Exhibit 10.1

 

SILICON LABORATORIES INC.

 

2009 STOCK INCENTIVE PLAN

As Amended and Restated on April 15, 2014

 

ARTICLE 1.                                                                       
PURPOSES OF THE PLAN

 

The purposes of the Silicon Laboratories Inc. 2009 Stock Incentive Plan (the
“Plan”) are to attract and retain the best available personnel, to provide
additional incentives to Employees, Directors and Consultants and to promote the
success of the Company’s business by linking the personal interests of the
Directors, Employees, and Consultants to those of Company stockholders and by
providing such individuals with an incentive for outstanding performance to
generate superior returns to Company stockholders.

 

ARTICLE 2.                                                                       
DEFINITIONS

 

Wherever the following terms are used in the Plan they shall have the meanings
specified below, unless the context clearly indicates otherwise.  The singular
pronoun shall include the plural where the context so indicates.

 

2.1                               “Affiliate” shall have the meaning ascribed to
such term in Rule 12b-2 promulgated under the Exchange Act.  The Board shall
have the authority to determine the time or times at which “Affiliate” status is
determined within the foregoing definition.

 

2.2                               “Award” means an Option, an award of
Restricted Stock, a Stock Appreciation Right, an award of Performance Shares, an
award of Performance Stock Units, an award of Restricted Stock Units, a
Performance-Based Award or any other right or benefit, including any other Award
under Article 8, granted to a Participant pursuant to the Plan.

 

2.3                               “Award Agreement” means any written agreement,
contract, or other instrument or document evidencing the terms and conditions of
an Award, including through electronic medium.

 

2.4                               “Board” means the Board of Directors of the
Company.

 

2.5                               “Change in Control” means and includes each of
the following:

 

(a)                                 A transaction or series of transactions
(other than an offering of the Shares to the general public through a
registration statement filed with the Securities and Exchange Commission)
whereby any “person” or related “group” of “persons” (as such terms are used in
Sections 13(d) and 14(d)(2) of the Exchange Act) (other than the Company, any of
its subsidiaries, an employee benefit plan maintained by the Company or any of
its subsidiaries or a “person” that, prior to such transaction, directly or
indirectly controls, is controlled by, or is under common control with, the
Company) directly or indirectly acquires beneficial ownership (within the
meaning of Rule 13d-3 under the Exchange Act) of securities of the Company
possessing more than 50% of the total combined voting power of the Company’s
securities outstanding immediately after such acquisition; or

 

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(b)                                 During any period of two consecutive years,
individuals who, at the beginning of such period, constitute the Board together
with any new director(s) (other than a director designated by a person who shall
have entered into an agreement with the Company to effect a transaction
described in Section 2.5(a) or Section 2.5(c) hereof) whose election by the
Board or nomination for election by the Company’s stockholders was approved by a
vote of at least a majority 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 a majority thereof; or

 

(c)                                  The consummation by the Company (whether
directly involving the Company or indirectly involving the Company through one
or more intermediaries) of (x) a merger, consolidation, reorganization, or
business combination or (y) a sale or other disposition of all or substantially
all of the Company’s assets in any single transaction or series of related
transactions or (z) the acquisition of assets or stock of another entity, in
each case other than a transaction:

 

(i)                                     Which results in the Company’s voting
securities outstanding immediately before the transaction continuing to
represent (either by remaining outstanding or by being converted into voting
securities of the Company or the person that, as a result of the transaction,
controls, directly or indirectly, the Company or owns, directly or indirectly,
all or substantially all of the Company’s assets or otherwise succeeds to the
business of the Company (the Company or such person, the “Successor Entity”))
directly or indirectly, at least a majority of the combined voting power of the
Successor Entity’s outstanding voting securities immediately after the
transaction, and

 

(ii)                                  After which no person or group
beneficially owns voting securities representing 50% or more of the combined
voting power of the Successor Entity; provided, however, that no person or group
shall be treated for purposes of this Section 2.5(c)(ii) as beneficially owning
50% or more of combined voting power of the Successor Entity solely as a result
of the voting power held in the Company prior to the consummation of the
transaction; or

 

(d)                                 The Company’s stockholders approve a
liquidation or dissolution of the Company.

 

Notwithstanding anything to the contrary in the foregoing, a transaction shall
not constitute a Change in Control if it is effected for the purpose of changing
the place of incorporation or form of organization of the ultimate parent entity
(including where the Company is succeeded by an issuer incorporated under the
laws of another state, country or foreign government for such purpose and
whether or not the Company remains in existence following such transaction)
where all or substantially all of the persons or group that beneficially own all
or substantially all of the combined voting power of the Company’s voting
securities immediately prior to the transaction beneficially own all or
substantially all of the combined voting power of the Company in substantially
the same proportions of their ownership after the transaction.

 

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The Committee shall have full and final authority, which shall be exercised in
its discretion, to determine conclusively whether a Change in Control of the
Company has occurred pursuant to the above definition, and the date of the
occurrence of such Change in Control and any incidental matters relating
thereto.

 

2.6                               “Code” means the U.S. Internal Revenue Code of
1986, as amended.

 

2.7                               “Committee” means the committee of the Board
appointed or described in Article 12 to administer the Plan.

 

2.8                               “Common Stock” means the common stock of the
Company, par value $0.0001 per share, and such other securities of the Company
that may be substituted for the Common Stock pursuant to Article 11.

 

2.9                               “Company” means Silicon Laboratories Inc., a
Delaware corporation.

 

2.10                        “Consultant” means any consultant or adviser if:
(a) the consultant or advisor renders bona fide services to the Company or any
Subsidiary or Affiliate; (b) the services rendered by the consultant or advisor
are not in connection with the offer or sale of securities in a capital-raising
transaction and do not directly or indirectly promote or maintain a market for
the Company’s securities; and (c) the consultant or advisor is a natural person.

 

2.11                        “Covered Employee” means an Employee who is, or
could be, a “covered employee” within the meaning of Section 162(m) of the Code.

 

2.12                        “Director” means a member of the Board.

 

2.13                        “Disability” means that the Participant would
qualify to receive benefit payments under the long-term disability policy,  as
it may be amended from time to time, of the Company or the Subsidiary or
Affiliate to which the Participant provides services regardless of whether the
Participant is covered by such policy.  If the Company or the Subsidiary or
Affiliate to which the Participant provides service does not have a long-term
disability plan in place, “Disability” means that a Participant is unable to
carry out the responsibilities and functions of the position held by the
Participant by reason of any medically determined physical or mental impairment
for a period of not less than ninety (90) consecutive days.  A Participant shall
not be considered to have incurred a Disability unless he or she furnishes proof
of such impairment sufficient to satisfy the Board in its discretion. 
Notwithstanding the foregoing, for purposes of Incentive Stock Options granted
under the Plan, “Disability” means that the Participant is disabled within the
meaning of Section 22(e)(3) of the Code.

 

2.14                        “Dividend Equivalent Right” means a right granted to
a Participant related to the Award of Restricted Stock Units, Performance Shares
and/or Performance Units which is a right to receive the equivalent value of
dividends paid on the Shares prior to vesting of the Award.  Such Dividend
Equivalent Rights shall be converted to cash or additional Shares, or a
combination of cash and Shares, by such formula and at such time and subject to
such limitations as may be determined by the Committee.

 

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2.15                        “Eligible Individual” means any person who is an
Employee, a Consultant or a Director, as determined by the Committee.

 

2.16                        “Employee” means a full time or part time employee
of the Company or any Subsidiary or Affiliate, including an officer or Director,
who is treated as an employee in the personnel records of the Company or
Subsidiary or Affiliate for the relevant period, but shall exclude individuals
who are classified by the Company or Subsidiary or Affiliate as (a) independent
contractors or (b) intermittent or temporary, even if any such classification is
changed retroactively as a result of an audit, litigation or otherwise.  A
Participant shall not cease to be an Employee in the case of (i) any vacation or
sick time or otherwise approved paid time off in accordance with the Company or
Subsidiary or Affiliate’s policy or (ii) transfers between locations of the
Company or between the Company, a Subsidiary and/or Affiliate.  Neither services
as a Director nor payment of a director’s fee by the Company or a Subsidiary or
Affiliate shall be sufficient to constitute “employment” by the Company or any
Subsidiary or Affiliate.

 

2.17                        “Equity Restructuring” shall mean a nonreciprocal
transaction between the Company and its stockholders, such as a stock dividend,
stock split, spin-off, rights offering or recapitalization through a large,
nonrecurring cash dividend, that affects the Shares (or other securities of the
Company) or the price of Shares (or other securities) and causes a change in the
per share value of the Shares underlying outstanding Awards.

 

2.18                        “Exchange Act” means the U.S. Securities Exchange
Act of 1934, as amended.

