exv10w1






Exhibit 10.1




COMSCORE, INC.




2007 EQUITY INCENTIVE PLAN

(As Amended and Restated June 8, 2011)




1. Purposes of the Plan. The purposes of this 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.





     The Plan permits the grant of Incentive Stock Options, Nonstatutory Stock Options, Restricted
Stock, Restricted Stock Units, Stock Appreciation Rights, Performance Units, Performance Shares,
Dividend Equivalents and Deferred Stock Units.



     2. Definitions. As used herein, the following definitions will apply:




     (a) “Administrator” means the Board or any of its Committees as will be
administering the Plan, in accordance with Section 4 of the Plan.




     (b) “Applicable Laws” means the requirements relating to the administration of
equity-based awards 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.




     (c) “Award” means, individually or collectively, a grant under the Plan of Options,
Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, Performance Units,
Performance Shares, Dividend Equivalents and Deferred Stock Units.




     (d) “Award Agreement” means the written or electronic 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.




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




     (f) “Change in Control” means the occurrence of any of the following events:




     (i) Any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act)
becomes the “beneficial owner” (as defined in Rule 13d-3 of the Exchange Act), directly or
indirectly, of securities of the Company representing fifty percent (50%) or more of the
total voting power represented by the Company’s then outstanding voting securities;




     (ii) The consummation of the sale or disposition by the Company of all or substantially
all of the Company’s assets;




     (iii) A change in the composition of the Board occurring within a two (2)-year period,
as a result of which fewer than a majority of the directors are Incumbent Directors.
“Incumbent Directors” means directors who either (A) are Directors as of the effective date
of the Plan, or (B) are elected, or nominated for election, to the Board with the affirmative
votes of at least a majority of the Incumbent Directors at the time of such election or
nomination (but will not include an individual whose election or nomination is in connection
with an actual or threatened proxy contest relating to the election of directors to the
Company); or



 









 






     (iv) The consummation of a merger or consolidation of the Company with any other
corporation, other than a merger or consolidation 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 consolidation.




     (g) “Code” means the Internal Revenue Code of 1986, as amended. Any reference to a
section of the Code herein will be a reference to any successor or amended section of the Code.




     (h) “Committee” means a committee of Directors or of other individuals satisfying
Applicable Laws appointed by the Board in accordance with Section 4 hereof.




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




     (j) “Company” means comScore, Inc., a Delaware corporation, or any successor
thereto.




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




     (l) “Deferred Stock Unit” means a deferred stock unit Award granted to a
Participant pursuant to Section 11




     (m) “Determination Date” means the latest possible date that will not jeopardize
the qualification of an Award granted under the Plan as “performance-based compensation” under
Section 162(m) of the Code.




     (n) “Director” means a member of the Board.




     (o) “Disability” means total and permanent disability as defined in Section
22(e)(3) of the Code, provided that in the case of Awards other than Incentive Stock Options,
the Administrator in its discretion may determine whether a permanent and total disability
exists in accordance with uniform and non-discriminatory standards adopted by the Administrator
from time to time.




     (p) “Dividend Equivalent” means a credit, payable in cash, made at the discretion
of the Administrator, to the account of a Participant in an amount equal to the cash dividends
paid on one Share for each Share represented by an Award held by such Participant.




     (q) “Employee” means any person, including Officers and Directors, employed by the
Company or any Parent or Subsidiary of the Company. Neither service as a Director nor payment of
a director’s fee by the Company will be sufficient to constitute “employment” by the Company.




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




     (s) “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, the Nasdaq Global
Market or the Nasdaq Capital Market of The Nasdaq Stock Market, its Fair Market Value will 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;




     (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 will 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;



 









 






     (iii) For purposes of any Awards granted on the Registration Date, the Fair Market Value
will be the initial price to the public as set forth in the final prospectus included within
the registration statement in Form S-1 filed with the Securities and Exchange Commission for
the initial public offering of the Company’s Common Stock; or




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




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




     (u) “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.




     (v) “Inside Director” means a Director who is an Employee.




     (w) “Nonstatutory Stock Option” means an Option that by its terms does not qualify
or is not intended to qualify as an Incentive Stock Option.




     (x) “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.




     (y) “Option” means a stock option granted pursuant to the Plan.




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




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




     (bb) “Participant” means the holder of an outstanding Award.




