exv10w1






Exhibit 10.1




OXiGENE, INC.

2005 STOCK PLAN

(as amended on October 31, 2011)



1. DEFINITIONS.



Unless otherwise specified or unless the context otherwise requires, the following terms, as used
in this OXiGENE, Inc. 2005 Stock Plan, have the following meanings:



Administrator means the Board of Directors, unless it has delegated power to act on its
behalf to the Committee, in which case the Administrator means the Committee.



Affiliate means a corporation which, for purposes of Section 424 of the Code, is a parent
or subsidiary of the Company, direct or indirect.



Agreement means an agreement between the Company and a Participant delivered pursuant to
the Plan, in such form as the Administrator shall approve.



Board of Directors means the Board of Directors of the Company.



Code means the United States Internal Revenue Code of 1986, as amended.



Committee means the committee of the Board of Directors to which the Board of Directors has
delegated power to act under or pursuant to the provisions of the Plan.



Common Stock means shares of the Company’s common stock, $.01 par value per share.



Company means OXiGENE, Inc., a Delaware corporation.



Disability or Disabled means permanent and total disability as defined in Section
22(e)(3) of the Code.



Employee means any employee of the Company or of an Affiliate (including, without
limitation, an employee who is also serving as an officer or director of the Company or of an
Affiliate), designated by the Administrator to be eligible to be granted one or more Stock Rights
under the Plan.



Fair Market Value of a Share of Common Stock means:





(1) If the Common Stock is listed on a national securities exchange or traded in the
over-the-counter market and sales prices are regularly reported for the Common Stock, the
closing or last price of the Common Stock on the composite tape or other comparable
reporting system for the trading day on the applicable date and if such date is not a
trading day, the last market trading day prior to such date;




(2) If the Common Stock is not traded on a national securities exchange but is traded
on the over-the-counter market, if sales prices are not regularly reported for the Common
Stock for the trading day referred to in clause (1), and if bid and asked prices for the
Common Stock are regularly reported, the mean between the bid and the asked price for



 









 






the Common Stock at the close of trading in the over-the-counter market for the trading day
on which Common Stock was traded on the applicable date and if such date is not a trading
day, the last market trading day prior to such date; and




(3) If the Common Stock is neither listed on a national securities exchange nor traded in
the over-the-counter market, such value as the Administrator, in good faith, shall
determine.


ISO means an option meant to qualify as an incentive stock option under Section 422 of the
Code.



Non-Qualified Option means an option which is not intended to qualify as an ISO.



Option means an ISO or Non-Qualified Option granted under the Plan.



Participant means an Employee, director or consultant of the Company or an Affiliate to
whom one or more Stock Rights are granted under the Plan. As used herein, “Participant” shall
include “Participant’s Survivors” where the context requires.



Plan means this OXiGENE, Inc. 2005 Stock Plan.



Shares means shares of the Common Stock as to which Stock Rights have been or may be
granted under the Plan or any shares of capital stock into which the Shares are changed or for
which they are exchanged within the provisions of Paragraph 3 of the Plan. The Shares issued under
the Plan may be authorized and unissued shares or shares held by the Company in its treasury, or
both.



Stock-Based Award means a grant by the Company under the Plan of an equity award or equity
based award which is not an Option or Stock Grant.



Stock Grant means a grant by the Company of Shares under the Plan.



Stock Right means a right to Shares or the value of Shares of the Company granted pursuant
to the Plan — an ISO, a Non-Qualified Option, a Stock Grant or a Stock-Based Award.



Survivor means a deceased Participant’s legal representatives and/or any person or persons
who acquired the Participant’s rights to a Stock Right by will or by the laws of descent and
distribution.



2. PURPOSES OF THE PLAN.



The Plan is intended to encourage ownership of Shares by Employees and directors of and certain
consultants to the Company in order to attract such people, to induce them to work for the benefit
of the Company or of an Affiliate and to provide additional incentive for them to promote the
success of the Company or of an Affiliate. The Plan provides for the granting of ISOs,
Non-Qualified Options, Stock Grants and Stock-Based Awards.










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3. SHARES SUBJECT TO THE PLAN.



(a) The number of Shares which may be issued from time to time pursuant to this Plan, shall be
2,500,000 shares of Common Stock or the
equivalent of such number of Shares after the Administrator, in its sole discretion, has
interpreted the effect of any stock split, stock dividend, combination, recapitalization or similar
transaction in accordance with Paragraph 24 of the Plan.



(b) If an Option ceases to be outstanding, in whole or in part (other than by exercise), or if the
Company shall reacquire (at no more than its original issuance price) any Shares issued pursuant to
a Stock Grant or Stock-Based Award, or if any Stock Right expires or is forfeited, cancelled, or
otherwise terminated or results in any Shares not being issued, the unissued or reacquired Shares
which were subject to such Stock Right shall again be available for issuance from time to time
pursuant to this Plan. Notwithstanding the foregoing, if a Stock Right is exercised, in whole or
in part, by tender of Shares or if the Company or an Affiliate’s tax withholding obligation is
satisfied by withholding Shares, the number of Shares deemed to have been issued under the Plan for
purposes of the limitation set forth in Paragraph 3(a) above shall be the number of Shares that
were subject to the Stock Right or portion thereof, and not the net number of Shares actually
issued.



