or exercisable for, or any other rights to
purchase or acquire Common Stock (except Common Stock included in such public
offering or acquired on the public market after such offering) during such
period of time following the effective date of a registration statement of the
Company filed under the Securities Act that the Lead Underwriter shall specify
(the “Lock-Up Period”). The Participant shall further agree to sign such
documents as may be requested by the Lead Underwriter to effect the foregoing
and agree that the Company may impose stop-transfer instructions with respect to
Common Stock acquired pursuant to an Award until the end of such Lock-Up Period.
     11.21 Headings and Captions. The headings and captions herein are provided
for reference and convenience only, shall not be considered part of the Plan,
and shall not be employed in the construction of the Plan.
ARTICLE XII
EFFECTIVE DATE OF PLAN
     The Plan shall become effective at 12:01 a.m. Eastern Time on August 26,
2011, which shall be the date of its adoption by the Board, subject to the
approval of the Plan by the stockholders of the Company in accordance with the
requirements of the laws of the State of Delaware.
ARTICLE XIII
TERM OF PLAN
     No Award shall be granted pursuant to the Plan on or after the tenth
anniversary of the earlier of the date that the Plan is adopted or the date of
stockholder approval, but Awards granted prior to such tenth anniversary may
extend beyond that date.
ARTICLE XIV
NAME OF PLAN
     This Plan shall be known as the “Conexant Holdings, Inc. 2011 Incentive
Compensation Plan.”

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