exv4w1





EXHIBIT
4.1


SNAPin SOFTWARE, INC.




2003 EQUITY INCENTIVE PLAN




(as amended and restated through October 1, 2008)




SECTION 1. PURPOSE




The purpose of the SNAPin Software, Inc. (“SnapIn” or “the Company”) 2003 Equity Incentive Plan is
to attract, retain and motivate employees, officers, directors, consultants, agents, advisors and
independent contractors of SNAPin and its Related Companies by providing them the opportunity to
acquire a proprietary interest in the Company and to link their interests and efforts to the
long-term interests of the Company’s stockholders.



SECTION 2. DEFINITIONS




As used in the Plan,




“Acquired Entity” means any entity acquired by the Company or a Related Company or with which the
Company or a Related Company merges or combines.



“Acquisition Price” means the fair market value of the securities, cash or other property, or any
combination thereof, receivable upon consummation of a Company Transaction in respect of a share of
Common Stock.



“Award” means any awards of Options, Stock Appreciation Rights, Stock Awards, Restricted Stock or
Stock Units, as may be designated by the Plan Administrator from time to time.



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



“Cause,” unless otherwise defined in the instrument evidencing the Award or in a written
employment, services or other agreement between the Participant and the Company or a Related
Company, means dishonesty, fraud, serious misconduct, unauthorized use or disclosure of
confidential information or trade secrets, or conduct prohibited by criminal law (except minor
violations), in each case as determined by the Company’s chief human resources officer or other
person performing that function or, in the case of directors and executive officers, the Plan
Administrator, each of whose determination shall be conclusive and binding.



“Code” means the Internal Revenue Code of 1986, as amended from time to time.



“Common Stock” means the common stock, par value $0.001 per share, of the Company.



“Company” means SNAPin Software, Inc., a Delaware corporation.



 









 





“Company Transaction,” unless otherwise defined in the instrument evidencing the Award or in a
written employment, services or other agreement between the Participant and the Company or a
Related Company, means consummation of



(a) a merger or consolidation of the Company with or into any other company or other entity,



(b) a sale in one transaction, or a series of transactions undertaken with a common purpose, of at
least 90% of the Company’s outstanding voting securities, or



(c) a sale, lease, exchange or other transfer in one transaction or a series of related
transactions undertaken with a common purpose of all or substantially all of the Company’s assets;



provided, however, that a Company Transaction shall not include a Related Party Transaction. Where
a series of transactions undertaken with a common purpose is deemed to be a Company Transaction,
the date of such Company Transaction shall be the date on which the last of such transactions is
consummated.



“Disability,” unless otherwise defined by the Plan Administrator or in the instrument evidencing
the Award or in a written employment, services or other agreement between the Participant and the
Company or a Related Company, and subject to Section 8.8, means a mental or physical impairment of
the Participant that is expected to result in death or that has lasted or is expected to last for a
continuous period of 12 months or more and that causes the Participant to be unable to perform his
or her material duties for the Company or a Related Company and to be engaged in any substantial
gainful activity, in each case as determined by the Company’s chief human resources officer or
other person performing that function or, in the case of directors and executive officers, the Plan
Administrator, each of whose determination shall be conclusive and binding.



“Effective Date” has the meaning set forth in Section 18.



“Eligible Person” means any person eligible to receive an Award as set forth in Section 5.



“Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time.



“Fair Market Value” means the per share fair market value of the Common Stock as established in
good faith by the Plan Administrator or, if the Common Stock is publicly traded, the average of the
high and low trading prices for the Common Stock on any given date during regular trading or, if
not trading on that date, such price on the last preceding date on which the Common Stock was
traded, unless determined otherwise by the Plan Administrator using such methods or procedures as
it may establish.



“Grant Date” means the later of (a) the date on which the Plan Administrator completes the
corporate action authorizing the grant of an Award or such later date specified by the Plan
Administrator or (b) the date on which all conditions precedent to the Award have been



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satisfied,
provided that conditions to the exercisability or vesting of Awards shall not defer the Grant Date.



“Incentive Stock Option” means an Option granted with the intention that it qualify as an
“incentive stock option” as that term is defined in Section 422 of the Code or any successor
provision.



“Nonqualified Stock Option” means an Option other than an Incentive Stock Option.



“Option” means a right to purchase Common Stock granted under Section 7.



“Option Expiration Date” has the meaning set forth in Section 7.6.



“Option Term” means the maximum term of an Option as set forth in Section 7.3.



“Participant” means any Eligible Person to whom an Award is granted.



“Plan” means the SNAPin Software, Inc. 2003 Equity Incentive Plan.



“Plan Administrator” has the meaning set forth in Section 3.1.



“Related Company” means any entity that, directly or indirectly, is in control of, is controlled by
or is under common control with the Company.



“Related Party Transaction” means (a) a merger or consolidation of the Company in which the holders
of the outstanding voting securities of the Company immediately prior to the merger or
consolidation hold at least a majority of the outstanding voting securities of the Successor
Company immediately after the merger or consolidation; (b) a sale, lease, exchange or other
transfer of all or substantially all of the Company’s assets to a majority-owned subsidiary
company; (c) a transaction undertaken for the principal purpose of restructuring the capital of the
Company, including, but not limited to, reincorporating the Company in a different jurisdiction,
converting the Company to a limited liability company or creating a holding company; or (d) a
corporate dissolution or liquidation.



“Restricted Stock” means an Award of shares of Common Stock granted under Section 10, the rights of
ownership of which may be subject to restrictions prescribed by the Plan Administrator.



“Retirement,” unless otherwise defined in the instrument evidencing the Award or in a written
employment, services or other agreement between the Participant and the Company or a Related
Company, means “Retirement” as defined for purposes of the Plan by the Plan Administrator or, if
not so defined, means Termination of Service on or after the date the Participant reaches age 55
and has completed ten years of employment or service with the Company or a Related Company.



“Securities Act” means the Securities Act of 1933, as amended from time to time.



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“Stock Appreciation Right” has the meaning set forth in Section 9.1.



“Stock Award” means an Award of shares of Common Stock granted under Section 10, the rights of
ownership of which are not subject to restrictions prescribed by the Plan Administrator.



“Stock Unit” means an Award denominated in units of Common Stock granted under Section 10.



“Substitute Awards” means Awards granted or shares of Common Stock issued by the Company in
assumption of, or in substitution or exchange for, awards previously granted by an Acquired Entity.



“Successor Company” means the surviving company, the successor company, the acquiring company or
its parent, as applicable, in connection with a Company Transaction.



