ex10_60.htm


    Exhibit
10.60

    ADOBE
SYSTEMS INCORPORATED

    NONSTATUTORY
STOCK OPTION AGREEMENT

    (DIRECTOR)

    


    THIS
NONSTATUTORY STOCK OPTION AGREEMENT (the “Option
Agreement”) is
made and entered into as of the Date of Option Grant by and between Adobe
Systems Incorporated and

    


     %%FIRST_NAME%-%
%%LAST_NAME%-%                                 (the
“Participant”).  The Company
has granted to the Participant pursuant to the Adobe Systems Incorporated 2003
Equity Incentive Plan (the “Plan”) an option to purchase
certain shares of Stock (the “Option”),
upon the terms and conditions set forth in this Option Agreement.

    


    1. Definitions
and Construction.

     

    
      	
              1.1  

            	
              Definitions.  Whenever
      used herein, the following terms shall have their respective meanings set
      forth below:

            


    

     

    
      	
              (a)  

            	
              “Date of
      Option Grant” means
      %%OPTION_DATE,’Month DD, YYYY’%-%.

            


    

     

    
      	
              (b)  

            	
              “Number of
      Option Shares” means
      %%TOTAL_SHARES_GRANTED%-% shares of Stock, as adjusted from time to time
      pursuant to Section 10.

            


    

     

    
      	
              (c)  

            	
              “Exercise
      Price”
      means $%%OPTION_PRICE%-% per share of Stock, as adjusted from time to
      time pursuant to Section 10.

            


    

     

    
      	
              (d)  

            	
              “Initial
      Vesting Date” means the day
      immediately preceding the day of the first annual meeting of the
      stockholders of the Company (each such meeting, an “Annual Meeting”)
      following the Date of Option Grant.

            


    

     

    
      	
              (e)  

            	
              “Vested
      Shares”
      means, on any relevant date, that portion (disregarding any fractional
      share) of the Number of Option Shares determined by multiplying the Number
      of Option Shares by the “Vested
      Percentage” determined as of such
      date as follows:

            


    

    


    
      	 
      	 	
              Vested
      Percentage

            	 
	
              Prior
      to Initial Vesting Date

            	 	 	—	 
	 
      	 	 	 	 
	
              On
      Initial Vesting Date, provided the Participant’s Service has not
      terminated prior to such date.

            	 	 	25	%
	 
      	 	 	 	 
	
              Plus:

            	 	 	 	 
	
              On
      each subsequent anniversary of the Initial Vesting Date, until the Vested
      Percentage equals 100%, provided the Particpant’s Service has not
      terminated prior to such date.

            	 	 	25	%


    

    


    
      	
              (f)  

            	
              “Affiliate” means (i) an
      entity, other than a Parent Corporation, that directly, or indirectly
      through one or more intermediary entities, controls the Company or
      (ii) an entity, other than a Subsidiary Corporation, that is
      controlled by the Company directly, or indirectly through one or more
      intermediary entities.  For this purpose, the term “control”
      (including the term “controlled by”) means the possession, direct or
      indirect, of the power to direct or cause the direction of the management
      and policies of the relevant entity, whether through the ownership of
      voting securities, by contract or otherwise; or shall have such other
      meaning

            


    


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    assigned
such term for the purposes of registration in the United States (“U.S.”) on Form
S-8 under the Securities Act.

    


    
      	
              (g)  

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

            


    

     

    
      	
              (h)  

            	
              “Code” means the U.S.
      Internal Revenue Code of 1986, as amended, and any applicable regulations
      promulgated thereunder.

            


    

     

    
      	
              (i)  

            	
              “Committee” means the Executive
      Compensation Committee or other committee of the Board duly appointed to
      administer the Plan in respect of Directors and having such powers as
      shall be specified by the Board.  If no committee of the Board
      has been appointed to administer the Plan, the Board shall exercise all of
      the powers of the Committee granted herein, and, in any event, the Board
      may in its discretion exercise any or all of such
  powers.

            


    

     

    
      	
              (j)  

            	
              “Company” means Adobe Systems
      Incorporated, a Delaware corporation, or any successor corporation
      thereto.

            


    

     

    
      	
              (k)  

            	
              “Disability” means the permanent
      and total disability of the Participant within the meaning of Section
      22(e)(3) of the Code.

