exv10w4






Exhibit 10.4




ATMEL CORPORATION




2005 STOCK PLAN




(AS AMENDED AND RESTATED AUGUST 14, 2008)




     1. Background. The Plan permits the grant of Nonstatutory Stock Options, Incentive
Stock Options, Stock Purchase Rights, Stock Appreciation Rights, and Restricted Stock Units.



     2. Purposes of the Plan. The purposes of this 2005 Stock Plan are:




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





     3. Definitions. As used herein, the following definitions shall apply:



          (a) “Administrator” means the Board or any of its Committees as shall be administering the
Plan, in accordance with Section 5 of the Plan.




          (b) “Affiliate” means any corporation or any other entity (including, but not limited to,
partnerships and joint ventures) controlling, controlled by, or under common control with the
Company.




          (c) “Applicable Laws” means the requirements relating to the administration of stock option
plans under U.S. state corporate laws, U.S. federal and state securities laws, the Code, any stock
exchange or quotation system on which the Common Stock is listed or quoted and the applicable laws
of any foreign country or jurisdiction where Awards are, or will be, granted under the Plan.




          (d) “Annual Revenue” means the Company’s or a business unit’s net sales for the Fiscal Year,
determined in accordance with generally accepted accounting principles; provided, however, that
prior to the Fiscal Year, the Committee shall determine whether any significant item(s) shall be
excluded or included from the calculation of Annual Revenue with respect to one or more
Participants.




          (e) “Award” means, individually or collectively, a grant under the Plan of Options, Stock
Purchase Rights, Stock Appreciation Rights, and Restricted Stock Units.




          (f) “Award Agreement” means the written agreement setting forth the terms and provisions
applicable to each Award granted under the Plan. The Award Agreement is subject to the terms and
conditions of the Plan.




 









 








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




          (h) “Cash Flow from Operations” means as to any Fiscal Year, the Company’s cash generated from
operating activities, or a business unit’s cash generated from operating activities, determined in
accordance with generally acceptable accounting principles.




          (i) “Code” means the Internal Revenue Code of 1986, as amended. Reference to a specific
section of the Code or regulation thereunder shall include such section or regulation, any valid
regulation promulgated under such section, and any comparable provision of any future legislation
or regulation amending, supplementing or superseding such section or regulation.




          (j) “Committee” means a committee of Directors appointed by the Board in accordance with
Section 5 of the Plan.




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




          (l) “Company” means Atmel Corporation, a Delaware corporation.




          (m) “Consultant” means any person, including an advisor, engaged by the Company or a Parent or
Subsidiary to render services to such entity.




          (n) “Director” means a member of the Board, either as an Employee or an Outside Director.




          (o) “Disability” means total and permanent disability as defined in Section 22(e)(3) of the
Code.




          (p) “Earnings Per Share” means as to any Fiscal Year, the Company’s Net Income or a business
unit’s Pro Forma Net Income, divided by a weighted average number of common shares outstanding and
dilutive common equivalent shares deemed outstanding.




          (q) “Employee” means any person, including Officers and Directors, employed by the Company or
any Parent or Subsidiary of the Company. A Service Provider shall not cease to be an Employee in
the case of (i) any leave of absence approved by the Company or (ii) transfers between locations of
the Company or between the Company, its Parent, any Subsidiary, or any successor. For purposes of
Incentive Stock Options, no such leave may exceed ninety days, unless reemployment upon expiration
of such leave is guaranteed by statute or contract. If reemployment upon expiration of a leave of
absence approved by the Company is not so guaranteed, then three months following the 91st
day of such leave any Incentive Stock Option held by the Optionee shall cease to be treated
as an Incentive Stock Option and shall be treated for tax purposes as a Nonstatutory Stock Option.
Neither service as a Director nor payment of a director’s fee by the Company shall be sufficient to
constitute “employment” by the Company.




          (r) “Exercise Price” means the price at which a Share may be purchased by a Participant
pursuant to the exercise of an Option.




          (s) “Exchange Act” means the Securities Exchange Act of 1934, as amended.




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




               (i) If the Common Stock is listed on any established stock exchange or a national market
system, including without limitation the Nasdaq Global Select Market, Nasdaq Global Market, or
Nasdaq Capital Market, its Fair Market Value shall be the closing sales price for such stock (or
the closing bid, if no sales were reported) as quoted on such exchange or system on the day of
determination, as reported in The Wall Street Journal or such other source as the Administrator
deems reliable, or, if the day of determination is not a trading day, the average of the closing
sales prices (or the closing bids, if no sales were reported) on the immediately following and
preceding trading dates, in either case as reported by The Wall Street Journal or such other source
as the Administrator deems reliable;



               (ii) If the Common Stock is regularly quoted by a recognized securities dealer but selling
prices are not reported, the Fair Market Value of a Share of Common Stock shall be the mean between
the high bid and low asked prices for the Common Stock on the day of determination, as reported in
The Wall Street Journal or such other source as the Administrator deems reliable; or



               (iii) In the absence of an established market for the Common Stock, the Fair Market Value
shall be determined in good faith by the Administrator.



          (u) “Fiscal Year” means the fiscal year of the Company.




          (v) “Grant Date” means, with respect to an Award, the date that the Award was granted.




          (w) “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.




          (x) “Net Income” means as to any Fiscal Year, the income after taxes of the Company for the
Fiscal Year determined in accordance with generally accepted accounting principles, provided that
prior to the Fiscal Year, the Committee shall determine whether any significant item(s) shall be
included or excluded from the calculation of Net Income with respect to one or more Participants.




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




          (z) “Notice of Grant” means a written or electronic notice evidencing certain terms and
conditions of an individual Award grant. The Notice of Grant is part of the Award Agreement.




          (aa) “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.




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          (bb) “Operating Profit” means the Company’s or a business unit’s profit from operations but
excluding any unusual items, determined in accordance with generally accepted accounting
principles.




          (cc) “Option” means an Incentive Stock Option or a Nonstatutory Stock Option granted pursuant
to the Plan.