     (cc) “Performance Goals” means the goal(s) (or combined goal(s)) determined by the
Administrator (in its discretion) to be applicable to a Participant with respect to an Award. As
determined by the Administrator, 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: (i)
attainment of research and development milestones, (ii) bookings, (iii) business divestitures
and acquisitions, (iv) cash flow (including free cash flow), (v) cash position, (vi) contract
awards or backlog, (vii) customer renewals, (viii) customer retention rates from an acquired
company, business unit or division, (ix) earnings (which may include earnings before interest
and taxes, earnings before interest, taxes, depreciation and amortization, and net earnings),
(x) earnings per Share, (xi) expenses, (xii) gross margin, (xiii) growth in stockholder value
relative to the moving average of the S&P 500 Index or another index, (xiv) internal rate of
return, (xv) market share, (xvi) net income, (xvii) net profit, (xviii) net sales, (xix) new
product development, (xx) new product invention or innovation, (xxi) number of customers, (xxii)
operating cash flow, (xxiii) operating expenses, (xxiv) operating income, (xxv) operating
margin, (xxvi) overhead or other expense reduction, (xxvii) product defect measures, (xxviii)
product release timelines, (xxix) productivity, (xxx) profit, (xxxi) return on assets, (xxxii)
return on capital, (xxxiii) return on equity, (xxxiv) return on investment, (xxxv) return on
sales, (xxxvi) revenue, (xxxvii) revenue growth, (xxxviii) sales results, (xxxix) sales growth,
(xl) stock price, (xli) time to market, (xlii) total stockholder return, and (xliii) working
capital. The Performance Goals may differ from Participant to Participant and from Award to
Award. Any criteria used may be measured, as applicable, (1) in absolute terms, (2) in relative
terms (including, but not limited to, passage of time and/or against another company or
companies), (3) on a per-share basis, (4) against the performance of the Company as a whole or a
portion of the Company, and (5) on a pre-tax or after-tax basis.




     (dd) “Performance Period” means any Fiscal Year of the Company or such shorter or
longer period as determined by the Administrator in its sole discretion.



 









 






     (ee) “Performance Share” means an Award denominated in Shares which may be earned
in whole or in part upon attainment of performance goals or other vesting criteria as the
Administrator may determine pursuant to Section 10.




     (ff) “Performance Unit” means an Award which may be earned in whole or in part upon
attainment of performance goals or other vesting criteria as the Administrator may determine and
which may be settled for cash, Shares or other securities or a combination of the foregoing
pursuant to Section 10.




     (gg) “Period of Restriction” means the period during which the transfer of Shares
of Restricted Stock are subject to restrictions and therefore, the Shares are subject to a
substantial risk of forfeiture. Such restrictions may be based on the passage of time, the
achievement of target levels of performance, or the occurrence of other events as determined by
the Administrator.




     (hh) “Plan” means this 2007 Equity Incentive Plan.




     (ii) “Registration Date” means the effective date of the first registration
statement that is filed by the Company and declared effective pursuant to Section 12(g) of the
Exchange Act, with respect to any class of the Company’s securities.




     (jj) “Restricted Stock” means Shares issued pursuant to a Restricted Stock award
under Section 7 of the Plan, or issued pursuant to the early exercise of an Option.




     (kk) “Restricted Stock Unit” means a bookkeeping entry representing an amount equal
to the Fair Market Value of one Share, granted pursuant to Section 8. Each Restricted Stock Unit
represents an unfunded and unsecured obligation of the Company.




     (ll) “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.




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




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




     (oo) “Share” means a share of the Common Stock, as adjusted in accordance with
Section 15 of the Plan.




     (pp) “Stock Appreciation Right” means an Award, granted alone or in connection with
an Option, that pursuant to Section 9 is designated as a Stock Appreciation Right.




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



     3. Stock Subject to the Plan.



     (a) Stock Subject to the Plan. Subject to the provisions of Section 15 of the Plan,
the maximum aggregate number of Shares that may be issued under the Plan is 1,400,000 Shares
(following the 1-for-5 reverse stock split of the Company’s outstanding capital stock occurring on
June 21, 2007), plus (i) any Shares that, as of the Registration Date, have been reserved but not
issued pursuant to any awards granted under the Company’s Incentive Plan (the “Existing
Plan”) and are not subject to any awards granted thereunder, and (ii) any Shares subject to
stock options or similar awards granted under the Existing Plan that expire or otherwise terminate
without having been exercised in full and Shares issued pursuant to awards granted under the
Existing Plan that are forfeited to or repurchased by the Company, with the maximum number of
Shares to be added to the Plan pursuant to clauses (i) and (ii) equal to 1,000,000 Shares. The
Shares may be authorized, but unissued, or reacquired Common Stock.



     (b) Automatic Share Reserve Increase. The number of Shares available for issuance
under the Plan will be increased on the first day of each Fiscal Year beginning with the 2008
Fiscal Year, in an amount equal to the least of



 









 




(i) 1,800,000 Shares, (ii) 4% of the outstanding Shares on the last day of the immediately
preceding Fiscal Year or (iii) such number of Shares determined by the Board.




     (c) Lapsed Awards. If an Award expires or becomes unexercisable without having been
exercised in full, is surrendered pursuant to an Exchange Program, or, with respect to Restricted
Stock, Restricted Stock Units, Performance Units or Performance Shares, is forfeited to or
repurchased by the Company due to failure to vest, the unpurchased Shares (or for Awards other than
Options or Stock Appreciation Rights the forfeited or repurchased Shares) which were subject
thereto will become available for future grant or sale under the Plan (unless the Plan has
terminated). With respect to Stock Appreciation Rights, only Shares actually issued pursuant to a
Stock Appreciation Right will cease to be available under the Plan; all remaining Shares under
Stock Appreciation Rights will remain available for future grant or sale under the Plan (unless the
Plan has terminated). Shares that have actually been issued under the Plan under any Award will not
be returned to the Plan and will not become available for future distribution under the Plan;
provided, however, that if Shares issued pursuant to Awards of Restricted Stock, Restricted Stock
Units, Performance Shares or Performance Units are repurchased by the Company or are forfeited to
the Company, such Shares will become available for future grant under the Plan. Shares used to pay
the exercise price of an Award or to satisfy the tax withholding obligations related to an Award
will become available for future grant or sale under the Plan. To the extent an Award under the
Plan is paid out in cash rather than Shares, such cash payment will not result in reducing the
number of Shares available for issuance under the Plan. Notwithstanding the foregoing and, subject
to adjustment as provided in Section 15, the maximum number of Shares that may be issued upon the
exercise of Incentive Stock Options will equal the aggregate Share number stated in Section 3(a),
plus, to the extent allowable under Section 422 of the Code and the Treasury Regulations
promulgated thereunder, any Shares that become available for issuance under the Plan pursuant to
Sections 3(b) and 3(c).