 

2.19                        “Fair Market Value” means, as of any given date,
(a) if Shares are traded on any established stock exchange, the closing price of
a Share as quoted on the principal exchange on which the Shares are listed, as
reported in the Wall Street Journal (or such other source as the Company may
deem reliable for such purposes) for such date, or if no sale occurred on such
date, the first trading date immediately prior to such date during which a sale
occurred; or (b) if Shares are not traded on an exchange but are regularly
quoted on a national market or other quotation system, the closing sales price
on such date as quoted on such market or system, or if no sales occurred on such
date, then on the date immediately prior to such date on which sales prices are
reported; or (c) in the absence of an established market for the Shares of the
type described in (a) or (b) of this Section 2.19, the fair market value
established by the Committee acting in good faith to be reasonable and in
compliance with Section 409A of the Code.

 

Notwithstanding the foregoing, for income tax reporting purposes under U.S.
federal, state, local or non-US law and for such other purposes as the Committee
deems appropriate, including, without limitation, where Fair Market Value is
used in reference to exercise, vesting, settlement or payout of an Award, the
Fair Market Value shall be determined by the Company in accordance with uniform
and nondiscriminatory standards adopted by it from time to time.

 

2.20                        “Full Value Award” means any Award other than an
(a) Option, (b) SAR or (c) other Award for which the Participant pays (or the
value or amount payable under the Award is reduced by) an amount equal to or
exceeding the Fair Market Value of the Shares, determined as of the date of
grant.

 

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2.21                        “Incentive Stock Option” means an Option that is
intended to meet the requirements of Section 422 of the Code or any successor
provision thereto.

 

2.22                        “Independent Director” means a Director of the
Company who is not an Employee.

 

2.23                        “Involuntary Termination” shall have the meaning
ascribed to such term in the Award Agreement, or if the term is not defined in
the Award Agreement, shall mean the termination of the employment or service of
any Participant which occurs by reason of:

 

(a)                     such Participant’s involuntary dismissal or discharge by
the Company or a Subsidiary or Affiliate for reasons other than Misconduct, or

 

(b)                                 such Participant’s voluntary resignation
following (A) a change in his or her position with the Company or Subsidiary or
Affiliate employing the Participant which materially reduces his or her duties
and responsibilities or the level of management to which he or she reports,
(B) a reduction in his or her level of total compensation (including base
salary, fringe benefits and target bonus under any corporate-performance based
bonus or incentive programs) by more than fifteen percent (15%) unless such
reduction is effectuated as part of a broad-based compensation reduction scheme
within the Company and/or its Subsidiaries and Affiliates, (C) a relocation of
such Participant’s place of employment by more than fifty (50) miles, provided
and only if such change, reduction or relocation is effected by the Company
without the individual’s written consent or (D) negotiations between the
Participant and the Company and/or Subsidiary or Affiliate employing the
Participant in the context of a reduction in force.

 

2.24                        “Misconduct” shall mean the commission of any act of
fraud, embezzlement or dishonesty by the Participant, any unauthorized use or
disclosure by such person of confidential information or trade secrets of the
Company (or any Subsidiary or Affiliate) or any intentional wrongdoing by such
person, whether by omission or commission, which adversely affects the business
or affairs of the Company (or any Subsidiary or Affiliate) in a material manner,
as determined by the Committee, in its sole discretion.  This shall not limit
the grounds for the dismissal or discharge of any person in the employment or
service of the Company (or any Subsidiary or Affiliate).

 

2.25                        “New Pool” shall have the meaning assigned to it in
Section 3.1(a) hereof.

 

2.26                        “Non-Employee Director” means a Director of the
Company who qualifies as a “Non-Employee Director” as defined in
Rule 16b-3(b)(3) under the Exchange Act, or any successor rule.

 

2.27                        “Non-Qualified Stock Option” means an Option that is
not intended to be an Incentive Stock Option.

 

2.28                        “Option” means a right granted to a Participant
pursuant to Article 5 to purchase a specified number of Shares at a specified
price during specified time periods.  An Option may be either an Incentive Stock
Option or a Non-Qualified Stock Option.

 

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2.29                        “Participant” means any Eligible Individual who, as
a Director, Consultant or Employee, has been granted an Award pursuant to the
Plan.

 

2.30                        “Performance-Based Award” means an Award granted
pursuant to Article 9.

 

2.31                        “Performance Criteria” means the criteria that the
Committee selects for purposes of establishing the Performance Goal or
Performance Goals for a Participant for a Performance Period.  The Performance
Criteria that will be used to establish Performance Goals are limited to the
following: earnings or net earnings (either before or after interest, taxes,
depreciation and amortization), economic value-added, sales or revenue, income,
net income (either before or after taxes), operating earnings, cash flow
(including, but not limited to, operating cash flow and free cash flow), cash
flow return on capital, return on assets or net assets, return on stockholders’
equity, return on capital, stockholder returns, return on sales, gross or net
profit margin, productivity, expense, margins, operating efficiency, customer
satisfaction, working capital, earnings per share, price per Share, market
share, new products, customer penetration, technology and risk management, any
of which may be measured either in absolute terms or as compared to any
incremental increase or as compared to results of a peer group or securities or
stock market index.  The Committee shall define in an objective fashion the
manner of calculating the Performance Criteria it selects to use for such
Performance Period for such Participant.

 

2.32                        “Performance Goals” means, for a Performance Period,
the goals established in writing by the Committee for the Performance Period
based upon the Performance Criteria.  Depending on the Performance Criteria used
to establish such Performance Goals, the Performance Goals may be expressed in
terms of overall Company performance, the performance of a Subsidiary or
Affiliate, the performance of a division or a business unit of the Company or a
Subsidiary or Affiliate, or the performance of an individual.  The Committee, in
its discretion, may, to the extent consistent with, and within the time
prescribed by, Section 162(m) of the Code, appropriately adjust or modify the
calculation of Performance Goals for such Performance Period in order to prevent
the dilution or enlargement of the rights of Participants (a) in the event of,
or in anticipation of, any unusual or extraordinary corporate item, transaction,
event, or development, or (b) in recognition of, or in anticipation of, any
other unusual or nonrecurring events affecting the Company, or the financial
statements of the Company, or in response to, or in anticipation of, changes in
applicable laws, regulations, accounting principles, or business conditions.

 

2.33                        “Performance Period” means the one or more periods
of time, which may be of varying and overlapping durations, as the Committee may
select, over which the attainment of one or more Performance Goals will be
measured for the purpose of determining a Participant’s right to, and the
payment of, a Performance-Based Award.

 

2.34                        “Performance Share” means a right granted to a
Participant pursuant to Section 8.1 hereof, to receive Shares, the payment of
which is contingent upon achieving certain Performance Goals or other
performance-based targets established by the Committee.

 

2.35                        “Performance Stock Unit” means a right granted to a
Participant pursuant to Section 8.2 hereof, to receive Shares (or value of
Shares in cash), the payment of which is contingent upon achieving certain
Performance Goals or other performance-based targets established by the
Committee.

 

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2.36                        “Plan” means this 2009 Stock Incentive Plan, as it
may be amended from time to time.

 

2.37                        “Prior Pool” shall have the meaning assigned to it
in Section 3.1(a) hereof.

 

2.38                        “Qualified Performance-Based Compensation” means any
compensation that is intended to qualify as “qualified performance-based
compensation” as described in Section 162(m)(4)(C) of the Code.

 

2.39                        “Restricted Stock” means Shares awarded to a
Participant pursuant to Article 6 that are subject to certain restrictions as
set forth in the Award Agreement.

 

2.40                        “Restricted Stock Unit” means an Award granted
pursuant to Section 8.3 hereof and shall be evidenced by a bookkeeping entry
representing the equivalent of one Share.

 

2.41                        “Section 409A Compliance” shall have the meaning
assigned to it in Section 10.6 hereof.

 

2.42                        “Securities Act” shall mean the U.S. Securities Act
of 1933, as amended.

 

2.43                        “Share” means a share of Common Stock.

 

2.44                        “Stock Appreciation Right” or “SAR” means a right
granted pursuant to Article 7 to receive a payment equal to the excess of the
Fair Market Value of a specified number of Shares on the date the SAR is
exercised over the grant price of the SAR, as set forth in the applicable Award
Agreement.

 

2.45                        “Subsidiary” means any “subsidiary corporation” as
defined in Section 424(f) of the Code and any applicable regulations promulgated
thereunder or any other entity of which a majority of the outstanding voting
stock or voting power is beneficially owned directly or indirectly by the
Company.

 

ARTICLE 3.                                                                       
SHARES SUBJECT TO THE PLAN

 

3.1                               Number of Shares.

 

(a)                                 Separate Share Pools.  Subject to Article 11
and Section 3.1(c) hereof, the aggregate number of Shares which may be issued or
transferred pursuant to Awards, including upon the exercise of Incentive Stock
Options, under the Plan shall be 9,900,000 Shares, which shall be comprised of
the following two pools of Shares:

 

(i)                                     6,800,000 Shares, which represents the
number of Shares reserved for the grant of Awards under the Plan immediately
prior to the effective date of the amendment and restatement of the Plan set
forth in Section 13.2 hereof, of which 940,631 Shares remained available as of
February 19, 2014 (the “Prior Pool”), and

 

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(ii)                                  3,100,000 Shares, which represents the
number of Shares by which the share reserve was increased as of the effective
date of the amendment and restatement of the Plan set forth in Section 13.2
hereof (the “New Pool”).