          (dd) “Optionee” means the holder of an outstanding Option or Stock Purchase Right granted
under the Plan.




          (ee) “Option Exchange Program” means a program whereby outstanding Options are surrendered or
cancelled in exchange for the right to receive options of the same type, of a different type and/or
cash pursuant to such terms as the Administrator may determine.




          (ff) “Optioned Stock” means the Common Stock subject to an Award.




          (gg) “Outside Director” means a Director who is not an Employee.




          (hh) “Parent” means a “parent corporation,” whether now or hereafter existing, as defined in
Section 424(e) of the Code.




          (ii) “Participant” means the holder of an outstanding Award, which shall include an Optionee.




          (jj) “Performance Goals” means the goal(s) (or combined goal(s)) determined by the Committee
(in its discretion) to be applicable to a Participant with respect to an Award. As determined by
the Committee, the Performance Goals applicable to an Award may provide for a targeted level or
levels of achievement using one or more of the following measures: (a) Annual Revenue, (b)
Operating Profit, (c) Cash Flow from Operations, (d) Net Income, (e) Pro Forma Net Income, (f)
Earnings Per Share, and (g) Return on Sales. The Performance Goals may differ from Participant to
Participant and from Award to Award. Any criteria used may be (i) measured in absolute terms, (ii)
measured in relative terms (including, but not limited to compared to another company or
companies), (iii) measured against the performance of the Company as a whole or a segment of the
Company and/or (iv) measured on a pre-tax or post-tax basis (if applicable).




          (kk) “Plan” means this 2005 Stock Plan, as amended.




          (ll) “Pro Forma Net Income” means as to any business unit for any Fiscal Year, the
Controllable Profits of such business unit, minus allocations of designated corporate expenses.




          (mm) “Reload Option” means an Option that automatically is granted if a Participant pays the
exercise price of an Option by tendering Shares.




          (nn) “Restricted Stock” means shares of Common Stock acquired pursuant to a grant of Stock
Purchase Rights under Section 12 of the Plan.




          (oo) “Restricted Stock Purchase Agreement” means a written agreement between the Company and
the Optionee evidencing the terms and restrictions applying to stock purchased under a Stock




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Purchase Right. The Restricted Stock Purchase Agreement is subject to the terms and conditions of
the Plan and the Notice of Grant.




          (pp) “Restricted Stock Unit” means an Award granted to a Participant pursuant to Section 14.




          (qq) “Retirement” means, in the case of an Employee or Director: (a) a Termination of Service
occurring on or after age sixty-five (65), or (b) a Termination of Service occurring on or after
age sixty (60) with at least ten (10) Years of Service. With respect to a Consultant, no
Termination of Service shall be deemed to be on account of “Retirement.”




          (rr) “Return on Sales” means as to any Fiscal Year, the percentage equal to the Company’s Net
Income or the business unit’s Pro Forma Net Income, divided by the Company’s or the business unit’s
Annual Revenue, as applicable.




          (ss) “Rule 16b-3” means Rule 16b-3 of the Exchange Act or any successor to Rule 16b-3, as in
effect when discretion is being exercised with respect to the Plan.




          (tt) “Section 16(b)” means Section 16(b) of the Exchange Act.




          (uu) “Section 409A” means Section 409A of the Code and any proposed, temporary or final
Treasury Regulations and Internal Revenue Service guidance thereunder, as each may be amended from
time to time.




          (vv) “Service Provider” means an Employee, Director or Consultant.




          (ww) “Share” means a share of the Common Stock, as adjusted in accordance with Section 16 of
the Plan.




          (xx) “Stock Appreciation Right” or “SAR” means an Award, granted alone or in connection with a
related Option (either affiliated or tandem) that pursuant to Section 13 is designated as an SAR.




          (yy) “Stock Purchase Right” means the right to purchase Common Stock pursuant to Section 12 of
the Plan, as evidenced by a Notice of Grant.




          (zz) “Subsidiary” means a “subsidiary corporation”, whether now or hereafter existing, as
defined in Section 424(f) of the Code.




          (aaa) “Termination of Service” means (a) in the case of an Employee, a cessation of the
employee-employer relationship between the Employee and the Company or an Affiliate for any reason,
including, but not by way of limitation, a termination by resignation, discharge, death,
Disability, Retirement, or the disaffiliation of an Affiliate, but excluding any such termination
where there is a simultaneous re-employment or engagement as a consultant by the Company or an
Affiliate; (b) in the case of a Consultant, a cessation of the service relationship between the
Consultant and the Company or an Affiliate for any reason, including, but not by way of limitation,
a termination by resignation, discharge, death, Disability, or the disaffiliation of an Affiliate,
but excluding any such termination where there is a simultaneous employment as an Employee or
re-




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engagement of the Consultant by the Company or an Affiliate; and (c) in the case of a Director,
a cessation of the Director’s service on the Board for any reason, including, but not by way of
limitation, a termination by resignation, death, Disability, Retirement or non-reelection to the
Board, but excluding any such termination where there is a simultaneous employment as an Employee
or engagement as a Consultant by the Company or an Affiliate.




     4. Stock Subject to the Plan.



          (a) Subject to the provisions of Section 16 of the Plan, the maximum aggregate number of
Shares that may be optioned and sold under the Plan is 114,000,000 Shares.1 The Shares
may be authorized, but unissued, or reacquired Common Stock.




          If an Award expires or becomes unexercisable without having been exercised in full, or is
surrendered pursuant to an Option Exchange Program, the unpurchased Shares which were subject
thereto shall become available for future grant or sale under the Plan (unless the Plan has
terminated); provided, however, that Shares that have actually been issued under
the Plan, whether upon exercise of an Option or Right, shall not be returned to the Plan and shall
not become available for future distribution under the Plan, except that if Shares of Restricted
Stock are repurchased by the Company at their original purchase price, such Shares shall become
available for future grant under the Plan.