“Termination of Service” means a termination of employment or service relationship with the Company
or a Related Company for any reason, whether voluntary or involuntary, including by reason of
death, Disability or Retirement. Any question as to whether and when there has been a Termination
of Service for the purposes of an Award and the cause of such Termination of Service shall be
determined by the Company’s chief human resources officer or other person performing that function
or, in the case of directors and executive officers, the Plan Administrator, each of whose
determination shall be conclusive and binding. Transfer of a Participant’s employment or service
relationship between the Company and any Related Company shall not be considered a Termination of
Service for purposes of an Award. Unless the Board determines otherwise, a Termination of Service
shall be deemed to occur if the Participant’s employment or service relationship is with an entity
that has ceased to be a Related Company.



“Vesting Commencement Date” means the Grant Date or such other date set forth in the instrument
evidencing the Award as the date from which the Option begins to vest for purposes of Section 7.4.



SECTION 3. ADMINISTRATION




3.1 Administration of the Plan




The Plan shall be administered by the Board. Notwithstanding the foregoing, the Board may delegate
concurrent responsibility for administering the Plan, including with respect to designated classes
of Eligible Persons, to a committee or committees (which term includes subcommittees) consisting of
one or more members of the Board, subject to such limitations as the Board deems appropriate. If
and so long as the Common Stock is registered under Section 12(b) or 12(g) of the Exchange Act, the
Board shall consider in selecting the
members of any committee acting as Plan Administrator, with respect to any persons subject or
likely to become subject to Section 16 of the Exchange Act, the provisions regarding



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(a) “outside
directors” as contemplated by Section 162(m) of the Code and (b) “non-employee directors” as
contemplated by Rule 16b-3(b)(3) under the Exchange Act, or any successor provision thereto.
Members of any committee shall serve for such term as the Board may determine, subject to removal
by the Board at any time. All references in the Plan to the “Plan Administrator” shall be, as
applicable, to the Board or any committee to whom the Board has delegated authority to administer
the Plan.



3.2 Administration and Interpretation by Plan Administrator




Except for the terms and conditions explicitly set forth in the Plan, the Plan Administrator shall
have full power and exclusive authority, subject to such orders or resolutions not inconsistent
with the provisions of the Plan as may from time to time be adopted by the Board to the extent the
Plan Administrator is a committee of the Board, to (a) select the Eligible Persons to whom Awards
may from time to time be granted under the Plan; (b) determine the type or types of Award to be
granted to each Participant under the Plan; (c) determine the number of shares of Common Stock to
be covered by each Award granted under the Plan; (d) determine the terms and conditions of any
Award granted under the Plan; (e) approve the forms of agreements for use under the Plan; (f)
determine whether, to what extent and under what circumstances Awards may be settled in cash,
shares of Common Stock or other property or canceled or suspended; (g) determine whether, to what
extent and under what circumstances cash, shares of Common Stock, other property and other amounts
payable with respect to an Award shall be deferred either automatically or at the election of the
Participant; (h) interpret and administer the Plan and any instrument evidencing an Award; (i)
establish such rules and regulations as it shall deem appropriate for the proper administration of
the Plan; (j) delegate ministerial duties to such of the Company’s officers as it so determines;
and (k) make any other determination and take any other action that the Plan Administrator deems
necessary or desirable for administration of the Plan. Decisions of the Plan Administrator shall
be final, conclusive and binding on all persons, including the Company, any Participant, any
stockholder and any Eligible Person. A majority of the members of the Plan Administrator may
determine its actions and fix the time and place of its meetings.



SECTION 4. SHARES SUBJECT TO THE PLAN




4.1 Authorized Number of Shares




Subject to adjustment from time to time as provided in Section 13.1, a maximum of 6,300,000 shares
of Common Stock shall be available for issuance under the Plan. Shares issued under the Plan shall
be drawn from authorized and unissued shares or shares now held or subsequently acquired by the
Company as treasury shares.



4.2 Share Usage




(a) Shares of Common Stock covered by an Award shall not be counted as used unless and until they
are actually issued and delivered to a Participant. If any Award lapses,



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expires, terminates or is
canceled prior to the issuance of shares thereunder or if shares of Common Stock are issued under
the Plan to a Participant and thereafter are forfeited to or otherwise reacquired by the Company,
the shares subject to such Awards and the forfeited or reacquired shares shall again be available
for issuance under the Plan. Any shares of Common Stock (i) tendered by a Participant or retained
by the Company as full or partial payment to the Company for the purchase price of an Award or to
satisfy tax withholding obligations in connection with an Award or (ii) covered by an Award that is
settled in cash shall be available for Awards under the Plan.



(b) The Plan Administrator shall have the authority to grant Awards as an alternative to or as the
form of payment for grants or rights earned or due under other compensation plans or arrangements
of the Company.



(c) Notwithstanding anything in the Plan to the contrary, the Plan Administrator may grant
Substitute Awards under the Plan. Substitute Awards shall not reduce the number of shares
authorized for issuance under the Plan. In the event that a written agreement pursuant to which a
Company Transaction or a Related Party Transaction is completed is approved by the Board and said
agreement sets forth the terms and conditions of the Substitute Awards, said terms and conditions
shall be deemed to be the action of the Plan Administrator without any further action by the Plan
Administrator, except as may be required for compliance with Rule 16b-3 under the Exchange Act, and
the persons holding such Substitute Awards shall be deemed to be Participants.



(d) Notwithstanding the foregoing and, subject to adjustment provided in Section 13.1, the maximum
number of shares that may be issued upon the exercise of Incentive Stock Options shall equal the
aggregate share number stated in Section 4.1.



SECTION 5. ELIGIBILITY




An Award may be granted to any employee, officer or director of the Company or a Related Company
whom the Plan Administrator from time to time selects. An Award may also be granted to any
consultant, agent, advisor or independent contractor for bona fide services rendered to the Company
or any Related Company that (a) are not in connection with the offer and sale of the Company’s
securities in a capital-raising transaction and (b) do not directly or indirectly promote or
maintain a market for the Company’s securities.



SECTION 6. AWARDS




6.1 Form, Grant and Settlement of Awards




The Plan Administrator shall have the authority, in its sole discretion, to determine the type or
types of Awards to be granted under the Plan. Such Awards may be granted either alone, in addition
to or in tandem with any other type of Award. Any Award settlement may be subject to such
conditions, restrictions and contingencies as the Plan Administrator shall determine.



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6.2 Evidence of Awards




Awards granted under the Plan shall be evidenced by a written (including electronic) instrument
that shall contain such terms, conditions, limitations and restrictions as the Plan Administrator
shall deem advisable and that are not inconsistent with the Plan.



6.3 Vesting of Awards




The effect on the vesting of an Award of a Company-approved leave of absence or a Participant’s
working less than full-time shall be determined by the Company’s chief human resources officer or
other person performing that function or, in the case of directors and executive officers, the
Board, each of whose determination shall be conclusive and binding.