4. ADMINISTRATION OF THE PLAN.



The Administrator of the Plan will be the Board of Directors, except to the extent the Board of
Directors delegates its authority to the Committee, in which case the Committee shall be the
Administrator. Subject to the provisions of the Plan, the Administrator is authorized to:





a. Interpret the provisions of the Plan and all Stock Rights and to make all rules and
determinations which it deems necessary or advisable for the administration of the Plan;




b. Determine which Employees, directors and consultants shall be granted Stock Rights;




c. Determine the number of Shares for which a Stock Right or Stock Rights shall be granted;
provided, however, that in no event shall Stock Rights with respect to more than 200,000
Shares be granted to any Participant in any fiscal year;




d. Specify the terms and conditions upon which a Stock Right or Stock Rights may be granted;
and




e. Adopt any sub-plans applicable to residents of any specified jurisdiction as it deems
necessary or appropriate in order to comply with or take advantage of any tax or other laws
applicable to the Company or to Plan Participants or to otherwise facilitate the
administration of the Plan, which sub-plans may include additional restrictions or
conditions applicable to Stock Rights or Shares issuable pursuant to a Stock Right;



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provided, however, that all such interpretations, rules, determinations, terms and conditions shall
be made and prescribed in the context of not causing any adverse tax consequences under Section
409A of the Code and preserving the tax status under Section 422 of the Code of those Options which
are designated as ISOs. Subject to the foregoing, the interpretation and construction by the
Administrator of any provisions of the Plan or of any Stock Right granted under it shall be final,
unless otherwise determined by the Board of Directors, if the Administrator is the Committee. In
addition, if the Administrator is the Committee, the Board of Directors may take any action under
the Plan that would otherwise be the responsibility of the Committee.



To the extent permitted under applicable law, the Board of Directors or the Committee may allocate
all or any portion of its responsibilities and powers to any one or more of its members and may
delegate all or any portion of its responsibilities and powers to any person selected by it. The
Board of Directors or the Committee may revoke any such allocation or delegation at any time.



5. ELIGIBILITY FOR PARTICIPATION.



The Administrator will, in its sole discretion, name the Participants in the Plan, provided,
however, that each Participant must be an Employee, director or consultant of the Company or of an
Affiliate at the time a Stock Right is granted. Notwithstanding the foregoing, the Administrator
may authorize the grant of a Stock Right to a person not then an Employee, director or consultant
of the Company or of an Affiliate; provided, however, that the actual grant of such Stock Right
shall be conditioned upon such person becoming eligible to become a Participant at or prior to the
time of the execution of the Agreement evidencing such Stock Right. ISOs may be granted only to
Employees. Non-Qualified Options, Stock Grants and Stock-Based Awards may be granted to any
Employee, director or consultant of the Company or an Affiliate. The granting of any Stock Right to
any individual shall neither entitle that individual to, nor disqualify him or her from,
participation in any other grant of Stock Rights.



6. TERMS AND CONDITIONS OF OPTIONS.



Each Option shall be set forth in writing in an Option Agreement, duly executed by the Company and,
to the extent required by law or requested by the Company, by the Participant. The Administrator
may provide that Options be granted subject to such terms and conditions, consistent with the terms
and conditions specifically required under this Plan, as the Administrator may deem appropriate
including, without limitation, subsequent approval by the shareholders of the Company of this Plan
or any amendments thereto. The Option Agreements shall be subject to at least the following terms
and conditions:



A. Non-Qualified Options: Each Option intended to be a Non-Qualified Option shall be
subject to the terms and conditions which the Administrator determines to be appropriate and in the
best interest of the Company, subject to the following minimum standards for any such Non-Qualified
Option:





a. Option Price: Each Option Agreement shall state the option price (per share) of
the Shares covered by each Option, which option price shall be determined by the



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Administrator but shall not be less than the Fair Market Value per share of Common Stock.




b. Number of Shares: Each Option Agreement shall state the number of Shares to which
it pertains.




c. Option Periods: Each Option Agreement shall state the date or dates on which it
first is exercisable and the date after which it may no longer be exercised, and may provide
that the Option rights accrue or become exercisable in installments over a period of months
or years, or upon the occurrence of certain conditions or the attainment of stated goals or
events.




d. Option Conditions: Exercise of any Option may be conditioned upon the
Participant’s execution of a Share purchase agreement in form satisfactory to the
Administrator providing for certain protections for the Company and its other shareholders,
including requirements that:




i. The Participant’s or the Participant’s Survivors’ right to sell or transfer the
Shares may be restricted; and




ii. The Participant or the Participant’s Survivors may be required to execute letters of
investment intent and must also acknowledge that the Shares will bear legends noting any
applicable restrictions.




e. Option Term: Each Option shall terminate not more than ten years from the date of
the grant or at such earlier time as the Option Agreement may provide.


B. ISOs: Each Option intended to be an ISO shall be issued only to an Employee and be
subject to the following terms and conditions, with such additional restrictions or changes as the
Administrator determines are appropriate but not in conflict with Section 422 of the Code and
relevant regulations and rulings of the Internal Revenue Service:





a. Minimum Standards: The ISO shall meet the minimum standards required of
Non-Qualified Options, as described in Paragraph 6(A) above, except clause (a) thereunder.




b. Option Price: Immediately before the ISO is granted, if the Participant owns,
directly or by reason of the applicable attribution rules in Section 424(d) of the Code:




i. 10% or less of the total combined voting power of all classes of stock of the
Company or an Affiliate, the Option price per share of the Shares covered by each ISO
shall not be less than 100% of the Fair Market Value per share of the Shares on the date
of the grant of the Option; or




ii. More than 10% of the total combined voting power of all classes of stock of the
Company or an Affiliate, the Option price per share of the Shares covered by each ISO
shall not be less than 110% of the Fair Market Value on the date of grant.




c. Term of Option: For Participants who own:



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i. 10% or less of the total combined voting power of all classes of stock of the
Company or an Affiliate, each ISO shall terminate not more than ten years from the date
of the grant or at such earlier time as the Option Agreement may provide; or




ii. More than 10% of the total combined voting power of all classes of stock of the
Company or an Affiliate, each ISO shall terminate not more than five years from the date
of the grant or at such earlier time as the Option Agreement may provide.




d. Limitation on Yearly Exercise: The Option Agreements shall restrict the amount of
ISOs which may become exercisable in any calendar year (under this or any other ISO plan of
the Company or an Affiliate) so that the aggregate Fair Market Value (determined at the time
each ISO is granted) of the stock with respect to which ISOs are exercisable for the first
time by the Participant in any calendar year does not exceed $100,000.