          (b) Full Value Awards. Any Shares subject to Restricted Stock, Restricted Stock
Units, and Stock Purchase Rights granted on or after May 14, 2008 will be counted against the
numerical limits of this Section 4 as one and 78/100 (1.78) Shares for every one (1) Share subject
thereto. Further, if Shares acquired pursuant to any Restricted Stock, Restricted Stock Units, and
Stock Purchase Rights granted on or after May 14, 2008 are forfeited or repurchased by the Company
and would otherwise return to the Plan pursuant to this Section 4, one and 78/100 (1.78) times the
number of Shares so forfeited or repurchased will return to the Plan and will again become
available for issuance.




     5. Administration of the Plan.



          (a) Procedure.




               (i) Multiple Administrative Bodies. The Plan may be administered by different
Committees with respect to different groups of Service Providers.



               (ii) Section 162(m). To the extent that the Administrator determines it to be
desirable to qualify Awards granted hereunder as “performance-based compensation” within the
meaning of Section 162(m) of the Code, the Plan shall be administered by a Committee of two or more
“outside directors” within the meaning of Section 162(m) of the Code. For purposes of qualifying
grants of Awards as “performance-based compensation” under Section 162(m) of the Code, the
Committee, in its discretion, may set restrictions based upon the achievement of Performance Goals.
The Performance Goals shall be set by the Committee on or before the latest





 




			
	1	 	Includes 58,000,000 Shares approved by the Company’s
stockholders on May 14, 2008.





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date permissible to
enable the Awards to qualify as “performance-based compensation” under Section 162(m) of the Code.
In granting Awards that are intended to qualify under Section 162(m) of the Code, the Committee
shall follow any procedures determined by it from time to time to be necessary or appropriate to
ensure qualification of the Awards under Section 162(m) of the Code (e.g., in determining the
Performance Goals).




               (iii) Rule 16b-3. To the extent desirable to qualify transactions hereunder as exempt
under Rule 16b-3, the transactions contemplated hereunder shall be structured to satisfy the
requirements for exemption under Rule 16b-3.



               (iv) Other Administration. Other than as provided above, the Plan shall be
administered by (A) the Board or (B) a Committee, which committee shall be constituted to satisfy
Applicable Laws.



          (b) Powers of the Administrator. Subject to the provisions of the Plan, and in the
case of a Committee, subject to the specific duties delegated by the Board to such Committee, the
Administrator shall have the authority, in its discretion:




               (i) to determine the Fair Market Value;



               (ii) to select the Service Providers to whom Awards may be granted hereunder;



               (iii) to determine the number of shares of Common Stock to be covered by each Award granted
hereunder;



               (iv) to approve forms of agreement for use under the Plan;



               (v) to determine the terms and conditions, not inconsistent with the terms of the Plan, of any
Award granted hereunder. Such terms and conditions include, but are not limited to, the exercise
price, the time or times when Awards may be exercised (which may be based on performance criteria),
any vesting acceleration or waiver of forfeiture restrictions, and any restriction or limitation
regarding any Award or the Shares relating thereto, based in each case on such factors as the
Administrator, in its sole discretion, shall determine;



               (vi) to construe and interpret the terms of the Plan and Awards granted pursuant to the Plan;



               (vii) to prescribe, amend and rescind rules and regulations relating to the Plan, including
rules and regulations relating to sub-plans established for the purpose of satisfying applicable
foreign laws;



               (viii) to modify or amend each Award (subject to Section 18(c) of the Plan), including the
discretionary authority to extend the post-termination exercisability period of Options longer than
is otherwise provided for in the Plan;



               (ix) to allow Optionees to satisfy withholding tax obligations by electing to have the Company
withhold from the Shares to be issued upon exercise of an Award that number of



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Shares having a Fair
Market Value equal to the minimum amount required to be withheld. The Fair Market Value of the
Shares to be withheld shall be determined on the date that the amount of tax to be withheld is to
be determined. All elections by an Optionee to have Shares withheld for this purpose shall be made
in such form and under such conditions as the Administrator may deem necessary or advisable;



               (x) to authorize any person to execute on behalf of the Company any instrument required to
effect the grant of an Award previously granted by the Administrator;



               (xi) to commence a Section 409A Exchange Offer in connection with each Option that had a per
share exercise price that was less than the fair market value of a share of the Company’s common
stock, as determined for purposes of Section 409A, on the Option’s grant date and that was
unvested, in whole or in part, as of December 31, 2004 (notwithstanding Section 18(b) of the Plan),
as described by Section 23 of the Plan;



               (xii) to make all other determinations deemed necessary or advisable for administering the
Plan.



          (c) Additional Power of Administrator Requiring Stockholder Approval. The
Administrator shall have authority to take the following actions, but only if not otherwise
prohibited by the provisions of the Plan and only if approval by the Company’s stockholders is
obtained:




               (i) reduce the exercise price of any Award to the then current Fair Market Value if the Fair
Market Value of the Common Stock covered by such Award shall have declined since the date the Award
was granted; provided, however, that the Administrator shall have the power to make adjustments in
the exercise price of any Award pursuant to Section 16 without the necessity of obtaining
stockholder approval;



               (ii) institute an Option Exchange Program to allow for the cancellation of an outstanding
Option followed by its immediate replacement with a new Option with a lower exercise price, or with
a different type of Award, cash or a combination thereof; provided, however, that the Administrator
shall have the power to make adjustments in the exercise price of any Award pursuant to Section 16
without the necessity of obtaining stockholder approval; and



               (iii) institute any other program that would constitute a revaluation or repricing of Options;
provided, however, that the Administrator shall have the power to make adjustments in the exercise
price of any Award pursuant to Section 16 without the necessity of obtaining stockholder approval.



          (d) Effect of Administrator’s Decision. The Administrator’s decisions, determinations
and interpretations shall be final and binding on all Optionees and any other holders of Options or
Stock Purchase Rights.




     6. Eligibility. Nonstatutory Stock Options, Stock Purchase Rights, Stock Appreciation
Rights and Restricted Stock Units may be granted to Service Providers. Incentive Stock Options may
be granted only to Employees.



