exv10w13



 







    Exhibit 10.13



 




    eBay
    Inc.

    2001 Equity Incentive
    Plan, As Amended



 




    Initial
    Stockholder Approval on May 25, 2001

    Amendment Adopted by the Board of Directors on March 14,
    2002

    Stockholder Approval of Amendment on June 5, 2002

    Amendment Adopted by the Compensation Committee as of
    March 18, 2003

    Stockholder Approval of Amendment on June 26, 2003

    Amendment Adopted by the Compensation Committee on
    March 18, 2004

    Stockholder Approval of Amendment on June 24, 2004

    Amendment Adopted By the Compensation Committee on
    March 21, 2006

    Stockholder Approval of Amendment on June 13, 2006

    Amendment Adopted By the Compensation Committee on
    January 10, 2007



 




    Termination
    Date: March 21, 2011



 




    1.  Purposes.



 



    (a) Eligible Option Recipients.  The
    persons eligible to receive Options are the Employees, Directors
    and Consultants of the Company and its Affiliates.



 



    (b) Available Options.  The purpose of the
    Plan is to provide a means by which eligible recipients of
    Options may be given an opportunity to benefit from increases in
    value of the Common Stock through the granting of
    (i) Incentive Stock Options and (ii) Nonstatutory
    Stock Options.



 



    (c) General Purpose.  The Company, by
    means of the Plan, seeks to retain the services of the group of
    persons eligible to receive Options, to secure and retain the
    services of new members of this group and to provide incentives
    for such persons to exert maximum efforts for the success of the
    Company and its Affiliates.



 




    2.  Definitions.



 



    (a) “Affiliate” means any parent
    corporation or subsidiary corporation of the Company, whether
    now or hereafter existing, as those terms are defined in
    Sections 424(e) and (f), respectively, of the Code, and any
    other entity which is controlled, directly or indirectly, by the
    Company.



 



    (b) “Board” means the Board of Directors
    of the Company.



 



    (c) “Code” means the United States
    Internal Revenue Code of 1986, as amended.



 



    (d) “Committee” means a committee of one
    or more members of the Board appointed by the Board in
    accordance with subsection 3(c).



 



    (e) “Common Stock” means the common stock
    of the Company.



 



    (f) “Company” means eBay Inc., a Delaware
    corporation.



 



    (g) “Consultant” means any natural person,
    including an advisor, (i) engaged by the Company or an
    Affiliate to render consulting or advisory services and who is
    compensated for such services, or (ii) who is a member of
    the Board of Directors or comparable governing body of an
    Affiliate and who is compensated for such services. However, the
    term “Consultant” shall not include Directors who are
    not compensated by the Company for their services as Directors.
    In addition, the payment of a director’s fee by the Company
    for services as a Director shall not cause a Director to be
    considered a “Consultant” for purposes of the Plan.



 



    (h) “Continuous Service” means that the
    Optionholder’s service with the Company or an Affiliate,
    whether as an Employee, Director or Consultant, is not
    interrupted or terminated. The Optionholder’s Continuous
    Service shall not be deemed to have terminated merely because of
    a change in the capacity in which the Optionholder renders
    service to the Company or an Affiliate as an Employee,
    Consultant or Director or a change in the entity for which the













 






    Optionholder renders such service, provided that there is no
    interruption or termination of the Optionholder’s service
    with the Company or an Affiliate. For example, a change in
    status from an Employee of the Company to a Consultant of an
    Affiliate or a Director will not constitute an interruption of
    Continuous Service. The Board or the chief executive officer of
    the Company, in that party’s sole discretion, may determine
    whether Continuous Service shall be considered interrupted in
    the case of any leave of absence approved by that party,
    including sick leave, military leave or any other personal leave.



 



    (i) “Covered Employee” means the chief
    executive officer and the four (4) other highest
    compensated officers of the Company for whom total compensation
    is required to be reported to stockholders under the Exchange
    Act, as determined for purposes of Section 162(m) of the
    Code.



 



    (j) “Director” means a member of the Board
    of Directors of the Company.



