EX-10.2.1



 Exhibit 10.2.1 
  

 
  
  

ETSY, INC. 

2006 STOCK PLAN 

ADOPTED BY BOARD OF DIRECTORS ON
MAY 17, 2006 
  
 APPROVED
BY STOCKHOLDERS ON JUNE 1, 2006 







 TABLE OF CONTENTS 

 

							
	 	  	 	  	Page	 
			
	SECTION 1.	  	Establishment And Purpose	  	 	1	  
			
	SECTION 2.	  	Administration	  	 	1	  
	            (a)	  	Committees of the Board of Directors	  	 	1	  
	            (b)	  	Authority of the Board of Directors	  	 	1	  
			
	SECTION 3.	  	Eligibility	  	 	1	  
	            (a)	  	General Rule	  	 	1	  
	            (b)	  	Ten-Percent Stockholders	  	 	1	  
			
	SECTION 4.	  	Stock Subject To Plan	  	 	2	  
	            (a)	  	Basic Limitation	  	 	2	  
	            (b)	  	Additional Shares	  	 	2	  
			
	SECTION 5.	  	Terms And Conditions Of Awards Or Sales	  	 	2	  
	            (a)	  	Stock Purchase Agreement	  	 	2	  
	            (b)	  	Duration of Offers and Nontransferability of Rights	  	 	2	  
	            (c)	  	Purchase Price	  	 	2	  
	            (d)	  	Withholding Taxes	  	 	2	  
	            (e)	  	Restrictions on Transfer of Shares	  	 	2	  
			
	SECTION 6.	  	Terms And Conditions Of Options	  	 	3	  
	            (a)	  	Stock Option Agreement	  	 	3	  
	            (b)	  	Number of Shares	  	 	3	  
	            (c)	  	Exercise Price	  	 	3	  
	            (d)	  	Exercisability	  	 	3	  
	            (e)	  	Term	  	 	3	  
	            (f)	  	Restrictions on Transfer of Shares	  	 	3	  
	            (g)	  	Transferability of Options	  	 	3	  
	            (h)	  	Withholding Taxes	  	 	4	  
	            (i)	  	No Rights as a Stockholder	  	 	4	  
	            (j)	  	Modification, Extension and Assumption of Options	  	 	4	  
			
	SECTION 7.	  	Payment For Shares	  	 	4	  
	            (a)	  	General Rule	  	 	4	  
	            (b)	  	Surrender of Stock	  	 	4	  
	            (c)	  	Services Rendered	  	 	4	  
	            (d)	  	Promissory Note	  	 	4	  
	            (e)	  	Exercise/Sale	  	 	5	  
	            (f)	  	Exercise/Pledge	  	 	5	  
	            (g)	  	Other Forms of Payment	  	 	5	  
			
	SECTION 8.	  	Adjustment Of Shares	  	 	5	  
	            (a)	  	General	  	 	5	  
	            (b)	  	Mergers and Consolidations	  	 	5	  


  
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	SECTION 9.	  	Securities Law Requirements	  	 	6	  
			
	SECTION 10.	  	No Retention Rights	  	 	7	  
			
	SECTION 11.	  	Duration and Amendments	  	 	7	  
	            (a)	  	Term of the Plan	  	 	7	  
	            (b)	  	Right to Amend or Terminate the Plan	  	 	7	  
	            (c)	  	Effect of Amendment or Termination	  	 	7	  
			
	SECTION 12.	  	Definitions	  	 	7	  


  
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 ETSY, INC. 2006 STOCK PLAN 

SECTION 1.   ESTABLISHMENT AND PURPOSE. 

The purpose of the Plan is to offer selected persons an opportunity to acquire a proprietary interest in the success of the
Company, or to increase such interest, by purchasing Shares of the Company’s Stock. The Plan provides both for the direct award or sale of Shares and for the grant of Options to purchase Shares. Options granted under the Plan may include
Nonstatutory Options as well as ISOs intended to qualify under Section 422 of the Code. 
 Capitalized terms are
defined in Section 12. 
 SECTION 2.   ADMINISTRATION. 

(a)      Committees of the Board of Directors.  The Plan may be administered
by one or more Committees. Each Committee shall consist of one or more members of the Board of Directors who have been appointed by the Board of Directors. Each Committee shall have such authority and be responsible for such functions as the Board
of Directors has assigned to it. If no Committee has been appointed, the entire Board of Directors shall administer the Plan. Any reference to the Board of Directors in the Plan shall be construed as a reference to the Committee (if any) to whom the
Board of Directors has assigned a particular function. 
 (b)      Authority of the Board
of Directors.  Subject to the provisions of the Plan, the Board of Directors shall have full authority and discretion to take any actions it deems necessary or advisable for the administration of the Plan. All decisions,
interpretations and other actions of the Board of Directors shall be final and binding on all Purchasers, all Optionees and all persons deriving their rights from a Purchaser or Optionee. 

SECTION 3.   ELIGIBILITY. 

(a)      General Rule.  Only Employees, Outside Directors and Consultants
shall be eligible for the grant of Nonstatutory Options or the direct award or sale of Shares. Only Employees shall be eligible for the grant of ISOs. 