     (d) Share Reserve. The Company, during the term of this Plan, will at all times
reserve and keep available such number of Shares as will be sufficient to satisfy the requirements
of the Plan.



     4. Administration of the Plan.



     (a) Procedure.



     (i) Multiple Administrative Bodies. Different Committees with respect to different
groups of Service Providers may administer the Plan.



     (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 will be administered by a Committee of two (2) or
more “outside directors” within the meaning of Section 162(m) of the Code.



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



     (iv) Other Administration. Other than as provided above, the Plan will be
administered by (A) the Board or (B) a Committee, which committee will 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 will 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 to be covered by each Award granted hereunder;




     (iv) to approve forms of Award Agreements 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 will 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 21(c) of the Plan), including but
not limited to the discretionary authority to extend the post-termination exercisability period
of Awards and to extend the maximum term of an Option (subject to Section 6(c) regarding
Incentive Stock Options);




     (ix) to allow Participants to satisfy withholding tax obligations in such manner as
prescribed in Section 17;




     (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 allow a Participant to defer the receipt of the payment of cash or the delivery of
Shares that would otherwise be due to such Participant under an Award; and




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



     (c) Effect of Administrator’s Decision. The Administrator’s decisions, determinations
and interpretations will be final and binding on all Participants and any other holders of Awards.



     5. Eligibility. Nonstatutory Stock Options, Stock Appreciation Rights, Restricted
Stock, Restricted Stock Units, Performance Shares, Performance Units, Dividend Equivalents and
Deferred Stock Units may be granted to Service Providers. Incentive Stock Options may be granted
only to Employees.



     6. Stock Options.



     (a) Limitations. Each Option will 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 Participant during any calendar year (under
all plans of the Company and any Parent or Subsidiary) exceeds one hundred thousand dollars
($100,000), such Options will be treated as Nonstatutory Stock Options. For purposes of this
Section 6(a), Incentive Stock Options will be taken into account in the order in which they were
granted. The Fair Market Value of the Shares will be determined as of the time the Option with
respect to such Shares is granted.



     (b) Number of Shares. The Administrator will have complete discretion to determine
the number of Shares subject to Options granted to any Service Provider; provided, however, no
Service Provider will be granted Options covering more than 1,000,000 Shares during any Fiscal
Year. In connection with his or her initial service as an Employee, a Service Provider may be
granted Options to purchase up to an additional 1,000,000 Shares, which will not count against the
limit set forth above. The foregoing limitations will be adjusted proportionately in connection
with any change in the Company’s capitalization as described in Section 15.



     (c) Term of Option. The term of each Option will be stated in the Award Agreement. In
the case of an Incentive Stock Option, the term will be ten (10) years from the date of grant or
such shorter term as may be provided in the Award Agreement. Moreover, in the case of an Incentive
Stock Option granted to a Participant who, at the time the 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 will be
five (5) years from the date of grant or such shorter term as may be provided in the Award
Agreement.



 









 





     (d) Option Exercise Price and Consideration.



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




     (1) 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 will be no less than one
hundred ten percent (110%) of the Fair Market Value per Share on the date of grant.




     b) granted to any Employee other than an Employee described in paragraph (A) immediately
above, the per Share exercise price will be no less than one hundred percent (100%) of the Fair
Market Value per Share on the date of grant.




     (2) In the case of a Nonstatutory Stock Option, the per Share exercise price will be no
less than one hundred percent (100%) of the Fair Market Value per Share on the date of grant.




     (3) Notwithstanding the foregoing, Options may be granted with a per Share exercise price
of less than one hundred percent (100%) of the Fair Market Value per Share on the date of grant
pursuant to a transaction described in, and in a manner consistent with, Section 424(a) of the
Code.




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




     (iii) Form of Consideration. The Administrator will 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 will determine the acceptable form of consideration at
the time of grant. Such consideration may consist entirely of: (1) cash; (2) check; (3)
promissory note, (4) other Shares, provided that such Shares have a Fair Market Value on the
date of surrender equal to the aggregate exercise price of the Shares as to which such Option
will be exercised and provided that accepting such Shares, in the sole discretion of the
Administrator, will not result in any adverse accounting consequences to the Company; (5)
consideration received by the Company under a broker-assisted (or other) cashless exercise
program implemented by the Company in connection with the Plan; (6) any combination of the
foregoing methods of payment; or (7) such other consideration and method of payment for the
issuance of Shares to the extent permitted by Applicable Laws.



     (e) Exercise of Option.