            


    

     

    
      	
              (l)  

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

            


    

     

    
      	
              (m)  

            	
              “Fair Market
      Value”
      means, as of any date, the value of a share of Stock or other property as
      determined by the Committee, in its discretion, or by the Company, in its
      discretion, if such determination is expressly allocated to the Company
      herein, subject to the following:

            


    

     

    
      	
              (i)  

            	
              If,
      on such date, the Stock is listed on a national or regional securities
      exchange or market system, the Fair Market Value of a share of Stock shall
      be the closing price of a share of Stock (or the mean of the closing bid
      and asked prices of a share of Stock if the Stock is so quoted instead) as
      quoted on the Nasdaq Global Select Market, the Nasdaq SmallCap Market or
      such other national or regional securities exchange or market system
      constituting the primary market for the Stock, as reported on www.Nasdaq.com or such
      other source as the Company deems reliable.  If the relevant
      date does not fall on a day on which the Stock has traded on such
      securities exchange or market system, the date on which the Fair Market
      Value shall be established shall be the last day on which the Stock was so
      traded prior to the relevant date, or such other appropriate day as shall
      be determined by the Committee, in its
  discretion.

            


    

     

    If, on
such date, the Stock is not listed on a national or regional securities exchange
or market system, the Fair Market Value of a share of Stock shall be as
determined by the Committee in good faith without regard to any restriction
other than a restriction which, by its terms, will never lapse.

     

    
      	
              (n)  

            	
              “Officer”
      means any person designated by the Board as an officer of the
      Company.

            


    

     

    
      	
              (o)  

            	
              “Option
      Expiration Date” means the date ten
      (10) years after the Date of Option
Grant.

            


    


    
      
         


      

      
        2

        
          

        

      

      
         


      

    


    


    
      	
              (p)  

            	
              “Parent
      Corporation” means any present or
      future “parent corporation” of the Company, as defined in
      Section 424(e) of the Code.

            


    

    


    
      	
              (q)  

            	
              “Participating
      Company”
      means the Company or any Parent Corporation, Subsidiary Corporation or
      Affiliate.

            


    

     

    
      	
              (r)  

            	
              “Participating
      Company Group” means, at any point
      in time, all corporations collectively which are then Participating
      Companies.

            


    

     

    
      	
              (s)  

            	
              “Securities
      Act” means
      the U.S. Securities Act of 1933, as
amended.

            


    

     

    
      	
              (t)  

            	
              “Service” means the
      Participant’s service with the Participating Company Group as a
      Director.  The Participant’s Service shall be deemed to have
      terminated if the Participant ceases to render Service to the
      Participating Company Group in such capacity.  However, the
      Participant’s Service shall not be deemed to have terminated merely
      because of a change in the Participating Company for which the Participant
      renders Service in such initial capacity, provided that there is no
      interruption or termination of the Participant’s
      Service.  Furthermore, the Participant’s Service with the
      Participating Company Group shall not be deemed to have terminated if the
      Participant takes any bona fide leave of absence approved by the Company
      of ninety (90) days or less.  In the event of a leave in excess
      of ninety (90) days, the Participant’s Service shall be deemed to
      terminate on the ninety-first (91st) day of the leave unless the
      Participant’s right to return to Service with the Participating Company
      Group is guaranteed by statute or contract.  Notwithstanding the
      foregoing, unless otherwise designated by the Company or required by law,
      a leave of absence shall not be treated as Service for purposes of
      determining vesting under the Participant’s Option
      Agreement.  The Participant’s Service shall be deemed to have
      terminated either upon an actual termination of Service or upon the
      corporation for which the Participant performs Service ceasing to be a
      Participating Company.  Subject to the foregoing, the Company,
      in its discretion, shall determine whether the Participant’s Service has
      terminated and the effective date of such
  termination.

            


    

     

    
      	
              (u)  

            	
              “Stock” means the common
      stock of the Company, as adjusted from time to time in accordance with
      Section 10.

            


    

     

    
      	
              (v)  

            	
              “Subsidiary
      Corporation” means any present or
      future “subsidiary corporation” of the Company, as defined in
      Section 424(f) of the Code.

            


    

     

    
      	
              1.2  

            	
              Construction.  Captions
      and titles contained herein are for convenience only and shall not affect
      the meaning or interpretation of any provision of this Option
      Agreement.  Except when otherwise indicated by the context, the
      singular shall include the plural and the plural shall include the
      singular.  Use of the term “or” is not intended to be exclusive,
      unless the context clearly requires
otherwise.