7. TERMS AND CONDITIONS OF STOCK GRANTS.



Each offer of a Stock Grant to a Participant shall state the date prior to which the Stock Grant
must be accepted by the Participant, and the principal terms of each Stock Grant shall be set forth
in an Agreement, duly executed by the Company and, to the extent required by law or requested by
the Company, by the Participant. The Agreement shall be in a form approved by the Administrator and
shall contain terms and conditions which the Administrator determines to be appropriate and in the
best interest of the Company, subject to the following minimum standards:





(a) Each Agreement shall state the purchase price (per share), if any, of the Shares covered
by each Stock Grant, which purchase price shall be determined by the Administrator but shall
not be less than the minimum consideration required by the Delaware General Corporation Law
on the date of the grant of the Stock Grant;




(b) Each Agreement shall state the number of Shares to which the Stock Grant pertains; and




(c) Each Agreement shall include the terms of any right of the Company to restrict or
reacquire the Shares subject to the Stock Grant, including the time and events upon which
such rights shall accrue and the purchase price therefor, if any.


8. TERMS AND CONDITIONS OF OTHER STOCK-BASED AWARDS.



The Board shall have the right to grant other Stock-Based Awards based upon the Common Stock having
such terms and conditions as the Board may determine, including, without limitation, the grant of
Shares based upon certain conditions, the grant of securities convertible into Shares and the grant
of stock appreciation rights, phantom stock awards or stock units. The principal terms of each
Stock-Based Award shall be set forth in an Agreement, duly executed by the Company and, to the
extent required by law or requested by the Company, by the Participant. The Agreement shall be in a
form approved by the Administrator and shall contain terms and conditions which the Administrator
determines to be appropriate and in the best interest of the Company.



The Company intends that the Plan and any Stock-Based Awards granted hereunder be exempt from the
application of Section 409A of the Code or meet the requirements of paragraphs (2), (3)


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and (4) of subsection (a) of Section 409A of the Code, to the extent applicable, and be operated in
accordance with Section 409A so that any compensation deferred under any Stock-Based Award (and
applicable investment earnings) shall not be included in income under Section 409A of the Code.
Any ambiguities in the Plan shall be construed to effect the intent as described in this Paragraph
8.



9. EXERCISE OF OPTIONS AND ISSUE OF SHARES.



An Option (or any part or installment thereof) shall be exercised by giving written notice to the
Company or its designee, together with provision for payment of the full purchase price in
accordance with this Paragraph for the Shares as to which the Option is being exercised, and upon
compliance with any other condition(s) set forth in the Option Agreement. Such notice shall be
signed by the person exercising the Option, shall state the number of Shares with respect to which
the Option is being exercised and shall contain any representation required by the Plan or the
Option Agreement. Payment of the purchase price for the Shares as to which such Option is being
exercised shall be made (a) in United States dollars in cash or by check, or (b) at the discretion
of the Administrator, through delivery of shares of Common Stock having a Fair Market Value equal
as of the date of the exercise to the cash exercise price of the Option, or (c) at the discretion
of the Administrator, by having the Company retain from the shares otherwise issuable upon exercise
of the Option, a number of shares having a Fair Market Value equal as of the date of exercise to
the exercise price of the Option, or (d) at the discretion of the Administrator, by delivery of the
grantee’s personal recourse note, bearing interest payable not less than annually at no less than
100% of the applicable Federal rate, as defined in Section 1274(d) of the Code, with or without the
pledge of such Shares as collateral, or (e) at the discretion of the Administrator, in accordance
with a cashless exercise program established with a securities brokerage firm, and approved by the
Administrator, or (f) at the discretion of the Administrator, by any combination of (a), (b), (c),
(d) and (e) above, or (g) at the discretion of the Administrator, payment of such other lawful
consideration as the Board may determine. Notwithstanding the foregoing, the Administrator shall
accept only such payment on exercise of an ISO as is permitted by Section 422 of the Code.



The Company shall then reasonably promptly deliver the Shares as to which such Option was exercised
to the Participant (or to the Participant’s Survivors, as the case may be). In determining what
constitutes “reasonably promptly,” it is expressly understood that the issuance and delivery of the
Shares may be delayed by the Company in order to comply with any law or regulation (including,
without limitation, state securities or “blue sky” laws) which requires the Company to take any
action with respect to the Shares prior to their issuance. The Shares shall, upon delivery, be
fully paid, non-assessable Shares.



The Administrator shall have the right to accelerate the date of exercise of any installment of any
Option; provided that the Administrator shall not accelerate the exercise date of any installment
of any Option granted to an Employee as an ISO (and not previously converted into a Non-Qualified
Option pursuant to Paragraph 27) if such acceleration would violate the annual vesting limitation
contained in Section 422(d) of the Code, as described in Paragraph 6.B.d.