 



    (k) “Disability” means the inability of a
    natural person to continue to perform services for the Company
    or any Affiliate of the type previously performed prior to the
    occurrence of such Disability, whether as a result of physical
    and/or
    mental illness or injury, as determined by a physician
    acceptable to the Company, for a period that is expected to be
    of a duration of no less than six (6) months.



 



    (l) “Employee” means any person employed
    for tax purposes by the Company or an Affiliate. Mere service as
    a Director or payment of a director’s fee by the Company or
    an Affiliate shall not be sufficient to constitute
    “employment” by the Company or an Affiliate.



 



    (m) “Equity Restructuring” means a
    non-reciprocal transaction (i.e. a transaction in which the
    Company does not receive consideration or other resources in
    respect of the transaction approximately equal to and in
    exchange for the consideration or resources the Company is
    relinquishing in such transaction) between the Company and its
    stockholders, such as a stock split, spin-off, rights offering,
    nonrecurring stock dividend or recapitalization through a large,
    nonrecurring cash dividend, that affects the shares of Common
    Stock (or other securities of the Company) or the share price of
    Common Stock (or other securities) and causes a change in the
    per share value of the Common Stock underlying outstanding
    Options.



 



    (n) “Exchange Act” means the United States
    Securities Exchange Act of 1934, as amended.



 



    (o) “Fair Market Value” means, as of any
    date, the value of the Common Stock determined as follows:



 



    (i) If the Common Stock is listed on any established stock
    exchange or traded on the Nasdaq National Market or the Nasdaq
    SmallCap Market, 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 market (or the exchange or market with the greatest
    volume of trading in the Common Stock) on the last market
    trading day prior to the day of determination, as reported in
    The Wall Street Journal or such other source as the Board
    deems reliable.



 



    (ii) In the absence of such markets for the Common Stock,
    the Fair Market Value shall be determined in good faith by the
    Board.



 



    (p) “Incentive Stock Option” means an
    Option intended to qualify as an incentive stock option within
    the meaning of Section 422 of the Code and the regulations
    promulgated thereunder.



 



    (q) “Non-Employee Director” means a
    Director who either (i) is not a current Employee or
    Officer of the Company or its parent or a subsidiary, does not
    receive compensation (directly or indirectly) from the Company
    or its parent or a subsidiary for services rendered as a
    consultant or in any capacity other than as a Director (except
    for an amount as to which disclosure would not be required under
    Item 404(a) of
    Regulation S-K
    promulgated pursuant to the Securities Act
    (“Regulation S-K”)),
    does not possess an interest in any other transaction as to
    which disclosure would be required under Item 404(a) of
    Regulation S-K
    and is not engaged in a business relationship as to which
    disclosure would be required under Item 404(b) of
    Regulation S-K;
    or (ii) is otherwise considered a “non-employee
    director” for purposes of
    Rule 16b-3.



 



    (r) “Nonstatutory Stock Option” means an
    Option not intended to qualify as an Incentive Stock Option.




    

    2








 





 



    (s) “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.



 



    (t) “Option” means an Incentive Stock
    Option or a Nonstatutory Stock Option granted pursuant to
    Section 6 of the Plan.



 



    (u) “Option Agreement” means a written
    agreement between the Company and an Optionholder evidencing the
    terms and conditions of an individual Option grant. Each Option
    Agreement shall be subject to the terms and conditions of the
    Plan.



 



    (v) “Optionholder” means a person to whom
    an Option is granted pursuant to the Plan or, if applicable,
    such other person who holds an outstanding Option.



 



    (w) “Outside Director” means a Director
    who either (i) is not a current employee of the Company or
    an “affiliated corporation” (within the meaning of
    Treasury Regulations promulgated under Section 162(m) of
    the Code), is not a former employee of the Company or an
    “affiliated corporation” receiving compensation for
    prior services (other than benefits under a tax qualified
    pension plan), was not an officer of the Company or an
    “affiliated corporation” at any time and is not
    currently receiving direct or indirect remuneration from the
    Company or an “affiliated corporation” for services in
    any capacity other than as a Director or (ii) is otherwise
    considered an “outside director” for purposes of
    Section 162(m) of the Code.



