Exhibit 10.1
3COM CORPORATION
2003 STOCK PLAN, AS AMENDED

 

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TABLE OF CONTENTS

                      Page  
1.
  Purposes of the Plan     1  
 
           
2.
  Definitions     1  
 
           
 
  (a) “Administrator”     1  
 
  (b) “Applicable Laws”     1  
 
  (c) “Award”     1  
 
  (d) “Award Agreement”     1  
 
  (e) “Cause”     1  
 
  (f) “Change in Control”     1  
 
  (g) “Code”     2  
 
  (h) “Committee”     2  
 
  (i) “Common Stock”     2  
 
  (j) “Company”     2  
 
  (k) “Consultant”     2  
 
  (l) “Director”     2  
 
  (m) “Disability”     2  
 
  (n) “Discretionary Options”     3  
 
  (o) “Employee”     3  
 
  (p) “Exchange Act”     3  
 
  (q) “Fair Market Value”     3  
 
  (r) “Incentive Stock Option”     3  
 
  (s) “Independent Director”     3  
 
  (t) “Inside Director”     3  
 
  (u) “Nonstatutory Stock Option”     3  
 
  (v) “Notice of Grant”     4  
 
  (w) “Officer”     4  
 
  (x) “Option”     4  
 
  (y) “Optioned Stock”     4  
 
  (z) “Parent”     4  
 
  (aa) “Participant”     4  
 
  (bb) “Plan”     4  
 
  (cc) “Qualifying Board Retirement”     4  
 
  (dd) “Restricted Stock”     4  
 
  (ee) “Rule 16b-3”     4  
 
  (ff) “Section 16(b)”     4  
 
  (gg) “Service Provider”     4  
 
  (hh) “Share”     4  
 
  (ii) “Stock Appreciation Right” or “SAR”     4  
 
  (jj)“Subsidiary”     4  
 
           
3.
  Stock Subject to the Plan     4  
 
           
 
  (a) Maximum Shares     5  

 

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TABLE OF CONTENTS
(Continued)

                      Page  
 
  (b) Full Value Awards     5  
 
  (c) Lapsed Awards     5  
 
           
4.
  Administration of the Plan     5  
 
           
 
  (a) Procedure     5  
 
  (b) Powers of the Administrator     6  
 
  (c) Effect of Administrator's Decision     7  
 
           
5.
  Eligibility     7  
 
           
 
  (a) Awards and Discretionary Stock Options     7  
 
  (b) Automatic Independent Director Option Grants     7  
 
           
6.
  Limitations     7  
 
           
7.
  Term of Plan     8  
 
           
8.
  Stock Options     8  
 
           
 
  (a) Term of Option     8  
 
  (b) Option Exercise Price, Waiting Period and Consideration     8  
 
  (c) Termination of Relationship as a Service Provider     10  
 
  (d) Disability of Optionee     10  
 
  (e) Death of Optionee     10  
 
           
9.
  Restricted Stock     11  
 
           
 
  (a) Grant of Restricted Stock     11  
 
  (b) Exercise Price and other Terms     11  
 
  (c) Restricted Stock Award Agreement     11  
 
           
10.
  Stock Appreciation Rights     11  
 
           
 
  (a) Grant of SARs     11  
 
  (b) Exercise Price and other Terms     11  
 
  (c) Payment of SAR Amount     11  
 
  (d) Payment upon Exercise of SAR     12  
 
  (e) Settlements and Plan Share Allocation     12  
 
  (f) SAR Agreement     12  
 
  (g) Expiration of SARs     12  
 
  (h) Termination of Relationship as a Service Provider     12  
 
  (i) Disability of Participant     12  
 
  (j) Death of Participant     13  
 
           
11.
  Option Grants to Independent Directors     13  
 
           
 
  (a) Nonstatutory Stock Options     13  
 
  (b) Administration     13  
 
  (c) Guidelines     13  
 
  (d) Initial Grant     14  
 
  (e) Pro-Rata Grant     14  

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TABLE OF CONTENTS
(Continued)

                      Page  
 
  (f) Annual Grant     14  
 
  (g) Other Option Terms     14  
 
           
12.
  Leaves of Absence     15  
 
           
13.
  Non-Transferability of Awards     15  
 
           
14.
  Adjustments Upon Changes in Capitalization, Dissolution, Liquidation or Change
of Control     15  
 
           
 
  (a) Changes in Capitalization     15  
 
  (b) Dissolution or Liquidation     16  
 
  (c) Change of Control     16  
 
           
15.
  Award Date of Grant     17  
 
           
16.
  Amendment and Termination of the Plan     17  
 
           
 
  (a) Amendment and Termination; No Repricing     18  
 
  (b) Stockholder Approval     18  
 
  (c) Effect of Amendment or Termination     18  
 
           
17.
  Conditions Upon Issuance of Shares     18  
 
           
 
  (a) Legal Compliance     18  
 
  (b) Investment Representations     18  
 
           
18.
  Inability to Obtain Authority     18  
 
           
19.
  Reservation of Shares     18  
 
           
20.
  Stockholder Approval     18  
 
           
21.
  Compliance With Code Section 409A     18  

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3COM CORPORATION
2003 STOCK PLAN, AS AMENDED
     1. Purposes of the Plan. The purposes of this 2003 Stock Plan are:

  •   to attract and retain the best available personnel for positions of
substantial responsibility,     •   to provide additional incentive to Employees
and Consultants, and     •   to promote the success of the Company’s business.

          The Plan permits the grant of Incentive Stock Options, Nonstatutory
Stock Options, Restricted Stock and Stock Appreciation Rights. In addition, the
Plan provides for automatic option grants to Independent Directors.
     2. Definitions. As used herein, the following definitions shall apply:
          (a) “Administrator” means the Board or any of its Committees as shall
be administering the Plan, in accordance with Section 4 of the Plan.
          (b) “Applicable Laws” means the requirements relating to the
administration of stock option plans under U.S. state corporate laws, U.S.
federal and state securities laws, the Code, any stock exchange or quotation
system on which the Common Stock is listed or quoted and the applicable laws of
any foreign country or jurisdiction where Awards are granted under the Plan.
          (c) “Award” means, individually or collectively, a grant under the
Plan of Options, SARs or Restricted Stock.
          (d) “Award Agreement” means the written agreement setting forth the
terms and provisions applicable to each Award granted under the Plan. The Award
Agreement is subject to the terms and conditions of the Plan.
          (e) “Cause” means (i) an act of personal dishonesty taken by the
Participant in connection with his or her responsibilities as an employee and
intended to result in substantial personal enrichment of the Participant,
(ii) Participant being convicted of or pleading nolo contendere to a felony,
(iii) a willful act by the Participant which constitutes gross misconduct and
which is injurious to the Company, (iv) following delivery to the Participant of
a written demand for performance from the Company which describes the basis for
the Company’s reasonable belief that the Participant has not substantially
performed his or her duties, continued violations by the Participant of the
Participant’s obligations to the Company which are demonstrably willful and
deliberate on the Participant’s part.
          (f) “Change in Control” means the occurrence of any of the following
events:

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               (i) Any Person becomes the “beneficial owner” (as defined in
Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the
Company representing fifty percent (50%) or more of the total voting power
represented by the Company’s then outstanding voting securities; or
               (ii) The consummation of the sale or disposition by the Company
of all or substantially all the Company’s assets; or
               (iii) The consummation of a merger or consolidation of the
Company with any other corporation, other than a merger or consolidation which
would result in the voting securities of the Company outstanding immediately
prior thereto continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving entity) at least fifty
percent (50%) of the total voting power represented by the voting securities of
the Company or such surviving entity outstanding immediately after such merger
or consolidation; or
               (iv) A change in the composition of the Board occurring within a
two-year period, as a result of which fewer than a majority of the directors are
Incumbent Directors. “Incumbent Directors” shall mean directors who either
(A) are directors of the Company as of the date upon which this Agreement was
entered into, or (B) are elected, or nominated for election, to the Board with
the affirmative votes of at least a majority of those directors whose election
or nomination was not in connection with any transaction described in
subsections (i), (ii), or (iii) above, or in connection with an actual or
threatened proxy contest relating to the election of directors to the Company.
          (g) “Code” means the U.S. Internal Revenue Code of 1986, as amended.
          (h) “Committee” means a committee, which may consist of one or more
persons whom may or may not be Board members, as is consistent with Applicable
Laws, appointed by the Board in accordance with Section 4 of the Plan.
          (i) “Common Stock” means the common stock of the Company.
          (j) “Company” means 3Com Corporation.
          (k) “Consultant” means any person, including an advisor, engaged by
the Company or a Parent or Subsidiary to render services to such entity.
          (l) “Director” means a member 3Com’s Board of Directors.
          (m) “Disability” means total and permanent disability as defined in
Section 22(e)(3) of the Code, provided that in the case of Awards other than
Incentive Stock Options, the Administrator in its discretion may determine
whether a permanent and total disability exists in accordance with uniform and
non-discriminatory standards adopted by the Administrator from time to time.

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          (n) “Discretionary Options” means Incentive Stock Options and
Nonstatutory Stock Options that are not issued pursuant to the Independent
Director option grant provisions of Section 11.
          (o) “Employee” means any person, including Officers and Directors,
employed by the Company or any Parent or Subsidiary of the Company. A Service
Provider shall not cease to be an Employee in the case of (i) any leave of
absence approved by the Company or any leave for which a return to employment is
guaranteed under Applicable Laws, or (ii) transfers between locations of the
Company or between the Company, its Parent, any Subsidiary, or any successor.
For purposes of Incentive Stock Options, no such leave may exceed ninety days,
unless reemployment upon expiration of such leave is guaranteed by statute or
contract. If reemployment upon expiration of a leave of absence approved by the
Company is not so guaranteed, on the 181st day of such leave any Incentive Stock
Option held by the Optionee shall cease to be treated as an Incentive Stock
Option and shall be treated for tax purposes as a Nonstatutory Stock Option.
Neither service as a Director nor payment of a director’s fee by the Company
shall be sufficient to constitute “employment” by the Company.
          (p) “Exchange Act” means the Securities Exchange Act of 1934, as
amended.
          (q) “Fair Market Value” means, as of any date, the value of Common
Stock determined as follows:
               (i) If the Common Stock is listed on any established stock
exchange or a national market system, including without limitation the Nasdaq
National Market or The Nasdaq SmallCap Market of The Nasdaq Stock Market, its
Fair Market Value shall be the closing sales price for such stock (or the
closing bid, if no sales were reported) as quoted on such exchange or system on
the date of determination, as reported in The Wall Street Journal or such other
source as the Administrator deems reliable;
               (ii) If the Common Stock is regularly quoted by a recognized
securities dealer but selling prices are not reported, the Fair Market Value of
a Share of Common Stock shall be the mean between the high bid and low asked
prices for the Common Stock on the date of determination, as reported in The
Wall Street Journal or such other source as the Administrator deems reliable; or
               (iii) in the absence of an established market for the Common
Stock, the Fair Market Value shall be determined in good faith by the
Administrator.
          (r) “Incentive Stock Option” means an Option intended to qualify as an
incentive stock option within the meaning of Section 422 of the Code and the
regulations promulgated thereunder.
          (s) “Independent Director” means a Director who is not an Employee.
          (t) “Inside Director” means a Director who is an Employee.
          (u) “Nonstatutory Stock Option” means an Option not intended to
qualify as an Incentive Stock Option.

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          (v) “Notice of Grant” means a written or electronic notice evidencing
certain terms and conditions of an individual Award. The Notice of Grant is part
of the Award Agreement.
          (w) “Officer” means a person who is an officer of the Company within
the meaning of Section 16 of the Exchange Act and the rules and regulations
promulgated thereunder.
          (x) “Option” means a stock option granted pursuant to the Plan.
          (y) “Optioned Stock” means the Common Stock subject to an Option or
SAR.
          (z) “Parent” means a “parent corporation,” whether now or hereafter
existing, as defined in Section 424(e) of the Code.
          (aa) “Participant” means the holder of an outstanding Award granted
under the Plan.
          (bb) “Plan” means this 2003 Stock Plan, as from time to time amended
and in effect.
          (cc) “Qualifying Board Retirement” means an Independent Director’s
termination from Board membership, including pursuant to the Independent
Director’s death or Disability, if such termination follows ten full years of
Board service or five full years of Board service and attainment of age 62 or
greater.
          (dd) “Restricted Stock” means shares of Common Stock or units/rights
to acquire shares of Common Stock granted pursuant to Section 9 of the Plan that
are subject to vesting.
          (ee) “Rule 16b-3” means Rule 16b-3 of the Exchange Act or any
successor to Rule 16b-3, as in effect when discretion is being exercised with
respect to the Plan.
          (ff) “Section 16(b)” means Section 16(b) of the Exchange Act.
          (gg) “Service Provider” means an Employee, Director or Consultant.
          (hh) “Share” means a share of the Common Stock, as adjusted in
accordance with Section 14 of the Plan.
          (ii) “Stock Appreciation Right ” or “SAR” means an Award, granted
alone or in connection with a related Option, that pursuant to Section 10 is
designated as an SAR.
          (jj) “Subsidiary” means a “subsidiary corporation”, whether now or
hereafter existing, as defined in Section 424(f) of the Code and also include
partnerships, limited liability companies and other entities that are at least
30% owned by the Company.
     3. Stock Subject to the Plan.

