Exhibit 10.1
AMERICAN REPROGRAPHICS COMPANY
2005 EMPLOYEE STOCK PURCHASE PLAN
Adopted By the Board of Directors January 10, 2005
Approved By Shareholders February 3, 2005
Amended and Restated as of July 30, 2009
1. Purpose.
(a) The purpose of the Plan is to provide a means by which Employees of the
Company and certain designated Related Corporations may be given an opportunity
to purchase shares of the Common Stock of the Company. This Plan includes two
components: a Code Section 423 Component and a Non-423 Component. This Plan
shall govern the terms and conditions of grants made under both the Code
Section 423 Component and the Non-423 Component. Except as otherwise indicated,
the Non-423 Component will operate and be administered in the same manner as the
Code Section 423 Component.
(b) The Company, by means of the Plan, seeks to secure and retain the services
of current and new Employees and to provide incentives for such persons to exert
maximum efforts for the success of the Company and its Related Corporations.
(c) The Company intends that the Purchase Rights granted under the Code
Section 423 Component be considered options issued under an employee stock
purchase plan qualifying under Section 423 of the Code although the Company
makes no undertaking or representation to maintain such qualification.
2. Definitions.
As used in the Plan and any Offering, unless otherwise specified, the following
terms have the meanings set forth below:
(a) “Board” means the Board of Directors of the Company.
(b) “Code” means the Internal Revenue Code of 1986, as amended.
(c) “Code Section 423 Component” means the component of this Plan that is
intended to meet the requirements set forth in Section 423(b) of the Code, as
amended, to qualify as an “employee stock purchase plan” under Section 423 of
the Code. The provisions of the Code Section 423 Component shall be construed,
administered and enforced in accordance with Section 423(b), so as to extend and
limit Plan participation in a uniform and nondiscriminatory basis consistent
with the requirements of Section 423 of the Code.
(d) “Committee” means a committee appointed by the Board in accordance with
Section 3(c) of the Plan.
(e) “Common Stock” means the common stock of the Company.

 

 

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(f) “Company” means American Reprographics Company, a Delaware corporation.
(g) “Contributions” means the payroll deductions and other additional payments
that a Participant contributes to fund the exercise of a Purchase Right.
(h) “Corporate Transaction” means the occurrence, in a single transaction or in
a series of related transactions, of any one or more of the following events:
(i) a sale, lease, license or other disposition of all or substantially all of
the consolidated assets of the Company;
(ii) a sale or other disposition of at least ninety percent (90%) of the
outstanding securities of the Company;
(iii) a merger, consolidation or similar transaction following which the Company
is not the surviving corporation; or
(iv) a merger, consolidation or similar transaction following which the Company
is the surviving corporation but the shares of Common Stock outstanding
immediately preceding the merger, consolidation or similar transaction are
converted or exchanged by virtue of the merger, consolidation or similar
transaction into other property, whether in the form of securities, cash or
otherwise.
(i) “Director” means a member of the Board.
(j) “Eligible Employee” means an Employee who meets the requirements set forth
in the Offering for eligibility to participate in the Offering, provided that
such Employee also meets the requirements for eligibility to participate set
forth in Section 6 of the Plan.
(k) “Employee” means any person, including Officers and Directors, who is
employed for purposes of Section 423(b)(4) of the Code by the Company or a
Related Corporation. Neither service as a Director nor payment of a director’s
fee shall be sufficient to make an individual an Employee of the Company or a
Related Corporation.
(l) “Exchange Act” means the Securities Exchange Act of 1934, as amended.
(m) “Fair Market Value” means the value of a security, as determined in good
faith by the Board. If the security is listed on any established stock exchange
or traded on the New York Stock Exchange, the Fair Market Value of a share of
Common Stock shall be the closing sales price for such stock (or the closing
bid, if no sales were reported) as quoted on such exchange (or the exchange or
market with the greatest volume of trading in the Common Stock) on the last
Trading Day prior to the relevant determination date, as reported in The Wall
Street Journal or such other source as the Board deems reliable.
(n) “IPO Date” means the effective date of the initial public offering of the
Common Stock.