 



    (x) “Plan” means this eBay Inc. 2001
    Equity Incentive Plan, as amended.



 



    (y) “Rule 16b-3”
    means
    Rule 16b-3
    promulgated under the Exchange Act or any successor to
    Rule 16b-3,
    as in effect from time to time.



 



    (z) “Securities Act” means the United
    States Securities Act of 1933, as amended.



 



    (aa) “Ten Percent Stockholder” means a
    person who owns (or is deemed to own pursuant to
    Section 424(d) of the Code) stock possessing more than ten
    percent (10%) of the total combined voting power of all classes
    of stock of the Company or of any of its Affiliates.



 




    3.  Administration.



 



    (a) Administration by Board.  The Board
    shall administer the Plan unless and until the Board delegates
    administration to a Committee, as provided in
    subsection 3(c).



 



    (b) Powers of Board.  The Board shall have
    the power, subject to, and within the limitations of, the
    express provisions of the Plan:



 



    (i) To determine from time to time which of the persons
    eligible under the Plan shall be granted Options; when and how
    each Option shall be granted; what type or combination of types
    of Option shall be granted; the provisions of each Option
    granted (which need not be identical), including the time or
    times when a person shall be permitted to receive Common Stock
    pursuant to an Option; and the number of shares of Common Stock
    with respect to which an Option shall be granted to each such
    person.



 



    (ii) To construe and interpret the Plan and Options granted
    under it, and to establish, amend and revoke rules and
    regulations for its administration. The Board, in the exercise
    of this power, may correct any defect, omission or inconsistency
    in the Plan or in any Option Agreement, in a manner and to the
    extent it shall deem necessary or expedient to make the Plan
    fully effective.



 



    (iii) To amend the Plan or an Option as provided in
    Section 11.



 



    (iv) To terminate or suspend the Plan as provided in
    Section 12.



 



    (v) Generally, to exercise such powers and to perform such
    acts as the Board deems necessary or expedient in its sole
    discretion to promote the best interests of the Company and its
    stockholders that are not in conflict with the provisions of the
    Plan.




    

    3








 





 



    (c) Delegation to Committee.



 



    (i) General.  The Board may delegate
    administration of the Plan to a Committee or Committees of one
    (1) or more members of the Board, and the term
    “Committee” shall apply to any person or persons to
    whom such authority has been delegated. If administration is
    delegated to a Committee, the Committee shall have, in
    connection with the administration of the Plan, the powers
    theretofore possessed by the Board, including the power to
    delegate to a subcommittee of one (1) or more members of
    the Board any of the administrative powers the Committee is
    authorized to exercise (and references in this Plan to the Board
    shall thereafter be to the Committee or subcommittee), 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 the administration of the Plan.



 



    (ii) Committee Composition when Common Stock is Publicly
    Traded.  At such time as the Common Stock is
    publicly traded, in the discretion of the Board, a Committee may
    consist solely of two (2) or more Outside Directors, in
    accordance with Section 162(m) of the Code,
    and/or
    solely of two or more Non-Employee Directors, in accordance with
    Rule 16b-3.
    Within the scope of such authority, the Board or the Committee
    may (1) delegate to a committee of one or more members of
    the Board who are not Outside Directors the authority to grant
    Options to eligible persons who are either (a) not then
    Covered Employees and are not expected to be Covered Employees
    at the time of recognition of income resulting from such Option
    or (b) not persons with respect to whom the Company wishes
    to comply with Section 162(m) of the Code
    and/or
    (2) delegate to a committee of one or more members of the
    Board who are not Non-Employee Directors the authority to grant
    Options to eligible persons who are not then subject to
    Section 16 of the Exchange Act.



 



    (d) Effect of Board’s Decision.  All
    determinations, interpretations and constructions made by the
    Board in good faith shall not be subject to review by anyone and
    shall be final, binding and conclusive on all Optionholders and
    any other person having an interest in such determination,
    interpretation or construction.