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          (a) Maximum Shares. Subject to the provisions of Section 14 of the
Plan, the maximum aggregate number of Shares which may be issued under the Plan
is 73,000,000 Shares. The Shares may be authorized, but unissued, or reacquired
Common Stock.
          (b) Full Value Awards. This Section 3(b) is effective upon stockholder
approval, after Board approval on June 18, 2008, for new Awards granted under
the Plan after such stockholder approval effective date. Any Shares subject to
Options or SARs shall be counted against the numerical limits of this Section 3
as one Share for every Share subject thereto. Any Shares subject to Restricted
Stock with a per share purchase price lower than 100% of the Fair Market Value
on the date of grant shall be counted against the numerical limits of this
Section 3 as 1.43 Shares for every one Share subject thereto. If any Shares
acquired pursuant to an Award of Restricted Stock are forfeited or repurchased
by the Company and would otherwise return to the Plan pursuant to Section 3(c),
1.43 times the number of Shares so forfeited or repurchased will return to the
Plan and will again become available for future grant or sale under the Plan.
          (c) Lapsed Awards. If an Award expires or becomes unexercisable
without having been exercised in full, or, with respect to Restricted Stock, is
forfeited back to or repurchased by the Company, the unpurchased Shares (or for
Restricted Stock, the forfeited or repurchased shares) which were subject
thereto shall become available for future grant or sale under the Plan (unless
the Plan has terminated). With respect to SARs, all shares which are the subject
of an issued SAR shall cease to be available under the Plan, except for SARs
which expire or become unexercisable without having been exercised in full.
Shares that have actually been issued under the Plan under any Award shall not
be returned to the Plan and shall not become available for future distribution
under the Plan, except that if Shares of Restricted Stock are repurchased by the
Company at their original purchase price or are forfeited to the Company, such
Shares shall become available for future grant under the Plan. For the avoidance
of doubt, except for Awards which expire or become unexercisable without having
been exercised in full, the following Shares shall not become available for
issuance under the Plan: (i) Shares tendered by Participants as full or partial
payment to the Company upon exercise of Options granted, or shares repurchased
using cash proceeds upon exercise of Options granted, under the Plan;
(ii) Shares reserved for issuance upon the grant of SARs, to the extent the
number of reserved Shares exceeds the number of Shares actually issued upon
exercise of the SARs; and (iii) Shares withheld by, or otherwise remitted to,
the Company to satisfy a Participant’s tax withholding obligations upon the
lapse of restrictions on Restricted Stock or the exercise of options or SARs
granted under the Plan or upon any other payment or issuance of Shares under the
Plan.
     4. Administration of the Plan.
          (a) Procedure.
               (i) Multiple Administrative Bodies. The Plan may be administered
by different Committees with respect to different groups of Service Providers.
               (ii) Section 162(m). To the extent that the Administrator
determines it to be desirable to qualify Awards granted hereunder as
“performance-based compensation” within the meaning of Section 162(m) of the
Code, the Plan shall be administered by a

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Compensation Committee of two or more “outside directors” within the meaning of
Section 162(m) of the Code.
               (iii) Rule 16b-3. To the extent desirable to qualify transactions
hereunder as exempt under Rule 16b-3, the transactions contemplated hereunder
shall be structured to satisfy the requirements for exemption under Rule 16b-3.
               (iv) Other Administration. Other than as provided above, the Plan
shall be administered by (A) the Compensation Committee, or (B) a different
Committee, in either case which shall be constituted to satisfy Applicable Laws.
Grants to Independent Directors under Section 11 of the Plan shall be
administered by the Company’s Inside Directors.
          (b) Powers of the Administrator. Subject to the provisions of the Plan
the Administrator shall have the authority, in its discretion:
               (i) to determine the Fair Market Value;
               (ii) to select the Service Providers to whom Awards may be
granted hereunder;
               (iii) to determine the number of shares of Common Stock to be
covered by each Award granted hereunder;
               (iv) to approve forms of agreement for use under the Plan;
               (v) to determine the terms and conditions, not inconsistent with
the terms of the Plan, of any Award granted hereunder. Such terms and conditions
include, but are not limited to, the exercise or purchase price, the time or
times when Awards may be vested, exercised, purchased or granted (which may be
based on performance criteria), any vesting acceleration or waiver of forfeiture
restrictions or repurchase rights, and any restriction or limitation regarding
any Award or the shares of Common Stock relating thereto, based in each case on
such factors as the Administrator, in its sole discretion, shall determine;
               (vi) to construe and interpret the terms of the Plan and awards
granted pursuant to the Plan, including, but not limited to, a determination of
a Participant’s date of termination with respect to any Award granted under the
Plan;
               (vii) to prescribe, amend and rescind rules and regulations
relating to the Plan, including rules and regulations relating to sub-plans
established for the purpose of qualifying for preferred tax treatment under
foreign tax laws, satisfying foreign securities law or achieving other foreign
legal compliance objectives;
               (viii) to modify or amend each Award (subject to Section 16 of
the Plan), including the discretionary authority to extend the post-termination
vesting or exercisability of Awards longer than is otherwise provided for in the
Plan;
               (ix) to allow Participants to satisfy withholding tax obligations
by electing to have the Company withhold from the Shares to be issued upon
exercise of an Option