 

(b)                                 Share Reserve Counting.  Shares that are
subject to Awards granted under the Plan shall be counted against Shares
available for grant under the Plan in accordance with the provisions of this
Section 3.1(b).

 

(i)                                     Prior Pool Share Counting.  Any Shares
that are subject to Awards granted under the Prior Pool will be counted against
the maximum limit set forth in Section 3.1(a) in accordance with the following: 
Shares that are subject to Options and SARs shall be counted as one (1) Share
for every one (1) Share subject to the granted Award; and Shares that are
subject to Full Value Awards (i.e., not Options or SARs) shall be counted as one
and fifty-five hundredths (1.55) Shares for every one (1) Share subject to the
granted Award.

 

(ii)                                  New Pool Share Counting.  Any Shares that
are subject to each type of Award granted under the New Pool shall be counted
against the maximum limit set forth in Section 3.1(a) as one (1) Share for every
one (1) Share subject to the granted Award.

 

(c)                                  Shares Reissuable Under Plan.  To the
extent that an Award terminates, expires, lapses for any reason, or is settled
in cash, any Shares subject to the Award shall again be available for the grant
of an Award pursuant to the Plan.  Any Shares that become available for the
grant of Awards pursuant to this Section 3.1(c) shall be added back in
accordance with the following:

 

(i)                                     Prior Pool.  For Awards granted under
the Prior Pool, the Shares will be added back to the Prior Pool as one (1) Share
if such Shares were subject to Options or SARs and as one and fifty-five
hundredths (1.55) Shares if such Shares were subject to Full Value Awards;

 

(ii)                                  New Pool.  For Awards granted under the
New Pool, the Shares will be added back to the New Pool as one (1) Share for
each Share subject to each type of Award.

 

(d)                                 Shares Not Counted Against Share Pool
Reserve.  To the extent permitted by applicable law and/or any exchange rule,
Shares issued in assumption of, or in substitution for, any outstanding awards
of any entity acquired in any form of combination by the Company or any
Subsidiary or Affiliate shall not be counted against Shares available for grant
pursuant to this Plan.  The payment of Dividend Equivalent Rights in cash in
conjunction with any outstanding Awards shall not be counted against the Shares
available for issuance under the Plan.

 

(e)                                  Shares Not Reissuable Under Plan. 
Notwithstanding the foregoing, the following Shares shall not be added to the
Shares authorized for grant under Section 3.1(a): (i) Any Shares tendered by a
Participant or withheld by the Company to satisfy the grant or exercise price or
tax withholding obligation pursuant to any Award; (ii) Shares not issued or
delivered as a result of the net settlement of an outstanding Award and
(iii) Shares repurchased by the Company on the open market with the proceeds of
the exercise price from Options.  Notwithstanding the provisions of this
Section 3.1(c), no Shares may again be optioned, granted or awarded if such
action would cause an Incentive Stock Option to fail to qualify as an incentive
stock option under Section 422 of the Code.

 

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3.2                               Shares Distributed.  Any Shares distributed
pursuant to an Award may consist, in whole or in part, of authorized and
unissued Shares, treasury Shares or Shares purchased on the open market.

 

3.3                               Limitation on Number of Shares Subject to
Awards.  Notwithstanding any provision in the Plan to the contrary, and subject
to Article 11, the maximum number of Shares with respect to one or more Awards
that may be granted to any one Participant during any calendar year shall be
1,000,000 Shares and where an Award is intended to comply with Section 162(m) of
the Code, the maximum amount that may be paid in cash during any calendar year
with respect to any Award shall be $30,000,000.

 

ARTICLE 4.                        ELIGIBILITY AND PARTICIPATION

 

4.1                               Eligibility.  Each Eligible Individual shall
be eligible to be granted one or more Awards pursuant to the Plan.  An Eligible
Individual who is subject to taxation in the U.S. and who is a service provider
to an Affiliate may be granted Options or SARs under this Plan only if the
Affiliate qualifies as an “eligible issuer of service recipient stock” within
the meaning of §1.409A-1(b)(5)(iii)(E) of the Treasury Regulations promulgated
under Section 409A of the Code.

 

4.2                               Participation.  Subject to the provisions of
the Plan, the Committee may, from time to time, select from among all Eligible
Individuals, those to whom Awards shall be granted and shall determine the
nature and amount of each Award.  No Eligible Individual shall have any right to
be granted an Award pursuant to this Plan and the grant of an Award to an
Eligible Individual shall not imply any entitlement to receive future Awards.

 

ARTICLE 5.                        STOCK OPTIONS

 

5.1                               General.  The Committee is authorized to grant
Options to Eligible Individuals on the following terms and conditions:

 

(a)                                 Exercise Price.  The exercise price per
Share subject to an Option shall be determined by the Committee and set forth in
the Award Agreement; provided that, subject to Section 5.2(c) hereof, the per
Share exercise price for any Option shall not be less than 100% of the Fair
Market Value of a Share on the date of grant.

 

(b)                                 Time and Conditions of Exercise.  The
Committee shall determine the time or times at which an Option may be exercised
in whole or in part; provided that the term of any Option granted under the Plan
shall not exceed ten years.  The Committee shall also determine the performance
or other conditions, if any, that must be satisfied before all or part of an
Option may be exercised.

 

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(c)                                  Payment.  The Committee shall determine the
methods by which the exercise price of an Option may be paid, potentially
including the following methods: (i) cash or check, (ii) surrender of Shares or
delivery of a properly executed form of attestation of ownership of Shares as
the Committee may require (including withholding of Shares otherwise deliverable
upon exercise of the Award) which have a Fair Market Value on the date of
surrender of attestation equal to the aggregate exercise price of the Shares as
to which the Award shall be exercised, (iii) promissory note bearing interest at
no less than such rate as shall then preclude the imputation of interest under
the Code, (iv) other property acceptable to the Committee (including through the
delivery of a notice that the Participant has placed a market sell order with a
broker with respect to Shares then issuable upon exercise of the Option, and
that the broker has been directed to pay a sufficient portion of the net
proceeds of the sale to the Company in satisfaction of the Option exercise
price; provided that payment of such proceeds is then made to the Company upon
settlement of such sale), or (v) any combination of the foregoing methods of
payment.  The Award Agreement will specify the methods of paying the exercise
price available to Participants.  The Committee shall also determine the methods
by which Shares shall be delivered or deemed to be delivered to Participants. 
Notwithstanding any other provision of the Plan to the contrary, no Participant
who is a Director or an “executive officer” of the Company within the meaning of
Section 13(k) of the Exchange Act shall be permitted to pay the exercise price
of an Option, or continue any extension of credit with respect to the exercise
price of an Option with a loan from the Company or a loan arranged by the
Company in violation of Section 13(k) of the Exchange Act.

 

(d)                                 Evidence of Grant.  All Options shall be
evidenced by an Award Agreement between the Company and the Participant.  The
Award Agreement shall include such additional provisions as may be specified by
the Committee.

 

5.2                               Incentive Stock Options.  Incentive Stock
Options shall be granted only to Employees of the Company or any Subsidiary, and
the terms of any Incentive Stock Options granted pursuant to the Plan, in
addition to the requirements of Section 5.1 hereof, must comply with the
provisions of this Section 5.2.

 

(a)                                 Expiration.  Subject to
Section 5.2(c) hereof, an Incentive Stock Option shall expire and may not be
exercised to any extent by anyone after the first to occur of the following
events:

 

(i)                                     Ten years from the date it is granted,
unless an earlier time is set in the Award Agreement;

 

(ii)                                  Three months after the Participant’s
termination of employment as an Employee; and

 

(iii)                               One year after the date of the Participant’s
termination of employment or service on account of death, or Disability within
the meaning of Section 22(e)(3) of the Code.  Upon the Participant’s Disability
or death, any Incentive Stock Options exercisable at the Participant’s
Disability or death may be exercised by the Participant’s legal representative
or representatives, by the person or persons entitled to do so pursuant to the
Participant’s last will and testament, or, if the Participant fails to make
testamentary disposition of such Incentive Stock Option or dies intestate, by
the person or persons entitled to receive the Incentive Stock Option pursuant to
the applicable laws of descent and distribution.

 

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(b)           Dollar Limitation.  The aggregate Fair Market Value (determined as
of the time the Option is granted) of all Shares with respect to which Incentive
Stock Options are first exercisable by a Participant in any calendar year may
not exceed $100,000 or such other limitation as imposed by Section 422(d) of the
Code, or any successor provision.  To the extent that Incentive Stock Options
are first exercisable by a Participant in excess of such limitation, the excess
shall be considered Non-Qualified Stock Options.

 

(c)           Ten Percent Owners.  An Incentive Stock Option shall be granted to
any individual who, at the date of grant, owns stock possessing more than ten
percent of the total combined voting power of all classes of Shares of the
Company only if such Option is granted at a price that is not less than 110% of
Fair Market Value on the date of grant and the Option is exercisable for no more
than five years from the date of grant.