     7. Limitations.



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          (a) Each Option shall be designated in the Award Agreement as either an Incentive Stock Option
or a Nonstatutory Stock Option. However, notwithstanding such designation, to the extent that the
aggregate Fair Market Value of the Shares with respect to which Incentive Stock Options are
exercisable for the first time by the Optionee during any calendar year (under all plans of the
Company and any Parent or Subsidiary) exceeds $100,000, such Options shall be treated as
Nonstatutory Stock Options. For purposes of this Section 7(a), Incentive Stock Options shall be
taken into account in the order in which they were granted. The Fair Market Value of the Shares
shall be determined as of the time the Option with respect to such Shares is granted.




          (b) Neither the Plan nor any Award shall confer upon an Optionee any right with respect to
continuing the Optionee’s relationship as a Service Provider with the Company, nor shall they
interfere in any way with the Optionee’s right or the Company’s right to terminate such
relationship at any time, with or without cause.




          (c) The following limitations shall apply to grants of Options, Stock Purchase Rights, Stock
Appreciation Rights and Restricted Stock Units:




               (i) No Service Provider shall be granted, in any fiscal year of the Company, Options, Stock
Purchase Rights, Stock Appreciation Rights or Restricted Stock Units to purchase more than
5,000,000 Shares.



               (ii) In connection with his or her initial service, a Service Provider may be granted Options,
Stock Purchase Rights, Stock Appreciation Rights or Restricted Stock Units to purchase up to an
additional 5,000,000 Shares which shall not count against the limit set forth in subsection (i)
above.



               (iii) The foregoing limitations shall be adjusted proportionately in connection with any
change in the Company’s capitalization as described in Section 16.



               (iv) If an Option, Stock Purchase Rights, Stock Appreciation Rights or Restricted Stock Unit
is cancelled in the same fiscal year of the Company in which it was granted (other than in
connection with a transaction described in Section 16), the cancelled Option, Stock Purchase
Rights, Stock Appreciation Rights or Restricted Stock Units will be counted against the limits set
forth in subsections (i) and (ii) above. For this purpose, if the exercise price of an Option,
Stock Purchase Rights, Stock Appreciation Rights or Restricted Stock Unit is reduced, the
transaction will be treated as a cancellation of the Option, Stock Purchase Rights, Stock
Appreciation Rights or Restricted Stock Units and the grant of a new Option, Stock Purchase Rights,
Stock Appreciation Rights or Restricted Stock Units.



     8. Term of Plan. Subject to Section 22 of the Plan, the Plan shall become effective
upon adoption by the Board and obtaining stockholder approval. The Plan amends and restates the
previous 1996 Stock Plan. It shall continue in effect for a term of ten (10) years unless
terminated earlier under Section 18 of the Plan.



     9. Term of Option. The term of each Option shall be stated in the Award Agreement;
however, the term of an Option granted on or after April 9, 2008 shall be no longer than ten (10)
years from the Grant Date or such shorter term as may be provided in the Award Agreement.
Moreover, in the case of an Incentive Stock Option granted to an Optionee who, at the time the



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Incentive Stock Option is granted, owns stock representing more than ten percent (10%) of the total
combined voting power of all classes of stock of the Company or any Parent or Subsidiary, the term
of the Incentive Stock Option shall be five (5) years from the Grant Date or such shorter term as
may be provided in the Award Agreement.



     10. Option Exercise Price and Consideration.



          (a) Exercise Price. The per share exercise price for the Shares to be issued pursuant
to exercise of an Option shall be determined by the Administrator, subject to the following:




               (i) In the case of an Incentive Stock Option



                    (A) granted to an Employee who, at the time the Incentive Stock Option is granted, owns stock
representing more than ten percent (10%) of the voting power of all classes of stock of the Company
or any Parent or Subsidiary, the per Share exercise price shall be no less than 110% of the Fair
Market Value per Share on the Grant Date.



                    (B) granted to any Employee other than an Employee described in paragraph (A) immediately
above, the per Share exercise price shall be no less than 100% of the Fair Market Value per Share
on the Grant Date.



               (ii) In the case of a Nonstatutory Stock Option granted on or after April 9, 2008, except as
may be required by law to ensure favorable tax treatment in a non-U.S. jurisdiction, the per Share
exercise price shall be no less than 100% of the Fair Market Value per share on the Grant Date .
In the case of a Nonstatutory Stock Option intended to qualify as “performance-based compensation”
within the meaning of Section 162(m) of the Code, the per Share exercise price shall be no less
than 100% of the Fair Market Value per Share on the Grant Date.



               (iii) Notwithstanding the foregoing, Options may be granted with a per Share exercise price of
less than 100% of the Fair Market Value per Share on the Grant Date pursuant to a merger or other
corporate transaction.



          (b) Waiting Period and Exercise Dates. At the time an Option is granted, the
Administrator shall fix the period within which the Option may be exercised and shall determine any
conditions which must be satisfied before the Option may be exercised.




          (c) Form of Consideration. The Administrator shall determine the acceptable form of
consideration for exercising an Option, including the method of payment. In the case of an
Incentive Stock Option, the Administrator shall determine the acceptable form of consideration at
the time of grant. Such consideration may consist entirely of:




               (i) cash;



               (ii) check;



               (iii) other Shares, which in the case of Shares acquired directly or indirectly from the
Company, (A) have been vested and owned by the Optionee for more than six



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months on the date of
surrender, and (B) have a Fair Market Value on the date of surrender equal to the aggregate
exercise price of the Shares as to which said Option shall be exercised;



               (iv) consideration received by the Company under a cashless exercise program implemented by
the Company in connection with the Plan;



               (v) a reduction in the amount of any Company liability to the Optionee, including any
liability attributable to the Optionee’s participation in any Company-sponsored deferred
compensation program or arrangement;



               (vi) any combination of the foregoing methods of payment; or



               (vii) such other consideration and method of payment for the issuance of Shares to the extent
permitted by Applicable Laws.