     (i) Procedure for Exercise; Rights as a Stockholder. Any Option granted hereunder
will 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. An Option may not be
exercised for a fraction of a Share.



     An Option will be deemed exercised when the Company receives: (i) notice of exercise (in such
form as the Administrator may specify from time to time) from the person entitled to exercise the
Option, and (ii) full payment for the Shares with respect to which the Option is exercised
(together with applicable withholding taxes). 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 will be issued in the name of the Participant or, if
requested by the Participant, in the name of the Participant 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 stockholder will exist with respect to the Shares subject to an Option, notwithstanding
the exercise of the Option. The Company will 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 13 of the
Plan.



 









 





     Exercising an Option in any manner will 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.



     (ii) Termination of Relationship as a Service Provider. If a Participant ceases to be
a Service Provider, other than upon the Participant’s termination as the result of the
Participant’s death or Disability, the Participant 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 will remain exercisable for three (3) months following the Participant’s termination. Unless
otherwise provided by the Administrator, if on the date of termination the Participant is not
vested as to his or her entire Option, the Shares covered by the unvested portion of the Option
will revert to the Plan. If after termination the Participant does not exercise his or her Option
within the time specified by the Administrator, the Option will terminate, and the Shares covered
by such Option will revert to the Plan.



     (iii) Disability of Participant. If a Participant ceases to be a Service Provider as
a result of the Participant’s Disability, the Participant 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 will remain exercisable for twelve (12) months following the Participant’s termination.
Unless otherwise provided by the Administrator, if on the date of termination the Participant is
not vested as to his or her entire Option, the Shares covered by the unvested portion of the Option
will revert to the Plan. If after termination the Participant does not exercise his or her Option
within the time specified herein, the Option will terminate, and the Shares covered by such Option
will revert to the Plan.



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



     7. Restricted Stock.



     (a) Grant of Restricted Stock. Subject to the terms and provisions of the Plan, the
Administrator, at any time and from time to time, may grant Shares of Restricted Stock to Service
Providers in such amounts as the Administrator, in its sole discretion, will determine.



     (b) Restricted Stock Agreement. Each Award of Restricted Stock will be evidenced by
an Award Agreement that will specify the Period of Restriction, the number of Shares granted, and
such other terms and conditions as the Administrator, in its sole discretion, will determine.
Notwithstanding the foregoing, for Awards of Restricted Stock intended to qualify as
“performance-based compensation” within the meaning of Section 162(m) of the Code, during any
Fiscal Year no Service Provider will receive more than an aggregate of 300,000 Shares of Restricted
Stock; provided, however, that in connection with a Service Provider’s initial service as an
Employee, for Restricted Stock intended to qualify as “performance-based compensation” within the
meaning of Section 162(m) of the Code, the Service may be granted an aggregate of up to an
additional 300,000 Shares of Restricted Stock. The foregoing limitations will be adjusted
proportionately in connection with any changes in the Company’s capitalization as described in
Section 15. Unless the Administrator determines otherwise, the Company as escrow agent will hold
Shares of Restricted Stock until the restrictions on such Shares have lapsed.



 









 





     (c) Transferability. Except as provided in this Section 7, Shares of Restricted Stock
may not be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated until the
end of the applicable Period of Restriction.



     (d) Other Restrictions. The Administrator, in its sole discretion, may impose such
other restrictions on Shares of Restricted Stock as it may deem advisable or appropriate.



     (e) Removal of Restrictions. Except as otherwise provided in this Section 7, Shares
of Restricted Stock covered by each Restricted Stock grant made under the Plan will be released
from escrow as soon as practicable after the last day of the Period of Restriction or at such other
time as the Administrator may determine. The Administrator, in its discretion, may accelerate the
time at which any restrictions will lapse or be removed. Unless otherwise provided by the
Administrator, all Shares of Restricted Stock for which restrictions have not lapsed at the time of
the Participant’s termination as a Service Provider for any or no reason, will be forfeited and
automatically transferred to and reacquired by the Company and will revert to the Plan and become
available for future grant under the Plan upon the date of such termination and the Participant
will have no further rights thereunder.



     (f) Voting Rights. During the Period of Restriction, Service Providers holding Shares
of Restricted Stock granted hereunder may exercise full voting rights with respect to those Shares,
unless the Administrator determines otherwise.



     (g) Dividends and Other Distributions. During the Period of Restriction, Service
Providers holding Shares of Restricted Stock will be entitled to receive all dividends and other
distributions paid with respect to such Shares, unless the Administrator provides otherwise. If any
such dividends or distributions are paid in Shares, the Shares will be subject to the same
restrictions on transferability and forfeitability as the Shares of Restricted Stock with respect
to which they were paid.



     (h) Return of Restricted Stock to Company. On the date set forth in the Award
Agreement, the Restricted Stock for which restrictions have not lapsed will revert to the Company
and again will become available for grant under the Plan.



     (i) Section 162(m) Performance Restrictions. For purposes of qualifying grants of
Restricted Stock as “performance-based compensation” under Section 162(m) of the Code, the
Administrator, in its discretion, may set restrictions based upon the achievement of Performance
Goals. The Performance Goals will be set by the Administrator on or before the Determination Date.
In granting Restricted Stock which is intended to qualify under Section 162(m) of the Code, the
Administrator will follow any procedures determined by it from time to time to be necessary or
appropriate to ensure qualification of the Award under Section 162(m) of the Code (e.g., in
determining the Performance Goals.