            


    

     

    2. Tax
Status of Option.

     

    This
Option is intended to be a nonstatutory stock option and shall not be treated as
an incentive stock option within the meaning of Section 422(b) of the
Code.


    
      
         


      

      
        3

        
          

        

      

      
         


      

    


    3. Administration.

     

    All
questions of interpretation concerning this Option Agreement shall be determined
by the Committee.  All determinations by the Committee shall be final
and binding upon all persons having an interest in the Option.  Any
Officer shall have the authority to act on behalf of the Company with respect to
any matter, right, obligation, or election which is the responsibility of or
which is allocated to the Company herein, provided the Officer has apparent
authority with respect to such matter, right, obligation, or
election.

    


    4. Exercise
of the Option.

     

    
      	
              4.1  

            	
              Right to Exercise.  Except
      as otherwise provided herein, the Option shall be exercisable on and after
      the Initial Vesting Date and prior to the termination of the Option (as
      provided in Section 7) in an amount not to exceed the number of
      Vested Shares less the number of shares previously acquired upon exercise
      of the Option.  In no event shall the Option be exercisable for
      more shares than the Number of Option
Shares.

            


    

     

    
      	
              4.2  

            	
              Method of Exercise.  Exercise
      of the Option shall be by means of electronic notice in a form authorized
      by the Company, which shall be digitally signed or authenticated by the
      Participant in such manner as required by the notice and transmitted to
      the Equity Compensation Department of the Company or other authorized
      representative of the Company (including a third-party administrator
      designated by the Company).  In the event that the Participant
      is not authorized or is unable to provide electronic notice of exercise,
      the Option shall be exercised by written notice to the Company, which
      shall be signed by the Participant and delivered in person, by certified
      or registered mail, return receipt requested, by confirmed facsimile
      transmission, or by such other means as the Company may permit, to the
      Equity Compensation Department of the Company, or other authorized
      representative of the Company (including a third-party administrator
      designated by the Company).  Each such notice, whether
      electronic or written, must state the Participant’s election to exercise
      the Option, the number of whole shares of Stock for which the Option is
      being exercised and such other representations and agreements as to the
      Participant’s investment intent with respect to such shares as may be
      required pursuant to the provisions of this Option
      Agreement.  Further, each such notice must be received by the
      Company prior to the termination of the Option as set forth in
      Section 7 and must be accompanied by full payment of the aggregate
      Exercise Price for the number of shares of Stock being
      purchased.  The Option shall be deemed to be exercised upon
      receipt by the Company of such electronic or written notice and the
      aggregate Exercise Price.

            


    

     

    
      	
              4.3  

            	
              Payment
      of Exercise Price.

            


    

     

    
      	
              (a)  

            	
              Forms of Consideration
      Authorized.  Except as otherwise provided below, payment
      of the aggregate Exercise Price for the number of shares of Stock for
      which the Option is being exercised shall be made (i) in cash, by check or
      by cash equivalent or (ii) by means of a Cashless Exercise, as defined in
      Section 4.3(b).

            


    

     

    
      	
              (b)  

            	
              Cashless
      Exercise.  A “Cashless
      Exercise”
      means the delivery of a properly executed notice of exercise together with
      irrevocable instructions to a broker in a form acceptable to the Company
      providing for the assignment to the Company of the proceeds of a sale or
      loan with respect to some or all of the shares being acquired upon the
      exercise of the Option pursuant to a program or procedure approved by the
      Company (including, without limitation, through an exercise complying with
      the provisions of Regulation T as promulgated from time to time by
      the Board of Governors of the Federal Reserve System).  The
      Company reserves, at any and all times, the right, in the Company’s sole
      and absolute

            


    


    
      
         


      

      
        4

        
          

        

      

      
         


      

    


    discretion,
to establish, decline to approve or terminate any such program or procedure,
including with respect to the Participant notwithstanding that such program or
procedures may be available to others.