 




    4.  Shares Subject
    to the Plan.



 



    (a) Share Reserve.  Subject to the
    provisions of Section 10 relating to adjustments upon
    changes in Common Stock, the Common Stock that may be issued
    pursuant to Options shall not exceed in the aggregate Two
    Hundred Twenty Two Million
    (222,000,000)1
    shares of Common Stock.



 



    (b) Reversion of Shares to the Share
    Reserve.  If any Option shall for any reason
    expire or otherwise terminate, in whole or in part, without
    having been exercised in full, the shares of Common Stock not
    acquired under such Option shall revert to and again become
    available for issuance under the Plan.



 



    (c) Source of Shares.  The shares of
    Common Stock subject to the Plan may be unissued shares or
    reacquired shares, bought on the market or otherwise.



 



    5.  Eligibility.



 



    (a) Eligibility for Specific
    Options.  Incentive Stock Options may be granted
    only to Employees. Nonstatutory Stock Options may be granted to
    Employees, Directors and Consultants.



 



    (b) Non-Employee
    Directors.  Notwithstanding the provisions of
    subsection 5(a) hereof, a Director who is not an Employee
    only may be granted nondiscretionary Options that the
    Stockholders have approved as to the following option
    provisions: Number of shares, date of automatic grant, term,
    exercise price, consideration, vesting schedule, exercise
    schedule, and the post-termination exercise periods.



 



    (c) Ten Percent
    Stockholders.  Notwithstanding the provisions of
    subsection 5(a) hereof, a Ten Percent Stockholder shall not
    be granted an Incentive Stock Option unless the exercise price
    of such Option is at least one hundred ten percent (110%) of the
    Fair Market Value of the Common Stock at the date of grant and
    the Option is not exercisable after the expiration of five
    (5) years from the date of grant.


 

 


    1  Denotes
    that such share number reflects the stock split of eBay’s
    common stock occurring in 8/03 and 2/05.




    

    4








 





 



    (d) Section 162(m)
    Limitation.  Notwithstanding the provisions of
    subsection 5(a) hereof and subject to the provisions of
    Section 10 relating to adjustments upon changes in the
    shares of Common Stock, no Employee shall be eligible to be
    granted Options covering more than Four Million
    (4,000,000)1
    shares of Common Stock during any calendar year.



 



    (e) Consultants.  Notwithstanding the
    provisions of subsection 5(a) hereof, a Consultant shall
    not be eligible for the grant of an Option if, at the time of
    grant, a
    Form S-8
    Registration Statement under the Securities Act
    (“Form S-8”)
    is not available to register either the offer or the sale of the
    Company’s securities to such Consultant because of the
    nature of the services that the Consultant is providing to the
    Company, or because the Consultant is not a natural person, or
    as otherwise provided by the rules governing the use of
    Form S-8.



 




    6.  Option
    Provisions.



 



    Each Option shall be in such form and shall contain such terms
    and conditions as the Board shall deem appropriate. All Options
    shall be separately designated Incentive Stock Options or
    Nonstatutory Stock Options at the time of grant, and, if
    certificates are issued, a separate certificate or certificates
    will be issued for shares of Common Stock purchased on exercise
    of each type of Option. The provisions of separate Options need
    not be identical, but each Option shall include (through
    incorporation of provisions hereof by reference in the Option or
    otherwise) the substance of each of the following provisions:



 



    (a) Term.  Subject to the provisions of
    subsection 5(c) regarding Ten Percent Stockholders, no
    Option shall be exercisable after the expiration of ten
    (10) years from the date it was granted.



 



    (b) Exercise Price.



 



    (i) Subject to the provisions of subsection 5(c)
    regarding Ten Percent Stockholders and subsection 6(b)(ii)
    below, the exercise price of each Option shall be not less than
    one hundred percent (100%) of the Fair Market Value of the
    Common Stock subject to the Option on the date the Option is
    granted.



 



    (ii) An Option may be granted with an exercise price lower
    than that set forth in subsection 6(b)(i) above if such
    Option is granted pursuant to an assumption or substitution for
    another option in a manner satisfying the provisions of
    Section 424(a) of the Code.



 



    (c) Consideration.