     8. Restricted Stock Units.



     (a) Grant. Restricted Stock Units may be granted at any time and from time to time as
determined by the Administrator. After the Administrator determines that it will grant Restricted
Stock Units under the Plan, it will advise the Participant in an Award Agreement of the terms,
conditions, and restrictions related to the grant, including the number of Restricted Stock Units.
Notwithstanding the foregoing, for Awards of Restricted Stock Units intended to qualify as
“performance-based compensation” within the meaning of Section 162(m) of the Code, during any
Fiscal Year no Service Provider will receive more than an aggregate of 300,000 Restricted Stock
Units; provided, however, that in connection with a Service Provider’s initial service as an
Employee, for Restricted Stock Units intended to qualify as “performance-based compensation” within
the meaning of Section 162(m) of the Code, the Service may be granted an aggregate of up to an
additional 300,000 Restricted Stock Units. The foregoing limitations will be adjusted
proportionately in connection with any change in the Company’s capitalization as described in
Section 15.



     (b) Vesting Criteria and Other Terms. The Administrator will set vesting criteria in
its discretion, which, depending on the extent to which the criteria are met, will determine the
number of Restricted Stock Units that will be paid out to the Participant. The Administrator may
set vesting criteria based upon the achievement of Company-



 









 




wide, business unit, or individual goals (including, but not limited to, continued
employment), or any other basis determined by the Administrator in its discretion.




     (c) Earning Restricted Stock Units. Upon meeting the applicable vesting criteria, the
Participant will be entitled to receive a payout as determined by the Administrator.
Notwithstanding the foregoing, at any time after the grant of Restricted Stock Units, the
Administrator, in its sole discretion, may reduce or waive any vesting criteria that must be met to
receive a payout. Unless otherwise provided by the Administrator, all Restricted Stock Units that
have not vested at the time of the Participant’s termination as a Service Provider for any or no
reason, will be forfeited to the Company and will revert to the Plan and become available for
future grant under the Plan upon the date of such termination and the Participant’s right to
receive any Shares or payment thereunder will immediately terminate.



     (d) Form and Timing of Payment. Payment of earned Restricted Stock Units will be made
as soon as practicable after the date(s) determined by the Administrator and set forth in the Award
Agreement. The Administrator, in its sole discretion, may only settle earned Restricted Stock Units
in cash, Shares, or a combination of both.



     (e) Cancellation. On the date set forth in the Award Agreement, all unearned
Restricted Stock Units will be forfeited to the Company.



     (f) Section 162(m) Performance Restrictions. For purposes of qualifying grants of
Restricted Stock Units as “performance-based compensation” under Section 162(m) of the Code, the
Administrator, in its discretion, may set restrictions based upon the achievement of Performance
Goals. The Performance Goals will be set by the Administrator on or before the Determination Date.
In granting Restricted Stock Units which are intended to qualify under Section 162(m) of the Code,
the Administrator will follow any procedures determined by it from time to time to be necessary or
appropriate to ensure qualification of the Award under Section 162(m) of the Code (e.g., in
determining the Performance Goals).



     9. Stock Appreciation Rights.



     (a) Grant of Stock Appreciation Rights. Subject to the terms and conditions of the
Plan, a Stock Appreciation Right 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 to determine
the number of Stock Appreciation Rights granted to any Participant, provided that during any Fiscal
Year, no Service Provider will be granted Stock Appreciation Rights covering more than 1,000,000
Shares. Notwithstanding the foregoing limitation, in connection with a Service Provider’s initial
service as an Employee, the Service Provider may be granted Stock Appreciation Rights covering up
to an additional 1,000,000 Shares. The foregoing limitations will be adjusted proportionately in
connection with any change in the Company’s capitalization as described in Section 15.



     (c) Exercise Price and Other Terms. The per share exercise price for the Shares to be
issued pursuant to exercise of a Stock Appreciation Right will be determined by the Administrator
and will be no less than one hundred percent (100%) of the Fair Market Value per Share on the date
of grant. Otherwise, subject to Section 6(a) of the Plan, the Administrator, subject to the
provisions of the Plan, will have complete discretion to determine the terms and conditions of
Stock Appreciation Rights granted under the Plan.



     (d) Stock Appreciation Right Agreement. Each Stock Appreciation Right grant will be
evidenced by an Award Agreement that will specify the exercise price, the term of the Stock
Appreciation Right, the conditions of exercise, and such other terms and conditions as the
Administrator, in its sole discretion, will determine.



     (e) Expiration of Stock Appreciation Rights. A Stock Appreciation Right granted under
the Plan will expire upon the date determined by the Administrator, in its sole discretion, and set
forth in the Award Agreement. Notwithstanding the foregoing, the rules of Section 6(d) also will
apply to Stock Appreciation Rights.



     (f) Payment of Stock Appreciation Right Amount. Upon exercise of a Stock Appreciation
Right, a Participant will 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 Stock Appreciation Right is exercised.