     

    
      	
              4.4  

            	
              Tax Withholding.  Regardless
      of any action taken by the Participating Company Group with respect to any
      or all income tax, social insurance, payroll tax, payment on account or
      other tax-related withholding (“Tax-Related
      Items”),
      the Participant acknowledges that the ultimate liability for all
      Tax-Related Items legally due by the Participant is and remains the
      Participant’s responsibility and that the Participating Company Group
      (i) makes no representations or undertakings regarding the treatment
      of any Tax-Related Items in connection with any aspect of the Option,
      including the grant, vesting or exercise of the Option, the subsequent
      sale of shares acquired pursuant to such exercise, or the receipt of any
      dividends and (ii) does not commit to structure the terms of the grant or
      any other aspect of the Option to reduce or eliminate the Participant’s
      liability for Tax-Related Items.  At the time of exercise of the
      Option, the Participant shall pay or make adequate arrangements
      satisfactory to the Participating Company Group to satisfy all withholding
      obligations of the Participating Company Group.  In this regard,
      at the time the Option is exercised, in whole or in part, or at any other
      time as reasonably requested by the Company, the Participant hereby
      authorizes withholding of all applicable Tax-Related Items from payroll
      and any other amounts payable to the Participant, and otherwise agrees to
      make adequate provision for withholding of all applicable Tax Related
      Items by the Participating Company Group, if any, which arise in
      connection with the Option.  Alternatively, or in addition, if
      permissible under applicable law, the Participating Company Group may (i)
      sell or arrange for the sale of shares acquired by the Participant to meet
      the withholding obligation of Tax-Related Items and/or (ii) withhold in
      shares, provided that only the amount of shares necessary to satisfy the
      minimum withholding amount are withheld.  Finally, the
      Participant shall pay to the Participating Company Group any amount of the
      Tax-Related Items that the Participating Company Group may be required to
      withhold as a result of the Participant’s participation in the Plan that
      cannot be satisfied by the means previously described.  The
      Company shall have no obligation to process the exercise of the Option or
      to deliver shares of Stock until the obligations in connection with the
      Tax-Related Items as described in this section have been satisfied by the
      Participant.

            


    

    


    
      	
              4.5  

            	
              Beneficial Ownership of Shares;
      Certificate Registration.  The
      Participant hereby authorizes the Company, in its sole discretion, to
      deposit for the benefit of the Participant with any broker with which the
      Participant has an account relationship of which the Company has notice
      any or all shares acquired by the Participant pursuant to the exercise of
      the Option.  Except as provided by the preceding sentence, a
      certificate for the shares as to which the Option is exercised shall be
      registered in the name of the Participant, or, if applicable, in the names
      of the heirs of the Participant.

            


    

     

    
      	
              4.6  

            	
              Restrictions on Grant of the
      Option and Issuance of Shares.  The
      grant of the Option and the issuance of shares of Stock upon exercise of
      the Option shall be subject to compliance with all applicable requirements
      of federal, state or foreign law with respect to such
      securities.  The Option may not be exercised if the issuance of
      shares of Stock upon exercise would constitute a violation of any
      applicable federal, state or foreign securities laws or other law or
      regulations or the requirements of any stock exchange or market system
      upon which the Stock may then be listed.  In addition, the
      Option may not be exercised unless (i) a registration statement under
      the Securities Act shall at the time of exercise of the Option be in
      effect with respect to the shares issuable upon exercise of the Option or
      (ii) in the opinion of legal counsel to the Company, the shares
      issuable upon exercise of the Option may be issued in accordance with the
      terms of an applicable exemption from the registration requirements of the
      Securities Act.  THE PARTICIPANT IS CAUTIONED THAT THE OPTION
      MAY NOT BE EXERCISED

            


    


    
      
         


      

      
        5

        
          

        

      

      
         


      

    


    UNLESS THE
FOREGOING CONDITIONS ARE SATISFIED.  ACCORDINGLY, THE PARTICIPANT MAY
NOT BE ABLE TO EXERCISE THE OPTION WHEN DESIRED EVEN THOUGH THE OPTION IS
VESTED.  The inability of the Company to obtain from any regulatory
body having jurisdiction the authority, if any, deemed by the Company’s legal
counsel to be necessary to the lawful issuance and sale of any shares subject to
the Option 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.  As a condition to the exercise of the Option, the
Company may require the Participant to satisfy any qualifications that may be
necessary or appropriate, to evidence compliance with any applicable law or
regulation and to make any representation or warranty with respect thereto as
may be requested by the Company.

    


     

    
      	
              4.7  

            	
              Fractional Shares.  The
      Company shall not be required to issue fractional shares upon the exercise
      of the Option.