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or SAR or upon the vesting or earlier tax recognition of Restricted Stock that
number of Shares having a Fair Market Value equal to the amount required to be
withheld. The Fair Market Value of the Shares to be withheld shall be determined
on the date that the amount of tax to be withheld is to be determined. All
elections by a Participant to have Shares withheld for this purpose shall be
made in such form and under such conditions as the Administrator may deem
necessary or advisable;
               (x) to authorize any person to execute on behalf of the Company
any instrument required to effect the grant of an Award previously granted by
the Administrator; and
               (xi) to make all other determinations deemed necessary or
advisable for administering the Plan.
          (c) Effect of Administrator’s Decision. The Administrator’s decisions,
determinations and interpretations shall be final and binding on all
Participants and any other holders of Awards.
     5. Eligibility.
          (a) Awards and Discretionary Stock Options. Awards and Discretionary
Options may be granted to Service Providers. Incentive Stock Options may be
granted only to Employees.
          (b) Automatic Independent Director Option Grants. Automatic Option
grants under Section 11 hereof shall only be made to Independent Directors.
     6. Limitations.
          (a) Each Option shall be designated in the Option Agreement as either
an Incentive Stock Option or a Nonstatutory Stock Option. However,
notwithstanding such designation, to the extent that the aggregate Fair Market
Value of the Shares with respect to which Incentive Stock Options are
exercisable for the first time by the Optionee during any calendar year (under
all plans of the Company and any Parent or subsidiary as defined in Code
Section 424(f)) exceeds $100,000, such Options shall be treated as Nonstatutory
Stock Options. For purposes of this Section 6(a), Incentive Stock Options shall
be taken into account in the order in which they were granted. The Fair Market
Value of the Shares shall be determined as of the time the Option with respect
to such Shares is granted.
          (b) Neither the Plan nor any Award shall confer upon a Participant any
right with respect to continuing their relationship as a Service Provider, nor
shall they interfere in any way with the right of the Participant or the right
of the Company or its Parent or Subsidiaries to terminate such relationship at
any time, with or without cause.
          (c) The following limitations shall apply to grants of Options and
SARs with an exercise price equal to or exceeding 100% of Fair Market Value on
the grant date:
               (i) No Service Provider shall be granted, in any fiscal year of
the Company, Option or SARs to purchase more than 1,750,000 Shares.

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               (ii) In connection with his or her initial service, a Service
Provider may be granted Options to purchase up to an additional 1,750,000 Shares
which shall not count against the limit set forth in subsection (i) above.
               (iii) The foregoing limitations shall be adjusted proportionately
in connection with any change in the Company’s capitalization as described in
Section 14(a).
               (iv) If an Option is cancelled in the same fiscal year of the
Company in which it was granted (other than in connection with a transaction
described in Section 14(c)), the cancelled Option will be counted against the
limits set forth in subsections (i) and (ii) above.
     7. Term of Plan. The Plan shall become effective upon the date of
stockholder approval of the Plan in 2003. It shall continue in effect for a term
of ten (10) years from the date upon which the Board approved the Plan subject
to obtaining stockholder approval, namely July 15, 2013.
     8. Stock Options.
          (a) Term of Option. The term of each Option shall be stated in the
Option Agreement and shall be no more than seven (7) years from the date of
grant. Moreover, in the case of an Incentive Stock Option granted to an Optionee
who, at the time the Incentive Stock Option is granted, owns stock representing
more than ten percent (10%) of the total combined voting power of all classes of
stock of the Company or any Parent or subsidiary that qualifies under Code
Section 424(f), the term of the Incentive Stock Option shall be five (5) years
from the date of grant or such shorter term as may be provided in the Option
Agreement.
          (b) Option Exercise Price, Waiting Period and Consideration.
               (i) Exercise Price. The per share exercise price for the Shares
to be issued pursuant to exercise of an Option shall be determined by the
Administrator, subject to the following:
                    (1) In the case of an Incentive Stock Option
                         a) granted to an Employee who, at the time the
Incentive Stock Option is granted, owns stock representing more than ten percent
(10%) of the voting power of all classes of stock of the Company or any Parent
or Code Section 424(f) subsidiary, the per Share exercise price shall be no less
than 110% of the Fair Market Value per Share on the date of grant.
                         b) granted to any Employee other than an Employee
described in paragraph a) immediately above, the per Share exercise price shall
be no less than 100% of the Fair Market Value per Share on the date of grant.
                    (2) In the case of a Nonstatutory Stock Option, the per
Share exercise price shall be determined by the Administrator, with a minimum
exercise price equal to par value.

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               (ii) Waiting Period and Exercise Dates. At the time an Option is
granted, the Administrator shall fix the period within which the Option may
become vested or be exercised and shall determine any conditions which must be
satisfied before the Option may vest or be exercised.
               (iii) Form of Consideration. The Administrator shall determine
the acceptable form of consideration for exercising an Option, including the
method of payment. In the case of an Incentive Stock Option, the Administrator
shall determine the acceptable form of consideration at the time of grant. Such
consideration, subject to Applicable Laws, may consist entirely of:
                    (1) cash;
                    (2) check;
                    (3) other Shares which (A) in the case of Shares acquired
upon exercise of an option, have been owned by the Optionee for more than six
months on the date of surrender, and (B) have a Fair Market Value on the date of
surrender equal to the aggregate exercise price of the Shares as to which said
Option shall be exercised;
                    (4) consideration received by the Company under a
broker-assisted cashless exercise program acceptable to the Company, in its sole
discretion;
                    (5) any combination of the foregoing methods of payment; or
                    (6) such other consideration and method of payment for the
issuance of Shares to the extent permitted by Applicable Laws.
               (iv) Exercise of Option; Rights as a Stockholder. Any Option
granted hereunder shall be exercisable according to the terms of the Plan and at
such times and under such conditions as determined by the Administrator and set
forth in the Option Agreement.
               An Option shall be deemed exercised when the Company receives:
(i) written or electronic notice of exercise (in accordance with the Option
Agreement) from the person entitled to exercise the Option, and (ii) full
payment for the Shares with respect to which the Option is exercised. Full
payment may consist of any consideration and method of payment authorized by the
Administrator and permitted by the Option Agreement and the Plan. Shares issued
upon exercise of an Option shall be issued in the name of the Optionee or, if
requested by the Optionee, in the name of the Optionee and his or her spouse.
Until the Shares are issued (as evidenced by the appropriate entry on the books
of the Company or of a duly authorized transfer agent of the Company), no right
to vote or receive dividends or any other rights as a stockholder shall exist
with respect to the Optioned Stock, notwithstanding the exercise of the Option.
The Company shall issue (or cause to be issued) such Shares promptly after the
Option is exercised. No adjustment will be made for a dividend or other right
for which the record date is prior to the date the Shares are issued, except as
provided in Section 14 of the Plan.
               Exercising an Option in any manner shall decrease the number of
Shares thereafter available, both for purposes of the Plan and for sale under
the Option, by the number