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The Administrator may, in its discretion, amend any term or condition of an outstanding Option
provided (i) such term or condition as amended is permitted by the Plan, (ii) any such amendment
shall be made only with the consent of the Participant to whom the Option was granted, or in the
event of the death of the Participant, the Participant’s Survivors, if the amendment is adverse to
the Participant, and (iii) any such amendment of any Option shall be made only after the
Administrator determines whether such amendment would constitute a “modification” of any Option
which is an ISO (as that term is defined in Section 424(h) of the Code) or would cause any adverse
tax consequences for the holder of any Option including, but not limited to, pursuant to Section
409A of the Code.





	10.	 	ACCEPTANCE OF STOCK GRANTS AND STOCK-BASED AWARDS AND ISSUE OF SHARES.




A Stock Grant or Stock-Based Award (or any part or installment thereof) shall be accepted by
executing the applicable Agreement and delivering it to the Company or its designee, together with
provision for payment of the full purchase price, if any, in accordance with this Paragraph for the
Shares as to which such Stock Grant or Stock-Based Award is being accepted, and upon compliance
with any other conditions set forth in the applicable Agreement. Payment of the purchase price for
the Shares as to which such Stock Grant or Stock-Based Award is being accepted shall be made (a) in
United States dollars in cash or by check, or (b) at the discretion of the Administrator, through
delivery of shares of Common Stock having a Fair Market Value equal as of the date of acceptance of
the Stock Grant or Stock-Based Award to the purchase price of the Stock Grant or Stock-Based Award,
or (c) at the discretion of the Administrator, by delivery of the grantee’s personal recourse note
bearing interest payable not less than annually at no less than 100% of the applicable Federal
rate, as defined in Section 1274(d) of the Code, or (d) at the discretion of the Administrator, by
any combination of (a), (b) and (c) above.



The Company shall then, if required pursuant to the applicable Agreement, reasonably promptly
deliver the Shares as to which such Stock Grant or Stock-Based Award was accepted to the
Participant (or to the Participant’s Survivors, as the case may be), subject to any escrow
provision set forth in the applicable Agreement. In determining what constitutes “reasonably
promptly,” it is expressly understood that the issuance and delivery of the Shares may be delayed
by the Company in order to comply with any law or regulation (including, without limitation, state
securities or “blue sky” laws) which requires the Company to take any action with respect to the
Shares prior to their issuance.



The Administrator may, in its discretion, amend any term or condition of an outstanding Stock
Grant, Stock-Based Award or applicable Agreement provided (i) such term or condition as amended is
permitted by the Plan, (ii) any such amendment shall be made only with the consent of the
Participant to whom the Stock Grant or Stock-Based Award was made, if the amendment is adverse to
the Participant and (iii) any such amendment shall be made only after the Administrator determines
whether such amendment would cause any adverse tax consequences to the Participant, including, but
not limited to, pursuant to Section 409A of the Code.




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11. RIGHTS AS A SHAREHOLDER.



No Participant to whom a Stock Right has been granted shall have rights as a shareholder with
respect to any Shares covered by such Stock Right, except after due exercise of the Option or
acceptance of the Stock Grant or as set forth in any Agreement and tender of the full purchase
price, if any, for the Shares being purchased pursuant to such exercise or acceptance and
registration of the Shares in the Company’s share register in the name of the Participant.



12. ASSIGNABILITY AND TRANSFERABILITY OF STOCK RIGHTS.



By its terms, a Stock Right granted to a Participant shall not be transferable by the Participant
other than (i) by will or by the laws of descent and distribution, or (ii) as approved by the
Administrator in its discretion and set forth in the applicable Agreement provided that no Stock
Right may be transferred by a Participant for value. Notwithstanding the foregoing, an ISO
transferred except in compliance with clause (i) above shall no longer qualify as an ISO. The
designation of a beneficiary of a Stock Right by a Participant, with the prior approval of the
Administrator and in such form as the Administrator shall prescribe, shall not be deemed a transfer
prohibited by this Paragraph. Except as provided above, a Stock Right shall only be exercisable or
may only be accepted, during the Participant’s lifetime, by such Participant (or by his or her
legal representative) and shall not be assigned, pledged or hypothecated in any way (whether by
operation of law or otherwise) and shall not be subject to execution, attachment or similar
process. Any attempted transfer, assignment, pledge, hypothecation or other disposition of any
Stock Right or of any rights granted thereunder contrary to the provisions of this Plan, or the
levy of any attachment or similar process upon a Stock Right, shall be null and void.



13. EFFECT ON OPTIONS OF TERMINATION OF SERVICE OTHER THAN “FOR CAUSE” OR DEATH OR
DISABILITY.



Except as otherwise provided in a Participant’s Option Agreement, in the event of a termination of
service (whether as an employee, director or consultant) with the Company or an Affiliate before
the Participant has exercised an Option, the following rules apply:





a. A Participant who ceases to be an employee, director or consultant of the Company or of
an Affiliate (for any reason other than termination “for cause”, Disability, or death for
which events there are special rules in Paragraphs 14, 15, and 16, respectively), may
exercise any Option granted to him or her to the extent that the Option is exercisable on
the date of such termination of service, but only within such term as the Administrator has
designated in a Participant’s Option Agreement.




b. Except as provided in Subparagraph (c) below, or Paragraph 15 or 16, in no event may an
Option intended to be an ISO, be exercised later than three months after the Participant’s
termination of employment.




c. The provisions of this Paragraph, and not the provisions of Paragraph 15 or 16, shall
apply to a Participant who subsequently becomes Disabled or dies after the termination of
employment, director status or consultancy; provided, however, in the case of a
Participant’s Disability or death within three months after the termination of employment,
director status or consultancy, the Participant or the Participant’s Survivors may exercise



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the Option within one year after the date of the Participant’s termination of service, but
in no event after the date of expiration of the term of the Option.