            


    

     

    5. Nontransferability
of the Option.

     

    The Option
may be exercised during the lifetime of the Participant only by the Participant
or the Participant’s guardian or legal representative and may not be assigned or
transferred in any manner except by will or by the laws of descent and
distribution.  Following the death of the Participant, the Option, to
the extent provided in Section 8, may be exercised by the Participant’s
legal representative or by any person empowered to do so under the deceased
Participant’s will or under the then applicable laws of descent and
distribution.

    


    6. Nature of
Option.

     

    
      	 	
              In
      accepting the Option, the Participant acknowledges that:
  

            


    

    


    
      	
              6.1  

            	
              the
      Plan is established voluntarily by the Company; it is discretionary in
      nature and it may be modified, amended, suspended or terminated by the
      Company at any time, unless otherwise provided in the Plan and this Option
      Agreement;

            


    

     

    
      	
              6.2  

            	
              the
      grant of the Option is voluntary and occasional and does not create any
      contractual or other right to receive future grants of Options, or
      benefits in lieu of Options, even if Options have been granted repeatedly
      in the past;

            


    

     

    
      	
              6.3  

            	
              all
      decisions with respect to future Option grants, if any, will be at the
      sole discretion of the Company; 

            


    

     

    
      	
              6.4  

            	
              the
      Participant’s participation in the Plan shall not create a right to
      employment or further service with the Participating Company Group and
      shall not interfere with any ability of the Participating Company Group to
      terminate the Participant’s relationship with the Company at any time with
      or without cause; 

            


    

     

    
      	
              6.5  

            	
              the
      Participant is voluntarily participating in the Plan;
  

            


    

     

    
      	
              6.6  

            	
              the
      Option is not part of normal or expected compensation or salary for any
      purpose, including, but not limited to, calculating any severance,
      resignation, termination, redundancy, end-of-service payments, bonuses,
      long-service awards, pension or retirement benefits or similar payments;
      

            


    

     

    
      	
              6.7  

            	
              in
      the event that the Participant is not an employee of the Company, the
      Option grant will not be interpreted to form an employment contract or
      relationship with the Company; and furthermore, the Option grant will not
      be interpreted to form an employment contract with the other members of
      the Participating Company
Group;

            


    


    
      
         


      

      
        6

        
          

        

      

      
         


      

    


    


    
      	
              6.8  

            	
              the
      future value of the underlying shares is unknown and cannot be predicted
      with certainty; 

            


    

     

    
      	
              6.9  

            	
              if
      the underlying shares do not increase in value, the Option will have no
      value; 

            


    

     

    
      	
              6.10  

            	
              if
      the Participant exercises the Option and obtains shares, the value of
      those shares acquired upon exercise may increase or decrease in value,
      even below the Option price; and

            


    

     

    
      	
              6.11  

            	
              in
      consideration of the grant of the Option, no claim or entitlement to
      compensation or damages arises from termination of the Option or
      diminution in value of the Option or shares purchased through exercise of
      the Option resulting from termination of the Participant’s Service with
      the Participating Company Group (for any reason whether or not in breach
      of applicable labor laws) and the Participant irrevocably releases the
      Participating Company Group from any such claim that may
      arise.  If, notwithstanding the foregoing, any such claim is
      found by a court of competent jurisdiction to have arisen then, by signing
      this Option Agreement, Participant shall be deemed irrevocably to have
      waived his or her entitlement to pursue such a
  claim.

            


    

     

    7. Termination
of the Option.

     

    The Option
shall terminate and may no longer be exercised after the first to occur of
(a) the Option Expiration Date, (b) the last date for exercising the
Option following termination of the Participant’s Service as described in
Section 8, or (c) a Change of Control to the extent provided in
Section 9.

    


    8. Effect
of Termination of Service.

     

    
      	
              8.1  

            	
              Option
      Exercisability.

            


    

     

    
      	
              (a)  

            	
              Disability.  If
      the Participant’s Service terminates because of the Disability of the
      Participant, then the Option, to the extent unexercised and exercisable on
      the date on which the Participant’s Service terminated, may be exercised
      by the Participant (or the Participant’s guardian or legal representative)
      at any time prior to the expiration of twelve (12) months after the date
      on which the Participant’s Service terminated, but in any event no later
      than the Option Expiration Date.