     11. Exercise of Option.



          (a) Procedure for Exercise; Rights as a Shareholder. Any Option granted hereunder
shall be exercisable according to the terms of the Plan and at such times and under such conditions
as determined by the Administrator and set forth in the Award Agreement. Except for options
granted prior to October 11, 1996, or unless the Administrator provides otherwise, vesting of
Options granted hereunder shall be suspended during any unpaid leave of absence. An Option may not
be exercised for a fraction of a Share.




               An Option shall be deemed exercised when the Company receives: (i) written or electronic
notice of exercise (in accordance with the Award Agreement) from the person entitled to exercise
the Option, and (ii) full payment for the Shares with respect to which the Option is exercised.
Full payment may consist of any consideration and method of payment authorized by the Administrator
and permitted by the Award Agreement and the Plan. Shares issued upon exercise of an Option shall
be issued in the name of the Optionee or, if requested by the Optionee, in the name of the Optionee
and his or her spouse. Until the Shares are issued (as evidenced by the appropriate entry on the
books of the Company or of a duly authorized transfer agent of the Company), no right to vote or
receive dividends or any other rights as a shareholder shall exist with respect to the Optioned
Stock, notwithstanding the exercise of the Option. The Company shall issue (or cause to be issued)
such Shares promptly after the Option is exercised. No adjustment will be made for a dividend or
other right for which the record date is prior to the date the Shares are issued, except as
provided in Section 16 of the Plan.



               Exercising an Option in any manner shall decrease the number of Shares thereafter available,
both for purposes of the Plan and for sale under the Option, by the number of Shares as to which
the Option is exercised.



          (b) Termination of Relationship as a Service Provider. If an Optionee ceases to be a
Service Provider, other than upon the Optionee’s death or Disability, the Optionee may exercise his
or her Option within such period of time as is specified in the Award Agreement to the extent that
the Option is vested on the date of termination (but in no event later than the expiration of the
term of such Option as set forth in the Award Agreement). In the absence of a specified time in
the Award Agreement, the Option shall remain exercisable for three (3) months following the
Optionee’s




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termination. If, on the date of termination, the Optionee is not vested as to his or
her entire Option, the Shares covered by the unvested portion of the Option shall revert to the
Plan. If, after termination, the Optionee does not exercise his or her Option within the time
specified by the Administrator, the Option shall terminate, and the Shares covered by such Option
shall revert to the Plan.




          (c) Disability of Optionee. If an Optionee ceases to be a Service Provider as a
result of the Optionee’s Disability, the Optionee may exercise his or her Option within such period
of time as is specified in the Award Agreement to the extent the Option is vested on the date of
termination (but in no event later than the expiration of the term of such Option as set forth in
the Award Agreement). In the absence of a specified time in the Award Agreement, the Option shall
remain exercisable for twelve (12) months following the Optionee’s termination. If, on the date of
termination, the Optionee is not vested as to his or her entire Option, the Shares covered by the
unvested portion of the Option shall revert to the Plan. If, after termination, the Optionee does
not exercise his or her Option within the time specified herein, the Option shall terminate, and
the Shares covered by such Option shall revert to the Plan.




          (d) Death of Optionee. If an Optionee dies while a Service Provider, the Option may
be exercised following the Optionee’s death within such period of time as is specified in the Award
Agreement to the extent the Option is vested on the date of death (but in no event later than the
expiration of the term of such Option as set forth in the Award Agreement), by the Optionee’s
designated beneficiary, provided such beneficiary has been designated prior to Optionee’s death in
a form acceptable to the Administrator. If no such beneficiary has been designated by the
Optionee, then such Option may be exercised by the personal representative of the Optionee’s estate
or by the person(s) to whom the Option is transferred pursuant to the Optionee’s will or in
accordance with the laws of descent and distribution. In the absence of a specified time in the
Award Agreement, the Option shall remain exercisable for twelve (12) months following the
Optionee’s death. If, at the time of death, the Optionee is not vested as to his or her entire
Option, the Shares covered by the unvested portion of the Option shall immediately revert to the
Plan. If the Option is not so exercised within the time specified herein, the Option shall
terminate, and the Shares covered by such Option shall revert to the Plan.




12. Stock Purchase Rights.




          (a) Rights to Purchase. Stock Purchase Rights may be issued either alone, in addition
to, or in tandem with other awards granted under the Plan and/or cash awards made outside of the
Plan. After the Administrator determines that it will offer Stock Purchase Rights under the Plan,
it shall advise the offeree in writing or electronically, by means of a Notice of Grant, of the
terms, conditions and restrictions related to the offer, including the number of Shares that the
offeree shall be entitled to purchase, the price to be paid, and the time within which the offeree
must accept such offer. The offer shall be accepted by execution of a Restricted Stock Purchase
Agreement in the form determined by the Administrator.




          (b) Number of Shares. The Administrator shall have complete discretion to determine
the number of Stock Purchase Rights granted to any Participant, provided that during any Fiscal
Year, no Participant shall be granted Stock Purchase Rights covering more than 5,000,000 Shares,
unless in connection with his or her initial service as described in Section 7(c)(ii).




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          (c) Repurchase Option. Unless the Administrator determines otherwise, the Restricted
Stock Purchase Agreement shall grant the Company a repurchase option exercisable upon the voluntary
or involuntary termination of the purchaser’s service with the Company for any reason (including
death or Disability). The purchase price for Shares repurchased pursuant to the Restricted Stock
Purchase Agreement shall be the original price paid by the purchaser and may be paid by
cancellation of any indebtedness of the purchaser to the Company. The repurchase option shall
lapse at a rate determined by the Administrator.




          (d) Other Provisions. The Restricted Stock Purchase Agreement shall contain such
other terms, provisions and conditions not inconsistent with the Plan as may be determined by the
Administrator in its sole discretion.