 

(d)           Notice of Disposition.  The Participant shall give the Company
prompt notice of any disposition of Shares acquired by exercise of an Incentive
Stock Option within (i) two years from the date of grant of such Incentive Stock
Option or (ii) one year after the transfer of such Shares to the Participant.

 

(e)           Right to Exercise.  During a Participant’s lifetime, an Incentive
Stock Option may be exercised only by the Participant.

 

(f)            Failure to Meet Requirements.  Any Option (or portion thereof)
purported to be an Incentive Stock Option, which, for any reason, fails to meet
the requirements of Section 422 of the Code shall be considered a Non-Qualified
Stock Option.

 

ARTICLE 6.                  RESTRICTED STOCK AWARDS

 

6.1          Grant of Restricted Stock.  The Committee is authorized to make
Awards of Restricted Stock to any Eligible Individual selected by the Committee
in such amounts and subject to such terms and conditions as determined by the
Committee.  All Awards of Restricted Stock shall be evidenced by an Award
Agreement.

 

6.2          Purchase Price.  At the time of the grant of an Award of Restricted
Stock, the Committee shall determine the price, if any, to be paid by the
Participant for each Share subject to the Award of Restricted Stock.  To the
extent required by applicable law, the price to be paid by the Participant for
each Share subject to the Award of Restricted Stock shall not be less than the
par value of a Share (or such higher amount required by applicable law).  The
purchase price of Shares acquired pursuant to the Award of Restricted Stock
shall be paid either: (i) in cash at the time of purchase; (ii) at the sole
discretion of the Committee, by services rendered or to be rendered to the
Company or a Subsidiary or Affiliate; or (iii) in any other form of legal
consideration that may be acceptable to the Committee in its sole discretion and
in compliance with applicable law.

 

6.3          Issuance and Restrictions.  Restricted Stock shall be subject to
such restrictions on transferability and other restrictions as the Committee may
impose (including, without limitation, limitations on the right to vote
Restricted Stock or the right to receive dividends on the Restricted Stock). 
These restrictions may lapse separately or in combination at such times,
pursuant to such circumstances, in such installments, or otherwise, as the
Committee determines at the time of the grant of the Award or thereafter.

 

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6.4          Forfeiture.  Except as otherwise determined by the Committee at the
time of the grant of the Award or thereafter, upon termination of employment or
service during the applicable restriction period, Restricted Stock that is at
that time subject to restrictions shall be forfeited; provided, however, that
the Committee may (a) provide in any Restricted Stock Award Agreement that
restrictions or forfeiture conditions relating to Restricted Stock will be
waived in whole or in part in the event of terminations resulting from specified
causes, and (b) in other cases waive in whole or in part restrictions or
forfeiture conditions relating to Restricted Stock.

 

6.5          Certificates for Restricted Stock.  Restricted Stock granted
pursuant to the Plan may be evidenced in such manner as the Committee shall
determine.  If certificates representing shares of Restricted Stock are
registered in the name of the Participant, certificates must bear an appropriate
legend referring to the terms, conditions, and restrictions applicable to such
Restricted Stock, and the Company may, at its discretion, retain physical
possession of the certificate until such time as all applicable restrictions
lapse.

 

ARTICLE 7.                  STOCK APPRECIATION RIGHTS

 

7.1          Grant of Stock Appreciation Rights.

 

(a)           A Stock Appreciation Right may be granted to any Eligible
Individual selected by the Committee.  A Stock Appreciation Right shall be
subject to such terms and conditions not inconsistent with the Plan as the
Committee shall impose and shall be evidenced by an Award Agreement, provided
that the term of any Stock Appreciation Right shall not exceed ten years.

 

(b)           A Stock Appreciation Right shall entitle the Participant (or other
person entitled to exercise the Stock Appreciation Right pursuant to the Plan)
to exercise all or a specified portion of the Stock Appreciation Right (to the
extent then exercisable pursuant to its terms) and to receive from the Company
an amount equal to the product of (i) the excess of (A) the Fair Market Value of
the Shares on the date the Stock Appreciation Right is exercised over (B) the
grant price of the Stock Appreciation Right and (ii) the number of Shares with
respect to which the Stock Appreciation Right is exercised, subject to any
limitations the Committee may impose.

 

(c)           Grant Price.  The grant price per Share subject to a Stock
Appreciation Right shall be determined by the Committee and set forth in the
Award Agreement; provided that, the per Share grant price for any Stock
Appreciation Right shall not be less than 100% of the Fair Market Value of a
Share on the date of grant.

 

7.2          Payment and Limitations on Exercise.

 

(a)           Subject to Section 7.2(b) hereof, payment of the amounts
determined under Section 7.1(b) hereof shall be in cash, in Shares (based on its
Fair Market Value as of the date the Stock Appreciation Right is exercised) or a
combination of both, as determined by the Committee.

 

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(b)           To the extent any payment under Section 7.1(b) hereof is effected
in Shares, it shall be made subject to satisfaction of all applicable provisions
of Article 5 pertaining to Options.

 

ARTICLE 8.                  OTHER TYPES OF AWARDS

 

8.1          Performance Share Awards.  Any Eligible Individual selected by the
Committee may be granted one or more Awards of Performance Shares which shall be
denominated in a number of Shares and which may be linked to any one or more of
the Performance Criteria or other specific performance criteria determined
appropriate by the Committee, in each case on a specified date or dates or over
any period or periods determined by the Committee.  In making such
determinations, the Committee shall consider (among such other factors as it
deems relevant in light of the specific type of award) the contributions,
responsibilities and other compensation of the particular Participant.  The
Committee may authorize Dividend Equivalents to be paid on outstanding
Performance Share Awards.  If Dividend Equivalents are authorized to be paid,
they may be paid at the time dividends are declared on the Shares or at the time
the awards vest and they may be paid in either cash or Shares or any combination
of cash and Shares, as determined in the discretion of the Committee.

 

8.2          Performance Stock Units.  Any Eligible Individual selected by the
Committee may be granted one or more Performance Stock Unit awards which shall
be denominated in unit equivalent of Shares and/or units of value including
dollar value of Shares and which may be linked to any one or more of the
Performance Criteria or other specific performance criteria determined
appropriate by the Committee, in each case on a specified date or dates or over
any period or periods determined by the Committee.  In making such
determinations, the Committee shall consider (among such other factors as it
deems relevant in light of the specific type of award) the contributions,
responsibilities and other compensation of the particular Participant.  On the
vesting date, the Company shall, subject to Section 10.5(a), transfer to the
Participant one unrestricted, fully transferable Share for each Performance
Stock Unit scheduled to be paid out on such date and not previously forfeited. 
Alternatively, settlement of a Performance Stock Unit may be made in cash (in an
amount reflecting the Fair Market Value of Shares that would have been issued)
or any combination of cash and Shares, as determined by the Committee, in its
sole discretion.  The Committee may authorize Dividend Equivalents to be paid on
outstanding Performance Stock Units.  If Dividend Equivalents are authorized to
be paid, they may be paid at the time dividends are declared on the Shares or at
the time the awards vest and they may be paid in either cash or Shares or any
combination of cash and Shares, as determined in the discretion of the
Committee.

 

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8.3          Restricted Stock Units.  The Committee is authorized to make Awards
of Restricted Stock Units to any Eligible Individual selected by the Committee
in such amounts and subject to such terms and conditions as determined by the
Committee.  At the time of grant, the Committee shall specify the date or dates
on which the Restricted Stock Units shall become fully vested and
nonforfeitable, and may specify such conditions to vesting as it deems
appropriate.  The vesting conditions may be based on the passage of time or the
attainment of performance-based conditions.  On the settlement date, the Company
shall, subject to Section 10.5(a) hereof  and satisfaction of applicable
withholding taxes (as further set forth in Section 15.3 hereof), transfer to the
Participant one unrestricted, fully transferable Share for each Restricted Stock
Unit scheduled to be paid out on such date and not previously forfeited. 
Alternatively, settlement of a Restricted Stock Unit may be made in cash (in an
amount reflecting the Fair Market Value of Shares that would have been issued)
or any combination of cash and Shares, as determined by the Committee, in its
sole discretion, in either case, less applicable withholding taxes (as further
set forth in Section 15.3 hereof).  The Committee may authorize Dividend
Equivalents to be paid on outstanding Restricted Stock Units.  If Dividend
Equivalents are authorized to be paid, they may be paid at the time dividends
are declared on the Shares or at the time the awards vest and they may be paid
in either cash or Shares or any combination of cash and Shares, as determined in
the discretion of the Committee.

 

8.4          Other Awards.  The Committee is authorized under the Plan to make
any other Award to an Eligible Individual that is not inconsistent with the
provisions of the Plan and that by its terms involves or might involve the
issuance of (i) Shares, (ii) a right with an exercise or conversion privilege
related to the passage of time, the occurrence of one or more events, or the
satisfaction of performance criteria or other conditions, or (iii) any other
right with the value derived from the value of the Shares.  The Committee may
establish one or more separate programs under the Plan for the purpose of
issuing particular forms of Awards to one or more classes of Participants on
such terms and conditions as determined by the Committee from time to time.