            


    

     

    
      	
              (b)  

            	
              Death.  If the
      Participant’s Service terminates because of the death of the Participant,
      then the Option, to the extent unexercised and exercisable on the date on
      which the Participant’s Service terminated, may be exercised by the
      Participant’s legal representative or other person who acquired the right
      to exercise the Option by reason of the Participant’s death at any time
      prior to the expiration of twelve (12) months after the date on which the
      Participant’s Service terminated, but in any event no later than the
      Option Expiration Date.  The Participant’s Service shall be
      deemed to have terminated on account of death if the Participant dies
      within three (3) months after the Participant’s termination of
      Service.

            


    

     

    
      	
              (c)  

            	
              Other Termination of
      Service.  If the Participant’s Service terminates for any
      reason, except Disability, or death, the Option, to the extent unexercised
      and exercisable by the Participant on the date on which the Participant’s
      Service terminated, may be exercised by the Participant at any time prior
      to the expiration of three (3) months (or such other longer period of time
      as determined

            


    


    
      
         


      

      
        7

        
          

        

      

      
         


      

    


    by the
Committee, in its discretion) after the date on which the Participant’s Service
terminated, but in any event no later than the Option Expiration
Date.

     

    
      	
              8.2  

            	
              Extension if Exercise Prevented
      by Law.

            


    

     

    Notwithstanding
the foregoing, if the exercise of the Option within the applicable time periods
set forth in Section 8.1 is prevented by the provisions of
Section 4.6, the Option shall remain exercisable until three (3) months
after the date the Participant is notified by the Company that the Option is
exercisable, but in any event no later than the Option Expiration
Date.

     

    
      	
              8.3  

            	
              Extension if Participant
      Subject to Section 16(b).

            


    

     

    Notwithstanding
the foregoing, if a sale within the applicable time periods set forth in
Section 8.1 of shares acquired upon the exercise of the Option would
subject the Participant to suit under Section 16(b) of the Exchange Act,
the Option shall remain exercisable until the earliest to occur of (i) the
tenth (10th) day following the date on which a sale of such shares by the
Participant would no longer be subject to such suit, (ii) the one hundred
and ninetieth (190th) day after the Participant’s termination of Service, or
(iii) the Option Expiration Date.

     

    9. Change
of Control.

     

    In the
event of a Change of Control, any unexercised and/or unvested portions of this
Option shall become immediately exercisable and vested in full as of immediately
prior to the effective date of the Change of Control, subject to the
consummation of the Change in Control.

     

    10. Adjustments
for Changes in Capital Structure.

     

    In the
event of any change in the Stock through merger, consolidation, reorganization,
reincorporation, recapitalization, reclassification, stock dividend, stock
split, reverse stock split, split-up, split-off, spin-off, combination of
shares, exchange of shares or similar change in the capital structure of the
Company, or in the event of payment of a dividend or distribution to the
stockholders of the Company in a form other than Stock (excepting normal cash
dividends) that has a material effect on the Fair Market Value of shares of
Stock, appropriate adjustments shall be made in the number, Exercise Price and
class of shares subject to the Option.  If a majority of the shares
which are of the same class as the shares that are subject to the Option are
exchanged for, converted into, or otherwise become (whether or not pursuant to
an Ownership Change Event) shares of another corporation (the “New
Shares”), the
Committee may unilaterally amend the Option to provide that the Option is
exercisable for New Shares.  In the event of any such amendment, the
Number of Option Shares and the Exercise Price shall be adjusted in a fair and
equitable manner, as determined by the Committee, in its
discretion.  Notwithstanding the foregoing, any fractional share
resulting from an adjustment pursuant to this Section 10 shall be rounded
down to the nearest whole number, and in no event may the Exercise Price be
decreased to an amount less than the par value, if any, of the stock subject to
the Option. The adjustments determined by the Committee pursuant to this
Section 10 shall be final, binding and conclusive.

    


    11. Rights
as a Stockholder; Rights to Continue Service.

     

    The
Participant shall have no rights as a stockholder with respect to any shares
covered by the Option until the date of the issuance of the shares for which the
Option has been exercised (as evidenced by the appropriate entry on the books of
the Company or of a duly authorized transfer agent of the
Company).  No adjustment shall be made for dividends, distributions or
other rights for which the record date is prior to the date such shares are
issued, except as provided in Section 10.   Nothing in this
Option Agreement shall confer upon the Participant any right to


    
      
         


      

      
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    continue
in the Service of a Participating Company or interfere in any way with any right
of the Participating Company Group to terminate the Participant’s Service at any
time.