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of Shares as to which the Option is exercised. An Option may not be exercised
for a fraction of a Share.
                         (c) Termination of Relationship as a Service Provider.
If an Optionee ceases to be a Service Provider, other than upon the Optionee’s
death or Disability, the Optionee may exercise his or her Option within such
period of time as is specified in the Option Agreement to the extent that the
Option is vested and exercisable on the date of termination (but in no event
later than the expiration of the term of such Option as set forth in the Option
Agreement). In the absence of a specified time in the Option Agreement, the
Option shall remain exercisable for three (3) months following the Optionee’s
termination. If, on the date of termination, the Optionee is not vested as to
his or her entire Option, the Shares covered by the unvested portion of the
Option shall revert to the Plan. If, after termination, the Optionee does not
exercise his or her Option within the time specified by the Administrator, the
Option shall terminate, and the Shares covered by such Option shall revert to
the Plan.
                              Notwithstanding the above, in the event of an
Optionee’s change in status from Consultant, Employee or Director to Employee,
Consultant or Director (e.g., an Inside Director becoming an Independent
Director), an Optionee’s status as a Service Provider shall continue
notwithstanding the change in status. However, in such event, an Incentive Stock
Option held by the Optionee shall cease to be treated as an Incentive Stock
Option and shall be treated for tax purposes as a Nonstatutory Stock Option
three months and one day following such change of status.
                         (d) Disability of Optionee. If an Optionee ceases to be
a Service Provider as a result of the Optionee’s Disability, the Optionee may
exercise his or her Option within such period of time as is specified in the
Option Agreement to the extent the Option is vested and exercisable on the date
of termination (but in no event later than the expiration of the term of such
Option as set forth in the Option Agreement). In the absence of a specified time
in the Option Agreement, the Option shall remain exercisable for twelve
(12) months following the Optionee’s termination. If, on the date of
termination, the Optionee is not vested as to his or her entire Option, the
Shares covered by the unvested portion of the Option shall revert to the Plan.
If, after termination, the Optionee does not exercise his or her Option within
the time specified herein, the Option shall terminate, and the Shares covered by
such Option shall revert to the Plan.
                         (e) Death of Optionee. If an Optionee dies while a
Service Provider, the Option may be exercised within such period of time as is
specified in the Option Agreement (but in no event later than the expiration of
the term of such Option as set forth in the Notice of Grant), by the Optionee’s
estate or by a person who acquires the right to exercise the Option by bequest
or inheritance, but only to the extent that the Option is vested and exercisable
on the date of death. In the absence of a specified time in the Option
Agreement, the Option shall remain exercisable for twelve (12) months following
the Optionee’s termination. If, at the time of death, the Optionee is not vested
as to his or her entire Option, the Shares covered by the unvested portion of
the Option shall immediately revert to the Plan. The Option may be exercised by
the executor or administrator of the Optionee’s estate or, if none, by the
person(s) entitled to exercise the Option under the Optionee’s will or the laws
of descent or distribution. If the Option is not

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so exercised within the time specified herein, the Option shall terminate, and
the Shares covered by such Option shall revert to the Plan.
     9. Restricted Stock.
          (a) Grant of Restricted Stock. Subject to the terms and conditions of
the Plan, Restricted Stock may be granted to Service Providers at any time and
from time to time as shall be determined by the Administrator, in its sole
discretion. The Administrator shall have complete discretion to determine
(i) the number of Shares subject to a Restricted Stock award granted to any
Participant, (ii) whether the form of the award shall be Shares or units/rights
to acquire Shares, and (iii) the conditions that must be satisfied, including
performance-based milestones, upon which is conditioned the grant or vesting of
Restricted Stock. For Restricted Stock granted in the form of units/rights to
acquire Shares, each such unit/right shall be the equivalent of one Share of
Common Stock for purposes of determining the number of Shares subject to an
Award. Until the Shares are issued, no right to vote or receive dividends or any
other rights as a stockholder shall exist with respect to the units/rights to
acquire Shares.
          (b) Exercise Price and other Terms. The Administrator, subject to the
provisions of the Plan, shall have complete discretion to determine the terms
and conditions of Restricted Stock granted under the Plan. Restricted Stock
grants shall be subject to the terms, conditions, and restrictions determined by
the Administrator at the time the stock is awarded, which may include such
performance-based milestones as are determined appropriate by the Administrator.
The Administrator may require the recipient to sign a Restricted Stock Agreement
as a condition of the award. Any certificates representing the shares of Stock
awarded shall bear such legends as shall be determined by the Administrator.
          (c) Restricted Stock Award Agreement. Each Restricted Stock grant
shall be evidenced by an Award Agreement that shall specify the purchase price
(if any) and such other terms and conditions as the Administrator, in its sole
discretion, shall determine; provided; however, that if the Restricted Stock
grant has a purchase price, such purchase price must be paid no more than seven
(7) years following the date of grant.
     10. Stock Appreciation Rights.
          (a) Grant of SARs. Subject to the terms and conditions of the Plan,
SARs may be granted to Service Providers at any time and from time to time as
shall be determined by the Administrator, in its sole discretion. The
Administrator shall have complete discretion to determine the number of SARs
granted to any Participant.
          (b) Exercise Price and other Terms. The Administrator, subject to the
provisions of the Plan, shall have complete discretion to determine the terms
and conditions of SARs granted under the Plan; provided, however, that no SAR
may have a term of more than seven (7) years from the date of grant.
          (c) Payment of SAR Amount. Upon exercise of a SAR, a Participant shall
be entitled to receive payment from the Company in an amount determined by
multiplying:

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               (i) The difference between the Fair Market Value of a Share on
the date of exercise over the exercise price; times
               (ii) The number of Shares with respect to which the SAR is
exercised.
          (d) Payment upon Exercise of SAR. At the discretion of the
Administrator, payment for a SAR may be in cash, Shares or a combination
thereof.
          (e) Settlements and Plan Share Allocation. Cash payments of Stock
Appreciation Rights as well as Common Stock issued upon exercise of Stock
Appreciation Rights shall be applied against the maximum number of shares of
Common Stock that may be issued pursuant to the Plan. The number of shares to be
applied against such maximum number of shares in such circumstances shall be
counted as one (1) share for every Stock Appreciation Right subject thereto,
regardless of the number of shares or amount of cash used to settle the Stock
Appreciation Right.
          (f) SAR Agreement. Each SAR grant shall be evidenced by an Award
Agreement that shall specify the exercise price, the term of the SAR, the
conditions of exercise, and such other terms and conditions as the
Administrator, in its sole discretion, shall determine.
          (g) Expiration of SARs. A SAR granted under the Plan shall expire upon
the date determined by the Administrator, in its sole discretion, and set forth
in the Award Agreement.
          (h) Termination of Relationship as a Service Provider. If a
Participant ceases to be a Service Provider, other than upon the Participant’s
death or Disability, the Participant may exercise his or her Stock Appreciation
Right within such period of time as is specified in the Stock Appreciation Right
Agreement to the extent that the Stock Appreciation Right is vested and
exercisable on the date of termination (but in no event later than the
expiration of the term of such Stock Appreciation Right as set forth in the
Stock Appreciation Right Agreement). In the absence of a specified time in the
Stock Appreciation Right Agreement, the Stock Appreciation Right shall remain
exercisable for three (3) months following the Participant’s termination. If, on
the date of termination, the Participant is not vested as to his or her entire
Stock Appreciation Right, the Shares covered by the unvested portion of the
Stock Appreciation Right shall revert to the Plan. If, after termination, the
Participant does not exercise his or her Stock Appreciation Right within the
time specified by the Administrator, the Stock Appreciation Right shall
terminate, and the Shares covered by such Stock Appreciation Right shall revert
to the Plan. Notwithstanding the above, in the event of a Participant’s change
in status from Consultant, Employee or Director to Employee, Consultant or
Director (e.g., an Inside Director becoming an Independent Director), a
Participant’s status as a Service Provider shall continue notwithstanding the
change in status.
          (i) Disability of Participant. If a Participant ceases to be a Service
Provider as a result of the Participant’s Disability, the Participant may
exercise his or her Stock Appreciation Right within such period of time as is
specified in the Stock Appreciation Right Agreement to the extent the Stock
Appreciation Right is vested and exercisable on the date of termination (but in
no event later than the expiration of the term of such Stock Appreciation Right
as set forth in the Stock Appreciation Right Agreement). In the absence of a
specified time in the Stock Appreciation Right Agreement, the Stock Appreciation

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Right shall remain exercisable for twelve (12) months following the
Participant’s termination. If, on the date of termination, the Participant is
not vested as to his or her entire Stock Appreciation Right, the Shares covered
by the unvested portion of the Stock Appreciation Right shall revert to the
Plan. If, after termination, the Participant does not exercise his or her Stock
Appreciation Right within the time specified herein, the Stock Appreciation
Right shall terminate, and the Shares covered by such Stock Appreciation Right
shall revert to the Plan.
          (j) Death of Participant. If a Participant dies while a Service
Provider, the Stock Appreciation Right may be exercised within such period of
time as is specified in the Stock Appreciation Right Agreement (but in no event
later than the expiration of the term of such Stock Appreciation Right as set
forth in the Notice of Grant), by the Participant’s estate or by a person who
acquires the right to exercise the Stock Appreciation Right by bequest or
inheritance, but only to the extent that the Stock Appreciation Right is vested
and exercisable on the date of death. In the absence of a specified time in the
Stock Appreciation Right Agreement, the Stock Appreciation Right shall remain
exercisable for twelve (12) months following the Participant’s termination. If,
at the time of death, the Participant is not vested as to his or her entire
Stock Appreciation Right, the Shares covered by the unvested portion of the
Stock Appreciation Right shall immediately revert to the Plan. The Stock
Appreciation Right may be exercised by the executor or administrator of the
Participant’s estate or, if none, by the person(s) entitled to exercise the
Stock Appreciation Right under the Participant’s will or the laws of descent or
distribution. If the Stock Appreciation Right is not so exercised within the
time specified herein, the Stock Appreciation Right shall terminate, and the
Shares covered by such Stock Appreciation Right shall revert to the Plan.
     11. Option Grants to Independent Directors. All grants of Options to
Independent Directors pursuant to this Section shall be made strictly in
accordance with the following provisions:
          (a) Nonstatutory Stock Options. All Options granted pursuant to this
Section shall be Nonstatutory Stock Options and, except as otherwise provided
herein, shall be subject to the other terms and conditions of the Plan.
          (b) Administration. Option grants under this Section 11 shall be
administered by a committee consisting of the Company’s Inside Directors;
provided, however, that such committee shall not have any discretion to select
which Independent Directors shall be granted Options under this Section 11.
          (c) Guidelines. The committee of Inside Directors shall establish
guidelines (the “Guidelines”) that determine the number of shares to be subject
to the options granted under this Section 11, subject to the per option limits
set forth in Sections 11(d) and 11(f). The Guidelines must provide that on each
grant date, the number of shares of Common Stock subject to each option
automatically granted pursuant to Section 11(d) or 11(f), as the case may be,
shall be equal for each eligible participant, subject to distinctions based on
the outside director’s position as Chairman of the Board, designation as the
“lead” outside director, and service on Board committees, including service as
chairman of such committees.