 

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(o) “Non-423 Component” means a component of this Plan that is not intended to
meet the requirements set forth in Section 423(b) of the Code, as amended.
Options may be granted under the Non-423 Component pursuant to rules, procedures
or sub-plans adopted by the Board (or the Committee) that are designed to
achieve tax, securities laws or other objectives for Eligible Employees and/or
the Company.
(p) “Offering” means the grant of Purchase Rights to purchase shares of Common
Stock under the Plan to Eligible Employees.
(q) “Offering Date” means a date selected by the Board for an Offering to
commence.
(r) “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.
(s) “Participant” means an Eligible Employee who holds an outstanding Purchase
Right granted pursuant to the Plan.
(t) “Plan” means this American Reprographics Company 2005 Employee Stock
Purchase Plan, which includes a Code Section 423 Component and a Non-423
Component.
(u) “Purchase Date” means one or more dates during an Offering established by
the Board on which Purchase Rights shall be exercised and as of which purchases
of shares of Common Stock shall be carried out in accordance with such Offering.
(v) “Purchase Period” means a period of time specified within an Offering
beginning on the Offering Date or on the next day following a Purchase Date
within an Offering and ending on a Purchase Date. An Offering may consist of one
or more Purchase Periods.
(w) “Purchase Right” means an option to purchase shares of Common Stock granted
pursuant to the Plan.
(x) “Related Corporation” means any parent corporation or subsidiary
corporation, whether now or hereafter existing, as those terms are defined in
Sections 424(e) and (f), respectively, of the Code.
(y) “Securities Act” means the Securities Act of 1933, as amended.
(z) “Trading Day” means any day on which the exchange(s) or market(s) on which
shares of Common Stock are listed, whether it be an established stock exchange,
the New York Stock Exchange or otherwise, is open for trading.
3. Administration.
(a) The Board shall administer the Plan unless and until the Board delegates
administration to a Committee, as provided in Section 3(c). Whether or not the
Board has delegated administration, the Board shall have the final power to
determine all questions of policy and expediency that may arise in the
administration of the Plan.

 

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(b) The Board (or the Committee) shall have the power, subject to, and within
the limitations of, the express provisions of the Plan:
(i) To determine when and how Purchase Rights to purchase shares of Common Stock
shall be granted and the provisions of each Offering of such Purchase Rights
(which need not be identical).
(ii) To designate from time to time which Related Corporations of the Company
shall be eligible to participate in the Plan and designate which Related
Corporations should participate in the Non-423 Component of the Plan.
(iii) To construe and interpret the Plan and Purchase Rights, and to establish,
amend and revoke rules and regulations for the administration of the Plan. The
Board, in the exercise of this power, may correct any defect, omission or
inconsistency in the Plan, in a manner and to the extent it shall deem necessary
or expedient to make the Plan fully effective.
(iv) To amend the Plan as provided in Section 15.
(v) To terminate or suspend the Plan as provided in Section 16.
(vi) Generally, to exercise such powers and to perform such acts as it deems
necessary or expedient to promote the best interests of the Company and its
Related Corporations and to carry out the intent that Offerings made under the
423 Component of the Plan be treated as qualifying under Section 423(b) of the
Code.
(vii) To adopt such procedures and sub-plans as are necessary or appropriate to
permit participation in the Non-423 Component of the Plan by Employees who are
foreign nationals or employed outside the United States.
(c) The Board may delegate administration of the Plan to a Committee of the
Board composed of one (1) or more members of the Board. If administration of the
Plan is delegated to a Committee, the Committee shall have, in connection with
the administration of the Plan, the powers theretofore possessed by the Board,
subject, however, to such resolutions, not inconsistent with the provisions of
the Plan, as may be adopted from time to time by the Board. The Board may
abolish the Committee at any time and revest in the Board some or all of the
powers previously delegated. If administration is delegated to a Committee,
references to the Board in this Plan and in the Offering document shall
thereafter be deemed to be to the Board or the Committee, as the case may be.
(d) All determinations, interpretations and constructions made by the Board in
good faith shall not be subject to review by any person and shall be final,
binding and conclusive on all persons.
4. Shares of Common Stock Subject to the Plan.
Subject to the provisions of Section 14(a) relating to adjustments upon changes
in Common Stock, the stock that may be sold pursuant to Purchase Rights granted
under the Plan shall not exceed in the aggregate seven hundred fifty thousand
(750,000) shares of Common Stock.