    


    12. Miscellaneous
Provisions.

     

    
      	
              12.1  

            	
              Designation of
      Beneficiary.  Subject to local laws and procedures, the
      Participant may file with the Company a written designation of a
      beneficiary who, in the event of the death of the Participant, shall
      thereafter be entitled to exercise the Option to the extent that it
      remains exercisable in accordance with this Option
      Agreement.  Each designation will revoke all prior designations
      by the Participant, shall be in a form prescribed by the Company, and
      shall be effective only when filed by the Participant in writing with the
      Company during the Participant’s lifetime.  If the Participant
      is married and designates a beneficiary other than the Participant’s
      spouse, the effectiveness of such designation may be subject to the
      consent of the Participant’s spouse.  If the Participant dies
      without an effective designation of a beneficiary who is living at the
      time of the Participant’s death, the Option may be exercised by the
      Participant’s legal representative to the extent that it remains
      exercisable in accordance with this Option Agreement.  If the
      designated beneficiary survives the Participant but dies before exercising
      the Option to the full extent that it remains exercisable in accordance
      with this Option Agreement, then the Option shall be exercisable by the
      legal representative of such deceased designated beneficiary to the extent
      that it remains exercisable in accordance with this Option
      Agreement.  The determination of the Company as to which person,
      if any, qualifies as a designated beneficiary shall be final, conclusive
      and binding on all persons.

            


    

     

    
      	
              12.2  

            	
              Binding
      Effect.  This Option Agreement shall inure to the benefit
      of and be binding upon the parties hereto and their respective heirs,
      executors, administrators, successors and
  assigns.

            


    

     

    
      	
              12.3  

            	
              Termination or
      Amendment.  The Committee may terminate or amend the Plan
      or the Option at any time; provided, however, that except as provided in
      connection with a Change of Control, no such termination or amendment may
      adversely affect the Option or any unexercised portion hereof without the
      consent of the Participant unless such termination or amendment is
      necessary to comply with any applicable law or government
      regulation.  No amendment or addition to this Option Agreement
      shall be effective unless in
writing.

            


    

     

    
      	
              12.4  

            	
              Delivery of Documents and
      Notices.  Any document relating to participating in the
      Plan and/or notice required or permitted hereunder shall be given in
      writing and shall be deemed effectively given (except to the extent that
      this Option Agreement provides for effectiveness only upon actual receipt
      of such notice) upon personal delivery, electronic delivery, or upon
      deposit in the U.S. Post Office or foreign postal service, by registered
      or certified mail, with postage and fees prepaid, addressed to the other
      party at the e-mail address, if any, provided for the Participant by a
      Participating Company or at the address shown below that party’s signature
      to this Option Agreement or at such other address as such party may
      designate in writing from time to time to the other
  party.

            


    

     

    
      	
              (a)  

            	
              Description of Electronic
      Delivery.  The
      Plan documents, which may include but do not necessarily include: the Plan
      Prospectus, this Option Agreement and U.S. financial reports of the
      Company, may be delivered to the Participant electronically.  In
      addition, the Participant may deliver electronically the notice called for
      by Section 4.2 (the “Notice of Exercise”) to the Company or to such third
      party involved in administering the Plan as the Company may designate from
      time to time.  Such means of delivery may include but do not
      necessarily include the delivery of a link to a Company intranet or the
      internet site of a third party involved in administering the Plan, the
      delivery of the document via e-mail or such other delivery determined at
      the Committee’s discretion.

            


    


    
      
         


      

      
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              (b)  

            	
              Consent to Electronic
      Delivery.  The Participant acknowledges that the
      Participant has read Section 12.4 of this Option Agreement and consents to
      the electronic delivery of the Plan documents and the delivery of the
      Notice of Exercise, as described in Section 12.4(a) of this Option
      Agreement.  The Participant acknowledges that he or she may
      receive from the Company a paper copy of any documents delivered
      electronically at no cost if the Participant contacts the Company by
      telephone, through a postal service or electronic mail at
      equity@adobe.com.  The Participant further acknowledges that the
      Participant will be provided with a paper copy of any documents delivered
      electronically if electronic delivery fails; similarly, the Participant
      understands that the Participant must provide the Company or any
      designated third party with a paper copy of any documents delivered
      electronically if electronic delivery fails.  Also, the
      Participant understands that the Participant’s consent may be revoked or
      changed, including any change in the electronic mail address to which
      documents are delivered (if Participant has provided an electronic mail
      address), at any time by notifying the Company of such revised or revoked
      consent by telephone, postal service or electronic mail at
      equity@adobe.com.  Finally, the Participant understands that he
      or she is not required to consent to electronic
  delivery.