          (e) Rights as a Shareholder. Once the Stock Purchase Right is exercised, the
purchaser shall have the rights equivalent to those of a shareholder, and shall be a shareholder
when his or her purchase is entered upon the records of the duly authorized transfer agent of the
Company. No adjustment will be made for a dividend or other right for which the record date is
prior to the date the Stock Purchase Right is exercised, except as provided in Section 16 of the
Plan.




     13. Stock Appreciation Rights.



          (a) Grant of SARs. Subject to the terms and conditions of the Plan, a SAR may be
granted to Employees and Consultants at any time and from time to time as shall be determined by
the Administrator, in its sole discretion. The Administrator may grant affiliated SARs,
freestanding SARs, tandem SARs, or any combination thereof.




               (i) Number of Shares. The Administrator shall have complete discretion to determine
the number of SARs granted to any Participant, provided that during any Fiscal Year, no Participant
shall be granted SARs covering more than 5,000,000 Shares, unless in connection with his or her
initial service as described in Section 7(c)(ii).



               (ii) Exercise Price and Other Terms. The Administrator, subject to the provisions of
the Plan, shall have complete discretion to determine the terms and conditions of SARs granted
under the Plan. However, except as may be required by law to ensure favorable tax treatment in a
non-U.S. jurisdiction, the exercise price of a freestanding SAR shall be not less than one hundred
percent (100%) of the Fair Market Value of a Share on the Grant Date. The exercise price of tandem
or affiliated SARs shall equal the Exercise Price of the related Option.



          (b) Exercise of Tandem SARs. Tandem SARs may be exercised for all or part of the
Shares subject to the related Option upon the surrender of the right to exercise the equivalent
portion of the related Option. A tandem SAR may be exercised only with respect to the Shares for
which its related Option is then exercisable. With respect to a tandem SAR granted in connection
with an Incentive Stock Option: (a) the tandem SAR shall expire no later than the expiration of
the underlying Incentive Stock Option; (b) the value of the payout with respect to the tandem SAR
shall be for no more than one hundred percent (100%) of the difference between the Exercise Price
of the underlying Incentive Stock Option and the Fair Market Value of the Shares subject to the
underlying Incentive Stock Option at the time the tandem SAR is exercised; and (c) the tandem SAR
shall be




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exercisable only when the Fair Market Value of the Shares subject to the Incentive Stock
Option exceeds the Exercise Price of the Incentive Stock Option.




          (c) Exercise of Affiliated SARs. An affiliated SAR shall be deemed to be exercised
upon the exercise of the related Option. The deemed exercise of an affiliated SAR shall not
necessitate a reduction in the number of Shares subject to the related Option.




          (d) Exercise of Freestanding SARs. Freestanding SARs shall be exercisable on such
terms and conditions as the Administrator, in its sole discretion, shall determine.




          (e) SAR Agreement. Each SAR grant shall be evidenced by an Award Agreement that shall
specify the exercise price, the term of the SAR, the conditions of exercise, and such other terms
and conditions as the Administrator, in its sole discretion, shall determine.




          (f) Expiration of SARs. An SAR granted under the Plan shall expire upon the date
determined by the Administrator, in its sole discretion, and set forth in the Award Agreement;
however, an SAR granted on or after April 9, 2008 shall expire no later than ten (10) years from
the Grant Date. Notwithstanding the foregoing, the rules of Section 11 also shall apply to SARs.




          (g) Payment of SAR Amount. Upon exercise of an SAR, a Participant shall be entitled
to receive payment from the Company in an amount determined by multiplying:




               (i) The difference between the Fair Market Value of a Share on the date of exercise over the
exercise price; times



               (ii) The number of Shares with respect to which the SAR is exercised.



                    At the discretion of the Administrator, the payment upon SAR exercise may be in cash, in
Shares of equivalent value, or in some combination thereof. For purposes of Section 4 of the Plan,
the reduction in Shares available for future issuance upon the grant of the SAR will be determined
at the Grant Date based on the full number of Shares subject to the SAR. Upon settlement of the
SAR, there will be no further reduction in Shares available for future issuance under Section 4 of
the Plan. Upon the forfeiture of all or a portion of the SAR, the forfeited Shares shall be
returned to the Shares available for future issuance under Section 4 of the Plan. For avoidance of
doubt, upon settlement of an SAR, Shares will not be returned to the Shares available for future
issuance under Section 4 of the Plan, notwithstanding the fact that if Shares are issued in
settlement of an SAR they will be issued only based on the difference between the Fair Market Value
of a Share on the date of exercise over the exercise price.



     14. Restricted Stock Units.



          (a) Grant of Restricted Stock Units. Restricted Stock Units may be granted to Service
Providers at any time and from time to time, as will be determined by the Administrator, in its
sole discretion.




          (b) Number of Shares. The Administrator will have complete discretion in determining
the number of Restricted Stock Units granted to each Participant, provided that during




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any Fiscal
Year, no Participant shall be granted Restricted Stock Units covering more than 5,000,000 Shares,
unless in connection with his or her initial service as described in Section 7(c)(ii).





          (c) Value of Restricted Stock Units. Each Restricted Stock Unit will have an initial
value that is established by the Administrator on or before the Grant Date.




          (d) Performance Goals and Other Terms. The Administrator will set Performance Goals
or other vesting provisions (including, without limitation, continued status as a Service
Provider) in its discretion which, depending on the extent to which they are met, will determine
the number or value of Restricted Stock Units that will be paid out to the Service Providers. The
time period during which the Performance Goals or other vesting provisions must be met will be
called the “Performance Period.” Each award of Restricted Stock Units will be evidenced by an
Award Agreement that will specify the Performance Period, and such other terms and conditions as
the Administrator, in its sole discretion, will determine. The Administrator may set Performance
Goals based upon the achievement of Company-wide, divisional, or individual goals, applicable
federal or state securities laws, or any other basis determined by the Administrator in its
discretion.