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          (d) Initial Grant. Each person who first becomes an Independent
Director following the effective date of this Plan shall be automatically
granted an Option to purchase that number of shares as may be specified in the
Guidelines then currently in effect (the “Guideline Amount”) for service on the
Board, not to exceed 120,000 shares of Common Stock (or 160,000 shares if the
participant is the lead director or Chairman of the Board on the date of grant),
as of the date that is the fifth (5th) trading day of the month that immediately
follows the month in which that individual first becomes an Independent Director
and commences service on the Board whether through election by the stockholders
of the Company or appointment by the Board to fill a vacancy (the “Initial
Grant”); provided, however, that an Inside Director who ceases to be an Inside
Director and thereby becomes an Independent Director shall not receive an
Initial Grant. Subject to accelerated vesting upon certain Change of Control
transactions as specified in Section 14(c)(iii), the Initial Grant shall vest as
to 25% of the shares subject thereto on each anniversary of the date of grant,
so as to be 100% vested on the fourth anniversary of the date of grant, subject
to the Optionee remaining a director through such vesting dates.
          (e) Pro-Rata Grant. Additionally, at the time an Initial Grant is made
to a new director, he or she shall receive an option grant with the number of
shares subject thereto equal to the Guideline Amount multiplied by a fraction,
the numerator of which is the number of full months of service remaining prior
to the next annual stockholder meeting and the denominator of which is 12 (the
“Pro-Rata Grant”). Subject to accelerated vesting upon a Change of Control as
specified in Section 14(c)(iii), the Pro-Rata Grant will vest as to 50% of the
shares subject thereto on each anniversary of the date of grant, so as to be
100% vested on the second anniversary of the date of grant, subject to the
Optionee remaining a director through such vesting dates.
          (f) Annual Grant. On the date of each regularly scheduled Company
annual stockholder meeting, each Independent Director shall be automatically
granted an Option to purchase that number of shares equal to the Guideline
Amount for service on the Board, not to exceed 120,000 shares of Common Stock,
or 160,000 shares if the participant is the lead director or Chairman of the
Board on the date of grant (the “Annual Grants”). Subject to accelerated vesting
upon certain Change of Control transactions as specified in Section 14(c)(iii),
Annual Grants shall vest as to 50% of the shares subject thereto on the day
prior to the next year’s regularly scheduled Company annual stockholder meeting
and as to the balance of the shares subject thereto on the day prior to the next
year’s regularly scheduled Company annual stockholder meeting, so as to be 100%
vested on the day prior to the Company annual stockholder meeting held
approximately two years following the grant date, subject to the Optionee
remaining a director through such vesting dates.
          (g) Other Option Terms. The other terms of each option granted
pursuant to this Section 11 shall be as follows:
               (i) The option term shall be seven (7) years.
               (ii) The exercise price per Share shall be no less than 100% of
the Fair Market Value per Share on the date of grant.

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               (iii) In the event an Optionee’s service as a Director terminates
more than six (6) months following the commencement of service as an Independent
Director, then the Option shall immediately accelerate as to one year’s
additional vesting or, with respect to an Annual Grant, as to the number of
shares that would have vested on the day prior to the next regularly scheduled
meeting of the stockholders. The Option shall remain exercisable, to the extent
vested and exercisable on the date of termination of Board service, for one year
following such termination date (but in no event longer than the original term
of the Option); provided, however, that in the event of a Qualifying Board
Retirement, the Option shall vest as to 100% of the Shares and shall remain
exercisable for three years following such termination (but in no event longer
than the original term of the Option); provided, further that in the event of
the termination of service as an Independent Director due to the death or
Disability of the Optionee while an Independent Director, the Option shall
immediately accelerate as to one year’s additional vesting or, with respect to
an Annual Grant, as to the number of shares that would have vested on the day
prior to the next regularly scheduled meeting of the stockholders (or more, in
any event, if the cessation of Board Service would have been a Qualifying
Retirement) even if such termination of service is within six (6) months
following the commencement of service as an Independent Director.
               (iv) The permissible forms of consideration for exercising the
option shall be the same as for discretionary options as specified in
Section 8(b)(iii) hereof.
               (v) The provisions of Section 8(b)(iv) hereof relating to
stockholder rights shall also apply to options granted under this Section 11.
               (vi) The options granted under this Section 11 shall be subject
to the other terms and conditions set forth in the form of option agreement
selected by the committee of Inside Directors, in their sole discretion.
     12. Leaves of Absence. Unless the Administrator provides otherwise or as
otherwise required by Applicable Laws, vesting of Awards granted hereunder shall
cease commencing on the 91st day of any unpaid leave of absence and shall only
recommence upon return to active service.
     13. Non-Transferability of Awards. An Award may not be sold, pledged,
assigned, hypothecated, transferred, or disposed of in any manner other than by
will or by the laws of descent or distribution and may be exercised, during the
lifetime of the Participant, only by the Participant.
     14. Adjustments Upon Changes in Capitalization, Dissolution, Liquidation or
Change of Control.
          (a) Changes in Capitalization. Subject to any required action by the
stockholders of the Company, the number of shares of Common Stock covered by
each outstanding Award, the number of shares of Common Stock which have been
authorized for issuance under the Plan but as to which no Awards have yet been
granted or which have been returned to the Plan upon cancellation or expiration
of an Award, as well as the price per share of Common Stock covered by each such
outstanding Award and the 162(m) annual share issuance

15

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limits under Section 6(c) shall be proportionately adjusted for any increase or
decrease in the number of issued shares of Common Stock resulting from a stock
split, reverse stock split, stock dividend, combination or reclassification of
the Common Stock, or any other increase or decrease in the number of issued
shares of Common Stock effected without receipt of consideration by the Company;
provided, however, that conversion of any convertible securities of the Company
shall not be deemed to have been “effected without receipt of consideration.”
Such adjustment shall be made by the Compensation Committee, whose determination
in that respect shall be final, binding and conclusive. Except as expressly
provided herein, no issuance by the Company of shares of stock of any class, or
securities convertible into shares of stock of any class, shall affect, and no
adjustment by reason thereof shall be made with respect to, the number or price
of shares of Common Stock subject to an Award.
          (b) Dissolution or Liquidation. In the event of the proposed
dissolution or liquidation of the Company, the Administrator shall notify each
Participant as soon as practicable prior to the effective date of such proposed
transaction. The Administrator in its discretion may provide for a Participant
to have the right to exercise his or her Award until ten (10) days prior to such
transaction as to all of the stock covered thereby, including Shares as to which
the Award would not otherwise be vested or exercisable. In addition, the
Administrator may provide that any Company repurchase option or forfeiture
applicable to any Shares covered by an Award shall lapse as to all such Shares,
provided the proposed dissolution or liquidation takes place at the time and in
the manner contemplated. To the extent it has not been previously exercised, an
Award will terminate immediately prior to the consummation of such proposed
action.
          (c) Change of Control.
               (i) SARs and Discretionary Options. In the event of a Change of
Control, each outstanding SAR and Discretionary Option shall be assumed or an
equivalent option substituted by the successor corporation or a Parent or
subsidiary of the successor corporation. In the event that the successor
corporation refuses to assume or substitute for the SAR and Discretionary
Option, the Participant shall fully vest in and have the right to exercise the
SAR or Discretionary Option as to all of the Optioned Stock, including Shares as
to which it would not otherwise be vested or exercisable. If a SAR or
Discretionary Option becomes fully vested and exercisable in lieu of assumption
or substitution in the event of a Change of Control, the Administrator shall
notify the Participant in writing or electronically that the SAR or
Discretionary Option shall be fully vested and exercisable for a period of
fifteen (15) days from the date of such notice, and the SAR or Discretionary
Option shall terminate upon the expiration of such period. For the purposes of
this paragraph, the SAR or Discretionary Option shall be considered assumed if,
following the Change of Control, the SAR or option confers the right to purchase
or receive, for each Share of Optioned Stock subject to the SAR or Discretionary
Option immediately prior to the Change of Control, the consideration (whether
stock, cash, or other securities or property) received in the Change of Control
by holders of Common Stock for each Share held on the effective date of the
transaction (and if holders were offered a choice of consideration, the type of
consideration chosen by the holders of a majority of the outstanding Shares);
provided, however, that if such consideration received in the Change of Control
is not solely common stock of the successor corporation or its Parent, the
Administrator may, with the consent of the successor corporation, provide for
the consideration to be received upon the exercise of the SAR or Discretionary
Option, for each Share of Optioned Stock subject to the