            


    

    


    
      	
              12.5  

            	
              Data Privacy
      Consent.  The
      Participant hereby explicitly and unambiguously consents to the
      collection, use and transfer, in electronic or other form, of the
      Participant’s personal data as described in this document by and among the
      members of the Participating Company Group for the exclusive purpose of
      implementing, administering and managing the Participant’s participation
      in the Plan.

            


    

     

    The
Participant understands that the Company and the Participating Company Group
hold certain personal information about the Participant, including, but not
limited to, the Participant’s name, home address and telephone number, date of
birth, social insurance number or other identification number, salary,
nationality, job title, any shares of Stock or directorships held in the
Company, details of all Options or any other entitlement to shares of Stock
awarded, canceled, exercised, vested, unvested or outstanding in the
Participant’s favor, for the purpose of implementing, administering and managing
the Plan (“Data”).  The Participant understands that Data may be
transferred to any third parties assisting in the implementation, administration
and management of the Plan, that these recipients may be located in the
Participant’s country or elsewhere, and that the recipient’s country may have
different data privacy laws and protections than the Participant’s
country.  The Participant understands that he or she may request a
list with the names and addresses of any potential recipients of the Data by
contacting the Participant’s local human resources
representative.  The Participant authorizes the recipients to receive,
possess, use, retain and transfer the Data, in electronic or other form, for the
purposes of implementing, administering and managing the Participant’s
participation in the Plan, including any requisite transfer of such Data as may
be required to a broker or other third party with whom the Participant may elect
to deposit any shares of Stock acquired upon exercise of the
Option.  The Participant understands that Data will be held only as
long as is necessary to implement, administer and manage the Participant’s
participation in the Plan.  The Participant understands that he or she
may, at any time, view Data, request additional information about the storage
and processing of Data, require any necessary amendments to Data or refuse or
withdraw the consents herein, in any case without cost, by contacting in writing
the Participant’s local human resources representative.  The
Participant understands, however, that refusing or withdrawing the Participant’s
consent may affect the Participant’s ability to participate in the
Plan.  For more information on the consequences of the Participant’s
refusal to consent or withdrawal of consent, the Participant understands that he
or she may contact the Participant’s local human resources
representative.


    
      
         


      

      
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              12.6  

            	
              Integrated
      Agreement.  This Option Agreement and the Plan constitute
      the entire understanding and agreement of the Participant and the
      Participating Company Group with respect to the subject matter contained
      herein and supersedes any prior agreements, understandings, restrictions,
      representations, or warranties among the Participant and the Participating
      Company Group with respect to such subject matter other than those as set
      forth or provided for herein.  To the extent contemplated
      herein, the provisions of this Option Agreement shall survive any exercise
      of the Option and shall remain in full force and effect.  Any
      capitalized terms not defined herein shall have the meaning set forth in
      the Plan.

            


    

     

    
      	
              12.7  

            	
              Applicable
      Law.  This Option Agreement shall be governed by the laws
      of the State of California as such laws are applied to agreements between
      California residents entered into and to be performed entirely within the
      State of California. For purposes of litigating any dispute that arises
      directly or indirectly from the relationship of the parties as evidenced
      by this Option Agreement, the parties herby submit to and consent to the
      jurisdiction of the State of California and agree that such litigation
      shall be conducted only in the courts of Santa Clara County, California,
      or the federal courts of the United States for the Northern District of
      California, and no other courts, where this Option Agreement is made
      and/or performed.

            


    

     

    


     

    


     

    
      	
              ADOBE
      SYSTEMS INCORPORATED

            
	
              By:____________________

            
	
              Shantanu
      Narayen

            
	
              Title:Chief
      Executive Officer

            
	 
      
	
              Address:          345
      Park Avenue

            
	
              San Jose, CA
      95110-2704

            


    

    


     

    


    


    The
Participant represents that the Participant is familiar with the terms and
provisions of this Option Agreement and hereby accepts the Option subject to all
of the terms and provisions thereof.  The Participant hereby agrees to
accept as binding, conclusive and final all decisions or interpretations of the
Committee upon any questions arising under this Option
Agreement.


    
      
         


      

      
        11