(b)      Ten-Percent Stockholders.  A
person who owns more than 10% of the total combined voting power of all classes of outstanding stock of the Company, its Parent or any of its Subsidiaries shall not be eligible for the grant of an ISO unless (i) the Exercise Price is at least
110% of the Fair Market Value of a Share on the date of grant and (ii) such ISO by its terms is not exercisable after the expiration of five years from the date of grant. For purposes of this Subsection (b), in determining stock ownership,
the attribution rules of Section 424(d) of the Code shall be applied. 







 SECTION 4.   STOCK SUBJECT TO PLAN. 

(a)      Basic Limitation.  Not more than 1,279,127 Shares may be issued under
the Plan (subject to Subsection (b) below and Section 8). All of these Shares may be issued upon the exercise of ISOs. The number of Shares that are subject to Options or other rights outstanding at any time under the Plan shall not exceed
the number of Shares that then remain available for issuance under the Plan. The Company, during the term of the Plan, shall at all times reserve and keep available sufficient Shares to satisfy the requirements of the Plan. Shares offered under the
Plan may be authorized but unissued Shares or treasury Shares. 
 (b)      Additional
Shares.  In the event that Shares previously issued under the Plan are reacquired by the Company, such Shares shall be added to the number of Shares then available for issuance under the Plan. In the event that an outstanding Option or
other right for any reason expires or is canceled, the Shares allocable to the unexercised portion of such Option or other right shall be added to the number of Shares then available for issuance under the Plan. 

SECTION 5.   TERMS AND CONDITIONS OF AWARDS OR SALES. 

(a)      Stock Purchase Agreement.  Each award or sale of Shares under the
Plan (other than upon exercise of an Option) shall be evidenced by a Stock Purchase Agreement between the Purchaser and the Company. Such award or sale shall be subject to all applicable terms and conditions of the Plan and may be subject to any
other terms and conditions which are not inconsistent with the Plan and which the Board of Directors deems appropriate for inclusion in a Stock Purchase Agreement. The provisions of the various Stock Purchase Agreements entered into under the Plan
need not be identical. 
 (b)      Duration of Offers and Nontransferability of
Rights.    Any right to acquire Shares under the Plan (other than an Option) shall automatically expire if not exercised by the Purchaser within 30 days after the grant of such right was communicated to the Purchaser by the
Company. Such right shall not be transferable and shall be exercisable only by the Purchaser to whom such right was granted. 

(c)      Purchase Price.  The Purchase Price of Shares to be offered under the
Plan, if newly issued, shall not be less than the par value of such Shares. Subject to the preceding sentence, the Board of Directors shall determine the Purchase Price at its sole discretion. The Purchase Price shall be payable in a form described
in Section 7. 
 (d)      Withholding Taxes.    As a
condition to the purchase of Shares, the Purchaser shall make such arrangements as the Board of Directors may require for the satisfaction of any federal, state, local or foreign withholding tax obligations that may arise in connection with such
purchase. 
 (e)      Restrictions on Transfer of Shares.  Any Shares
awarded or sold under the Plan shall be subject to such special forfeiture conditions, rights of repurchase, rights of first refusal and other transfer restrictions as the Board of Directors may determine. Such restrictions shall be set forth in the
applicable Stock Purchase Agreement and shall apply in addition to any restrictions that may apply to holders of Shares generally. A Stock Purchase Agreement may provide for accelerated vesting in the event of the Purchaser’s death, disability
or retirement or other events. 

  
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 SECTION 6.   TERMS AND CONDITIONS OF OPTIONS. 

(a)      Stock Option Agreement.  Each grant of an Option under the Plan shall
be evidenced by a Stock Option Agreement between the Optionee and the Company. Such Option shall be subject to all applicable terms and conditions of the Plan and may be subject to any other terms and conditions which are not inconsistent with the
Plan and which the Board of Directors deems appropriate for inclusion in a Stock Option Agreement. The provisions of the various Stock Option Agreements entered into under the Plan need not be identical. 

(b)      Number of Shares.    Each Stock Option Agreement shall
specify the number of Shares that are subject to the Option and shall provide for the adjustment of such number in accordance with Section 8. The Stock Option Agreement shall also specify whether the Option is an ISO or a Nonstatutory Option.

 (c)      Exercise Price.  Each Stock Option Agreement shall specify the
Exercise Price. The Exercise Price of an ISO shall not be less than 100% of the Fair Market Value of a Share on the date of grant, and a higher percentage may be required by Section 3(b). The Exercise Price of a Nonstatutory Option shall not be
less than 100% of the Fair Market Value of a Share on the date of grant. Subject to the preceding two sentences, the Exercise Price under an Option shall be determined by the Board of Directors at its sole discretion. The Exercise Price shall be
payable in a form described in Section 7. 

(d)      Exercisability.  Each Stock Option Agreement shall specify the date
when all or any installment of the Option is to become exercisable. No Option shall be exercisable unless the Optionee has delivered an executed copy of the Stock Option Agreement to the Company. The Board of Directors shall determine the
exercisability provisions of any Stock Option Agreement at its sole discretion. All of an Optionee’s Options shall become exercisable in full if Section 8(b)(iv) applies. 