          (e) Duration of Performance Periods. The Administrator will set the length of time
for a Performance Period, subject to the following limits:



                    (i) The Performance Period related to Restricted Stock Units with Performance Goals shall not
be less than one (1) year; and



                    (ii) The Performance Period related to Restricted Stock Units with time-based vesting
provisions shall not be less than three (3) years;



     provided, however, that up to five percent (5%) of the shares currently authorized for grant
under the Plan may be subject to Restricted Stock Units without such limits on the length of the
Performance Period.




          (f) Earning of Restricted Stock Units. After the applicable Performance Period has
ended, the holder of Restricted Stock Units will be entitled to receive a payout of the number of
Restricted Stock Units earned by the Participant over the Performance Period, to be determined as
a function of the extent to which the corresponding Performance Goals or other vesting provisions
have been achieved. After the grant of a Restricted Stock Units, the Administrator shall not
reduce or waive any Performance Goals or other vesting provisions for such Restricted Stock Unit;
provided, however, that the Administrator, in its sole discretion, may reduce or waive any
Performance Goals or other vesting provisions for such Restricted Stock Unit in the event of a
Participant’s death, Disability, or Retirement, or in the event of the sale of substantially all
of the assets of the Company, or a merger of the Company with or into another entity pursuant to
which the stockholders of the Company before such transaction do not retain, directly or
indirectly, at least a majority of the beneficial interest in the voting stock of the Company
after such transaction.




          (g) Form and Timing of Payment of Restricted Stock Units. Payment of earned
Restricted Stock Units will be made as soon as practicable after the expiration of the applicable
Performance Period. The Administrator, in its sole discretion, may pay earned Restricted Stock
Units in the form of cash, in Shares (which have an aggregate Fair Market Value equal to the value



15









 







of the earned Restricted Stock Units at the close of the applicable Performance Period) or in a
combination thereof.




          (h) Cancellation of Restricted Stock Units. On the date set forth in the Award
Agreement, all unearned or unvested Restricted Stock Units will be forfeited to the Company, and
again will be available for grant under the Plan.



     15. Non-Transferability of Awards. Unless determined otherwise by the Administrator,
an Award may not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any
manner other than by will or by the laws of descent or distribution and may be exercised, during
the lifetime of the Optionee, only by the Optionee. If the Administrator makes an Award
transferable, such Award shall contain such additional terms and conditions as the Administrator
deems appropriate.



     16. Adjustments Upon Changes in Capitalization, Dissolution or Liquidation, Merger or
Asset Sale.




          (a) Changes in Capitalization. Subject to any required action by the stockholders of
the Company, the number and class of Shares that may be delivered under the Plan and/or the
number, class, and price of Shares covered by each outstanding Award, and the numerical Share
limits in Sections 4, 7, 13 and 14 of the Plan, shall be proportionately adjusted for any increase
or decrease in the number of issued Shares resulting from a stock split, reverse stock split,
stock dividend, combination or reclassification of the Shares, or any other increase or decrease
in the number of issued Shares effected without receipt of consideration by the Company; provided,
however, that conversion of any convertible securities of the Company shall not be deemed to have
been “effected without receipt of consideration.” Such adjustment shall be made by the Board,
whose determination in that respect shall be final, binding and conclusive. Except as expressly
provided herein, no issuance by the Company of shares of stock of any class, or securities
convertible into shares of stock of any class, shall affect, and no adjustment by reason thereof
shall be made with respect to, the number or price of Shares subject to an Award.




          (b) Dissolution or Liquidation. In the event of the proposed dissolution or
liquidation of the Company, the Administrator shall notify each Participant as soon as practicable
prior to the effective date of such proposed transaction. The Administrator in its discretion may
provide for a Participant to have the right to exercise his or her Award until ten (10) days prior
to such transaction as to all of the Optioned Stock covered thereby, including Shares as to which
the Award would not otherwise be exercisable. In addition, the Administrator may provide that any
Company repurchase option applicable to any Shares purchased upon exercise of an Award shall lapse
as to all such Shares, provided the proposed dissolution or liquidation takes place at the time
and in the manner contemplated. To the extent it has not been previously exercised, an Award will
terminate immediately prior to the consummation of such proposed action. Notwithstanding anything
in this Section 16(b) to the contrary, for Awards granted on or after August 14, 2008, that may be
considered “deferred compensation” within the meaning of Section 409A, the payment of any Awards
that accelerate in accordance with this Section 16(b) nevertheless will be made at the same time
or times as if such Awards had vested in accordance with the vesting provisions applicable to such
Awards unless otherwise determined by the Administrator.



16









 






          (c) Merger or Asset Sale. For Awards granted prior to August 14, 2008, in the event
of a merger of the Company with or into another corporation, or the sale of substantially all of
the assets of the Company, each outstanding Award shall be assumed or an equivalent option or
right substituted by the successor corporation or a Parent or Subsidiary of the successor
corporation. For Awards granted on or after August 14, 2008, in the event of (i) a merger of the
Company with or into another corporation, other than a merger which would result in the voting
securities of the Company outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the surviving entity or its
Parent) at least fifty percent (50%) of the total voting power represented by the voting
securities of the Company or such surviving entity or its Parent outstanding immediately after
such merger or (ii) the sale of substantially all of the assets of the Company, each outstanding
Award shall be assumed or an equivalent option or right substituted by the successor corporation
or a Parent or Subsidiary of the successor corporation. In the event that the successor
corporation refuses to assume or substitute for the Award (whether granted prior to, on or after
August 14, 2008), the Participant will fully vest in and have the right to exercise all of his or
her outstanding Options and Stock Appreciation Rights, including Shares as to which such Awards
would not otherwise be vested or exercisable, all restrictions on Restricted Stock will lapse,
and, with respect to Restricted Stock Units, all Performance Goals or other vesting criteria will
be deemed achieved at target levels and all other terms and conditions met. In addition, if an
Option or Stock Appreciation Right becomes fully vested and exercisable in lieu of assumption or
substitution in the event of a merger or sale of assets, the Administrator will notify the
Participant in writing or electronically that the Option or Stock Appreciation Right will be fully
vested and exercisable for a period of 15 days from the date of such notice, and the Option or
Stock Appreciation Right will terminate upon the expiration of such period.