 

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5. Grant of Purchase Rights; Offering.
(a) The Board may from time to time grant or provide for the grant of Purchase
Rights to purchase shares of Common Stock under the Plan to Eligible Employees
in an Offering (consisting of one or more Purchase Periods) on an Offering Date
or Offering Dates selected by the Board. Each Offering under the Code
Section 423 Component shall be in such form and shall contain such terms and
conditions as the Board shall deem appropriate, which shall comply with the
requirement of Section 423(b)(5) of the Code that all Employees granted Purchase
Rights shall have the same rights and privileges. The terms and conditions of an
Offering shall be incorporated by reference into the Plan and treated as part of
the Plan. The provisions of separate Offerings need not be identical, but each
Offering shall include (by reference to the provisions of this Plan or
otherwise) the period during which the Offering shall be effective, which period
shall not exceed twenty-seven (27) months beginning with the Offering Date, and
the substance of the provisions contained in Sections 6 through 9, inclusive.
The Board may from time to time grant or provide for the grant of rights to
purchase Common Stock of the Company under the Non-423 Component. If such grants
are intended to be made under the Non-423 Component, they will be designated as
such at the time of grant and such grants may not comply with the requirements
set forth under Section 423 of the Code.
(b) If a Participant has more than one Purchase Right outstanding under the
Plan, unless he or she otherwise indicates in agreements or notices delivered
hereunder: (i) each agreement or notice delivered by that Participant shall be
deemed to apply to all of his or her Purchase Rights under the Plan, and (ii) a
Purchase Right with a lower exercise price (or an earlier-granted Purchase
Right, if different Purchase Rights have identical exercise prices) shall be
exercised to the fullest possible extent before a Purchase Right with a higher
exercise price (or a later-granted Purchase Right if different Purchase Rights
have identical exercise prices) shall be exercised.
6. Eligibility.
(a) Purchase Rights may be granted only to Employees of the Company or, as the
Board may designate as provided in Section 3(b), to Employees of a Related
Corporation. Except as provided in Section 6(b), an Employee shall not be
eligible to be granted Purchase Rights under the Plan unless, on the Offering
Date, such Employee has been in the employ of the Company or the Related
Corporation, as the case may be, for such continuous period preceding such
Offering Date as the Board may require, but in no event shall the required
period of continuous employment be greater than two (2) years. In addition, the
Board may provide that no Employee shall be eligible to be granted Purchase
Rights under the Plan unless, on the Offering Date, such Employee’s customary
employment with the Company or the Related Corporation is more than twenty
(20) hours per week and/or more than five (5) months per calendar year.

 

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(b) The Board may provide that each person who, during the course of an
Offering, first becomes an Eligible Employee shall, on a date or dates specified
in the Offering which coincides with the day on which such person becomes an
Eligible Employee or which occurs thereafter, receive a Purchase Right under
that Offering, which Purchase Right shall thereafter be deemed to be a part of
that Offering. Such Purchase Right shall have the same characteristics as any
Purchase Rights originally granted under that Offering, as described herein,
except that:
(i) the date on which such Purchase Right is granted shall be the “Offering
Date” of such Purchase Right for all purposes, including determination of the
exercise price of such Purchase Right;
(ii) the period of the Offering with respect to such Purchase Right shall begin
on its Offering Date and end coincident with the end of such Offering; and
(iii) the Board may provide that if such person first becomes an Eligible
Employee within a specified period of time before the end of the Offering, he or
she shall not receive any Purchase Right under that Offering.
(c) No Employee shall be eligible for the grant of any Purchase Rights under the
Plan if, immediately after any such Purchase Rights are granted, such Employee
owns stock possessing five percent (5%) or more of the total combined voting
power or value of all classes of stock of the Company or of any Related
Corporation. For purposes of this Section 6(c), the rules of Section 424(d) of
the Code shall apply in determining the stock ownership of any Employee, and
stock which such Employee may purchase under all outstanding Purchase Rights and
options shall be treated as stock owned by such Employee.
(d) As specified by Section 423(b)(8) of the Code, an Eligible Employee may be
granted Purchase Rights under the Plan only if such Purchase Rights, together
with any other rights granted under all employee stock purchase plans of the
Company and any Related Corporations, do not permit such Eligible Employee’s
rights to purchase stock of the Company or any Related Corporation to accrue at
a rate which exceeds twenty five thousand dollars ($25,000) of Fair Market Value
of such stock (determined at the time such rights are granted, and which, with
respect to the Plan, shall be determined as of their respective Offering Dates)
for each calendar year in which such rights are outstanding at any time.
(e) Officers of the Company and any designated Related Corporation, if they are
otherwise Eligible Employees, shall be eligible to participate in Offerings
under the Plan. Notwithstanding the foregoing, the Board may provide in an
Offering that Employees who are highly compensated Employees within the meaning
of Section 423(b)(4)(D) of the Code shall not be eligible to participate.