d. Notwithstanding anything herein to the contrary, if subsequent to a Participant’s
termination of employment, termination of director status or termination of consultancy, but
prior to the exercise of an Option, the Board of Directors determines that, either prior or
subsequent to the Participant’s termination, the Participant engaged in conduct which would
constitute “cause”, then such Participant shall forthwith cease to have any right to
exercise any Option.




e. A Participant to whom an Option has been granted under the Plan who is absent from the
Company or an Affiliate because of temporary disability (any disability other than a
Disability as defined in Paragraph 1 hereof), or who is on leave of absence for any purpose,
shall not, during the period of any such absence, be deemed, by virtue of such absence
alone, to have terminated such Participant’s employment, director status or consultancy with
the Company or with an Affiliate, except as the Administrator may otherwise expressly
provide.




f. Except as required by law or as set forth in a Participant’s Option Agreement, Options
granted under the Plan shall not be affected by any change of a Participant’s status within
or among the Company and any Affiliates, so long as the Participant continues to be an
employee, director or consultant of the Company or any Affiliate.


14. EFFECT ON OPTIONS OF TERMINATION OF SERVICE “FOR CAUSE”.



Except as otherwise provided in a Participant’s Option Agreement, the following rules apply if the
Participant’s service (whether as an employee, director or consultant) with the Company or an
Affiliate is terminated “for cause” prior to the time that all his or her outstanding Options have
been exercised:





a. All outstanding and unexercised Options as of the time the Participant is notified his or
her service is terminated “for cause” will immediately be forfeited.




b. For purposes of this Plan, “cause” shall include (and is not limited to) dishonesty with
respect to the Company or any Affiliate, insubordination, substantial malfeasance or
non-feasance of duty, unauthorized disclosure of confidential information, breach by the
Participant of any provision of any employment, consulting, advisory, nondisclosure,
non-competition or similar agreement between the Participant and the Company, and conduct
substantially prejudicial to the business of the Company or any Affiliate. The determination
of the Administrator as to the existence of “cause” will be conclusive on the Participant
and the Company.




c. “Cause” is not limited to events which have occurred prior to a Participant’s termination
of service, nor is it necessary that the Administrator’s finding of “cause” occur prior to
termination. If the Administrator determines, subsequent to a Participant’s termination of
service but prior to the exercise of an Option, that either prior or subsequent to the
Participant’s termination the Participant engaged in conduct which would constitute “cause”,
then the right to exercise any Option is forfeited.



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d. Any provision in an agreement between the Participant and the Company or an Affiliate,
which contains a conflicting definition of “cause” for termination and which is in effect at
the time of such termination, shall supersede the definition in this Plan with respect to
that Participant.


15. EFFECT ON OPTIONS OF TERMINATION OF SERVICE FOR DISABILITY.



Except as otherwise provided in a Participant’s Option Agreement, a Participant who ceases to be an
employee, director or consultant of the Company or of an Affiliate by reason of Disability may
exercise any Option granted to such Participant:





a. To the extent that the Option has become exercisable but has not been exercised on the
date of Disability; and




b. In the event rights to exercise the Option accrue periodically, to the extent of a pro
rata portion through the date of Disability of any additional vesting rights that would have
accrued on the next vesting date had the Participant not become Disabled. The proration
shall be based upon the number of days accrued in the current vesting period prior to the
date of Disability.


A Disabled Participant may exercise such rights only within the period ending one year after the
date of the Participant’s termination of employment, directorship or consultancy, as the case may
be, notwithstanding that the Participant might have been able to exercise the Option as to some or
all of the Shares on a later date if the Participant had not become Disabled and had continued to
be an employee, director or consultant or, if earlier, within the originally prescribed term of the
Option.



The Administrator shall make the determination both of whether Disability has occurred and the date
of its occurrence (unless a procedure for such determination is set forth in another agreement
between the Company and such Participant, in which case such procedure shall be used for such
determination). If requested, the Participant shall be examined by a physician selected or approved
by the Administrator, the cost of which examination shall be paid for by the Company.



16. EFFECT ON OPTIONS OF DEATH WHILE AN EMPLOYEE, DIRECTOR OR CONSULTANT.



Except as otherwise provided in a Participant’s Option Agreement, in the event of the death of a
Participant while the Participant is an employee, director or consultant of the Company or of an
Affiliate, such Option may be exercised by the Participant’s Survivors:





a. To the extent that the Option has become exercisable but has not been exercised on the
date of death; and




b. In the event rights to exercise the Option accrue periodically, to the extent of a pro
rata portion through the date of death of any additional vesting rights that would have
accrued on the next vesting date had the Participant not died. The proration shall be based
upon



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the number of days accrued in the current vesting period prior to the Participant’s date of
death.


If the Participant’s Survivors wish to exercise the Option, they must take all necessary steps to
exercise the Option within one year after the date of death of such Participant, notwithstanding
that the decedent might have been able to exercise the Option as to some or all of the Shares on a
later date if he or she had not died and had continued to be an employee, director or consultant
or, if earlier, within the originally prescribed term of the Option.



17. EFFECT OF TERMINATION OF SERVICE ON UNACCEPTED STOCK GRANTS.



In the event of a termination of service (whether as an employee, director or consultant) with the
Company or an Affiliate for any reason before the Participant has accepted a Stock Grant, such
offer shall terminate.



For purposes of this Paragraph 17 and Paragraph 18 below, a Participant to whom a Stock Grant has
been offered and accepted under the Plan who is absent from work with the Company or with an
Affiliate because of temporary disability (any disability other than a permanent and total
Disability as defined in Paragraph 1 hereof), or who is on leave of absence for any purpose, shall
not, during the period of any such absence, be deemed, by virtue of such absence alone, to have
terminated such Participant’s employment, director status or consultancy with the Company or with
an Affiliate, except as the Administrator may otherwise expressly provide.