6.4 Deferrals




The Plan Administrator may permit or require a Participant to defer receipt of the payment of any
Award. If any such deferral election is permitted or required, the Plan Administrator, in its sole
discretion, shall establish rules and procedures for such payment deferrals, which may include the
grant of additional Awards or provisions for the payment or crediting of interest or dividend
equivalents, including converting such credits to deferred stock unit equivalents.



SECTION 7. OPTIONS




7.1 Grant of Options




The Plan Administrator may grant Options designated as Incentive Stock Options or Nonqualified
Stock Options.



7.2 Option Exercise Price




The exercise price for shares purchased under an Option shall be as established by the Plan
Administrator, but shall not be less than the minimum exercise price required by Section 8.3 with
respect to Incentive Stock Options, except in the case of Substitute Awards.



7.3 Term of Options




Subject to earlier termination in accordance with the terms of the Plan and the instrument
evidencing the Option, the maximum term of an Option (the “Option Term”) shall be as established
for that Option by the Plan Administrator or, if not so established, shall be ten years from the
Grant Date. For Incentive Stock Options, the Option Term shall be as specified in Section 8.4.



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7.4 Exercise of Options




The Plan Administrator shall establish and set forth in each instrument that evidences an Option
the time at which, or the installments in which, the Option shall vest and become exercisable, any
of which provisions may be waived or modified by the Plan Administrator at any time. If not so
established in the instrument evidencing the Option, the Option shall vest and become exercisable
according to the following schedule, which may be waived or modified by the Plan Administrator at
any time:



	 	 	 
	Period of Participant’s Continuous Employment or Service With the	 	Portion of Total Option That Is
	Company or Its Related Companies From the Vesting Commencement Date	 	Vested and Exercisable
	 
	 	 
	After 1 year
	 	1/4
	 
	 	 
	Each additional one-month period of continuous service completed thereafter
	 	An additional 1/48
	 
	 	 
	After 4 years
	 	100%






To the extent an Option has vested and become exercisable, the Option may be exercised in whole or
from time to time in part by delivery to the Company of a properly executed stock option exercise
agreement or notice, in a form and in accordance with procedures established by the Plan
Administrator, setting forth the number of shares with respect to which the Option is being
exercised, the restrictions imposed on the shares purchased under such exercise agreement or
notice, if any, and such representations and agreements as may be required by the Plan
Administrator, accompanied by payment in full as described in Section 7.5. An Option may be
exercised only for whole shares and may not be exercised for less than a reasonable number of
shares at any one time, as determined by the Plan Administrator.



7.5 Payment of Exercise Price




The exercise price for shares purchased under an Option shall be paid in full to the Company by
delivery of consideration equal to the product of the Option exercise price and the number of
shares purchased. Such consideration must be paid before the Company will issue the shares being
purchased and must be in a form or a combination of forms acceptable to the Plan Administrator for
that purchase, which forms may include:



(a) cash;




(b) check or wire transfer;




(c) tendering (either actually or, if the Common Stock is registered under Section 12(b) or 12(g)
of the Exchange Act, by attestation) shares of Common Stock already owned by the Participant, which
on the day prior to the exercise date have a Fair Market Value equal to the



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aggregate exercise
price of the shares being purchased under the Option (such shares must have been owned by the
Participant for at least six months or any shorter period necessary to avoid a charge to the
Company’s earnings for financial reporting purposes);



(d) if the Common Stock is registered under Section 12(b) or 12(g) of the Exchange Act, and to the
extent permitted by law, delivery of a properly executed exercise agreement or notice, together
with irrevocable instructions to a brokerage firm designated or approved by the Company to deliver
promptly to the Company the aggregate amount of sale or loan proceeds to pay the Option exercise
price and any withholding tax obligations that may arise in connection with the exercise, all in
accordance with the regulations of the Federal Reserve Board; or



(e) such other consideration as the Plan Administrator may permit.



In addition, to assist a Participant (including directors and executive officers) in acquiring
shares of Common Stock pursuant to an Award granted under the Plan, the Plan Administrator, in its
sole discretion, may authorize, either at the Grant Date or at any time before the acquisition of
Common Stock pursuant to the Award, (i) the payment by a Participant of the purchase price of the
Common Stock by a promissory note or (ii) the guarantee by the Company of a loan obtained by the
Participant from a third party. Such notes or loans must be full recourse to the extent necessary
to avoid charges to the Company’s earnings for financial reporting purposes. Subject to the
foregoing, the Plan Administrator shall in its sole discretion specify the terms of any loans or
loan guarantees, including the interest rate and terms of and security for repayment.



7.6 Effect of Termination of Service




The Plan Administrator shall establish and set forth in each instrument that evidences an Option
whether the Option shall continue to be exercisable, and the terms and conditions of such exercise,
after a Termination of Service, any of which provisions may be waived or modified by the Plan
Administrator at any time. If not so established in the instrument evidencing the Option, the
Option shall be exercisable according to the following terms and conditions, which may be waived or
modified by the Plan Administrator at any time:



(a) Any portion of an Option that is not vested and exercisable on the date of a Participant’s
Termination of Service shall expire on such date.



(b) Any portion of an Option that is vested and exercisable on the date of a Participant’s
Termination of Service shall expire on the earliest to occur of




(i) if the Participant’s Termination of Service occurs for reasons other than Cause,
Retirement, Disability or death, the date that is three months after such Termination of
Service;



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(ii) if the Participant’s Termination of Service occurs by reason of Retirement, Disability
or death, the one-year anniversary of such Termination of Service; and




(iii) the last day of the Option Term (the “Option Expiration Date”).



Notwithstanding the foregoing, if a Participant dies after the Participant’s Termination of Service
but while an Option is otherwise exercisable, the portion of the Option that is vested and
exercisable on the date of such Termination of Service shall expire upon the earlier to occur of
(y) the Option Expiration Date and (z) the one-year anniversary of the date of death, unless the
Plan Administrator determines otherwise.



Also notwithstanding the foregoing, in case a Participant’s Termination of Service occurs for
Cause, all Options granted to the Participant shall automatically expire upon first notification to
the Participant of such termination, unless the Plan Administrator determines otherwise. If a
Participant’s employment or service relationship with the Company is suspended pending an
investigation of whether the Participant shall be terminated for Cause, all the Participant’s
rights under any Option shall likewise be suspended during the period of investigation. If any
facts that would constitute termination for Cause are discovered after a Participant’s Termination
of Service, any Option then held by the Participant may be immediately terminated by the Plan
Administrator, in its sole discretion.



(c) A Participant’s change in status from an employee to a consultant, advisor or independent
contractor or a change in status from a consultant, advisor or independent contractor to an
employee shall not be considered a Termination of Service for purposes of this Section 7.6.