(e)      Term.  The Stock Option Agreement shall specify the term of the
Option. The term shall not exceed 10 years from the date of grant, and in the case of an ISO a shorter term may be required by Section 3(b). Subject to the preceding sentence, the Board of Directors at its sole discretion shall determine when
an Option is to expire. A Stock Option Agreement may provide for expiration prior to the end of its term in the event of the termination of the Optionee’s Service or death. 

(f)       Restrictions on Transfer of Shares.  Any Shares issued upon
exercise of an Option shall be subject to such special forfeiture conditions, rights of repurchase, rights of first refusal and other transfer restrictions as the Board of Directors may determine. Such restrictions shall be set forth in the
applicable Stock Option Agreement and shall apply in addition to any restrictions that may apply to holders of Shares generally. 

(g)      Transferability of Options.    An Option shall be
transferable by the Optionee only by (i) a beneficiary designation, (ii) a will or (iii) the laws of descent and 

  
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distribution, except as provided in the next sentence. If the applicable Stock Option Agreement so provides, a Nonstatutory Option shall also be transferable by gift or domestic relations order
to a Family Member of the Optionee. An ISO may be exercised during the lifetime of the Optionee only by the Optionee or by the Optionee’s guardian or legal representative. 

(h)     Withholding Taxes.  As a condition to the exercise of an Option, the
Optionee shall make such arrangements as the Board of Directors may require for the satisfaction of any federal, state, local or foreign withholding tax obligations that may arise in connection with such exercise. The Optionee shall also make such
arrangements as the Board of Directors may require for the satisfaction of any federal, state, local or foreign withholding tax obligations that may arise in connection with the disposition of Shares acquired by exercising an Option. 

(i)      No Rights as a Stockholder.    An Optionee, or a transferee
of an Optionee, shall have no rights as a stockholder with respect to any Shares covered by the Optionee’s Option until such person becomes entitled to receive such Shares by filing a notice of exercise and paying the Exercise Price pursuant to
the terms of such Option. 
 (j)      Modification, Extension and Assumption of
Options.    Within the limitations of the Plan, the Board of Directors may modify, extend or assume outstanding Options or may accept the cancellation of outstanding Options (whether granted by the Company or another issuer)
in return for the grant of new Options for the same or a different number of Shares and at the same or a different Exercise Price. The foregoing notwithstanding, no modification of an Option shall, without the consent of the Optionee, impair the
Optionee’s rights or increase the Optionee’s obligations under such Option. 
 SECTION 7.   PAYMENT FOR SHARES. 

(a)     General Rule.  The entire Purchase Price or Exercise Price of Shares issued
under the Plan shall be payable in cash or cash equivalents at the time when such Shares are purchased, except as otherwise provided in this Section 7. 

(b)     Surrender of Stock.  At the discretion of the Board of Directors, all or
any part of the Exercise Price may be paid by surrendering, or attesting to the ownership of, Shares that are already owned by the Optionee. Such Shares shall be surrendered to the Company in good form for transfer and shall be valued at their Fair
Market Value on the date when the Option is exercised. The Optionee shall not surrender, or attest to the ownership of, Shares in payment of the Exercise Price if such action would cause the Company to recognize compensation expense (or additional
compensation expense) with respect to the Option for financial reporting purposes. 

(c)     Services Rendered.  At the discretion of the Board of Directors, Shares may
be awarded under the Plan in consideration of services rendered to the Company, a Parent or a Subsidiary prior to the award. 

(d)     Promissory Note.  At the discretion of the Board of Directors, all or a
portion of the Exercise Price or Purchase Price (as the case may be) of Shares issued under the Plan may be paid with a full-recourse promissory note. The Shares shall be pledged as security 

  
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for payment of the principal amount of the promissory note and interest thereon. The interest rate payable under the terms of the promissory note shall not be less than the minimum rate (if any)
required to avoid (i) the imputation of additional interest under the Code and (ii) the recognition of compensation expense (or additional compensation expense) with respect to the Option for financial reporting purposes. Subject to the
foregoing, the Board of Directors (at its sole discretion) shall specify the term, interest rate, amortization requirements (if any) and other provisions of such note. 

(e)        Exercise/Sale.  To the extent that a Stock Option
Agreement so provides, and if Stock is publicly traded, payment may be made all or in part by the delivery (on a form prescribed by the Company) of an irrevocable direction to a securities broker approved by the Company to sell Shares and to deliver
all or part of the sales proceeds to the Company in payment of all or part of the Exercise Price and any withholding taxes. 

(f)         Exercise/Pledge.    To the extent that a
Stock Option Agreement so provides, and if Stock is publicly traded, payment may be made all or in part by the delivery (on a form prescribed by the Company) of an irrevocable direction to pledge Shares to a securities broker or lender approved by
the Company, as security for a loan, and to deliver all or part of the loan proceeds to the Company in payment of all or part of the Exercise Price and any withholding taxes. 

(g)        Other Forms of Payment.  At the discretion of the Board
of Directors, the Purchase Price or Exercise Price of Shares issued under the Plan may be paid in any other form permitted by the Delaware General Corporation Law, as amended. 