 

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7. Purchase Rights; Purchase Price.
(a) On each Offering Date, each Eligible Employee, pursuant to an Offering made
under the Plan, shall be granted a Purchase Right to purchase up to that number
of shares of Common Stock purchasable either with a percentage or with a maximum
dollar amount, as designated by the Board, but in either case not exceeding
fifteen percent (15%), of such Employee’s Earnings (as defined by the Board in
each Offering) during the period that begins on the Offering Date (or such later
date as the Board determines for a particular Offering) and ends on the date
stated in the Offering, which date shall be no later than the end of the
Offering.
(b) The Board shall establish one (1) or more Purchase Dates during an Offering
as of which Purchase Rights granted pursuant to that Offering shall be exercised
and purchases of shares of Common Stock shall be carried out in accordance with
such Offering.
(c) In connection with each Offering made under the Plan, the Board may specify
a maximum number of shares of Common Stock that may be purchased by any
Participant on any Purchase Date during such Offering. In connection with each
Offering made under the Plan, the Board may specify a maximum aggregate number
of shares of Common Stock that may be purchased by all Participants pursuant to
such Offering. In addition, in connection with each Offering that contains more
than one Purchase Date, the Board may specify a maximum aggregate number of
shares of Common Stock that may be purchased by all Participants on any Purchase
Date under the Offering. Notwithstanding anything to the contrary, during any
calendar year, no Participant may purchase under this Plan in excess of the
lesser of (i) two thousand five hundred (2,500) shares of Common Stock, or
(ii) a number of shares of Common Stock having an aggregate Fair Market Value
(determined on the date of the purchase(s)) of twenty-five thousand dollars
($25,000).
(d) If the number of shares of Common Stock which might be purchased by all
Participants on a Purchase Date exceeds the number of shares of Common Stock
available in the Plan as provided in Section 4 or the maximum aggregate number
of shares of Common Stock that may be purchased on such Purchase Date pursuant
to a limit established by the Board pursuant to Section 7.1(c), the Company
shall make a pro rata allocation of the shares available in as uniform a manner
as practicable and as the Company determines to be equitable. Any fractional
share resulting from such pro rata allocation to any Participant shall be
disregarded.
(e) The purchase price of shares of Common Stock acquired pursuant to Purchase
Rights shall be not less than the lesser of:
(i) an amount equal to eighty-five percent (85%) of the Fair Market Value of the
shares of Common Stock on the Offering Date; or
(ii) an amount equal to eighty-five percent (85%) of the Fair Market Value of
the shares of Common Stock on the applicable Purchase Date.
(f) The purchase price of shares of Common Stock acquired pursuant to Purchase
Rights under an Offering on or after June 30, 2009 shall be an amount equal to
eighty-five percent (85%) of the Fair Market Value of the shares of Common Stock
on the applicable Purchase Date, rounded up to the nearest whole cent per share.