SECTION 8. INCENTIVE STOCK OPTION LIMITATIONS




Notwithstanding any other provisions of the Plan, the terms and conditions of any Incentive Stock
Options shall in addition comply in all respects with Section 422 of the Code or any successor
provision and any applicable regulations thereunder, including the following:



8.1 Dollar Limitation




To the extent the aggregate Fair Market Value (determined as of the Grant Date) of Common Stock
with respect to which a Participant’s Incentive Stock Options become exercisable for the first time
during any calendar year (under the Plan and all other stock option plans of the Company and its
parent and subsidiary corporations) exceeds $100,000, such portion in
excess of $100,000 shall be treated as a Nonqualified Stock Option. In the event the Participant
holds two or more such Options that become exercisable for the first time in the same calendar
year, such limitation shall be applied on the basis of the order in which such Options are granted.



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8.2 Eligible Employees




Individuals who are not employees of the Company or one of its parent or subsidiary corporations
may not be granted Incentive Stock Options.



8.3 Exercise Price




The exercise price of an Incentive Stock Option shall be at least 100% of the Fair Market Value of
the Common Stock on the Grant Date and, in the case of an Incentive Stock Option granted to a
Participant who owns more than 10% of the total combined voting power of all classes of the stock
of the Company or of its parent or subsidiary corporations (a “10% Stockholder”), shall not be less
than 110% of the Fair Market Value of the Common Stock on the Grant Date. The determination of
more than 10% ownership shall be made in accordance with Section 422 of the Code.



8.4 Option Term




Subject to earlier termination in accordance with the terms of the Plan and the instrument
evidencing the Option, the Option Term of an Incentive Stock Option shall not exceed ten years, and
in the case of an Incentive Stock Option granted to a 10% Stockholder, shall not exceed five years.



8.5 Exercisability




An Option designated as an Incentive Stock Option shall cease to qualify for favorable tax
treatment as an Incentive Stock Option to the extent it is exercised (if permitted by the terms of
the Option) (a) more than three months after the date of a Participant’s Termination of Service if
termination was for reasons other than death or Disability, (b) more than one year after the date
of a Participant’s Termination of Service if termination was by reason of Disability, or (c) after
the Participant has been on leave of absence for more than 90 days, unless the Participant’s
reemployment rights are guaranteed by statute or contract.



8.6 Taxation of Incentive Stock Options




In order to obtain certain tax benefits afforded to Incentive Stock Options under Section 422 of
the Code, the Participant must hold the shares acquired upon the exercise of an Incentive Stock
Option for two years after the Grant Date and one year after the date of exercise. A Participant
may be subject to the alternative minimum tax at the time of exercise of an Incentive Stock Option.
The Participant shall give the Company prompt notice of any
disposition of shares acquired on the exercise of an Incentive Stock Option prior to the expiration
of such holding periods.



8.7 Promissory Notes




The amount of any promissory note delivered pursuant to Section 7.5 in connection with an Incentive
Stock Option shall bear interest at a rate specified by the Plan Administrator, but in



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no case less
than the rate required to avoid imputation of interest (taking into account any exceptions to the
imputed interest rules) for federal income tax purposes.



8.8 Code Definitions




For the purposes of this Section 8, “disability,” “parent corporation” and “subsidiary corporation”
shall have the meanings attributed to those terms for purposes of Section 422 of the Code.



SECTION 9. STOCK APPRECIATION RIGHTS




9.1 Grant of Stock Appreciation Rights




The Plan Administrator may grant stock appreciation rights (“Stock Appreciation Rights” or “SARs”)
to Participants at any time. An SAR may be granted in tandem with an Option or alone
(“freestanding”). The grant price of a tandem SAR shall be equal to the exercise price of the
related Option, and the grant price of a freestanding SAR shall be as established by the Plan
Administrator. An SAR may be exercised upon such terms and conditions and for the term as the Plan
Administrator determines in its sole discretion; provided, however, that, subject to earlier
termination in accordance with the terms of the Plan and the instrument evidencing the SAR, the
term of a freestanding SAR shall be as established for that SAR by the Plan Administrator or, if
not so established, shall be ten years, and in the case of a tandem SAR, (a) the term shall not
exceed the term of the related Option and (b) the tandem SAR 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, except that the tandem SAR may be exercised only with respect to the
shares for which its related Option is then exercisable.



9.2 Payment of SAR Amount




Upon the exercise of an SAR, a Participant shall be entitled to receive payment from the Company in
an amount determined by multiplying: (a) the difference between the Fair Market Value of the
Common Stock for the date of exercise over the grant price by (b) the number of shares with respect
to which the SAR is exercised. At the discretion of the Plan Administrator as set forth in the
instrument evidencing the Award, the payment upon exercise of an SAR may be in cash, in shares of
equivalent value, in some combination thereof or in any other manner approved by the Plan
Administrator in its sole discretion.



SECTION 10. STOCK AWARDS, RESTRICTED STOCK AND STOCK UNITS




10.1 Grant of Stock Awards, Restricted Stock and Stock Units




The Plan Administrator may grant Stock Awards, Restricted Stock or Stock Units on such terms and
conditions and subject to such repurchase or forfeiture restrictions, if any (which may be based on
continuous service with the Company or a Related Company or the achievement of any performance
criteria), as the Plan Administrator shall determine in its



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sole discretion, which terms,
conditions and restrictions shall be set forth in the instrument evidencing the Award.



10.2 Issuance of Shares; Settlement of Awards




Upon the satisfaction of any terms, conditions and restrictions prescribed with respect to
Restricted Stock or Stock Units, or upon a Participant’s release from any terms, conditions and
restrictions of Restricted Stock or Stock Units, as determined by the Plan Administrator, and
subject to the provisions of Section 11, (a) the shares of Restricted Stock covered by each Award
of Restricted Stock shall become freely transferable by the Participant, and (b) Stock Units shall
be paid in shares of Common Stock or, if set forth in the instrument evidencing the Award, in cash,
shares of Common Stock or a combination of cash and shares of Common Stock as the Plan
Administrator shall determine in its sole discretion. Any fractional shares subject to such Awards
shall be paid to the Participant in cash.



10.3 Dividends and Distributions




Participants holding shares of Restricted Stock or Stock Units may, if the Plan Administrator so
determines, be credited with dividends paid with respect to the underlying shares or dividend
equivalents while they are so held in a manner determined by the Plan Administrator in its sole
discretion. The Plan Administrator may apply any restrictions to the dividends or dividend
equivalents that the Plan Administrator deems appropriate. The Plan Administrator, in its sole
discretion, may determine the form of payment of dividends or dividend equivalents, including cash,
shares of Common Stock, Restricted Stock or Stock Units.



10.4 Waiver of Restrictions




Notwithstanding any other provisions of the Plan, the Plan Administrator, in its sole discretion,
may waive the repurchase or forfeiture period and any other terms, conditions or restrictions on
any Restricted Stock or Stock Unit under such circumstances and subject to such terms and
conditions as the Plan Administrator shall deem appropriate.