                    For the purposes of this paragraph, the Award shall be considered assumed if, following the
merger or sale of assets, the Award confers the right to purchase or receive, for each Share
subject to the Award immediately prior to the merger or sale of assets, the consideration (whether
stock, cash, or other securities or property) or, in the case of a Stock Appreciation Right upon
the exercise of which the Administrator determines to pay cash or a Restricted Stock Unit which the
Administrator can determine to pay in cash, the fair market value of the consideration received in
the merger or sale of assets by holders of Common Stock for each Share held on the effective date
of the transaction (and if holders were offered a choice of consideration, the type of
consideration chosen by the holders of a majority of the outstanding Shares); provided, however,
that if such consideration received in the merger or sale of assets is not solely common stock of
the successor corporation or its Parent, the Administrator may, with the consent of the successor
corporation, provide for the consideration to be received upon the exercise of an Option or Stock
Appreciation Right or upon the payout of a Restricted Stock Unit, for each Share subject to such
Award (or in the case of Restricted Stock Units, the number of implied shares determined by
dividing the value of the Restricted Stock Units by the per Share consideration received by holders
of Common Stock in the merger or sale of assets), to be solely common stock of the successor
corporation or its Parent equal in fair market value to the per Share consideration received by
holders of Common Stock in the merger or sale of assets.



                    Notwithstanding anything in this Section 16(c) to the contrary, an Award that vests, is earned
or paid-out upon the satisfaction of one or more Performance Goals will not be considered assumed
if the Company or its successor modifies any of such Performance Goals



17









 







without the Participant’s
consent; provided, however, a modification to such Performance Goals only to reflect the successor
corporation’s corporate structure post-merger or post-sale of assets will not be deemed to
invalidate an otherwise valid Award assumption.



     17. Date of Grant. The Grant Date of an Award shall be, for all purposes, the date on
which the Administrator makes the determination granting such Award, or such other later date as is
determined by the Administrator. Notice of the determination shall be provided to each Optionee
within a reasonable time after the date of such grant.



     18. Amendment and Termination of the Plan.



          (a) Amendment and Termination. The Board may at any time amend, alter, suspend or
terminate the Plan.




          (b) Shareholder Approval. The Company shall obtain shareholder approval of any Plan
amendment to the extent necessary and desirable to comply with Applicable Laws, and to adopt
material Plan amendments, including:




               (i) A material increase in benefits accrued to Participants under the Plan;



               (ii) An increase in the number of shares that may be optioned or sold under the Plan;



               (iii) A material modification (expansion or reduction) of the class of participants in the
Plan; or



               (iv) A provision permitting the Administrator to lapse or waive restrictions on Awards at its
discretion.



          (c) Effect of Amendment or Termination. No amendment, alteration, suspension or
termination of the Plan shall impair the rights of any Optionee, unless mutually agreed otherwise
between the Optionee and the Administrator, which agreement must be in writing and signed by the
Optionee and the Company. Termination of the Plan shall not affect the Administrator’s ability to
exercise the powers granted to it hereunder with respect to Options granted under the Plan prior to
the date of such termination.




     19. Conditions Upon Issuance of Shares.



          (a) Legal Compliance. Shares shall not be issued pursuant to the exercise of an Award
unless the exercise of such Award and the issuance and delivery of such Shares shall comply with
Applicable Laws and shall be further subject to the approval of counsel for the Company with
respect to such compliance.




          (b) Investment Representations. As a condition to the exercise of an Award, the
Company may require the person exercising such Award to represent and warrant at the time of any
such exercise that the Shares are being purchased only for investment and without any present
intention to sell or distribute such Shares if, in the opinion of counsel for the Company, such a
representation is required.




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     20. Inability to Obtain Authority. The inability of the Company to obtain authority
from any regulatory body having jurisdiction, which authority is deemed by the Company’s counsel to
be necessary to the lawful issuance and sale of any Shares hereunder, shall relieve the Company of
any liability in respect of the failure to issue or sell such Shares as to which such requisite
authority shall not have been obtained.



     21. Reservation of Shares. The Company, during the term of this Plan, will at all
times reserve and keep available such number of Shares as shall be sufficient to satisfy the
requirements of the Plan.



     22. Shareholder Approval. The Plan shall be subject to approval by the shareholders
of the Company within twelve (12) months after the date the Plan is adopted. Such shareholder
approval shall be obtained in the manner and to the degree required under Applicable Laws.



     23. Section 409A Exchange Offer. The Administrator, may in its sole discretion, offer
to each Optionee who holds an Option with an original Grant Date Exercise Price that was less than
the original Grant Date fair market value, as determined for purposes of Section 409A, (each a
“Discount Option”) one or more of the following choices with respect to the portion of such
Discount Option that was unvested on December 31, 2004 (such portion is referred to as the
“Eligible Discount Option”):



          (a) If Optionee exercised any Eligible Discount Option (or portion thereof) in 2006, then
Optionee may elect to amend the eligible portion of each Eligible Discount Option such that the
Exercise Price of the Option will be increased to the fair market value, as determined for purposes
of Section 409A, of a share of the Company’s Common Stock on the Option’s grant date.




          (b) If Optionee was granted an Eligible Discount Option, but did not exercise any Eligible
Discount Option in 2006, then Optionee may be given one or more of the following choices:




               (i) Optionee may elect to amend each Eligible Discount Option to change the option expiration
date identified in the original grant agreement to a date that is expected to constitute a fixed
calendar year election for purposes of Section 409A (the Administrator will have the discretion to
choose to allow Optionees to pick different calendar years for different portions of each Eligible
Discount Option); and/or



               (ii) Optionee may elect to amend the eligible portion of each Eligible Discount Option such
that the Exercise Price of the Option will be increased to the fair market value, as determined for
purposes of Section 409A, of a share of the Company’s Common Stock on the Option’s grant date.




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