 

8.5          Term.  Except as otherwise provided herein, the term of any Award
of Performance Shares, Performance Stock Units, Restricted Stock Units and any
other Award granted pursuant to this Article 8 shall be set by the Committee in
its discretion.

 

8.6          Exercise or Purchase Price.  The Committee may establish the
exercise or purchase price, if any, of any Award of Performance Shares,
Performance Stock Units, Restricted Stock Units and any other Award granted
pursuant to this Article 8; provided, however, that such price shall not be less
than the par value of a Share on the date of grant, unless otherwise permitted
by applicable state law.

 

8.7          Exercise upon Termination of Employment or Service.  An Award of
Performance Shares, Performance Stock Units, Restricted Stock Units and any
other Awards granted pursuant to this Article 8 shall only be exercisable or
payable while the Participant is an Employee, Consultant or Director, as
applicable; provided, however, that the Committee in its sole and absolute
discretion may provide that an Award of Performance Shares, Performance Stock
Units, Restricted Stock Units or any other Award granted pursuant to this
Article 8 may be exercised or paid subsequent to a termination of employment or
service, as applicable, or following a Change in Control of the Company, or
because of the Participant’s retirement, death or Disability, or otherwise;
provided, however, that any such provision with respect to Performance Shares or
Performance Stock Units shall be subject to the requirements of
Section 162(m) of the Code if such Performance Shares or Performance Stock Units
are granted as Qualified Performance-Based Compensation.

 

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8.8          Form of Payment.  Payments with respect to any Awards granted under
this Article 8 shall be made in cash, in Shares or a combination of both, as
determined by the Committee.

 

8.9          Award Agreement.  All Awards under this Article 8 shall be subject
to such additional terms and conditions as determined by the Committee and shall
be evidenced by an Award Agreement.

 

8.10        Timing of Settlement.  At the time of grant, the Committee shall
specify the settlement date applicable to an Award of Performance Shares,
Performance Stock Units, Restricted Stock Units or any other Award granted
pursuant to this Article 8, which shall be no earlier than the vesting
date(s) applicable to the relevant Award, or it may be deferred to any later
date to the extent and under the terms determined by the Committee, subject to
compliance with Section 409A of the Code.  Until an Award granted pursuant to
this Article 8 has been settled, the number of Shares subject to the Award shall
be subject to adjustment pursuant to Article 11 hereof.

 

ARTICLE 9.                                                     PERFORMANCE-BASED
AWARDS FOR COVERED EMPLOYEES

 

9.1          Purpose.  The purpose of this Article 9 is to provide the Committee
the ability to qualify Awards other than Options and SARs and that are granted
pursuant to Articles 6  and 8 as Qualified Performance-Based Compensation.  If
the Committee, in its discretion, decides to grant a Performance-Based Award to
a Covered Employee, the provisions of this Article 9 shall control over any
contrary provision contained in Articles 6 or 8; provided, however, that the
Committee may in its discretion grant Awards to Covered Employees that are based
on Performance Criteria or Performance Goals but that do not satisfy the
requirements of this Article 9.

 

9.2          Applicability.  This Article 9 shall apply only to those Covered
Employees selected by the Committee to receive Performance-Based Awards that are
intended to qualify as Qualified Performance-Based Compensation.  The
designation of a Covered Employee as a Participant for a Performance Period
shall not in any manner entitle the Participant to receive an Award for the
period.  Moreover, designation of a Covered Employee as a Participant for a
particular Performance Period shall not require designation of such Covered
Employee as a Participant in any subsequent Performance Period and designation
of one Covered Employee as a Participant shall not require designation of any
other Covered Employees as a Participant in such period or in any other period.

 

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9.3          Procedures with Respect to Performance-Based Awards.  To the extent
necessary to comply with the Qualified Performance-Based Compensation
requirements of Section 162(m)(4)(C) of the Code, with respect to any Award
granted under Articles 6 or 8 which may be granted to one or more Covered
Employees, no later than ninety (90) days following the commencement of any
fiscal year in question or any other designated fiscal period or period of
service (or such other time as may be required or permitted by Section 162(m) of
the Code), the Committee shall, in writing, (a) designate one or more Covered
Employees, (b) select the Performance Criteria applicable to the Performance
Period, (c) establish the Performance Goals, and amounts of such Awards, as
applicable, which may be earned for such Performance Period, and (d) specify the
relationship between Performance Criteria and the Performance Goals and the
amounts of such Awards, as applicable, to be earned by each Covered Employee for
such Performance Period.  Following the completion of each Performance Period,
the Committee shall certify in writing whether the applicable Performance Goals
have been achieved for such Performance Period.  In determining the amount
earned by a Covered Employee, the Committee shall have the right to reduce or
eliminate (but not to increase) the amount payable at a given level of
performance to take into account additional factors that the Committee may deem
relevant to the assessment of individual or corporate performance for the
Performance Period.

 

9.4          Payment of Performance-Based Awards.  Unless otherwise provided in
the applicable Award Agreement, a Participant must be employed by the Company or
a Subsidiary or Affiliate on the day a Performance-Based Award for the
appropriate Performance Period is paid to the Participant.  Furthermore, a
Participant shall be eligible to receive payment pursuant to a Performance-Based
Award for a Performance Period only if the Performance Goals for such period are
achieved.

 

9.5          Additional Limitations.  Notwithstanding any other provision of the
Plan, any Award which is granted to a Covered Employee shall be subject to any
additional limitations set forth in Section 162(m) of the Code (including any
amendment to Section 162(m) of the Code) or any regulations or rulings issued
thereunder that are requirements for qualification as qualified
performance-based compensation as described in Section 162(m)(4)(C) of the Code,
and the Plan shall be deemed amended to the extent necessary to conform to such
requirements.

 

ARTICLE 10.               PROVISIONS APPLICABLE TO AWARDS

 

10.1        Stand-Alone and Tandem Awards.  Awards granted pursuant to the Plan
may, in the discretion of the Committee, be granted either alone, in addition
to, or in tandem with, any other Award granted pursuant to the Plan. Awards
granted in addition to or in tandem with other Awards may be granted either at
the same time as or at a different time from the grant of such other Awards.

 

10.2        Award Agreement.  Awards under the Plan shall be evidenced by Award
Agreements that set forth the terms, conditions and limitations for each Award
which may include the term of an Award, the provisions applicable in the event
the Participant’s employment or service terminates, and the Company’s authority
to unilaterally or bilaterally amend, modify, suspend, cancel or rescind an
Award.

 

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10.3        Limits on Transfer.  No right or interest of a Participant in any
Award may be pledged, encumbered, or hypothecated to or in favor of any party
other than the Company or a Subsidiary or Affiliate, or shall be subject to any
lien, obligation, or liability of such Participant to any other party other than
the Company or a Subsidiary or Affiliate.  Except as otherwise provided by the
Committee, no Award shall be assigned, transferred, or otherwise disposed of by
a Participant other than by will or the laws of descent and distribution or
pursuant to beneficiary designation procedures approved from time to time by the
Committee (or the Board in the case of Awards granted to Independent
Directors).  The Committee by express provision in the Award or an amendment
thereto may permit an Award (other than an Incentive Stock Option) to be
transferred to, exercised by and paid to certain persons or entities related to
the Participant, including, but not limited to, members of the Participant’s
family, charitable institutions, or trusts or other entities whose beneficiaries
or beneficial owners are members of the Participant’s family and/or charitable
institutions, or to such other persons or entities as may be expressly approved
by the Committee, pursuant to such conditions and procedures as the Committee
may establish.  Any permitted transfer shall be subject to the condition that
the Committee receive evidence satisfactory to it that the transfer is being
made for estate and/or tax planning purposes (or to a “blind trust” in
connection with the Participant’s termination of employment or service with the
Company or a Subsidiary or Affiliate to assume a position with a governmental,
charitable, educational or similar non-profit institution) and on a basis
consistent with the Company’s lawful issue of securities.

 

10.4        Beneficiaries.  Notwithstanding Section 10.3 hereof, a Participant
may, if permitted by the Committee, designate a beneficiary to exercise the
rights of the Participant and to receive any distribution with respect to any
Award upon the Participant’s death.  A beneficiary, legal guardian, legal
representative, or other person claiming any rights pursuant to the Plan is
subject to all terms and conditions of the Plan and any Award Agreement
applicable to the Participant, except to the extent the Plan and Award Agreement
otherwise provide, and to any additional restrictions deemed necessary or
appropriate by the Committee.  If the Participant is married and resides in a
community property state, a designation of a person other than the Participant’s
spouse as his or her beneficiary with respect to more than 50% of the
Participant’s interest in the Award shall not be effective without the prior
written consent of the Participant’s spouse.  If no beneficiary has been
designated or survives the Participant, payment shall be made to either the
person’s estate or legal representative or the person entitled thereto pursuant
to the Participant’s will or the laws of descent and distribution (or equivalent
laws outside the U.S.).  Subject to the foregoing, a beneficiary designation may
be changed or revoked by a Participant at any time provided the change or
revocation is filed with the Committee.