SECTION 11. WITHHOLDING




The Company may require the Participant to pay to the Company the amount of (a) any taxes that the
Company is required by applicable federal, state, local or foreign law to withhold
with respect to the grant, vesting or exercise of an Award (“tax withholding obligations”) and (b)
any amounts due from the Participant to the Company or to any Related Company (“other
obligations”). The Company shall not be required to issue any shares of Common Stock or otherwise
settle an Award under the Plan until such tax withholding obligations and other obligations are
satisfied.



The Plan Administrator may permit or require a Participant to satisfy all or part of the
Participant’s tax withholding obligations and other obligations by (a) paying cash to the



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Company,
(b) having the Company withhold an amount from any cash amounts otherwise due or to become due from
the Company to the Participant, (c) having the Company withhold a number of shares of Common Stock
that would otherwise be issued to the Participant (or become vested in the case of Restricted
Stock) having a Fair Market Value equal to the tax withholding obligations and other obligations,
or (d) surrendering a number of shares of Common Stock the Participant already owns having a value
equal to the tax withholding obligations and other obligations. The value of the shares so
withheld may not exceed the employer’s minimum required tax withholding rate, and the value of the
shares so surrendered may not exceed such rate to the extent the Participant has owned the
surrendered shares for less than six months if such limitation is necessary to avoid a charge to
the Company for financial reporting purposes.



SECTION 12. ASSIGNABILITY




No Award or interest in an Award may be sold, assigned, pledged (as collateral for a loan or as
security for the performance of an obligation or for any other purpose) or transferred by the
Participant or made subject to attachment or similar proceedings otherwise than by will or by the
applicable laws of descent and distribution, except to the extent a Participant designates one or
more beneficiaries on a Company-approved form who may exercise the Award or receive payment under
the Award after the Participant’s death. During a Participant’s lifetime, an Award may be
exercised only by the Participant. Notwithstanding the foregoing and to the extent permitted by
Section 422 of the Code, the Plan Administrator, in its sole discretion, may permit a Participant
to assign or transfer an Award; provided, however, that any Award so assigned or transferred shall
be subject to all the terms and conditions of the Plan and the instrument evidencing the Award.



SECTION 13. ADJUSTMENTS




13.1 Adjustment of Shares




In the event, at any time or from time to time, a stock dividend, stock split, spin-off,
combination or exchange of shares, recapitalization, merger, consolidation, distribution to
stockholders other than a normal cash dividend, or other change in the Company’s corporate or
capital structure results in (a) the outstanding shares of Common Stock, or any securities
exchanged therefor or received in their place, being exchanged for a different number or kind of
securities of the Company or any other company or (b) new, different or additional securities of
the Company or any other company being received by the holders of shares of
Common Stock, then the Plan Administrator shall make proportional adjustments in (i) the maximum
number and kind of securities available for issuance under the Plan; (ii) the maximum number and
kind of securities issuable as Incentive Stock Options as set forth in Section 4.2(d); and (iii)
the number and kind of securities that are subject to any outstanding Award and the per share price
of such securities, without any change in the aggregate price to be paid therefor.



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The determination by the Plan Administrator as to the terms of any of the foregoing adjustments
shall be conclusive and binding.



Notwithstanding the foregoing, the issuance by the Company of shares of stock of any class, or
securities convertible into shares of stock of any class, for cash or property, or for labor or
services rendered, or for other valid consideration, either upon direct sale or upon the exercise
of rights or warrants to subscribe therefor, or upon conversion of shares or obligations of the
Company convertible into such shares or other securities, shall not affect, and no adjustment by
reason thereof shall be made with respect to, outstanding Awards. Also notwithstanding the
foregoing, a dissolution or liquidation of the Company or a Company Transaction shall not be
governed by this Section 13.1 but shall be governed by the remaining provisions of this Section 13.



13.2 Dissolution or Liquidation




To the extent not previously exercised or settled, and unless otherwise determined by the Plan
Administrator in its sole discretion, Options, Stock Appreciation Rights and Stock Units shall
terminate immediately prior to the dissolution or liquidation of the Company. To the extent a
forfeiture provision or repurchase right applicable to an Award has not been waived by the Plan
Administrator, the Award shall be forfeited immediately prior to the consummation of the
dissolution or liquidation.



13.3 Company Transaction





13.3.1 Options, Stock Appreciation Rights and Stock Units




(a) In the event of a Company Transaction, except as otherwise provided in the
instrument evidencing the Award or in a written employment, services or other
agreement between a Participant and the Company or a Related Company,




(i) In the event of a Company Transaction pursuant to the Agreement and
Plan of Merger dated as of August 13, 2008, by and among the Company and
Nuance Communications, Inc., and certain other parties (the “Nuance
Transaction”), all Options and Stock Appreciation Rights outstanding and
held by a Participant whose employment or service relationship has not
terminated (other than Terminations of Service immediately prior to or in
connection with the
Nuance Transaction) as of the date of the Nuance Transaction shall,
immediately prior to the Nuance Transaction, become vested and exercisable
with respect to 25% of the then unvested portion of the Award, and




(ii) In the event of a Company Transaction other than the Nuance
Transaction, all Options and Stock Appreciation Rights outstanding



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and held
by a Participant whose employment or service relationship has not
terminated (other than Terminations of Service immediately prior to or in
connection with the Company Transaction) as of the date of the Company
Transaction shall, immediately prior to the Company Transaction, become
vested and exercisable with respect to 100% of the then unvested portion of
the Award, provided, however, that such accelerated vesting and
exercisability shall not occur if and to the extent the Successor Company
assumes or continues such Options or Stock Appreciation Rights, or
substitutes equivalent options or rights.




(iii) All Stock Units outstanding as of the date of the Company Transaction
shall, immediately prior to the Company Transaction, become vested and
shall be settled with respect to 100% of the then unvested portion of the
Award; provided, however, that such accelerated vesting and settlement of
such Stock Units shall not occur if and to the extent any Successor Company
assumes or continues such Stock Units, or substitutes equivalent rights or
units.




(iv) Notwithstanding the foregoing, the Plan Administrator may determine,
in its sole discretion, that to the extent any Successor Company does not
assume or continue such Options, Stock Appreciation Rights or Stock Units,
or substitute equivalent options, rights or units, any portion of such
Awards that is not assumed, continued or substituted for by the Successor
Company shall terminate immediately prior to the Company Transaction in
exchange for a cash payment at least equal to the amount, if any, by which
the Acquisition Price multiplied by the number of shares of Common Stock
subject to such Award, either to the extent the Award is vested and
exercisable in accordance with its original terms or as such vesting and
exercisability may be accelerated by the Plan Administrator, in its sole
discretion, in connection with the Company Transaction, exceeds the
aggregate exercise or grant price, if any, for such Award.