 



    (i) The purchase price of Common Stock acquired pursuant to
    an Option shall be paid, to the extent permitted by applicable
    statutes and regulations, either (i) in cash at the time
    the Option is exercised or (ii) at the discretion of the
    Board at the time of the grant of the Option (or subsequently in
    the case of a Nonstatutory Stock Option) (1) by delivery to
    the Company, or attestation to the Company of ownership, of
    other Common Stock or (2) in any other form of legal
    consideration that may be acceptable to the Board.



 



    (ii) Unless otherwise specifically provided, the purchase
    price of Common Stock acquired pursuant to an Option that is
    paid by delivery to the Company, or attestation to the Company
    of ownership, of other Common Stock shall be paid only by shares
    of the Common Stock of the Company that have been held for more
    than six (6) months (or such longer or shorter period of
    time required to avoid a charge to earnings for financial
    accounting purposes).



 



    (d) Transferability of an Incentive Stock
    Option.  An Incentive Stock Option shall not be
    transferable except by will or by the laws of descent and
    distribution and shall be exercisable during the lifetime of the
    Optionholder only by the Optionholder. Notwithstanding the
    foregoing, the Optionholder may, by delivering written notice to
    the Company, in a form satisfactory to the Company, designate a
    third party who, in the event of the death of the Optionholder,
    shall thereafter be entitled to exercise the Option.



 



    (e) Transferability of a Nonstatutory Stock
    Option.  A Nonstatutory Stock Option shall be
    transferable to the extent provided in the Option Agreement. If
    the Nonstatutory Stock Option does not provide for


 

 


    1  Denotes
    that such share number reflects the stock split of eBay’s
    common stock occurring in 8/03 and 2/05.




    

    5








 






    transferability, then the Nonstatutory Stock Option shall not be
    transferable except by will or by the laws of descent and
    distribution and shall be exercisable during the lifetime of the
    Optionholder only by the Optionholder. Notwithstanding the
    foregoing, the Optionholder may, by delivering written notice to
    the Company, in a form satisfactory to the Company, designate a
    third party who, in the event of the death of the Optionholder,
    shall thereafter be entitled to exercise the Option.



 



    (f) Vesting Generally.  The total number
    of shares of Common Stock subject to an Option may, but need
    not, vest and therefore become exercisable in periodic
    installments that may, but need not, be equal. The Option may be
    subject to such other terms and conditions on the time or times
    when it may be exercised (which may be based on performance or
    other criteria) as the Board may deem appropriate. The vesting
    provisions of individual Options may vary. The provisions of
    this subsection 6(f) are subject to any Option provisions
    governing the minimum number of shares of Common Stock as to
    which an Option may be exercised.



 



    (g) Termination of Continuous Service.  In
    the event an Optionholder’s Continuous Service terminates
    (other than upon the Optionholder’s death or Disability),
    the Optionholder may exercise his or her Option (to the extent
    that the Optionholder was entitled to exercise such Option as of
    the date of termination) but only within such period of time
    ending on the earlier of (i) the date three (3) months
    following the termination of the Optionholder’s Continuous
    Service (or such longer or shorter period specified in the
    Option Agreement), or (ii) the expiration of the term of
    the Option as set forth in the Option Agreement. If, after
    termination, the Optionholder does not exercise his or her
    Option within the time specified in the Option Agreement, the
    Option shall terminate.



 



    (h) Extension of Termination Date.  An
    Optionholder’s Option Agreement may also provide that if
    the exercise of the Option following the termination of the
    Optionholder’s Continuous Service (other than upon the
    Optionholder’s death or Disability) would be prohibited at
    any time solely because the issuance of shares of Common Stock
    would violate the registration requirements under the Securities
    Act, then the Option shall terminate on the earlier of
    (i) the expiration of the term of the Option or
    (ii) the expiration of a period of three (3) months
    after the termination of the Optionholder’s Continuous
    Service during which the exercise of the Option would not be in
    violation of such registration requirements.