 

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8. Participation; Withdrawal; Termination.
(a) A Participant may elect to authorize payroll deductions pursuant to an
Offering under the Plan by completing and delivering to the Company, within the
time specified in the Offering, an enrollment form (in such form as the Company
may provide). Each such enrollment form shall authorize an amount of
Contributions expressed as a percentage of the submitting Participant’s Earnings
(as defined in each Offering) during the Offering (not to exceed the maximum
percentage specified by the Board). Each Participant’s Contributions shall
remain the property of the Participant at all times prior to the purchase of
Common Stock, but such Contributions may be commingled with the assets of the
Company and used for general corporate purposes except where applicable law
requires that Contributions be deposited with an independent third party. To the
extent provided in the Offering, a Participant may begin making Contributions
after the beginning of the Offering. To the extent provided in the Offering, a
Participant may thereafter reduce (including to zero) or increase his or her
Contributions. To the extent specifically provided in the Offering, in addition
to making Contributions by payroll deductions, a Participant may make
Contributions through the payment by cash or check prior to each Purchase Date
of the Offering, provided that payment through means other than payroll
deductions shall be permitted only if the Participant has not already had the
maximum permitted amount withheld through payroll deductions during the
Offering.
(b) During an Offering, a Participant may cease making Contributions and
withdraw from the Offering by delivering to the Company a notice of withdrawal
in such form as the Company may provide. Such withdrawal may be elected at any
time prior to the end of the Offering, except as provided otherwise in the
Offering. Upon such withdrawal from the Offering by a Participant, the Company
shall distribute to such Participant all of his or her accumulated Contributions
(reduced to the extent, if any, such Contributions have been used to acquire
shares of Common Stock for the Participant) under the Offering, and such
Participant’s Purchase Right in that Offering shall thereupon terminate. A
Participant’s withdrawal from an Offering shall have no effect upon such
Participant’s eligibility to participate in any other Offerings under the Plan,
but such Participant shall be required to deliver a new enrollment form in order
to participate in subsequent Offerings.
(c) Purchase Rights granted pursuant to any Offering under the Plan shall
terminate immediately upon a Participant ceasing to be an Employee for any
reason or for no reason (subject to any post-employment participation period
required by law) or other lack of eligibility. The Company shall distribute to
such terminated or otherwise ineligible Employee all of his or her accumulated
Contributions (reduced to the extent, if any, such Contributions have been used
to acquire shares of Common Stock for the terminated or otherwise ineligible
Employee) under the Offering.
(d) Purchase Rights shall not be transferable by a Participant otherwise than by
will, the laws of descent and distribution, or a beneficiary designation as
provided in Section 13. During a Participant’s lifetime, Purchase Rights shall
be exercisable only by such Participant.
(e) Unless otherwise specified in an Offering, the Company shall have no
obligation to pay interest on Contributions (except as may be required by
applicable law, as determined by the Company, for Participants in the Non-423
Component of the Plan).

 

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9. Exercise.
(a) On each Purchase Date during an Offering, each Participant’s accumulated
Contributions shall be applied to the purchase of shares of Common Stock up to
the maximum number of shares of Common Stock permitted pursuant to the terms of
the Plan and the applicable Offering, at the purchase price specified in the
Offering. No fractional shares shall be issued upon the exercise of Purchase
Rights unless specifically provided for in the Offering.
(b) If any amount of accumulated Contributions remains in a Participant’s
account after the purchase of shares of Common Stock and such remaining amount
is less than the amount required to purchase one share of Common Stock on the
final Purchase Date of an Offering, then such remaining amount shall be held in
such Participant’s account for the purchase of shares of Common Stock under the
next Offering under the Plan, unless such Participant withdraws from such next
Offering, as provided in Section 8(b), or is not eligible to participate in such
Offering, as provided in Section 6, in which case such amount shall be
distributed to such Participant after the final Purchase Date, without interest
(except as may be required by applicable law, as determined by the Company, for
Participants in the Non-423 Component of the Plan). If the amount of
Contributions remaining in a Participant’s account after the purchase of shares
of Common Stock is at least equal to the amount required to purchase one
(1) whole share of Common Stock on the final Purchase Date of the Offering, then
such remaining amount shall be distributed in full to such Participant at the
end of the Offering.
(c) No Purchase Rights may be exercised to any extent unless the shares of
Common Stock to be issued upon such exercise under the Plan are covered by an
effective registration statement pursuant to the Securities Act and the Plan is
in material compliance with all laws applicable to the Plan. If on a Purchase
Date during any Offering hereunder the shares of Common Stock are not so
registered or the Plan is not in such compliance, no Purchase Rights or any
Offering shall be exercised on such Purchase Date, and the Purchase Date shall
be delayed until the shares of Common Stock are subject to such an effective
registration statement and the Plan is in such compliance, except that the
Purchase Date shall not be delayed more than twelve (12) months and the Purchase
Date shall in no event be more than twenty-seven (27) months from the Offering
Date. If, on the Purchase Date under any Offering hereunder, as delayed to the
maximum extent permissible, the shares of Common Stock are not registered and
the Plan is not in such compliance, no Purchase Rights or any Offering shall be
exercised and all Contributions accumulated during the Offering (reduced to the
extent, if any, such Contributions have been used to acquire shares of Common
Stock) shall be distributed to the Participants.
10. Covenants of the Company.
The Company shall seek to obtain from each federal, state, foreign or other
regulatory commission or agency having jurisdiction over the Plan such authority
as may be required to issue and sell shares of Common Stock upon exercise of the
Purchase Rights. If, after commercially reasonable efforts, the Company is
unable to obtain from any such regulatory commission or agency the authority
that counsel for the Company deems necessary for the lawful issuance and sale of
shares of Common Stock under the Plan, the Company shall be relieved from any
liability for failure to issue and sell shares of Common Stock upon exercise of
such Purchase Rights unless and until such authority is obtained.