(b) Immediately following a Company Transaction, all outstanding Options, Stock
Appreciation Rights and Stock Units shall terminate and cease to be outstanding,
except to the extent assumed, continued or substituted for by the Successor
Company.




13.3.2 Restricted Stock




In the event of a Company Transaction, except as otherwise provided in the instrument
evidencing the Award or in a written employment, services or other agreement between a
Participant and the Company or a Related Company, the restrictions applicable to 25% of all
Restricted Stock outstanding as of the date of the Company Transaction shall, immediately
prior to the Company Transaction, lapse,



-16-









 







and such Restricted Stock shall become free of all
restrictions and become fully vested and transferable to the full extent of the original
Award. Notwithstanding the foregoing, if and to the extent any Successor Company generally
assumes or continues all or any portion of Options, Stock Appreciation Rights or Stock
Units outstanding as of the date of the Company Transaction, or substitutes equivalent
options, rights or units, the restrictions applicable to such Restricted Stock shall not
lapse, any Company repurchase rights shall automatically be assigned to the Successor
Company, and all such restrictions shall continue with respect to any shares of the
Successor Company or other consideration that may be issued in exchange or in substitution
for such Restricted Stock.




13.3.3 Assumption, Continuation or Substitution




For the purposes of this Section 13.3, an Award shall be considered assumed, continued or
substituted for if, following the Company Transaction, the Substitute Award confers the
right to purchase or receive, for each share of Common Stock subject to the Award
immediately prior to the Company Transaction, the consideration (whether stock, cash, or
other securities or property) received in the Company Transaction by holders of Common
Stock for each share subject to the Award immediately prior to the Company 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) without any change in the aggregate
exercise or grant price, if any, of such Award; provided, however, that if such
consideration received in the Company Transaction is not solely common stock of the
Successor Company, the Plan Administrator may, with the consent of the Successor Company,
provide for the consideration to be received upon the exercise or settlement of the Award,
for each share of Common Stock subject to the Award, to be solely common stock of the
Successor Company substantially equal in fair market value to the per share consideration
received by holders of Common Stock in the Company Transaction. The determination of such
substantial equality of value of consideration shall be made by the Plan Administrator,
whose determination shall be conclusive and binding.



13.4 Further Adjustment of Awards




Subject to Sections 13.2 and 13.3, the Plan Administrator shall have the discretion, exercisable at
any time before a sale, merger, consolidation, reorganization, liquidation, dissolution or change
in control of the Company, as defined by the Plan Administrator, to
take such further action as it determines to be necessary or advisable with respect to Awards.
Such authorized action may include (but shall not be limited to) establishing, amending or waiving
the type, terms, conditions or duration of, or restrictions on, Awards so as to provide for
earlier, later, extended or additional time for exercise, lifting restrictions and other
modifications, and the Plan Administrator may take such actions with respect to all Participants,
to certain categories of Participants or only to individual Participants. The Plan Administrator
may take such action before or after granting Awards to which the action



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relates and before or
after any public announcement with respect to such sale, merger, consolidation, reorganization,
liquidation, dissolution or change in control that is the reason for such action.



13.5 Limitations




The grant of Awards shall in no way affect the Company’s right to adjust, reclassify, reorganize or
otherwise change its capital or business structure or to merge, consolidate, dissolve, liquidate or
sell or transfer all or any part of its business or assets.



13.6 Fractional Shares




In the event of any adjustment in the number of shares covered by any Award, each such Award shall
cover only the number of full shares resulting from such adjustment.



SECTION 14. FIRST REFUSAL AND REPURCHASE RIGHTS




14.1 First Refusal Rights




Until the date on which the initial registration of the Common Stock under Section 12(b) or 12(g)
of the Exchange Act first becomes effective, the Company shall have the right of first refusal with
respect to any proposed sale or other disposition by a Participant of any shares of Common Stock
issued pursuant to an Award. Such right of first refusal shall be exercisable in accordance with
the terms and conditions established by the Plan Administrator and set forth in the stock purchase
agreement evidencing the purchase of the shares.



14.2 Repurchase Rights for Vested Shares




Until the date on which the initial registration of the Common Stock under Section 12(b) or 12(g)
of the Exchange Act first becomes effective, upon a Participant’s Termination of Service, all
vested shares of Common Stock issued pursuant to an Award (whether issued before or after such
Termination of Service) shall be subject to repurchase by the Company, at the Company’s sole
discretion, at the Fair Market Value of such shares on the date of such repurchase. The terms and
conditions upon which such repurchase right shall be exercisable (including the period and
procedure for exercise) shall be established by the Plan Administrator and set forth in the stock
purchase agreement evidencing the purchase of the shares.



14.3 General




The Company may not exercise its first refusal or repurchase rights under Section 14.1 or 14.2,
respectively, earlier than six months and one day following the date the shares were purchased by a
Participant (or any shorter period determined by the Company to be sufficient to avoid a charge to
the Company’s earnings for financial reporting purposes or required by applicable law).



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The Company’s first refusal and repurchase rights under this Section 14 are assignable by the
Company at any time.



SECTION 15. MARKET STANDOFF




In the event of an underwritten public offering by the Company of its equity securities pursuant to
an effective registration statement filed under the Securities Act, including the Company’s initial
public offering, no person may sell, make any short sale of, loan, hypothecate, pledge, grant any
option for the purchase of, or otherwise dispose of or transfer for value or otherwise agree to
engage in any of the foregoing transactions with respect to any shares issued pursuant to an Award
granted under the Plan without the prior written consent of the Company or its underwriters. Such
limitations shall be in effect for such period of time as may be requested by the Company or such
underwriters; provided, however, that in no event shall such period exceed 180 days. The
limitations of this Section 15 shall in all events terminate two years after the effective date of
the Company’s initial public offering.



In the event of any stock split, stock dividend, recapitalization, combination of shares, exchange
of shares or other change affecting the Company’s outstanding Common Stock effected as a class
without the Company’s receipt of consideration, any new, substituted or additional securities
distributed with respect to the purchased shares shall be immediately subject to the provisions of
this Section 15, to the same extent the purchased shares are at such time covered by such
provisions.



In order to enforce the limitations of this Section 15, the Company may impose stop-transfer
instructions with respect to the purchased shares until the end of the applicable standoff period.



SECTION 16. AMENDMENT AND TERMINATION




16.1 Amendment, Suspension or Termination




The Board may amend, suspend or terminate the Plan or any portion of the Plan at any time and in
such respects as it shall deem advisable; provided, however, that, to the extent required by
applicable law, regulation or stock exchange rule, stockholder approval shall be required for any
amendment to the Plan. Subject to Section 16.3, the Board may amend the terms of any outstanding
Award, prospectively or retroactively.