 



    (i) Disability of Optionholder.  In the
    event that an Optionholder’s Continuous Service terminates
    as a result of the Optionholder’s Disability, the
    Optionholder may exercise his or her Option (to the extent that
    the Optionholder was entitled to exercise such Option as of the
    date of termination), but only within such period of time ending
    on the earlier of (i) the date twelve (12) months
    following such termination (or such longer or shorter period
    specified in the Option Agreement), or (ii) the expiration
    of the term of the Option as set forth in the Option Agreement.
    If, after termination, the Optionholder does not exercise his or
    her Option within the time specified herein, the Option shall
    terminate.



 



    (j) Death of Optionholder.  In the event
    (i) an Optionholder’s Continuous Service terminates as
    a result of the Optionholder’s death or (ii) the
    Optionholder dies within the period (if any) specified in the
    Option Agreement after the termination of the
    Optionholder’s Continuous Service for a reason other than
    death, then the Option may be exercised (to the extent the
    Optionholder was entitled to exercise such Option as of the date
    of death) by the Optionholder’s estate, by a person who
    acquired the right to exercise the Option by bequest or
    inheritance or by a person designated to exercise the option
    upon the Optionholder’s death, but only within the period
    ending on the earlier of (1) the date eighteen
    (18) months following the date of death (or such longer or
    shorter period specified in the Option Agreement) or
    (2) the expiration of the term of such Option as set forth
    in the Option Agreement. If, after death, the Option is not
    exercised within the time specified herein, the Option shall
    terminate.



 




    7.  Covenants
    of the Company.



 



    (a) Availability of Shares.  During the
    terms of the Options, the Company shall keep available at all
    times the number of shares of Common Stock required to satisfy
    such Options.



 



    (b) Securities Law Compliance.  The
    Company shall seek to obtain from each regulatory commission or
    agency having jurisdiction over the Plan such authority as may
    be required to grant Options and to issue and sell




    

    6








 






    shares of Common Stock upon exercise of the Options; provided,
    however, that this undertaking shall not require the Company to
    register under the Securities Act the Plan, any Option or any
    Common Stock issued or issuable pursuant to any such Option. If,
    after reasonable efforts, the Company is unable to obtain from
    any such regulatory commission or agency the authority which
    counsel for the Company deems necessary for the lawful issuance
    and sale of Common Stock under the Plan, the Company shall be
    relieved from any liability for failure to issue and sell Common
    Stock upon exercise of such Options unless and until such
    authority is obtained.



 




    8.  Use
    of Proceeds from Stock.



 



    Proceeds from the sale of Common Stock pursuant to Options shall
    constitute general funds of the Company.



 




    9.  Miscellaneous.



 



    (a) Stockholder Rights.  No Optionholder
    shall be deemed to be the holder of, or to have any of the
    rights of a holder with respect to, any shares of Common Stock
    subject to such Option unless and until such Optionholder has
    satisfied all requirements for exercise of the Option pursuant
    to its terms.



 



    (b) No Employment or other Service
    Rights.  Nothing in the Plan or any instrument
    executed or Option granted pursuant thereto shall confer upon
    any Optionholder any right to continue to serve the Company or
    an Affiliate in the capacity in effect at the time the Option
    was granted or shall affect the right of the Company or an
    Affiliate to terminate (i) the employment of an Employee
    with or without notice and with or without cause, for any reason
    or no reason, (ii) the service of a Consultant pursuant to
    the terms of such Consultant’s agreement with the Company
    or an Affiliate or (iii) the service of a Director pursuant
    to the Bylaws of the Company or an Affiliate, and any applicable
    provisions of the corporate law of the jurisdiction in which the
    Company or the Affiliate is incorporated, as the case may be.



 



    (c) Incentive Stock Option $100,000
    Limitation.  To the extent that the aggregate Fair
    Market Value (determined at the time of grant) of Common Stock
    with respect to which Incentive Stock Options are exercisable
    for the first time by any Optionholder during any calendar year
    (under all plans of the Company and its Affiliates) exceeds one
    hundred thousand dollars ($100,000), the Options or portions
    thereof which exceed such limit (according to the order in which
    they were granted) shall be treated as Nonstatutory Stock
    Options.