In addition, for purposes of this Paragraph 17 and Paragraph 18 below, any change of employment or
other service within or among the Company and any Affiliates shall not be treated as a termination
of employment, director status or consultancy so long as the Participant continues to be an
employee, director or consultant of the Company or any Affiliate.



18. EFFECT ON STOCK GRANTS OF TERMINATION OF SERVICE OTHER THAN “FOR CAUSE” OR DEATH OR
DISABILITY.



Except as otherwise provided in a Participant’s Agreement, in the event of a termination of service
(whether as an employee, director or consultant), other than termination “for cause,” Disability,
or death for which events there are special rules in Paragraphs 19, 20, and 21, respectively,
before all forfeiture provisions or Company rights of repurchase shall have lapsed, then the
Company shall have the right to cancel or repurchase that number of Shares subject to a Stock Grant
as to which the Company’s forfeiture or repurchase rights have not lapsed.



19. EFFECT ON STOCK GRANTS OF TERMINATION OF SERVICE “FOR CAUSE”.



Except as otherwise provided in a Participant’s Agreement, the following rules apply if the
Participant’s service (whether as an employee, director or consultant) with the Company or an
Affiliate is terminated “for cause”:





     a. All Shares subject to any Stock Grant that remain subject to forfeiture provisions
or as to which the Company shall have a repurchase right shall be immediately



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forfeited to the Company as of the time the Participant is notified his or her service is
terminated for Cause.




     b. For purposes of this Plan, “cause” shall include (and is not limited to) dishonesty
with respect to the employer, insubordination, substantial malfeasance or non-feasance of
duty, unauthorized disclosure of confidential information, breach by the Participant of any
provision of any employment, consulting, advisory, nondisclosure, non-competition or similar
agreement between the Participant and the Company, and conduct substantially prejudicial to
the business of the Company or any Affiliate. The determination of the Administrator as to
the existence of “cause” will be conclusive on the Participant and the Company.




     c. “Cause” is not limited to events which have occurred prior to a Participant’s termination
of service, nor is it necessary that the Administrator’s finding of “cause” occur prior to
termination. If the Administrator determines, subsequent to a Participant’s termination of
service, that either prior or subsequent to the Participant’s termination the Participant
engaged in conduct which would constitute “cause,” then all Shares subject to any Stock
Grant that remained subject to forfeiture provisions or as to which the Company had a
repurchase right on the date of termination shall be immediately forfeited to the Company.




     d. Any provision in an agreement between the Participant and the Company or an Affiliate,
which contains a conflicting definition of “cause” for termination and which is in effect at
the time of such termination, shall supersede the definition in this Plan with respect to
that Participant.


20. EFFECT ON STOCK GRANTS OF TERMINATION OF SERVICE FOR DISABILITY.



Except as otherwise provided in a Participant’s Agreement, the following rules apply if a
Participant ceases to be an employee, director or consultant of the Company or of an Affiliate by
reason of Disability: to the extent the Company’s forfeiture provisions or rights of repurchase
have not lapsed on the date of Disability, they shall be exercisable; provided, however, that in
the event such forfeiture provisions or rights of repurchase lapse periodically, such provisions or
rights shall lapse to the extent of a pro rata portion of the Shares subject to such Stock Grant
through the date of Disability as would have lapsed had the Participant not become Disabled. The
proration shall be based upon the number of days accrued prior to the date of Disability.



The Administrator shall make the determination both of whether Disability has occurred and the date
of its occurrence (unless a procedure for such determination is set forth in another agreement
between the Company and such Participant, in which case such procedure shall be used for such
determination). If requested, the Participant shall be examined by a physician selected or approved
by the Administrator, the cost of which examination shall be paid for by the Company.




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21. EFFECT ON STOCK GRANTS OF DEATH WHILE AN EMPLOYEE, DIRECTOR OR CONSULTANT.



Except as otherwise provided in a Participant’s Agreement, the following rules apply in the event
of the death of a Participant while the Participant is an employee, director or consultant of the
Company or of an Affiliate: to the extent the Company’s forfeiture provisions or rights of
repurchase have not lapsed on the date of death, they shall be exercisable; provided, however, that
in the event such forfeiture provisions or rights of repurchase lapse periodically, such provisions
or rights shall lapse to the extent of a pro rata portion of the Shares subject to such Stock Grant
through the date of death as would have lapsed had the Participant not died. The proration shall be
based upon the number of days accrued prior to the Participant’s death.



22. PURCHASE FOR INVESTMENT.



Unless the offering and sale of the Shares to be issued upon the particular exercise or acceptance
of a Stock Right shall have been effectively registered under the Securities Act of 1933, as now in
force or hereafter amended (the “1933 Act”), the Company shall be under no obligation to issue the
Shares covered by such exercise unless and until the following conditions have been fulfilled:





a. The person(s) who exercise(s) or accept(s) such Stock Right shall warrant to the Company,
prior to the receipt of such Shares, that such person(s) are acquiring such Shares for their
own respective accounts, for investment, and not with a view to, or for sale in connection
with, the distribution of any such Shares, in which event the person(s) acquiring such
Shares shall be bound by the provisions of the following legend which shall be endorsed upon
the certificate(s) evidencing their Shares issued pursuant to such exercise or such grant:




“The shares represented by this certificate have been taken for investment and they may
not be sold or otherwise transferred by any person, including a pledgee, unless (1)
either (a) a Registration Statement with respect to such shares shall be effective under
the Securities Act of 1933, as amended, or (b) the Company shall have received an
opinion of counsel satisfactory to it that an exemption from registration under such Act
is then available, and (2) there shall have been compliance with all applicable state
securities laws.”




b. At the discretion of the Administrator, the Company shall have received an opinion of its
counsel that the Shares may be issued upon such particular exercise or acceptance in
compliance with the 1933 Act without registration thereunder.