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SAR or Discretionary Option, to be solely common stock of the successor
corporation or its Parent equal in fair market value to the per share
consideration received by holders of Common Stock in the Change of Control.
               (ii) Restricted Stock. In the event of a Change of Control, each
outstanding Restricted Stock award shall be assumed or an equivalent award
substituted by the successor corporation or a Parent or subsidiary of the
successor corporation. In the event that the successor corporation refuses to
assume or substitute for the Restricted Stock, the Participant shall fully vest
in the Restricted Stock, including Shares as to which it would not otherwise be
vested. For the purposes of this paragraph, the Restricted Stock shall be
considered assumed if, following the Change of Control, the Restricted Stock
confers the right to receive, for each Share and each unit/right to acquire a
Share that is subject to the Restricted Stock award immediately prior to the
Change of Control, the consideration (whether stock, cash, or other securities
or property) received in the Change of Control by holders of Common Stock for
each Share and each unit/right to acquire a Share held on the effective date of
the transaction (and if holders were offered a choice of consideration, the type
of consideration chosen by the holders of a majority of the outstanding Shares);
provided, however, that if such consideration received in the Change of Control
is not solely common stock of the successor corporation or its Parent, the
Administrator may, with the consent of the successor corporation, provide for
the consideration to be received, for each Share and each unit/right to acquire
a Share subject to the Restricted Stock award, to be solely common stock of the
successor corporation or its Parent equal in fair market value to the per share
consideration received by holders of Common Stock in the Change of Control.
               (iii) Automatic Independent Director Options. In the event of a
Change of Control in which the Independent Directors are terminated or asked to
resign either upon the Change of Control or within one year following the Change
of Control, their Options granted under Section 11 hereof shall vest 100%
immediately prior to such Change in Control. In the event of a Change of Control
in which the Independent Directors are not terminated or asked to resign, their
Options granted under Section 11 hereof shall be treated the same as
Discretionary Options hereunder.
               (iv) Certain Terminations Within Twelve Months Following a Change
of Control. In the event that, within twelve (12) months following a Change of
Control a Participant’s employment with the Company, its Parent, or a Subsidiary
is terminated involuntarily by his or her employer other than for Cause, then
such Participant’s Awards shall have their vesting accelerated as to fifty
percent (50%) of the Shares that are unvested as of the date of such termination
of employment.
     15. Award Date of Grant. Other than as set forth in Section 11 hereof as to
automatic grants to Independent Directors, the date of grant of an Award shall
be, for all purposes, the date on which the Administrator makes the
determination granting such Award, or such other later date as is determined by
the Administrator. Notice of the determination shall be provided to each
Participant within a reasonable time after the date of such grant.
     16. Amendment and Termination of the Plan.

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          (a) Amendment and Termination; No Repricing. The Committee may at any
time amend, alter, suspend or terminate the Plan, provided that the Board may
not amend the Plan to permit the repricing, including by way of exchange, or
acquisition for cash or other consideration of any Award without receiving prior
stockholder approval.
          (b) Stockholder Approval. The Company shall obtain stockholder
approval of any Plan amendment to the extent necessary and desirable to comply
with Applicable Laws.
          (c) Effect of Amendment or Termination. No amendment, alteration,
suspension or termination of the Plan shall impair the rights of any
Participant, unless mutually agreed otherwise between the Participant and the
Administrator, which agreement must be in writing and signed by the Participant
and the Company. Termination of the Plan shall not affect the Administrator’s
ability to exercise the powers granted to it hereunder with respect to Awards
granted under the Plan prior to the date of such termination.
     17. Conditions Upon Issuance of Shares.
          (a) Legal Compliance. Shares shall not be issued pursuant to the
exercise or vesting of an Award unless the exercise or vesting of such Award and
the issuance and delivery of such Shares shall comply with Applicable Laws and
shall be further subject to the approval of counsel for the Company with respect
to such compliance.
          (b) Investment Representations. As a condition to the exercise of an
Award, the Company may require the person exercising such Award to represent and
warrant at the time of any such exercise that the Shares are being purchased
only for investment and without any present intention to sell or distribute such
Shares if, in the opinion of counsel for the Company, such a representation is
required.
     18. Inability to Obtain Authority. The inability of the Company to obtain
authority from any regulatory body having jurisdiction, which authority is
deemed by the Company’s counsel to be necessary to the lawful issuance and sale
of any Shares hereunder, shall relieve the Company of any liability in respect
of the failure to issue or sell such Shares as to which such requisite authority
shall not have been obtained.
     19. Reservation of Shares. The Company, during the term of this Plan, will
at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.
     20. Stockholder Approval. The Plan shall be subject to approval by the
stockholders of the Company within twelve (12) months after the date the Plan is
adopted. Such stockholder approval shall be obtained in the manner and to the
degree required under Applicable Laws.
     21. Compliance With Code Section 409A. Awards will be designed and operated
in such a manner that they are either exempt from the application of, or comply
with, the requirements of Code Section 409A, except as otherwise determined in
the sole discretion of the Administrator. The Plan and each Award Agreement
under the Plan is intended to meet the requirements of Code Section 409A and
will be construed and interpreted in accordance with such intent, except as
otherwise determined in the sole discretion of the Administrator. To the extent
that an Award

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or payment, or the settlement or deferral thereof, is subject to Code
Section 409A the Award will be granted, paid, settled or deferred in a manner
that will meet the requirements of Code Section 409A, such that the grant,
payment, settlement or deferral will not be subject to the additional tax or
interest applicable under Code Section 409A.

19