 

10.5        Stock Certificates; Book Entry Procedures.

 

(a)           Notwithstanding anything herein to the contrary, the Company shall
not be required to issue or deliver any certificates evidencing Shares pursuant
to the exercise of any Award, unless and until the Board has determined, with
advice of counsel, that the issuance and delivery of such certificates is in
compliance with all applicable laws, regulations of governmental authorities
and, if applicable, the requirements of any exchange on which the Shares are
listed or traded.  All certificates evidencing Shares delivered pursuant to the
Plan are subject to any stop-transfer orders and other restrictions as the
Committee deems necessary or advisable to comply with federal, state local,
securities or other laws, including laws of jurisdictions outside of the United
States, rules and regulations and the rules of any national securities exchange
or automated quotation system on which the Shares are listed, quoted, or
traded.  The Committee may place legends on any certificate evidencing Shares to
reference restrictions applicable to the Shares.  In addition to the terms and
conditions provided herein, the Board may require that a Participant make such
reasonable covenants, agreements, and representations as the Board, in its
discretion, deems advisable in order to comply with any such laws, regulations,
or requirements. The Committee shall have the right to require any Participant
to comply with any timing or other restrictions with respect to the settlement
or exercise of any Award, including a window-period limitation, as may be
imposed in the discretion of the Committee.

 

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(b)           Notwithstanding any other provision of the Plan, unless otherwise
determined by the Committee or required by any applicable law, rule or
regulation, the Company shall not deliver to any Participant certificates
evidencing Shares issued in connection with any Award and instead such Shares
shall be recorded in the books of the Company (or, as applicable, its transfer
agent or stock plan administrator).

 

10.6        Accelerated Vesting and Deferral Limitations.  The Committee shall
not have the discretionary authority to accelerate or delay issuance of Shares
under an Award that constitutes a deferral of compensation within the meaning of
Section 409A of the Code, except to the extent that such acceleration or delay
may, in the discretion of the Committee, be effected in a manner that will not
cause any person to incur taxes, interest or penalties under Section 409A of the
Code (“Section 409A Compliance”).

 

10.7        Paperless Administration.  In the event that the Company
establishes, for itself or using the services of a third party, an automated
system for the documentation, granting or exercise of Awards, such as a system
using an internet website or interactive voice response, then the paperless
documentation, granting or exercise of Awards by a Participant may be permitted
through the use of such an automated system.

 

ARTICLE 11.               CHANGES IN CAPITAL STRUCTURE

 

11.1        Adjustments.

 

(a)           In the event of any stock dividend, stock split, combination or
exchange of shares, merger, consolidation or other distribution (other than
normal cash dividends) of Company assets to stockholders, or any other change
affecting the Shares or the price of the Shares other than an Equity
Restructuring, the Committee shall make such adjustments, if any, as the
Committee in its discretion may deem appropriate to reflect such change with
respect to (a) the aggregate number and kind of shares that may be issued under
the Plan (including, but not limited to, adjustments of the limitations in
Sections 3.1 and 3.3 hereof); (b) the terms and conditions of any outstanding
Awards (including, without limitation, any applicable performance targets or
criteria with respect thereto); and (c) the grant or exercise price per Share
for any outstanding Awards under the Plan.  Any adjustment affecting an Award
intended as Qualified Performance-Based Compensation shall be made consistent
with the requirements of Section 162(m) of the Code.

 

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(b)           In the event of any transaction or event described in
Section 11.1(a) hereof or any unusual or nonrecurring transactions or events
affecting the Company, any affiliate of the Company, or the financial statements
of the Company or any affiliate, or of changes in applicable laws, regulations
or accounting principles, the Committee, in its sole and absolute discretion,
and on such terms and conditions as it deems appropriate, either by the terms of
the Award or by action taken prior to the occurrence of such transaction or
event and either automatically or upon the Participant’s request, is hereby
authorized to take any one or more of the following actions whenever the
Committee determines that such action is appropriate in order to prevent
dilution or enlargement of the benefits or potential benefits intended to be
made available under the Plan or with respect to any Award under the Plan, to
facilitate such transactions or events or to give effect to such changes in
laws, regulations or principles:

 

(i)            To provide for either (A) termination of any such Award in
exchange for an amount of cash, if any, equal to the amount that would have been
attained upon the exercise of such Award or realization of the Participant’s
rights (and, for the avoidance of doubt, if as of the date of the occurrence of
the transaction or event described in this Section 11.1 the Committee determines
in good faith that no amount would have been attained upon the exercise of such
Award or realization of the Participant’s rights, then such Award may be
terminated by the Company without payment) or (B) the replacement of such Award
with other rights or property selected by the Committee in its sole discretion;

 

(ii)           To provide that such Award be assumed by the successor or
survivor corporation, or a parent or subsidiary thereof, or shall be substituted
for by similar options, rights or awards covering the stock of the successor or
survivor corporation, or a parent or subsidiary thereof, with appropriate
adjustments as to the number and kind of shares and prices;

 

(iii)          To make adjustments in the number and type of Shares (or other
securities or property) subject to outstanding Awards, and in the number and
kind of outstanding Restricted Stock and/or in the terms and conditions of
(including the grant or exercise price), and the criteria included in,
outstanding options, rights and awards;

 

(iv)          To provide that such Award shall be exercisable or payable or
fully vested with respect to all Shares covered thereby, notwithstanding
anything to the contrary in the Plan or the applicable Award Agreement; and

 

(v)           To provide that the Award cannot vest, be exercised or become
payable after such event.

 

(c)           In connection with the occurrence of any Equity Restructuring, and
notwithstanding anything to the contrary in Sections 11.1(a) and 11.1(b) hereof:

 

(i)            The number and type of securities subject to each outstanding
Award and the exercise price or grant price thereof, if applicable, shall be
equitably adjusted.  The adjustments provided under this
Section 11.1(c)(i) shall be nondiscretionary and shall be final and binding on
the affected Participant and the Company.

 

(ii)           The Committee shall make such equitable adjustments, if any, as
the Committee in its discretion may deem appropriate to reflect such Equity
Restructuring with respect to the aggregate number and kind of shares that may
be issued under the Plan (including, but not limited to, adjustments of the
limitations in Sections 3.1 and 3.3 hereof).

 

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11.2        Change in Control.

 

(a)           Notwithstanding Section 11.1 hereof, and except as may otherwise
be provided in any applicable Award Agreement or other written agreement entered
into between the Company and a Participant, if a Change in Control occurs and a
Participant’s Awards are not converted, assumed, or replaced by a successor or
survivor corporation, or a parent or subsidiary thereof, then immediately prior
to the Change in Control such Awards shall become fully exercisable and all
forfeiture restrictions on such Awards shall lapse and, following the
consummation of such Change in Control, all such Awards shall terminate and
cease to be outstanding.   In the event that the terms of any agreement (other
than the Award Agreement) between the Company or any Subsidiary or Affiliate and
a Participant contains provisions that conflict with and are more restrictive
than the provisions of this Section 11.2(a), this Section 11.2(a) shall prevail
and control and the more restrictive terms of such agreement (and only such
terms) shall be of no force or effect.

 

(b)           The Committee may at any time, subject to Section 10.6, provide
that one or more Awards will automatically accelerate in connection with a
Change in Control, whether or not those Awards are assumed or otherwise continue
in full force and effect.  In addition, where Awards are assumed or continued
after a Change of Control, the Committee may provide that one or more Awards
will automatically accelerate upon an Involuntary Termination of the
Participant’s employment or service within a designated period (not to exceed
eighteen (18) months) following the effective date of such Change in Control. 
Any such Award shall accordingly, immediately prior to the effective date of
such Change in Control or upon an Involuntary Termination of the Participant’s
employment or service following a Change in Control (at the Committee’s
discretion), become fully exercisable and all forfeiture restrictions on such
Award shall lapse.

 

(c)           Upon a Change in Control, the Committee may cause any and all
Awards outstanding hereunder to terminate at a specific time in the future,
including, but not limited to, the date of such Change in Control, and shall
give each Participant the right to exercise such Awards during a period of time
as the Committee, in its sole and absolute discretion, shall determine.

 

(d)           The portion of any Incentive Stock Option accelerated in
connection with a Change in Control shall remain exercisable as an Incentive
Stock Option only to the extent the applicable One Hundred Thousand Dollar
($100,000) limitation is not exceeded.  To the extent such dollar limitation is
exceeded, the accelerated portion of such Option shall be exercisable as a
Non-Statutory Option under the U.S. federal tax laws.

 

11.3        No Other Rights.  Except as expressly provided in the Plan, no
Participant shall have any rights by reason of any subdivision or consolidation
of Shares of any class, the payment of any dividend, any increase or decrease in
the number of Shares of any class or any dissolution, liquidation, merger, or
consolidation of the Company or any other corporation.  Except as expressly
provided in the Plan or pursuant to action of the Committee under the Plan, no
issuance by the Company of Shares of any class, or securities convertible into
Shares of any class, shall affect, and no adjustment by reason thereof shall be
made with respect to, the number of Shares subject to an Award or the grant or
the exercise price of any Award.