SECTION 8.   ADJUSTMENT OF SHARES. 

(a)        General.    In the event of a subdivision of
the outstanding Stock, a declaration of a dividend payable in Shares or a combination or consolidation of the outstanding Stock into a lesser number of Shares, corresponding adjustments shall automatically be made in each of (i) the number of
Shares available for future grants under Section 4, (ii) the number of Shares covered by each outstanding Option and (iii) the Exercise Price under each outstanding Option. In the event of a declaration of an extraordinary dividend
payable in a form other than Shares in an amount that has a material effect on the Fair Market Value of the Stock, a recapitalization, a spin-off, a reclassification or a similar occurrence, the Board of Directors at its sole discretion may make
appropriate adjustments in one or more of (i) the number of Shares available for future grants under Section 4, (ii) the number of Shares covered by each outstanding Option or (iii) the Exercise Price under each outstanding
Option. 
 (b)        Mergers and Consolidations.  In the event
that the Company is a party to a merger or consolidation, all outstanding Options shall be subject to the agreement of merger or consolidation. Such agreement shall provide for one or more of the following: 

(i)      The continuation of such outstanding Options by the
Company (if the Company is the surviving corporation). 

  
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 (ii)      The
assumption of such outstanding Options by the surviving corporation or its parent in a manner that complies with Section 424(a) of the Code (whether or not such Options are ISOs). 

(iii)     The substitution by the surviving corporation or its
parent of new options for such outstanding Options in a manner that complies with Section 424(a) of the Code (whether or not such Options are ISOs). 

(iv)     Full exercisability of such outstanding Options and full
vesting of the Shares subject to such Options, followed by the cancellation of such Options. The full exercisability of such Options and full vesting of the Shares subject to such Options may be contingent on the closing of such merger or
consolidation. The Optionees shall be able to exercise such Options during a period of not less than five full business days preceding the closing date of such merger or consolidation, unless (A) a shorter period is required to permit a timely
closing of such merger or consolidation and (B) such shorter period still offers the Optionees a reasonable opportunity to exercise such Options. Any exercise of such Options during such period may be contingent on the closing of such merger or
consolidation. 
 (v)      The cancellation of such
outstanding Options and a payment to the Optionees equal to the excess of (A) the Fair Market Value of the Shares subject to such Options (whether or not such Options are then exercisable or such Shares are then vested) as of the closing date
of such merger or consolidation over (B) their Exercise Price. Such payment shall be made in the form of cash, cash equivalents, or securities of the surviving corporation or its parent with a Fair Market Value equal to the required amount.
Such payment may be made in installments and may be deferred until the date or dates when such Options would have become exercisable or such Shares would have vested. Such payment may be subject to vesting based on the Optionee’s continuing
Service, provided that the vesting schedule shall not be less favorable to the Optionees than the schedule under which such Options would have become exercisable or such Shares would have vested. If the Exercise Price of the Shares subject to such
Options exceeds the Fair Market Value of such Shares, then such Options may be cancelled without making a payment to the Optionees. For purposes of this Paragraph (v), the Fair Market Value of any security shall be determined without regard to
any vesting conditions that may apply to such security. 
 SECTION 9.   SECURITIES LAW REQUIREMENTS. 

Shares shall not be issued under the Plan unless the issuance and delivery of such Shares comply with (or are exempt from)
all applicable requirements of law, including (without limitation) the Securities Act of 1933, as amended, the rules and regulations promulgated thereunder, state securities laws and regulations, and the regulations of any stock exchange or other
securities market on which the Company’s securities may then be traded. 

  
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 SECTION 10.  NO RETENTION RIGHTS. 

Nothing in the Plan or in any right or Option granted under the Plan shall confer upon the Purchaser or Optionee any right to
continue in Service for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Company (or any Parent or Subsidiary employing or retaining the Purchaser or Optionee) or of the Purchaser or Optionee,
which rights are hereby expressly reserved by each, to terminate his or her Service at any time and for any reason, with or without cause. 
 SECTION
11.  DURATION AND AMENDMENTS. 
 (a)      Term of the
Plan.  The Plan, as set forth herein, shall become effective on the date of its adoption by the Board of Directors, subject to the approval of the Company’s stockholders. If the stockholders fail to approve the Plan within 12
months after its adoption by the Board of Directors, then any grants, exercises or sales that have already occurred under the Plan shall be rescinded and no additional grants, exercises or sales shall thereafter be made under the Plan. The Plan
shall terminate automatically 10 years after the later of (i) its adoption by the Board of Directors or (ii) the most recent increase in the number of Shares reserved under Section 4 that was approved by the Company’s
stockholders. The Plan may be terminated on any earlier date pursuant to Subsection (b) below. 

(b)      Right to Amend or Terminate the Plan.  The Board of Directors may
amend, suspend or terminate the Plan at any time and for any reason; provided, however, that any amendment of the Plan shall be subject to the approval of the Company’s stockholders if it (i) increases the number of Shares available for
issuance under the Plan (except as provided in Section 8) or (ii) materially changes the class of persons who are eligible for the grant of ISOs. Stockholder approval shall not be required for any other amendment of the Plan. If the
stockholders fail to approve an increase in the number of Shares reserved under Section 4 within 12 months after its adoption by the Board of Directors, then any grants, exercises or sales that have already occurred in reliance on such increase
shall be rescinded and no additional grants, exercises or sales shall thereafter be made in reliance on such increase. 