16.2 Term of the Plan




The Plan shall have no fixed expiration date. After the Plan is terminated, no future Awards may
be granted, but Awards previously granted shall remain outstanding in accordance with their
applicable terms and conditions and the Plan’s terms and conditions. Notwithstanding the
foregoing, no Incentive Stock Options may be granted more than ten years after the earlier of (a)
the adoption of the Plan by the Board and (b) the adoption by the Board of any



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amendment to the
Plan that constitutes the adoption of a new plan for purposes of Section 422 of the Code.



16.3 Consent of Participant




The amendment, suspension or termination of the Plan or a portion thereof or the amendment of an
outstanding Award shall not, without the Participant’s consent, materially adversely affect any
rights under any Award theretofore granted to the Participant under the Plan. Any change or
adjustment to an outstanding Incentive Stock Option shall not, without the consent of the
Participant, be made in a manner so as to constitute a “modification” that would cause such
Incentive Stock Option to fail to continue to qualify as an Incentive Stock Option.
Notwithstanding the foregoing, any adjustments made pursuant to Sections 13.2 and 13.3 shall not be
subject to these restrictions.



SECTION 17. GENERAL




17.1 No Individual Rights




No individual or Participant shall have any claim to be granted any Award under the Plan, and the
Company has no obligation for uniformity of treatment of Participants under the Plan.



Furthermore, nothing in the Plan or any Award granted under the Plan shall be deemed to constitute
an employment contract or confer or be deemed to confer on any Participant any right to continue in
the employ of, or to continue any other relationship with, the Company or
any Related Company or limit in any way the right of the Company or any Related Company to
terminate a Participant’s employment or other relationship at any time, with or without cause.



17.2 Issuance of Shares




Notwithstanding any other provision of the Plan, the Company shall have no obligation to issue or
deliver any shares of Common Stock under the Plan or make any other distribution of benefits under
the Plan unless, in the opinion of the Company’s counsel, such issuance, delivery or distribution
would comply with all applicable laws (including, without limitation, the requirements of the
Securities Act or the laws of any state or foreign jurisdiction) and the applicable requirements of
any securities exchange or similar entity.



The Company shall be under no obligation to any Participant to register for offering or resale or
to qualify for exemption under the Securities Act, or to register or qualify under the laws of any
state or foreign jurisdiction, any shares of Common Stock, security or interest in a security paid
or issued under, or created by, the Plan, or to continue in effect any such registrations or
qualifications if made.



As a condition to the exercise of an Option or any other receipt of Common Stock pursuant to an
Award under the Plan, the Company may require (a) the Participant to represent and



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warrant at the
time of any such exercise or receipt that such shares are being purchased or received only for the
Participant’s own account and without any present intention to sell or distribute such shares and
(b) such other action or agreement by the Participant as may from time to time be necessary to
comply with the federal, state and foreign securities laws. At the option of the Company, a
stop-transfer order against any such shares may be placed on the official stock books and records
of the Company, and a legend indicating that such shares may not be pledged, sold or otherwise
transferred, unless an opinion of counsel is provided (concurred in by counsel for the Company)
stating that such transfer is not in violation of any applicable law or regulation, may be stamped
on stock certificates to ensure exemption from registration. The Plan Administrator may also
require the Participant to execute and deliver to the Company a purchase agreement or such other
agreement as may be in use by the Company at such time that describes certain terms and conditions
applicable to the shares.



To the extent the Plan or any instrument evidencing an Award provides for issuance of stock
certificates to reflect the issuance of shares of Common Stock, the issuance may be effected on a
noncertificated basis, to the extent not prohibited by applicable law or the applicable rules of
any stock exchange.



17.3 Indemnification




Each person who is or shall have been a member of the Board, or a committee appointed by the Board
to whom authority was delegated in accordance with Section 3.1 shall be indemnified and held
harmless by the Company against and from any loss, cost, liability or expense that may be imposed
upon or reasonably incurred by such person in connection with
or resulting from any claim, action, suit or proceeding to which such person may be a party or in
which such person may be involved by reason of any action taken or failure to act under the Plan
and against and from any and all amounts paid by such person in settlement thereof, with the
Company’s approval, or paid by such person in satisfaction of any judgment in any such claim,
action, suit or proceeding against such person; provided, however, that such person shall give the
Company an opportunity, at its own expense, to handle and defend the same before such person
undertakes to handle and defend it on such person’s own behalf, unless such loss, cost, liability
or expense is a result of such person’s own willful misconduct or except as expressly provided by
statute.



The foregoing right of indemnification shall not be exclusive of any other rights of
indemnification to which such person may be entitled under the Company’s certificate of
incorporation or bylaws, as a matter of law, or otherwise, or of any power that the Company may
have to indemnify such person or hold such person harmless.



17.4 No Rights as a Stockholder




Unless otherwise provided by the Plan Administrator or in the instrument evidencing the Award or in
a written employment, services or other agreement, no Option, Stock Appreciation Right or Stock
Unit shall entitle the Participant to any cash dividend, voting or



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other right of a stockholder
unless and until the date of issuance under the Plan of the shares that are the subject of such
Award.



17.5 Compliance With Laws and Regulations




In interpreting and applying the provisions of the Plan, any Option granted as an Incentive Stock
Option pursuant to the Plan shall, to the extent permitted by law, be construed as an “incentive
stock option” within the meaning of Section 422 of the Code.



17.6 Participants in Other Countries




The Plan Administrator shall have the authority to adopt such modifications, procedures and
subplans as may be necessary or desirable to comply with provisions of the laws of other countries
in which the Company or any Related Company may operate to ensure the viability of the benefits
from Awards granted to Participants employed in such countries, to comply with applicable foreign
laws and to meet the objectives of the Plan.



17.7 No Trust or Fund




The Plan is intended to constitute an “unfunded” plan. Nothing contained herein shall require the
Company to segregate any monies or other property, or shares of Common Stock, or to create any
trusts, or to make any special deposits for any immediate or deferred amounts payable to any
Participant, and no Participant shall have any rights that are greater than those of a general
unsecured creditor of the Company.



17.8 Successors




All obligations of the Company under the Plan with respect to Awards shall be binding on any
successor to the Company, whether the existence of such successor is the result of a direct or
indirect purchase, merger, consolidation, or otherwise, of all or substantially all the business
and/or assets of the Company.



17.9 Severability




If any provision of the Plan or any Award is determined to be invalid, illegal or unenforceable in
any jurisdiction, or as to any person, or would disqualify the Plan or any Award under any law
deemed applicable by the Plan Administrator, such provision shall be construed or deemed amended to
conform to applicable laws, or, if it cannot be so construed or deemed amended without, in the Plan
Administrator’s determination, materially altering the intent of the Plan or the Award, such
provision shall be stricken as to such jurisdiction, person or Award, and the remainder of the Plan
and any such Award shall remain in full force and effect.