 

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ARTICLE 12.               ADMINISTRATION

 

12.1        Committee.  Unless and until the Board delegates administration of
the Plan to a Committee as set forth below, the Plan shall be administered by
the full Board, and for such purposes the term “Committee” as used in this Plan
shall be deemed to refer to the Board.  The Board, at its discretion or as
otherwise necessary to comply with the requirements of Section 162(m) of the
Code, Rule 16b-3 promulgated under the Exchange Act or to the extent required by
any other applicable rule or regulation, may delegate administration of the Plan
to a Committee consisting of two or more members of the Board.  Unless otherwise
determined by the Board, the Committee shall consist solely of two or more
members of the Board each of whom is an “outside director,” within the meaning
of Section 162(m) of the Code, a Non-Employee Director and an “independent
director” under the NASDAQ rules (or other principal securities market on which
Shares are traded); provided that any action taken by the Committee shall be
valid and effective, whether or not members of the Committee at the time of such
action are later determined not to have satisfied the requirements for
membership set forth in this Section 12.1 or otherwise provided in any charter
of the Committee.  Notwithstanding the foregoing: (a) the full Board, acting by
a majority of its members in office, shall conduct the general administration of
the Plan with respect to all Awards granted to Independent Directors and for
purposes of such Awards the term “Committee” as used in this Plan shall be
deemed to refer to the Board and (b) the Committee may delegate its authority
hereunder to the extent permitted by Section 12.5 hereof.  In its sole
discretion, the Board may at any time and from time to time exercise any and all
rights and duties of the Committee under the Plan except with respect to matters
which under Rule 16b-3 under the Exchange Act or Section 162(m) of the Code, or
any regulations or rules issued thereunder, are required to be determined in the
sole discretion of the Committee.  Except as may otherwise be provided in any
charter of the Committee, appointment of Committee members shall be effective
upon acceptance of appointment; Committee members may resign at any time by
delivering written notice to the Board; and vacancies in the Committee may only
be filled by the Board.

 

12.2        Action by the Committee.  Unless otherwise established by the Board
or in any charter of the Committee, a majority of the Committee shall constitute
a quorum and the acts of a majority of the members present at any meeting at
which a quorum is present, and acts approved in writing by a majority of the
Committee in lieu of a meeting, shall be deemed the acts of the Committee.  Each
member of the Committee is entitled to, in good faith, rely or act upon any
report or other information furnished to that member by any officer or other
employee of the Company or any Subsidiary or Affiliate, the Company’s
independent certified public accountants, or any executive compensation
consultant or other professional retained by the Company to assist in the
administration of the Plan.

 

12.3        Authority of Committee.  Subject to any specific designation in the
Plan, the Committee has the exclusive power, authority and discretion to:

 

(a)           Designate Participants to receive Awards;

 

(b)           Determine the type or types of Awards to be granted to each
Participant;

 

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(c)           Determine the number of Awards to be granted and the number of
Shares to which an Award will relate;

 

(d)           Determine the terms and conditions of any Award granted pursuant
to the Plan, including, but not limited to, the exercise price, grant price, or
purchase price, any restrictions or limitations on the Award, any schedule for
lapse of forfeiture restrictions or restrictions on the exercisability of an
Award, and accelerations or waivers thereof, any provisions related to
non-competition and recapture of gain on an Award, based in each case on such
considerations as the Committee in its sole discretion determines; provided,
however, that the Committee shall not have the authority to accelerate the
vesting or waive the forfeiture of any Performance-Based Awards intended to
qualify as Qualified Performance Based-Compensation, except as permitted under
Section 162(m) of the Code;

 

(e)           Determine whether, to what extent, and pursuant to what
circumstances an Award may be settled in, or the exercise price of an Award may
be paid in, cash, Shares, other Awards, or other property, or an Award may be
canceled, forfeited, or surrendered;

 

(f)            Prescribe the form of each Award Agreement, which need not be
identical for each Participant and may vary for Participants outside the United
States;

 

(g)           Decide all other matters that must be determined in connection
with an Award;

 

(h)           Establish, adopt, or revise any rules and regulations including
adopting sub-plans to the Plan for the purposes of complying with foreign laws
an/or taking advantage of tax favorable treatment for Awards granted to
Participants outside the United States, as it may deem necessary or advisable to
administer the Plan;

 

(i)            To suspend or terminate the Plan at any time provided that such
suspension or termination does not impair rights and obligations under any
outstanding Award without written consent of the affected Participant.

 

(j)            Interpret the terms of, and any matter arising pursuant to, the
Plan or any Award Agreement; and

 

(k)           Make all other decisions and determinations that may be required
pursuant to the Plan or as the Committee deems necessary or advisable to
administer the Plan.

 

12.4        Decisions Binding.  The Committee’s interpretation of the Plan, any
Awards granted pursuant to the Plan, any Award Agreement and all decisions and
determinations by the Committee with respect to the Plan are final, binding, and
conclusive on all parties.

 

12.5        Delegation of Authority.  To the extent permitted by applicable law,
the Board may from time to time delegate to a committee of one or more members
of the Board or one or more officers of the Company the authority to grant or
amend Awards to Participants other than (a) Employees who are subject to
Section 16 of the Exchange Act, (b) Covered Employees, or (c) officers of the
Company (or Directors) to whom authority to grant or amend Awards has been
delegated hereunder.  For the avoidance of doubt, provided it meets the
limitation in the preceding sentence, this delegation shall include the right to
modify Awards as necessary to accommodate changes in the laws or regulations,
including in jurisdictions outside the United States.  Any delegation hereunder
shall be subject to the restrictions and limits that the Board specifies at the
time of such delegation, and the Board may at any time rescind the authority so
delegated or appoint a new delegatee.  At all times, the delegatee appointed
under this Section 12.5 shall serve in such capacity at the pleasure of the
Board.

 

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ARTICLE 13.               PLAN HISTORY AND EXPIRATION DATE

 

13.1        Plan History.  The Plan became effective on April 23, 2009, the date
the Plan was initially approved by the Company’s stockholders.  The Plan was
subsequently amended and restated, effective as of April 15, 2014.

 

13.2        Expiration Date.  The Plan will continue in effect until it is
terminated by the Board pursuant to Section 14.1 hereof, except that no
Incentive Stock Options may be granted under the Plan after the tenth
anniversary of January 23, 2014.  Any Awards that are outstanding on the date
the Plan terminates shall remain in force according to the terms of the Plan and
the applicable Award Agreement.

 

ARTICLE 14.               AMENDMENT, MODIFICATION, AND TERMINATION

 

14.1        Amendment, Modification, and Termination.  Subject to Section 15.14
hereof, with the approval of the Board, at any time and from time to time, the
Committee may terminate, amend or modify the Plan; provided, however, that
(a) to the extent necessary and desirable to comply with any applicable law,
regulation, or stock exchange rule, the Company shall obtain stockholder
approval of any Plan amendment in such a manner and to such a degree as
required, and (b) stockholder approval shall be required for any amendment to
the Plan that (i) increases the number of shares available under the Plan (other
than any adjustment as provided by Article 11), or (ii) permits the Committee to
extend the exercise period for an Option beyond ten years from the date of
grant.  Notwithstanding any provision in this Plan to the contrary, absent
approval of the stockholders of the Company, no Option or SAR may be amended to
reduce the per share exercise price of the shares subject to such Option or SAR
below the per share exercise price as of the date the Option or SAR is granted
and, except as permitted by Article 11, (a) no Option or SAR may be granted in
exchange for, or in connection with, the cancellation, surrender or substitution
of an Option or SAR having a higher per share exercise price and (b) no Option
or SAR may be cancelled in exchange for, or in connection with, the payment of a
cash amount or another Award at a time when the Option or SAR has a per share
exercise price that is higher than the Fair Market Value of a Share.

 

14.2        Awards Previously Granted.  Except with respect to amendments made
or other actions taken pursuant to Section 15.14 hereof or any amendment or
other action with respect to an outstanding Award that may be required or
desirable to comply with applicable law, as determined in the sole discretion of
the Committee, no termination, amendment, or modification of the Plan shall
adversely affect in any material way any Award previously granted pursuant to
the Plan without the prior written consent of the Participant; provided,
however, that an amendment or modification that may cause an Incentive Stock
Option to become a Non-Qualified Stock Option shall not be treated as adversely
affecting the rights of the Participant.

 

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ARTICLE 15.               GENERAL PROVISIONS

 

15.1        No Rights to Awards.  No Eligible Individual or other person shall
have any claim to be granted any Award pursuant to the Plan, and neither the
Company nor the Committee is obligated to treat Eligible Individuals,
Participants or any other persons uniformly.

 

15.2        No Stockholders Rights.  Except as otherwise provided herein, a
Participant shall have none of the rights of a stockholder with respect to
Shares covered by any Award, including the right to vote or receive dividends,
until the Participant becomes the record owner of such Shares, notwithstanding
the exercise of an Option or other Award.