(c)      Effect of Amendment or Termination.  No Shares shall be issued or
sold under the Plan after the termination thereof, except upon exercise of an Option granted prior to such termination. The termination of the Plan, or any amendment thereof, shall not affect any Share previously issued or any Option previously
granted under the Plan. 
 SECTION 12. DEFINITIONS. 

(a)      “Board of Directors” shall mean the Board of Directors of the
Company, as constituted from time to time. 
 (b)      “Code” shall mean the
Internal Revenue Code of 1986, as amended. 
 (c)      “Committee” shall
mean a committee of the Board of Directors, as described in Section 2(a). 

  
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 (d)      “Company” shall mean
Etsy, Inc., a Delaware corporation. 
 (e)      “Consultant” shall mean a
person who performs bona fide services for the Company, a Parent or a Subsidiary as a consultant or advisor, excluding Employees and Outside Directors. 

(f)      “Employee” shall mean any individual who is a common-law employee of the Company, a Parent or a Subsidiary. 

(g)      “Exercise Price” shall mean the amount for which one Share may be
purchased upon exercise of an Option, as specified by the Board of Directors in the applicable Stock Option Agreement. 

(h)      “Fair Market Value” shall mean the fair market value of a Share, as
determined by the Board of Directors in good faith. Such determination shall be conclusive and binding on all persons. 

(i)       “Family Member” shall mean (i) any child, stepchild,
grandchild, parent, stepparent, grandparent, spouse, former spouse, sibling, niece, nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law or sister-in-law, including adoptive relationships, (ii) any person sharing
the Optionee’s household (other than a tenant or employee), (iii) a trust in which persons described in Clause (i) or (ii) have more than 50% of the beneficial interest, (iv) a foundation in which persons described in
Clause (i) or (ii) or the Optionee control the management of assets and (v) any other entity in which persons described in Clause (i) or (ii) or the Optionee own more than 50% of the voting interests. 

(j)       “ISO” shall mean an employee incentive stock option described
in Section 422(b) of the Code. 
 (k)      “Nonstatutory Option” shall
mean a stock option not described in Sections 422(b) or 423(b) of the Code. 

(l)       “Option” shall mean an ISO or Nonstatutory Option granted under
the Plan and entitling the holder to purchase Shares. 
 (m)     “Optionee” shall
mean a person who holds an Option. 
 (n)      “Outside Director” shall mean
a member of the Board of Directors who is not an Employee. 

(o)      “Parent” shall mean any corporation (other than the Company) in an
unbroken chain of corporations ending with the Company, if each of the corporations other than the Company owns stock possessing 50% or more of the total combined voting power of all classes of stock in one of the other corporations in such chain. A
corporation that attains the status of a Parent on a date after the adoption of the Plan shall be considered a Parent commencing as of such date. 

(p)      “Plan” shall mean this Etsy, Inc. 2006 Stock Plan. 

  
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 (q)      “Purchase Price” shall
mean the consideration for which one Share may be acquired under the Plan (other than upon exercise of an Option), as specified by the Board of Directors. 

(r)      “Purchaser” shall mean a person to whom the Board of Directors has
offered the right to acquire Shares under the Plan (other than upon exercise of an Option). 

(s)      “Service” shall mean service as an Employee, Outside Director or
Consultant. 
 (t)       “Share” shall mean one share of Stock, as
adjusted in accordance with Section 8 (if applicable). 

(u)      “Stock” shall mean the Common Stock of the Company, with a par value
of $0.001 per Share. 
 (v)      “Stock Option Agreement” shall mean the
agreement between the Company and an Optionee that contains the terms, conditions and restrictions pertaining to the Optionee’s Option. 

(w)     “Stock Purchase Agreement” shall mean the agreement between the Company and
a Purchaser who acquires Shares under the Plan that contains the terms, conditions and restrictions pertaining to the acquisition of such Shares. 

(x)      “Subsidiary” shall mean any corporation (other than the Company) in
an unbroken chain of corporations beginning with the Company, if each of the corporations other than the last corporation in the unbroken chain owns stock possessing 50% or more of the total combined voting power of all classes of stock in one of
the other corporations in such chain. A corporation that attains the status of a Subsidiary on a date after the adoption of the Plan shall be considered a Subsidiary commencing as of such date. 

  
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 AMENDMENT NO. 1 TO THE 

ETSY, INC. 
 2006 STOCK
PLAN 
 Etsy, Inc., a Delaware corporation (the “Company”), adopted the 2006 Stock Plan on May 17, 2006 (the
“Plan”). Unless otherwise defined herein, all capitalized terms shall have the meaning set forth in the Plan. 