 

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11. Use of Proceeds from Shares of Common Stock.
Proceeds from the sale of shares of Common Stock pursuant to Purchase Rights
shall constitute general funds of the Company.
12. Rights as a Shareholder.
A Participant shall not be deemed to be the holder of, or to have any of the
rights of a holder with respect to, shares of Common Stock subject to Purchase
Rights unless and until the Participant’s shares of Common Stock acquired upon
exercise of Purchase Rights are recorded in the books of the Company (or its
transfer agent).
13. Designation of Beneficiary.
(a) A Participant may file a written designation of a beneficiary who is to
receive any shares of Common Stock and/or cash, if any, from the Participant’s
account under the Plan in the event of such Participant’s death subsequent to
the end of an Offering but prior to delivery to the Participant of such shares
of Common Stock or cash. In addition, a Participant may file a written
designation of a beneficiary who is to receive any cash from the Participant’s
account under the Plan in the event of such Participant’s death during an
Offering. Any such designation shall be on a form provided by or otherwise
acceptable to the Company. The Company may decide not to allow such designations
by Participants outside the U.S.
(b) The Participant may change such designation of beneficiary at any time by
written notice to the Company. In the event of the death of a Participant and in
the absence of a beneficiary validly designated under the Plan who is living at
the time of such Participant’s death, the Company shall deliver such shares of
Common Stock and/or cash to the executor or administrator of the estate of the
Participant, or if no such executor or administrator has been appointed (to the
knowledge of the Company), the Company, in its sole discretion, may deliver such
shares of Common Stock and/or cash to the spouse or to any one or more
dependents or relatives of the Participant, or if no spouse, dependent or
relative is known to the Company, then to such other person as the Company may
designate.
14. Adjustments Upon Changes in Securities; Corporate Transactions.
(a) If any change is made in the shares of Common Stock, subject to the Plan, or
subject to any Purchase Right, without the receipt of consideration by the
Company (through merger, consolidation, reorganization, recapitalization,
reincorporation, stock dividend, dividend in property other than cash, stock
split, liquidating dividend, combination of shares, exchange of shares, change
in corporate structure or other transaction not involving the receipt of
consideration by the Company), the Plan shall be appropriately adjusted in the
type(s), class(es) and maximum number of shares of Common Stock subject to the
Plan pursuant to Section 4(a), and the outstanding Purchase Rights shall be
appropriately adjusted in the type(s), class(es), number of shares and purchase
limits of such outstanding Purchase Rights. The Board shall make such
adjustments, and its determination shall be final, binding and conclusive.
(Notwithstanding the foregoing, the conversion of any convertible securities of
the Company shall not be treated as a “transaction not involving the receipt of
consideration by the Company.”)