 



    (d) Investment Assurances.  The Company
    may require an Optionholder, as a condition of exercising an
    Option or acquiring Common Stock under any Option, (i) to
    give written assurances satisfactory to the Company as to the
    Optionholder’s knowledge and experience in financial and
    business matters
    and/or to
    employ a purchaser representative reasonably satisfactory to the
    Company who is knowledgeable and experienced in financial and
    business matters and that he or she is capable of evaluating,
    alone or together with the purchaser representative, the merits
    and risks of exercising the Option; (ii) to give written
    assurances satisfactory to the Company stating that the
    Optionholder is acquiring Common Stock subject to the Option for
    the Optionholder’s own account and not with any present
    intention of selling or otherwise distributing the Common Stock;
    and/or
    (iii) to give such other written assurances as the Company
    shall determine are necessary, desirable or appropriate to
    comply with applicable securities regulation and other governing
    law. The Company may, upon advice of counsel to the Company,
    place legends on stock certificates issued under the Plan as
    such counsel deems necessary or appropriate in order to comply
    with applicable securities laws, including, but not limited to,
    legends restricting the transfer of the Common Stock.



 



    (e) Withholding Obligations.  To the
    extent provided by the terms of an Option Agreement, the
    Optionholder may satisfy any tax withholding obligation arising
    under the laws or regulations of any country, state or local
    jurisdiction relating to the exercise or acquisition of Common
    Stock under an Option by any of the following means (in addition
    to the Company’s right to withhold from any compensation
    paid to the Optionholder by the Company) or by a combination of
    such means: (i) tendering a cash payment;
    (ii) authorizing the Company to withhold shares of Common
    Stock from the shares of Common Stock otherwise issuable to the
    Optionholder as a result of the exercise or acquisition of
    Common Stock under the Option; provided, however, that no shares
    of Common Stock are withheld with a value exceeding the minimum
    amount of tax required to be withheld by law (or such lesser
    amount as may be required to avoid variable award accounting);
    or (iii) delivering to the Company owned and unencumbered
    shares of Common Stock.




    

    7








 





 




    10.  Adjustments
    upon Changes in Stock.



 



    (a) Capitalization Adjustments.  In the
    event that any dividend or other distribution, reorganization,
    merger, consolidation, combination, repurchase, or exchange of
    Common Stock or other securities of the Company, or other change
    in the corporate structure of the Company affecting the Common
    Stock (other than an Equity Restructuring) occurs such that an
    adjustment is determined by the Committee (in its sole
    discretion) to be appropriate in order to prevent dilution or
    enlargement of the benefits or potential benefits intended to be
    made available under the Plan, then the Committee shall, in such
    manner as it may deem equitable, adjust the number and class of
    Common Stock which may be delivered under the Plan, the exercise
    price per share and the number of shares covered by each Option
    which has not been exercised, and the numerical limits of
    Sections 4(a) and 5(d).



 



    (b) Dissolution or Liquidation.  In the
    event of a dissolution or liquidation of the Company, then all
    outstanding Options shall terminate immediately prior to such
    event.



 



    (c) Corporate Transaction.  In the event
    of (i) a sale, lease or other disposition of all or
    substantially all of the assets of the Company, (ii) a
    merger or consolidation in which the Company is not the
    surviving corporation, or (iii) a reverse merger in which
    the Company is the surviving corporation but the shares of
    Common Stock outstanding immediately preceding the merger are
    converted by virtue of the merger into other property, whether
    in the form of securities, cash or otherwise, then any surviving
    corporation or acquiring corporation shall assume or continue
    any Options outstanding under the Plan or shall substitute
    similar stock awards (including an award to acquire the same
    consideration paid to the stockholders in the transaction
    described in this subsection 10(c)) for those outstanding
    under the Plan. In the event any surviving corporation or
    acquiring corporation refuses to assume or continue such Options
    or to substitute similar stock awards for those outstanding
    under the Plan, then with respect to Options held by
    Optionholders whose Continuous Service has not terminated, the
    vesting of such Options (and, if applicable, the time during
    which such Options may be exercised) shall be accelerated in
    full, and the Options shall terminate if not exercised (if
    applicable) at or prior to such event. With respect to any other
    Options outstanding under the Plan, such Options shall terminate
    if not exercised (if applicable) at or prior to such event.