Section 4(a) of the Plan shall be amended in its entirety to read as follows: 

“(a) Basic Limitation. Not more than 2,373,188 Shares may be issued under the Plan (subject to Subsection (b) below
and Section 8). All of these Shares may be issued upon the exercise of ISOs. The number of Shares that are subject to Options or other rights outstanding at any time under the Plan shall not exceed the number of Shares that then remain
available for issuance under the Plan. The Company, during the term of the Plan, shall at all times reserve and keep available sufficient Shares to satisfy the requirements of the Plan. Shares offered under the Plan may be authorized but unissued
Shares or treasury Shares.” 
 Except as expressly amended hereby, the Plan shall remain unchanged and in full force and
effect and is hereby ratified and confirmed. 
  

					
	Adopted by the Board of Directors:	 	January 20, 2008	  	
			
	Adopted by the Stockholders:	 	January 25, 2008	  	








 AMENDMENT NO. 2 TO THE 

ETSY, INC. 
 2006 STOCK
PLAN 
 Etsy, Inc., a Delaware corporation (the “Company”), adopted the 2006 Stock Plan on May 17, 2006, as
amended January 20, 2008 (the “Plan”). Unless otherwise defined herein, all capitalized terms shall have the meaning set forth in the Plan. 

Section 4(a) of the Plan shall be amended in its entirety to read as follows: 

“(a) Basic Limitation. Not more than 2,611,780 Shares may be issued under the Plan (subject to Subsection (b) below
and Section 8). All of these Shares may be issued upon the exercise of ISOs. The number of Shares that are subject to Options or other rights outstanding at any time under the Plan shall not exceed the number of Shares that then remain
available for issuance under the Plan. The Company, during the term of the Plan, shall at all times reserve and keep available sufficient Shares to satisfy the requirements of the Plan. Shares offered under the Plan may be authorized but unissued
Shares or treasury Shares.” 
 Except as expressly amended hereby, the Plan shall remain unchanged and in full force and
effect and is hereby ratified and confirmed. 
  

					
	Adopted by the Board of Directors:	 	August 9, 2010	  	
			
	Adopted by the Stockholders:	 	August 10, 2010	  	








 AMENDMENT NO. 3 TO THE 

ETSY, INC. 
 2006 STOCK
PLAN 
 Etsy, Inc., a Delaware corporation (the “Company”), adopted the 2006 Stock Plan on May 17, 2006, as
amended on January 20, 2008 and August 9, 2010 (the “Plan”). Unless otherwise defined herein, all capitalized terms shall have the meaning set forth in the Plan. 

Section 4(a) of the Plan shall be amended in its entirety to read as follows: 

“(a) Basic Limitation. Not more than 3,497,511 Shares may be issued under the Plan (subject to Subsection (b) below
and Section 8). All of these Shares may be issued upon the exercise of ISOs. The number of Shares that are subject to Options or other rights outstanding at any time under the Plan shall not exceed the number of Shares that then remain
available for issuance under the Plan. The Company, during the term of the Plan, shall at all times reserve and keep available sufficient Shares to satisfy the requirements of the Plan. Shares offered under the Plan may be authorized but unissued
Shares or treasury Shares.” 
 Except as expressly amended hereby, the Plan shall remain unchanged and in full force and
effect and is hereby ratified and confirmed. 
  

			
	Adopted by the Board of Directors:	  	April 27, 2011
		
	Adopted by the Stockholders:	  	April 28, 2011








 AMENDMENT NO. 4 TO THE 

ETSY, INC. 
 2006 STOCK
PLAN 
 Etsy, Inc., a Delaware corporation (the “Company”), adopted the 2006 Stock Plan on May 17, 2006, as
amended on January 20, 2008, August 9, 2010 and April 27, 2011 (the “Plan”). Unless otherwise defined herein, all capitalized terms shall have the meaning set forth in the Plan. 

Section 4(a) of the Plan shall be amended in its entirety to read as follows: 

  “(a) Basic Limitation. Not more than 43,432,935 Shares may be issued under the Plan (subject
to Subsection (b) below and Section 8). All of these Shares may be issued upon the exercise of ISOs. The number of Shares that are subject to Options or other rights outstanding at any time under the Plan shall not exceed the number of
Shares that then remain available for issuance under the Plan. The Company, during the term of the Plan, shall at all times reserve and keep available sufficient Shares to satisfy the requirements of the Plan. Shares offered under the Plan may be
authorized but unissued Shares or treasury Shares.” 
 Except as expressly amended hereby, the Plan shall remain
unchanged and in full force and effect and is hereby ratified and confirmed. 
  

			
	Adopted by the Board of Directors:	  	April 27, 2012
		
	Adopted by the Stockholders:	  	April 27, 2012








 AMENDMENT NO. 5 TO THE 

ETSY, INC. 
 2006 STOCK
PLAN 
 Etsy, Inc., a Delaware corporation (the “Company”), adopted the 2006 Stock Plan on
May 17, 2006, as amended on January 20, 2008, August 9, 2010, April 27, 2011 and April 27, 2012 (the “Plan”). Unless otherwise defined herein, all capitalized terms shall have the meaning set forth
in the Plan. 
 Section 4(a) of the Plan shall be amended in its entirety to read as follows: 

“(a) Basic Limitation. Not more than 48,505,935 Shares may be issued under the Plan (subject to Subsection (b) below and
Section 8). All of these Shares may be issued upon the exercise of ISOs. The number of Shares that are subject to Options or other rights outstanding at any time under the Plan shall not exceed the number of Shares that then remain available
for issuance under the Plan. The Company, during the term of the Plan, shall at all times reserve and keep available sufficient Shares to satisfy the requirements of the Plan. Shares offered under the Plan may be authorized but unissued Shares or
treasury Shares.” 
 Except as expressly amended hereby, the Plan shall remain unchanged and in full force and effect
and is hereby ratified and confirmed. 
  