 

15.3        Withholding.  The Company or any Subsidiary or Affiliate, as
appropriate, shall have the authority and the right to deduct or withhold, or
require a Participant to remit to the Company, an amount sufficient to satisfy
U.S. federal, state, and local taxes and taxes imposed by jurisdictions outside
of the United States (including income tax, social insurance contributions,
payment on account and any other taxes that may be due) that the Company or a
Subsidiary or Affiliate determines are required to be withheld with respect to
any taxable event concerning a Participant arising as a result of this Plan or
to take such other action as may be necessary in the opinion of the Company or a
Subsidiary or Affiliate, as appropriate, to satisfy withholding obligations for
the payment of taxes.  The Committee may in its discretion and in satisfaction
of the foregoing requirement allow the Company to withhold, or allow a
Participant to elect to have the Company withhold, Shares otherwise issuable
under an Award (or allow the return of Shares) having a Fair Market Value equal
to the sums required to be withheld.  No Shares shall be delivered hereunder to
any Participant or other person until the Participant or such other person has
made arrangements acceptable to the Committee for the satisfaction of these tax
obligations with respect to any taxable event concerning the Participant or such
other person arising as a result of Awards made under this Plan.

 

15.4        No Right to Employment or Services.  Nothing in the Plan or any
Award Agreement shall interfere with or limit in any way the right of the
Company or any Subsidiary or Affiliate to terminate any Participant’s employment
or services at any time, nor confer upon any Participant any right to continue
in the employ or service of the Company or any Subsidiary or Affiliate.

 

15.5        Unfunded Status of Awards.  The Plan is intended to be an “unfunded”
plan for incentive compensation.  With respect to any payments not yet made to a
Participant pursuant to an Award, nothing contained in the Plan or any Award
Agreement shall give the Participant any rights that are greater than those of a
general creditor of the Company or any Subsidiary or Affiliate.

 

15.6        Indemnification.  To the extent allowable pursuant to applicable
law, each member of the Committee or of the Board shall be indemnified and held
harmless by the Company from any loss, cost, liability, or expense that may be
imposed upon or reasonably incurred by such member in connection with or
resulting from any claim, action, suit, or proceeding to which he or she may be
a party or in which he or she may be involved by reason of any action or failure
to act pursuant to the Plan and against and from any and all amounts paid by him
or her in satisfaction of judgment in such action, suit, or proceeding against
him or her; provided he or she gives the Company an opportunity, at its own
expense, to handle and defend the same before he or she undertakes to handle and
defend it on his or her own behalf.  The foregoing right of indemnification
shall not be exclusive of any other rights of indemnification to which such
persons may be entitled pursuant to the Company’s Certificate of Incorporation
or Bylaws, as a matter of law, or otherwise, or any power that the Company may
have to indemnify them or hold them harmless.

 

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15.7        Relationship to other Benefits.  No payment pursuant to the Plan
shall be taken into account in determining any benefits pursuant to any pension,
retirement, savings, profit sharing, group insurance, termination programs
and/or indemnities or severance payments, welfare or other benefit plan of the
Company or any Subsidiary or Affiliate except to the extent otherwise expressly
provided in writing in such other plan or an agreement thereunder.

 

15.8        Expenses.  The expenses of administering the Plan shall be borne by
the Company and/or its Subsidiaries and/or Affiliates.

 

15.9        Titles and Headings.  The titles and headings of the Sections in the
Plan are for convenience of reference only and, in the event of any conflict,
the text of the Plan, rather than such titles or headings, shall control.

 

15.10      Fractional Shares.  No fractional Shares shall be issued and the
Committee shall determine, in its discretion, whether cash shall be given in
lieu of fractional shares or whether such fractional shares shall be eliminated
by rounding up or down as appropriate.

 

15.11      Limitations Applicable to Section 16 Persons.  Notwithstanding any
other provision of the Plan, the Plan, and any Award granted or awarded to any
Participant who is then subject to Section 16 of the Exchange Act, shall be
subject to any additional limitations set forth in any applicable exemptive
rule under Section 16 of the Exchange Act (including any amendment to Rule 16b-3
under the Exchange Act) that are requirements for the application of such
exemptive rule.  To the extent permitted by applicable law, the Plan and Awards
granted or awarded hereunder shall be deemed amended to the extent necessary to
conform to such applicable exemptive rule.

 

15.12      Government and Other Regulations.  The obligation of the Company to
make payment of awards in Shares or otherwise shall be subject to all applicable
laws, rules, and regulations of the United States and jurisdictions outside the
United States, and to such approvals by government agencies, including
government agencies in jurisdictions outside of the United States, in each case
as may be required or as the Company deems necessary or advisable.  Without
limiting the foregoing, the Company shall have no obligation to issue or deliver
evidence of title for Shares subject to Awards granted hereunder prior to:
(i) obtaining any approvals from governmental agencies that the Company
determines are necessary or advisable, and (ii) completion of any registration
or other qualification with respect to the Shares under any applicable law in
the United States or in a jurisdiction outside of the United States or ruling of
any governmental body that the Company determines to be necessary or advisable
or at a time when any such registration or qualification is not current, has
been suspended or otherwise has ceased to be effective.  The inability or
impracticability of the Company to obtain or maintain 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 and shall constitute circumstances in which the Committee may determine
to amend or cancel Awards pertaining to such Shares, with or without
consideration to the affected Participant.  The Company shall be under no
obligation to register pursuant to the Securities Act, as amended, any of the
Shares paid pursuant to the Plan.  If the Shares paid pursuant to the Plan may
in certain circumstances be exempt from registration pursuant to the Securities
Act, as amended, the Company may restrict the transfer of such Shares in such
manner as it deems advisable to ensure the availability of any such exemption.

 

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15.13      Governing Law.  The Plan and all Award Agreements shall be construed
in accordance with and governed by the laws of the State of Texas.

 

15.14      Section 409A.  Except as provided in Section 15.15 hereof, to the
extent that the Committee determines that any Award granted under the Plan is
subject to Section 409A of the Code, the Award Agreement evidencing such Award
shall incorporate the terms and conditions required by Section 409A of the
Code.  To the extent applicable, the Plan and Award Agreements shall be
interpreted in accordance with Section 409A of the Code and Department of
Treasury regulations and other interpretive guidance issued thereunder,
including without limitation any such regulations or other guidance that may be
issued after the date the Plan became effective.  Notwithstanding any provision
of the Plan to the contrary, in the event that following the date an Award is
granted the Committee determines that the Award may be subject to Section 409A
of the Code and related Department of Treasury guidance(including such
Department of Treasury guidance as may be issued after the date the Plan became
effective), the Committee may adopt such amendments to the Plan and the
applicable Award Agreement or adopt other policies and procedures (including
amendments, policies and procedures with retroactive effect), or take any other
actions, including amendments or actions that would result in a reduction to the
benefits payable under an Award, in each case, without the consent of the
Participant, that the Committee determines are necessary or appropriate to
(a) exempt the Award from Section 409A of the Code and/or preserve the intended
tax treatment of the benefits provided with respect to the Award, or (b) comply
with the requirements of Section 409A of the Code and related Department of
Treasury guidance and thereby avoid the application of any penalty taxes under
such Section or mitigate any additional tax, interest and/or penalties or other
adverse tax consequences that may apply under Section 409A of the Code if
compliance is not practical.

 

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15.15      No Representations or Covenants with respect to Tax Qualification. 
Although the Company may endeavor to (1) qualify an Award for favorable tax
treatment under the laws of the United States or jurisdictions outside of the
United States (e.g., incentive stock options under Section 422 of the Code or
French-qualified stock options) or (2) avoid adverse tax treatment (e.g., under
Section 409A of the Code), the Company makes no representation to that effect
and expressly disavows any covenant to maintain favorable or avoid unfavorable
tax treatment, anything to the contrary in this Plan, including Section 15.14
hereof, notwithstanding.  The Company shall be unconstrained in its corporate
activities without regard to the potential negative tax impact on holders of
Awards under the Plan.  Nothing in this Plan or in an Award Agreement shall
provide a basis for any person to take any action against the Company or any
Affiliate based on matters covered by Section 409A of the Code, including the
tax treatment of any Awards, and neither the Company nor any Affiliate will have
any liability under any circumstances to the Participant or any other party if
the Award that is intended to be exempt from, or compliant with, Section 409A of
the Code, is not so exempt or compliant or for any action taken by the Committee
with respect thereto.

 

15.16      Clawback/Recovery. All Awards granted under the Plan will be subject
to recoupment in accordance with any clawback policy that the Company is
required to adopt pursuant to the listing standards of any national securities
exchange or association on which the Company’s securities are listed or as is
otherwise required by the Dodd-Frank Wall Street Reform and Consumer Protection
Act or other Applicable Laws.  In addition, the Committee may impose such other
clawback, recovery or recoupment provisions on an Award as the Committee
determines necessary or appropriate, including, but not limited to, a
reacquisition right in respect of previously acquired Shares or other cash or
property upon the occurrence of cause (as determined by the Committee).

 

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