     At the discretion of the Administrator, the payment upon Stock Appreciation Right exercise may
be in cash, in Shares of equivalent value, or in some combination thereof.



     10. Performance Units and Performance Shares.



     (a) Grant of Performance Units/Shares. Performance Units and Performance Shares 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. The Administrator will have complete discretion in
determining the number of Performance Units and Performance Shares granted to each Participant,
provided that during any Fiscal Year for Awards of Performance Units or Performance Shares intended
to qualify as “performance-based compensation” within the meaning of Section 162(m) of the Code,
(i) no Participant will receive more than 300,000 Performance Shares, and (ii) no Participant will
receive Performance Units having an initial value greater than $4,000,000. Notwithstanding the
foregoing limitation, in connection with a Participant’s initial service as an Employee, for
Performance Shares intended to qualify as “performance-based compensation” within the meaning of
Section 162(m) of the Code, an Employee may be granted up to an additional 300,000 Performance
Shares. The foregoing limitations will be adjusted proportionately in connection with any change in
the Company’s capitalization as described in Section 15.



     (b) Value of Performance Units/Shares. Each Performance Unit will have an initial
value that is established by the Administrator on or before the date of grant. Each Performance
Share will have an initial value equal to the Fair Market Value of a Share on the date of grant.



     (c) Performance Objectives and Other Terms.



     (i) General. The Administrator will set performance objectives 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 Performance Units/Shares that will be paid out to the Participant. Each Award of Performance
Units/Shares 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 objectives 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.



     (ii) Section 162(m) Performance Objectives. For purposes of qualifying grants of
Performance Units/Shares as “performance-based compensation” under Section 162(m) of the Code, the
Administrator, in its discretion, may determine that the performance objectives applicable to
Performance Units/Shares will be based on the achievement of Performance Goals. In granting
Performance Units/Shares which are intended to qualify as “performance-based compensation” under
Section 162(m) of the Code, the Administrator will follow any procedures determined by it from time
to time to be necessary or appropriate to ensure qualification of the Performance Units/Shares
under Section 162(m) of the Code (e.g., in determining the Performance Goals).



     (d) Earning of Performance Units/Shares. After the applicable Performance Period has
ended, the holder of Performance Units/Shares will be entitled to receive a payout of the number of
Performance Units/Shares earned by the Participant over the Performance Period, to be determined as
a function of the extent to which the corresponding performance objectives or other vesting
provisions have been achieved. After the grant of a Performance Unit/Share, the Administrator, in
its sole discretion, may reduce or waive any performance objectives or other vesting provisions for
such Performance Unit/Share. Unless otherwise provided by the Administrator, all Performance
Units/Shares that are unearned or unvested at the time of the Participant’s termination as a
Service Provider for any or no reason, will be forfeited to the Company and will revert to the Plan
and become available for future grant under the Plan upon the date of such termination and the
Participant’s right to receive any Shares or payment thereunder will immediately terminate.



 









 





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



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



     (g) Section 162(m) Performance Restrictions. For purposes of qualifying grants of
Performance Units/Shares as “performance-based compensation” under Section 162(m) of the Code, the
Administrator, in its discretion, may set restrictions based upon the achievement of Performance
Goals. The Performance Goals will be set by the Administrator on or before the Determination Date.
In granting Performance Units/Shares which are intended to qualify under Section 162(m) of the
Code, the Administrator will follow any procedures determined by it from time to time to be
necessary or appropriate to ensure qualification of the Award under Section 162(m) of the Code
(e.g., in determining the Performance Goals).



     11. Deferred Stock Units.



     (a) General. Deferred Stock Units will consist of Restricted Stock, Restricted Stock
Unit, Performance Share or Performance Unit Awards that the Administrator, in its sole discretion,
permits to be paid out in installments or on a deferred basis, in accordance with rules and
procedures established by the Administrator. Deferred Stock Units will remain subject to the claims
of the Company’s general creditors until distributed to the Participant.



     (b) Code Section 162(m). Deferred Stock Units intended to qualify as
“performance-based compensation” within the meaning of Section 162(m) of the Code will be subject
to the annual Code Section 162(m) limits applicable to the underlying Restricted Stock, Restricted
Stock Unit, Performance Share or Performance Unit Award as set forth in Section 7(b), 8(a) or
10(a), as applicable.



     12. Performance-Based Compensation Under Code Section 162(m).



     (a) General. If the Administrator, in its discretion, decides to grant an Award
intended to qualify as “performance-based compensation” under Section 162(m) of the Code, the
provisions of this Section 12 will control over any contrary provision in the Plan; provided,
however, that the Administrator may in its discretion grant Awards that are not intended to qualify
as “performance-based compensation” under Section 162(m) of the Code to such Participants that are
based on Performance Goals or other specific criteria or goals but that do not satisfy the
requirements of this Section 12.