			
	Adopted by the Board:	  	December 11, 2013
		
	Adopted by the Stockholders:	  	January 13, 2014








 ETSY, INC. 2006 STOCK PLAN 

NOTICE OF STOCK OPTION GRANT 

You have been granted the following option to purchase shares of the Common Stock of Etsy, Inc. (the “Company”): 

 

			
	 Name of Optionee:
	  	 «Name»

		
	 Total Number of Shares:
	  	 «TotalShares»

		
	 Type of Option:
	  	 «ISO»    Incentive Stock Option (ISO)

		
		  	 «NSO»   Nonstatutory Stock Option (NSO)

		
	 Exercise Price Per Share:
	  	 $«PricePerShare»

		
	 Date of Grant:
	  	 «DateGrant»

		
	 Date Exercisable:
	  	 This option may be exercised with respect to the first «Percent»% of the Shares subject to this option when the Optionee completes
«CliffPeriod» months of continuous Service after the Vesting Commencement Date set forth below. This option may be exercised with respect to an additional «Fraction»% of the Shares subject to this option when the Optionee
completes each month of continuous Service thereafter.

		
	 Vesting Commencement Date:
	  	 «VestComDate»

		
	 Expiration Date:
	  	 «ExpDate». This option expires earlier if the Optionee’s Service terminates earlier, as provided in Section 6 of the Stock Option
Agreement.



 By your signature and the signature of the Company’s representative below, you and the Company
agree that this option is granted under, and governed by the terms and conditions of, the 2006 Stock Plan and the Stock Option Agreement. Both of these documents are attached to, and made a part of, this Notice of Stock Option Grant.
Section 13 of the Stock Option Agreement includes important acknowledgements of the Optionee. 

 



			
	OPTIONEE:
	
	  

	
	





					
	ETSY, INC.	 	
			
	 By:
	 	  
	 	


					
			
	 Title:
	 	  
	 	

 
 








 THE OPTION GRANTED PURSUANT TO THIS AGREEMENT AND THE SHARES ISSUABLE UPON THE EXERCISE
THEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED, OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY AND
ITS COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED. 
 ETSY, INC. 2006 STOCK
PLAN: 
 STOCK OPTION AGREEMENT 

SECTION 1.   GRANT OF OPTION. 

(a)      Option.    On the terms and conditions set forth in the
Notice of Stock Option Grant and this Agreement, the Company grants to the Optionee on the Date of Grant the option to purchase at the Exercise Price the number of Shares set forth in the Notice of Stock Option Grant. The Exercise Price is agreed to
be at least 100% of the Fair Market Value per Share on the Date of Grant (110% of Fair Market Value if this option is designated as an ISO in the Notice of Stock Option Grant and Section 3(b) of the Plan applies). This option is intended to be
an ISO or an NSO, as provided in the Notice of Stock Option Grant. 
 (b)      $100,000
Limitation.    Even if this option is designated as an ISO in the Notice of Stock Option Grant, it shall be deemed to be an NSO to the extent (and only to the extent) required by the $100,000 annual limitation under
Section 422(d) of the Code. 
 (c)      Stock Plan and Defined
Terms.    This option is granted pursuant to the Plan, a copy of which the Optionee acknowledges having received. The provisions of the Plan are incorporated into this Agreement by this reference. Capitalized terms are
defined in Section 14 of this Agreement. 
 SECTION 2.   RIGHT TO EXERCISE. 

(a)      Exercisability.    Subject to Subsection (b) below and
the other conditions set forth in this Agreement, all or part of this option may be exercised prior to its expiration at the time or times set forth in the Notice of Stock Option Grant. 

(b)      Stockholder Approval.      Any other provision of
this Agreement notwithstanding, no portion of this option shall be exercisable at any time prior to the approval of the Plan by the Company’s stockholders. 

SECTION 3.   NO TRANSFER OR ASSIGNMENT OF OPTION. 

Except as otherwise provided in this Agreement, this option and the rights and privileges conferred hereby shall not be sold,
pledged or otherwise transferred (whether by operation of law or otherwise) and shall not be subject to sale under execution, attachment, levy or similar process. 







 SECTION 4.   EXERCISE PROCEDURES. 