23. DISSOLUTION OR LIQUIDATION OF THE COMPANY.



Upon the dissolution or liquidation of the Company, all Options granted under this Plan which as of
such date shall not have been exercised and all Stock Grants and Stock-Based Awards which have not
been accepted will terminate and become null and void; provided, however, that if the rights of a
Participant or a Participant’s Survivors have not otherwise terminated and expired, the Participant
or the Participant’s Survivors will have the right immediately prior to such dissolution or
liquidation to exercise or accept any Stock Right to the extent that the Stock Right is exercisable
or subject to acceptance as of the date immediately prior to such dissolution or liquidation. Upon
the dissolution or liquidation of the Company, any outstanding Stock-Based






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Awards shall immediately terminate unless otherwise determined by the Administrator or specifically
provided in the applicable Agreement.



24. ADJUSTMENTS.



Upon the occurrence of any of the following events, a Participant’s rights with respect to any
Stock Right granted to him or her hereunder shall be adjusted as hereinafter provided, unless
otherwise specifically provided in a Participant’s Agreement:





A. Stock Dividends and Stock Splits. If (i) the shares of Common Stock shall be
subdivided or combined into a greater or smaller number of shares or if the Company shall
issue any shares of Common Stock as a stock dividend on its outstanding Common Stock, or
(ii) additional shares or new or different shares or other securities of the Company or
other non-cash assets are distributed with respect to such shares of Common Stock, the
number of shares of Common Stock deliverable upon the exercise of an Option or acceptance of
a Stock Grant shall be appropriately increased or decreased proportionately, and appropriate
adjustments shall be made including, in the exercise or purchase price per share, to reflect
such events. The number of Shares subject to the limitations in Paragraphs 3(a) and 4(c)
shall also be proportionately adjusted upon the occurrence of such events.




B. Corporate Transactions. If the Company is to be consolidated with or acquired by
another entity in a merger, sale of all or substantially all of the Company’s assets other
than a transaction to merely change the state of incorporation (a “Corporate Transaction”),
the Administrator or the board of directors of any entity assuming the obligations of the
Company hereunder (the “Successor Board”), shall, as to outstanding Options, either (i) make
appropriate provision for the continuation of such Options by substituting on an equitable
basis for the Shares then subject to such Options either the consideration payable with
respect to the outstanding shares of Common Stock in connection with the Corporate
Transaction or securities of any successor or acquiring entity; or (ii) upon written notice
to the Participants, provide that all Options must be exercised (either (a) to the extent
then exercisable or, (b) at the discretion of the Administrator, all Options being made
fully exercisable for purposes of this Subparagraph), within a specified number of days of
the date of such notice, at the end of which period the Options shall terminate; or (iii)
terminate all Options in exchange for a cash payment equal to the excess of the Fair Market
Value of the Shares subject to such Options (either (a) to the extent then exercisable or,
(b) at the discretion of the Administrator, all Options being made fully exercisable for
purposes of this Subparagraph) over the exercise price thereof.




With respect to outstanding Stock Grants, the Administrator or the Successor Board, shall
either (i) make appropriate provisions for the continuation of such Stock Grants on the same
terms and conditions by substituting on an equitable basis for the Shares then subject to
such Stock Grants either the consideration payable with respect to the outstanding Shares of
Common Stock in connection with the Corporate Transaction or securities of any successor or
acquiring entity; or (ii) terminate all Stock Grants in exchange for a cash payment equal to
the excess of the Fair Market Value of the Shares



15









 







subject to such Stock Grants over the purchase price thereof, if any. In addition, in the
event of a Corporate Transaction, the Administrator may waive any or all repurchase rights
or forfeiture provisions with respect to outstanding Stock Grants.




C. Recapitalization or Reorganization. In the event of a recapitalization or
reorganization of the Company, other than a Corporate Transaction pursuant to which
securities of the Company or of another corporation are issued with respect to the
outstanding shares of Common Stock, a Participant upon exercising an Option or accepting a
Stock Grant after the recapitalization or reorganization shall be entitled to receive for
the purchase price paid upon such exercise or acceptance the number of replacement
securities which would have been received if such Option had been exercised or Stock Grant
accepted prior to such recapitalization or reorganization.




D. Adjustments to Stock-Based Awards. Upon the happening of any of the events
described in Subparagraphs A, B or C above, any outstanding Stock-Based Award shall be
appropriately adjusted to reflect the events described in such Subparagraphs. The
Administrator or the Successor Board shall determine the specific adjustments to be made
under this Paragraph 24 and, subject to Paragraph 4, its determination shall be conclusive.




E. Modification of Options. Notwithstanding the foregoing, any adjustments made
pursuant to Subparagraph A, B or C above with respect to Options shall be made only after
the Administrator determines whether such adjustments would constitute a “modification” of
any ISOs (as that term is defined in Section 424(h) of the Code) or would cause any adverse
tax consequences for the holders of Options, including, but not limited to, pursuant to
Section 409A of the Code. If the Administrator determines that such adjustments made with
respect to Options would constitute a modification or other adverse tax consequence, it may
refrain from making such adjustments, unless the holder of an Option specifically agrees in
writing that such adjustment be made and such writing indicates that the holder has full
knowledge of the consequences of such “modification” on his or her income tax treatment with
respect to the Option.