     (b) Performance Goals. The granting and/or vesting of Awards of Restricted Stock,
Restricted Stock Units, Performance Shares and Performance Units may be made subject to the
attainment of Performance Goals. The Performance Goals may differ from Participant to Participant
and from Award to Award. Any criteria used may be (A) measured in absolute terms, (B) measured in
terms of growth, (C) compared to another company or companies, (D) measured against the market as a
whole and/or according to applicable market indices, (E) measured against the performance of the
Company as a whole or a segment of the Company and/or (F) measured on a pre-tax or post-tax basis
(if applicable). Further, any Performance Goals may be used to measure the performance of the
Company as a whole or a portion of the Company, or one or more product lines or specific markets
and may be measured relative to a peer group or index. The Performance Goals may differ from
Participant to Participant and from Award to Award. Prior to the Determination Date, the
Administrator will determine whether any significant element(s) will be included in or excluded
from the calculation of any Performance Goal with respect to any Participant. In all other
respects, Performance Goals will be calculated in accordance with the Company’s financial
statements, generally accepted accounting principles, or under a methodology established by the
Administrator prior to or at the time of the issuance of an Award and which is consistently applied
with respect to a Performance Goal in the relevant Performance Period. In addition, the
Administrator will adjust any performance criteria, Performance Goal or other feature of an Award
that relates to or is wholly or partially based on the number of, or the value of, any stock of the



 









 




Company, to reflect any stock dividend or split, repurchase, recapitalization, combination, or
exchange of shares or other similar changes in such stock.




     (c) Procedures. To the extent necessary to comply with the performance-based
compensation provisions of Section 162(m) of the Code, with respect to any Award granted subject to
Performance Goals and intended to qualify as “performance-based compensation” under Section 162(m)
of the Code, within the first twenty-five percent (25%) of the Performance Period, but in no event
more than ninety (90) days following the commencement of any Performance Period (or such other time
as may be required or permitted by Section 162(m) of the Code), the Administrator will, in writing,
(i) designate one or more Participants to whom an Award will be made, (ii) select the Performance
Goals applicable to the Performance Period, (iii) establish the Performance Goals, and amounts of
such Awards, as applicable, which may be earned for such Performance Period, and (iv) specify the
relationship between Performance Goals and the amounts of such Awards, as applicable, to be earned
by each Participant for such Performance Period.



     (d) Additional Limitations. Notwithstanding any other provision of the Plan, any
Award which is granted to a Participant and is intended to constitute qualified performance-based
compensation under Section 162(m) of the Code will be subject to any additional limitations set
forth in the Code (including any amendment to Section 162(m)) or any regulations and ruling issued
thereunder that are requirements for qualification as qualified performance-based compensation as
described in Section 162(m) of the Code, and the Plan will be deemed amended to the extent
necessary to conform to such requirements.



     (e) Determination of Amounts Earned. Following the completion of each Performance
Period, the Administrator will certify in writing whether the applicable Performance Goals have
been achieved for such Performance Period. A Participant will be eligible to receive payment
pursuant to an Award intended to qualify as “performance-based compensation” under Section 162(m)
of the Code for a Performance Period only if the Performance Goals for such period are achieved. In
determining the amounts earned by a Participant pursuant to an Award intended to qualified as
“performance-based compensation” under Section 162(m) of the Code, the Administrator will have the
right to (a) reduce or eliminate (but not to increase) the amount payable at a given level of
performance to take into account additional factors that the Administrator may deem relevant to the
assessment of individual or corporate performance for the Performance Period, (b) determine what
actual Award, if any, will be paid in the event of a termination of employment as the result of a
Participant’s death or disability or upon a Change in Control or in the event of a termination of
employment following a Change in Control prior to the end of the Performance Period, and (c)
determine what actual Award, if any, will be paid in the event of a termination of employment other
than as the result of a Participant’s death or disability prior to a Change of Control and prior to
the end of the Performance Period to the extent an actual Award would have otherwise been achieved
had the Participant remained employed through the end of the Performance Period.



     13. Leaves of Absence/Transfer Between Locations. Unless the Administrator provides
otherwise, vesting of Awards granted hereunder will be suspended during any unpaid leave of
absence. A Service Provider will 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, or any Subsidiary. For purposes of Incentive Stock Options, no such leave may
exceed three (3) months, 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 six (6) months and one (1) day following the commencement of such leave any
Incentive Stock Option held by the Participant will cease to be treated as an Incentive Stock
Option and will be treated for tax purposes as a Nonstatutory Stock Option.



     14. 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 Participant, only by the Participant. If the Administrator makes an Award
transferable, such Award will contain such additional terms and conditions as the Administrator
deems appropriate.



 









 





     15. Adjustments; Dissolution or Liquidation; Merger or Change in Control.



     (a) Adjustments. In the event that any dividend or other distribution (whether in the
form of cash, Shares, other securities, or other property), recapitalization, stock split, reverse
stock split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase, or
exchange of Shares or other securities of the Company, or other change in the corporate structure
of the Company affecting the Shares occurs, the Administrator, in order to prevent diminution or
enlargement of the benefits or potential benefits intended to be made available under the Plan,
will adjust 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
Section 3 of the Plan.



     (b) Dissolution or Liquidation. In the event of the proposed dissolution or
liquidation of the Company, the Administrator will notify each Participant as soon as practicable
prior to the effective date of such proposed transaction. To the extent it has not been previously
exercised, an Award will terminate immediately prior to the consummation of such proposed action.



     (c) Change in Control. In the event of a merger or Change in Control, each
outstanding Award will be treated as the Administrator determines, including, without limitation,
that each Award be assumed or an equivalent option or right substituted by the successor
corporation or a Parent or Subsidiary of the successor corporation. The Administrator will not be
required to treat all Awards similarly in the transaction.