 

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(b) In the event of a Corporate Transaction, then: (i) any surviving or
acquiring corporation may continue or assume Purchase Rights outstanding under
the Plan or may substitute similar rights (including a right to acquire the same
consideration paid to shareholders in the Corporate Transaction) for those
outstanding under the Plan, or (ii) if any surviving or acquiring corporation
does not continue or assume such Purchase Rights or does not substitute similar
rights for Purchase Rights outstanding under the Plan, then, the Participants’
accumulated Contributions shall be used to purchase shares of Common Stock prior
to the Corporate Transaction under the ongoing Offering, and the Participants’
Purchase Rights under the ongoing Offering shall terminate immediately after
such purchase.
15. Amendment of the Plan.
(a) The Board at any time, and from time to time, may amend the Plan. However,
except as provided in Section 14 relating to adjustments upon changes in
securities and except as to amendments solely to benefit the administration of
the Plan, to take account of a change in legislation or to obtain or maintain
favorable tax, exchange control or regulatory treatment for Participants or the
Company or any Related Corporation, no amendment shall be effective unless
approved by the shareholders of the Company to the extent shareholder approval
is necessary for the Plan to satisfy the requirements of Section 423 of the Code
or other applicable laws or regulations.
(b) It is expressly contemplated that the Board may amend the Plan in any
respect the Board deems necessary or advisable to provide Employees with the
maximum benefits provided or to be provided under the provisions of the Code and
the regulations promulgated thereunder relating to employee stock purchase plans
that are intended to qualify under Section 423 of the Code or to bring the Plan
and/or Purchase Rights into compliance therewith.
(c) The rights and obligations under any Purchase Rights granted before
amendment of the Plan shall not be impaired by any amendment of the Plan except:
(i) with the consent of the person to whom such Purchase Rights were granted, or
(ii) as necessary to comply with any laws or governmental regulations
(including, without limitation, the provisions of the Code and the regulations
promulgated thereunder relating to employee stock purchase plans qualifying
under Section 423 of the Code). Notwithstanding the foregoing, in the event that
the Board determines that continuation of the Plan or an Offering would result
in unfavorable financial accounting consequences to the Company as a result of a
change after the IPO Date in the generally accepted accounting principles
applicable to the Plan, the Board may, in its discretion and without the consent
of any Participant, including with respect to an Offering then in progress:
(a) terminate the Plan or any Offering, (b) accelerate the Purchase Date of any
Offering, (c) reduce the discount applicable to any Purchase Right of any
Offering, (d) reduce the maximum number of shares of Common Stock that may be
purchased in any Offering or (e) take any combination of the foregoing actions.
16. Termination or Suspension of the Plan.
(a) The Board in its discretion may suspend or terminate the Plan at any time.
Unless sooner terminated, the Plan shall terminate at the time that all of the
shares of Common Stock reserved for issuance under the Plan, as increased and/or
adjusted from time to time, have been issued under the terms of the Plan. No
Purchase Rights may be granted under the Plan while the Plan is suspended or
after it is terminated.

 

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(b) Any benefits, privileges, entitlements and obligations under any Purchase
Rights while the Plan is in effect shall not be impaired by suspension or
termination of the Plan except (i) as expressly provided in the Plan or with the
consent of the person to whom such Purchase Rights were granted, (ii) as
necessary to comply with any laws, regulations, or listing requirements, or
(iii) as necessary to ensure that the Code Section 423 Component of the Plan
and/or Purchase Rights granted under the Code Section 423 Component of the Plan
comply with the requirements of Section 423 of the Code.
17. Effective date of Plan.
The Plan shall become effective on the IPO Date, but no Purchase Rights shall be
exercised unless and until the Plan has been approved by the shareholders of the
Company within twelve (12) months before or after the date the Plan is adopted
by the Board.
18. Miscellaneous Provisions.
(a) The Plan and Offering do not constitute an employment contract. Nothing in
the Plan or in the Offering shall in any way alter the at will nature of a
Participant’s employment or be deemed to create in any way whatsoever any
obligation on the part of any Participant to continue in the employ of the
Company or a Related Corporation, or on the part of the Company or a Related
Corporation to continue the employment of a Participant.
(b) The provisions of the Plan shall be governed by the law of the State of
California without resort to that state’s conflicts of laws rules.

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