25. ISSUANCES OF SECURITIES.



Except as expressly provided herein, no issuance by the Company of shares of stock of any class, or
securities convertible into shares of stock of any class, shall affect, and no adjustment by reason
thereof shall be made with respect to, the number or price of shares subject to Stock Rights.
Except as expressly provided herein, no adjustments shall be made for dividends paid in cash or in
property (including without limitation, securities) of the Company prior to any issuance of Shares
pursuant to a Stock Right.



26. FRACTIONAL SHARES.



No fractional shares shall be issued under the Plan and the person exercising a Stock Right shall
receive from the Company cash in lieu of such fractional shares equal to the Fair Market Value
thereof.




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27. CONVERSION OF ISOs INTO NON-QUALIFIED OPTIONS; TERMINATION OF ISOs.



The Administrator, at the written request of any Participant, may in its discretion take such
actions as may be necessary to convert such Participant’s ISOs (or any portions thereof) that have
not been exercised on the date of conversion into Non-Qualified Options at any time prior to the
expiration of such ISOs, regardless of whether the Participant is an employee of the Company or an
Affiliate at the time of such conversion. At the time of such conversion, the Administrator (with
the consent of the Participant) may impose such conditions on the exercise of the resulting
Non-Qualified Options as the Administrator in its discretion may determine, provided that such
conditions shall not be inconsistent with this Plan. Nothing in the Plan shall be deemed to give
any Participant the right to have such Participant’s ISOs converted into Non-Qualified Options, and
no such conversion shall occur until and unless the Administrator takes appropriate action. The
Administrator, with the consent of the Participant, may also terminate any portion of any ISO that
has not been exercised at the time of such conversion.



28. WITHHOLDING.



In the event that any federal, state, or local income taxes, employment taxes, Federal Insurance
Contributions Act (“F.I.C.A.”) withholdings or other amounts are required by applicable law or
governmental regulation to be withheld from the Participant’s salary, wages or other remuneration
in connection with the exercise or acceptance of a Stock Right or in connection with a
Disqualifying Disposition (as defined in Paragraph 29) or upon the lapsing of any forfeiture
provision or right of repurchase, the Company may withhold from the Participant’s compensation, if
any, or may require that the Participant advance in cash to the Company, or to any Affiliate of the
Company which employs or employed the Participant, the statutory minimum amount of such
withholdings unless a different withholding arrangement, including the use of shares of the
Company’s Common Stock or a promissory note, is authorized by the Administrator (and permitted by
law). For purposes hereof, the fair market value of the shares withheld for purposes of payroll
withholding shall be determined in the manner provided in Paragraph 1 above, as of the most recent
practicable date prior to the date of exercise. If the fair market value of the shares withheld is
less than the amount of payroll withholdings required, the Participant may be required to advance
the difference in cash to the Company or the Affiliate employer. The Administrator in its
discretion may condition the exercise of an Option for less than the then Fair Market Value on the
Participant’s payment of such additional withholding.



29. NOTICE TO COMPANY OF DISQUALIFYING DISPOSITION.



Each Employee who receives an ISO must agree to notify the Company in writing immediately after the
Employee makes a Disqualifying Disposition of any shares acquired pursuant to the exercise of an
ISO. A Disqualifying Disposition is defined in Section 424(c) of the Code and includes any
disposition (including any sale or gift) of such shares before the later of (a) two years after the
date the Employee was granted the ISO, or (b) one year after the date the Employee acquired Shares
by exercising the ISO, except as otherwise provided in Section 424(c) of the Code. If the Employee
has died before such stock is sold, these holding period requirements do not apply and no
Disqualifying Disposition can occur thereafter.




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30. TERMINATION OF THE PLAN.



The Plan will terminate on April 25, 2015, the date which is ten years from the earlier of
the date of its adoption by the Board of Directors and the date of its approval by the shareholders
of the Company. The Plan may be terminated at an earlier date by vote of the shareholders or the
Board of Directors of the Company; provided, however, that any such earlier termination shall not
affect any Agreements executed prior to the effective date of such termination.



31. AMENDMENT OF THE PLAN AND AGREEMENTS.



The Plan may be amended by the shareholders of the Company. The Plan may also be amended by the
Administrator, including, without limitation, to the extent necessary to qualify any or all
outstanding Stock Rights granted under the Plan or Stock Rights to be granted under the Plan for
favorable federal income tax treatment (including deferral of taxation upon exercise) as may be
afforded incentive stock options under Section 422 of the Code, and to the extent necessary to
qualify the shares issuable upon exercise or acceptance of any outstanding Stock Rights granted, or
Stock Rights to be granted, under the Plan for listing on any national securities exchange or
quotation in any national automated quotation system of securities dealers. Any amendment approved
by the Administrator which the Administrator determines is of a scope that requires shareholder
approval shall be subject to obtaining such shareholder approval. Any modification or amendment of
the Plan shall not, without the consent of a Participant, adversely affect his or her rights under
a Stock Right previously granted to him or her. With the consent of the Participant affected, the
Administrator may amend outstanding Agreements in a manner which may be adverse to the Participant
but which is not inconsistent with the Plan. In the discretion of the Administrator, outstanding
Agreements may be amended by the Administrator in a manner which is not adverse to the Participant.



32. EMPLOYMENT OR OTHER RELATIONSHIP.



Nothing in this Plan or any Agreement shall be deemed to prevent the Company or an Affiliate from
terminating the employment, consultancy or director status of a Participant, nor to prevent a
Participant from terminating his or her own employment, consultancy or director status or to give
any Participant a right to be retained in employment or other service by the Company or any
Affiliate for any period of time.



33. GOVERNING LAW.



This Plan shall be construed and enforced in accordance with the law of the State of Delaware.





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