-22-









 





17.10 Choice of Law




The Plan, all Awards granted thereunder and all determinations made and actions taken pursuant
hereto, to the extent not otherwise governed by the laws of the United States, shall be governed by
the laws of the State of Washington without giving effect to principles of conflicts of law.



17.11 Appendix Provisions




Participants who are residents of the State of California shall be subject to the additional terms
and conditions set forth in Appendix A to the Plan until such time as the Common Stock becomes a
“listed” security under the Securities Act.



SECTION 18. EFFECTIVE DATE




The effective date (the “Effective Date”) is the date on which the Plan is adopted by the Board.
If the stockholders of the Company do not approve the Plan within 12 months after the Board’s
adoption of the Plan, any Incentive Stock Options granted under the Plan will be treated as
Nonqualified Stock Options.



-23-









 





APPENDIX A




TO THE SNAPinSOFTWARE, INC.

2003 EQUITY INCENTIVE PLAN




(For California Residents Only)




This Appendix to the SNAPinSoftware, Inc. 2003 Equity Incentive Plan (the “Plan”) shall have
application only to Participants who are residents of the State of California. Capitalized terms
contained herein shall have the same meanings given to them in the Plan, unless otherwise provided
in this Appendix. Notwithstanding any provision contained in the Plan to the contrary and to the
extent required by applicable law, the following terms and conditions shall apply to all Awards
granted to residents of the State of California, until such time as the Common Stock becomes a
“listed security” under the Securities Act:



1. Nonqualified Stock Options shall have an exercise price that is not less than 85% of the Fair
Market Value of the Common Stock at the Grant Date, except that the exercise price shall be at
least 110% of the Fair Market Value in the case of any person who owns stock possessing more than
10% of the total combined voting power of all classes of stock of the Company or its parent or
subsidiary companies.



2. The purchase price for any shares of Common Stock that may be purchased under the Plan (“Stock
Purchase Rights”) shall be at least 85% of the Fair Market Value of the Common Stock at the time
the Participant is granted the Stock Purchase Right or at the time the purchase is consummated.
Notwithstanding the foregoing, the purchase price shall be at least 100% of the Fair Market Value
of the Common Stock at the time the Participant is granted the Stock Purchase Right or at the time
the purchase is consummated in the case of any person who owns stock possessing more than 10% of
the total combined voting power of all classes of stock of the Company or its parent or subsidiary
companies.



3. Options shall have a term of not more than ten years from the Grant Date.



4. Awards shall be nontransferable other than by will or the laws of descent and distribution.
Notwithstanding the foregoing, and to the extent permitted by Section 422 of the Code, the Plan
Administrator, in its discretion, may permit distribution of an Option to an inter vivos or
testamentary trust in which the Option is to be passed to beneficiaries upon the death of the
trustor (settlor), or by gift to “immediate family” as that term is defined in Rule 16a-1(e) under
the Exchange Act.



5. Options shall become exercisable at the rate of at least 20% per year over five years from the
date the Option is granted, subject to reasonable conditions such as continued employment.
However, in the case of an Option granted to officers, directors or consultants



A-1









 







of the Company or a Related Company, the Option may become fully exercisable, subject to reasonable
conditions such as continued employment, at any time or during any period established by the
Company or a Related Company.



6. Unless employment or services are terminated for Cause, the right to exercise an Option in the
event of Termination of Service, to the extent that the Participant is otherwise entitled to
exercise an Option on the date of Termination of Service, shall be




a. at least six months from the date of a Participant’s Termination of Service if
termination was caused by death or Disability; and




b. at least 30 days from the date of a Participant’s Termination of Service if termination
of employment was caused by other than death or Disability;




c. but in no event later than the Option Expiration Date.



7. No Award may be granted to a resident of California more than ten years after the earlier of the
date of adoption of the Plan and the date the Plan is approved by the stockholders.



8. Any Award exercised before stockholder approval is obtained shall be rescinded if stockholder
approval is not obtained within 12 months before or after the Plan is adopted. Such shares shall
not be counted in determining whether such approval is obtained.



9. The Company shall provide annual financial statements of the Company to each California resident
holding an outstanding Award under the Plan. Such financial statements need not be audited and
need not be issued to key employees whose duties at the Company assure them access to equivalent
information.



10. Any right of repurchase on behalf of the Company in the event of a Participant’s Termination of
Service shall be (a) at a purchase price that is not less than the Fair Market Value of the
securities upon Termination of Service, and the right to repurchase shall be exercised for cash or
cancellation of purchase money indebtedness for the shares within 90 days of Termination of Service
(or in the case of securities issued upon exercise of Options after the date of Termination of
Service, within 90 days after the date of the exercise), and the right shall terminate when the
Company’s securities become publicly traded; or (b) at the original purchase price, provided that
the right to repurchase at the original purchase price lapses at the rate of at least 20% of the
shares per year over five years from the date the Option or Stock Purchase Right is granted
(without respect to the date the Option or Stock Purchase Right was exercised or became
exercisable) and the right to repurchase shall be exercised for cash or cancellation of purchase
money indebtedness for the shares within 90 days of Termination of Service (or in the case of
securities issued upon exercise of Options after the date of Termination of Service, within 90 days
after the date of the exercise). In addition to the restrictions set forth in clauses (a) and (b),
the securities held by an officer,
director or consultant of the Company or a Related Company may be subject to additional or greater
restrictions.



A-2









 





PLAN ADOPTION AND AMENDMENTS/ADJUSTMENTS

SUMMARY PAGE




	 	 	 	 	 	 	 
	Date of	 	 	 	Section/Effect of	 	Date of Stockholder
	Board Action	 	Action	 	Amendment	 	Approval
	 
	 	 	 	 	 	 
	7/10/2003

	 	Initial Plan Adoption
	 	 	 	7/10/2003
	 
	 	 	 	 	 	 
	11/10/2004

	 	Added 1,000,000 to
shares allocated
	 	Section 4.1
	 	11/10/2004
	 
	 	 	 	 	 	 
	6/14/2005

	 	Added 250,000 to shares
allocated
	 	Section 4.1
	 	6/15/2005
	 
	 	 	 	 	 	 
	1/26/2006

	 	Increased plan by
2,050,000 shares to
4,300,000
	 	Section 4.1
	 	01/26/2006
	 
	 	 	 	 	 	 
	07/24/2008

	 	Added 25% vesting
acceleration for
options
	 	Section 13.3.1
	 	Not required
	 
	 	 	 	 	 	 
	8/21/2008

	 	Increased plan by
2,000,000 shares to
6,300,000
	 	Section 4.1	 	 
	 
	 	 	 	 	 	 
	10/01/2008

	 	Amended plan to provide
that for post-Nuance
transactions, options,
SARs and RSUs fully
accelerate in vesting
if not assumed,
continued or
substituted for by a
Successor Company.
	 	Section 13.3.1(a)
	 	Not required






A-1