 



    (d) Equity Restructuring Adjustments.  In
    connection with the occurrence of any Equity Restructuring, and
    notwithstanding anything to the contrary in Section 10(a)
    and 10(c) the number and type of securities subject to each
    outstanding Option and the exercise price thereof will be
    equitably adjusted by the Committee. The adjustments provided
    under this Section 10(d) shall be nondiscretionary and
    shall be final and binding on the affected Optionholder and the
    Company.



 




    11.  Amendment
    of the Plan and Options.



 



    (a) Amendment of Plan.  The Board at any
    time, and from time to time, may amend the Plan. However, except
    as provided in Section 10 relating to adjustments upon
    changes in Common Stock, no amendment shall be effective unless
    approved by the stockholders of the Company to the extent
    stockholder approval is necessary under applicable laws or
    regulations or to the extent that such amendment constitutes a
    material amendment of the Plan.



 



    (b) Stockholder Approval.  The Board may,
    in its sole discretion, submit any other amendment to the Plan
    for stockholder approval, including, but not limited to,
    amendments to the Plan intended to satisfy the requirements of
    Section 162(m) of the Code and the regulations thereunder
    regarding the exclusion of performance-based compensation from
    the limit on corporate deductibility of compensation paid to
    certain executive officers. Notwithstanding any other provision
    of the Plan to the contrary, the Board shall not, without prior
    stockholder approval, (A) reduce the exercise price of any
    outstanding Option under the Plan, (B) cancel any
    outstanding Option under the Plan and grant in substitution
    therefor, on either an immediate or delayed basis, a new Option
    under the Plan covering the same or a different number of shares
    of Common Stock or cash, or (C) take any other action with
    respect to any outstanding Option under the Plan that is treated
    as a repricing of such Option pursuant to generally accepted
    accounting principles.



 



    (c) Contemplated Amendments.  It is
    expressly contemplated that the Board may amend the Plan in any
    respect the Board deems necessary or advisable to provide
    eligible Employees with the maximum benefits provided or to be
    provided under the provisions of the Code and the regulations
    promulgated thereunder relating to Incentive Stock Options
    and/or to
    bring the Plan
    and/or
    Incentive Stock Options granted under it into compliance
    therewith.




    

    8








 





 



    (d) No Impairment of Rights.  Rights under
    any Option granted before amendment of the Plan shall not be
    impaired by any amendment of the Plan unless (i) the
    Company requests the consent of the Optionholder and
    (ii) the Optionholder consents in writing.



 



    (e) Amendment of Options.  The Board at
    any time, and from time to time, may amend the terms of any one
    or more Options; provided, however, that the rights under any
    Option shall not be impaired by any such amendment unless
    (i) the Company requests the consent of the Optionholder
    and (ii) the Optionholder consents in writing.



 




    12.  Termination
    or Suspension of the Plan.



 



    (a) Plan Term.  The Board may suspend or
    terminate the Plan at any time. Unless sooner terminated, the
    Plan shall terminate on the day before the tenth (10th)
    anniversary of the date the Plan is adopted by the Board or
    approved by the stockholders of the Company, whichever is
    earlier. No Options may be granted under the Plan while the Plan
    is suspended or after it is terminated.



 



    (b) No Impairment of Rights.  Suspension
    or termination of the Plan shall not impair rights and
    obligations under any Option granted while the Plan is in effect
    except with the written consent of the Optionholder.



 




    13.  Effective
    Date of Plan.



 



    The Plan shall become effective as determined by the Board, but
    no Option shall be exercised unless and until the Plan has been
    approved by the stockholders of the Company, which approval
    shall be within twelve (12) months before or after the date
    the Plan is adopted by the Board.



 




    14.  Choice
    of Law.



 



    The law of the State of Delaware shall govern all questions
    concerning the construction, validity and interpretation of this
    Plan, without regard to such state’s conflict of laws rules.




    

    9