     In the event that the successor corporation does not assume or substitute for the Award, 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 and Restricted Stock Units will lapse,
and, with respect to Awards with performance-based vesting, all performance goals or other vesting
criteria will be deemed achieved at one hundred percent (100%) of target levels and all other terms
and conditions met. In addition, if an Option or Stock Appreciation Right is not assumed or
substituted in the event of a Change in Control, the Administrator will notify the Participant in
writing or electronically that the Option or Stock Appreciation Right will be exercisable for a
period of time determined by the Administrator in its sole discretion, and the Option or Stock
Appreciation Right will terminate upon the expiration of such period.



     For the purposes of this subsection (c), an Award will be considered assumed if, following the
Change in Control, the Award confers the right to purchase or receive, for each Share subject to
the Award immediately prior to the Change in Control, the consideration (whether stock, cash, or
other securities or property) received in the Change in Control 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 Change in Control 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,
Performance Unit or Performance Share, for each Share subject to such Award, 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 Change in Control.



     Notwithstanding anything in this Section 15(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 without the Participant’s
consent; provided, however, a modification to such performance goals only to reflect the successor
corporation’s post-Change in Control corporate structure will not be deemed to invalidate an
otherwise valid Award assumption.



     (d) Outside Director Awards. With respect to Awards granted to an Outside Director
that are assumed or substituted for, if on the date of or following such assumption or substitution
the Participant’s status as a Director or a director of the successor corporation, as applicable,
is terminated other than upon a voluntary resignation by the Participant (unless such resignation
is at the request of the acquirer), then the Participant will fully vest in and have the right to
exercise Options and/or Stock Appreciation Rights as to all of the Shares underlying such Award,
including those Shares which would not otherwise be vested or exercisable, all restrictions on
Restricted Stock and Restricted Stock Units will lapse, and, with respect to Performance Units and
Performance Shares, all performance



 









 




goals or other vesting criteria will be deemed achieved at one hundred percent (100%) of
target levels and all other terms and conditions met.




     16. Code Section 409A. It is intended that Awards under this Plan will be either
exempt from the application of, or comply with, the requirements of Section 409A so that the grant,
payment, settlement or deferral thereof will not be subject to the additional tax imposed under
Section 409A, and any ambiguities and ambiguous terms herein shall be interpreted to so comply or
be exempt. The Company may, in good faith and without the consent of any Participant, make any
amendments to this Plan and take such reasonable actions which it deems necessary, appropriate or
desirable to avoid imposition of any additional tax or income recognition under Section 409A prior
to actual payment to any Participant.



     17. Tax Withholding.



     (a) Withholding Requirements. Prior to the delivery of any Shares or cash pursuant to
an Award (or exercise thereof), the Company will have the power and the right to deduct or
withhold, or require a Participant to remit to the Company, an amount sufficient to satisfy
federal, state, local, foreign or other taxes (including the Participant’s FICA obligation)
required to be withheld with respect to such Award (or exercise thereof).



     (b) Withholding Arrangements. The Administrator, in its sole discretion and pursuant
to such procedures as it may specify from time to time, may permit a Participant to satisfy such
tax withholding obligation, in whole or in part by (without limitation) (a) paying cash, (b)
electing to have the Company withhold otherwise deliverable cash or Shares having a Fair Market
Value equal to the minimum statutory amount required to be withheld, or (c) delivering to the
Company already-owned Shares having a Fair Market Value equal to the minimum statutory amount
required to be withheld. The Fair Market Value of the Shares to be withheld or delivered will be
determined as of the date that the taxes are required to be withheld.



     18. No Effect on Employment or Service. Neither the Plan nor any Award will confer
upon a Participant any right with respect to continuing the Participant’s relationship as a Service
Provider with the Company, nor will they interfere in any way with the Participant’s right or the
Company’s right to terminate such relationship at any time, with or without cause, to the extent
permitted by Applicable Laws.



     19. Date of Grant. The date of grant of an Award will 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 will be provided to each
Participant within a reasonable time after the date of such grant.



     20. Term of Plan. Subject to Section 24 of the Plan, the Plan will become effective
upon its adoption by the Board. It will continue in effect for a term of ten (10) years from the
date adopted by the Board, unless terminated earlier under Section 21 of the Plan.



     21. Amendment and Termination of the Plan.



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



     (b) Stockholder Approval. The Company will obtain stockholder approval of any Plan
amendment to the extent necessary and desirable to comply with Applicable Laws.



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



 









 





     22. Conditions Upon Issuance of Shares.



     (a) Legal Compliance. Shares will not be issued pursuant to the exercise of an Award
unless the exercise of such Award and the issuance and delivery of such Shares will comply with
Applicable Laws and will 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.



     23. 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, will relieve the Company of
any liability in respect of the failure to issue or sell such Shares as to which such requisite
authority will not have been obtained.



     24. Stockholder Approval. The Plan will be subject to approval by the stockholders
of the Company within twelve (12) months after the date the Plan is adopted by the Board. Such
stockholder approval will be obtained in the manner and to the degree required under Applicable
Laws.