(a)      Notice of Exercise.    The Optionee or the Optionee’s
representative may exercise this option by giving written notice to the Company pursuant to Section 12(c). The notice shall specify the election to exercise this option, the number of Shares for which it is being exercised and the form of
payment. The person exercising this option shall sign the notice. In the event that this option is being exercised by the representative of the Optionee, the notice shall be accompanied by proof (satisfactory to the Company) of the
representative’s right to exercise this option. The Optionee or the Optionee’s representative shall deliver to the Company, at the time of giving the notice, payment in a form permissible under Section 5 for the full amount of the
Purchase Price. 
 (b)      Issuance of Shares.    After receiving
a proper notice of exercise, the Company shall cause to be issued one or more certificates evidencing the Shares for which this option has been exercised. Such Shares shall be registered (i) in the name of the person exercising this option,
(ii) in the names of such person and his or her spouse as community property or as joint tenants with the right of survivorship or (iii) with the Company’s consent, in the name of a revocable trust. The Company shall cause such
certificates to be delivered to or upon the order of the person exercising this option. 

(c)      Withholding Taxes.    In the event that the Company
determines that it is required to withhold any tax as a result of the exercise of this option, the Optionee, as a condition to the exercise of this option, shall make arrangements satisfactory to the Company to enable it to satisfy all withholding
requirements. The Optionee shall also make arrangements satisfactory to the Company to enable it to satisfy any withholding requirements that may arise in connection with the disposition of Shares purchased by exercising this option. 

SECTION 5.   PAYMENT FOR STOCK. 

(a)      Cash.    All or part of the Purchase Price may be paid in
cash or cash equivalents. 
 (b)      Surrender of Stock.    At
the discretion of the Board of Directors, all or any part of the Purchase Price may be paid by surrendering, or attesting to the ownership of, Shares that are already owned by the Optionee. Such Shares shall be surrendered to the Company in good
form for transfer and shall be valued at their Fair Market Value as of the date when this option is exercised. 

(c)      Exercise/Sale.    All or part of the Purchase Price and any
withholding taxes may be paid by the delivery (on a form prescribed by the Company) of an irrevocable direction to a securities broker approved by the Company to sell Shares and to deliver all or part of the sales proceeds to the Company. However,
payment pursuant to this Subsection (c) shall be permitted only if (i) Stock then is publicly traded and (ii) such payment does not violate applicable law. 

  
 2 








 SECTION 6.   TERM AND EXPIRATION. 

(a)        Basic Term.  This option shall in any event expire on the
expiration date set forth in the Notice of Stock Option Grant, which date is 10 years after the Date of Grant (five years after the Date of Grant if this option is designated as an ISO in the Notice of Stock Option Grant and Section 3(b) of the
Plan applies). 
 (b)        Termination of Service (Except by
Death).    If the Optionee’s Service terminates for any reason other than death, then this option shall expire on the earliest of the following occasions: 

(i)      The expiration date determined pursuant to
Subsection (a) above; 
 (ii)     The date three months
after the termination of the Optionee’s Service for any reason other than Disability; or 

(iii)    The date 12 months after the termination of the Optionee’s
Service by reason of Disability. 
 The Optionee may exercise all or part of this option at any time before its expiration under the
preceding sentence, but only to the extent that this option had become exercisable before the Optionee’s Service terminated. When the Optionee’s Service terminates, this option shall expire immediately with respect to the number of Shares
for which this option is not yet exercisable. In the event that the Optionee dies after termination of Service but before the expiration of this option, all or part of this option may be exercised (prior to expiration) by the executors or
administrators of the Optionee’s estate or by any person who has acquired this option directly from the Optionee by beneficiary designation, bequest or inheritance, but only to the extent that this option had become exercisable before the
Optionee’s Service terminated. 
 (c)        Death of the
Optionee.   If the Optionee dies while in Service, then this option shall expire on the earlier of the following dates: 

(i)      The expiration date determined pursuant to
Subsection (a) above; or 
 (ii)     The date 12 months
after the Optionee’s death. 
 All or part of this option may be exercised at any time before its expiration under the preceding
sentence by the executors or administrators of the Optionee’s estate or by any person who has acquired this option directly from the Optionee by beneficiary designation, bequest or inheritance, but only to the extent that this option had become
exercisable before the Optionee’s death. When the Optionee dies, this option shall expire immediately with respect to the number of Shares for which this option is not yet exercisable. 

(d)        Part-Time Employment and Leaves of
Absence.    If the Optionee commences working on a part-time basis, then the Company may adjust the vesting schedule set forth in the Notice of Stock Option Grant in accordance with the Company’s part-time work


  
 3 








 
policy or the terms of an agreement between the Optionee and the Company pertaining to his or her part-time schedule. If the Optionee goes on a leave of absence, then the Company may adjust the
vesting schedule set forth in the Notice of Stock Option Grant in accordance with the Company’s leave of absence policy or the terms of such leave. Except as provided in the preceding sentence, Service shall be deemed to continue for any
purpose under this Agreement while the Optionee is on a bona fide leave of absence, if (i) such leave was approved by the Company in writing and (ii) continued crediting of Service for such purpose is expressly required by the terms
of such leave or by applicable law (as determined by the Company). Service shall be deemed to terminate when such leave ends, unless the Optionee immediately returns to active work. 

(e)        Notice Concerning ISO Treatment.  Even if this option is
designated as an ISO in the Notice of Stock Option Grant, it ceases to qualify for favorable tax treatment as an ISO to the extent that it is exercised: 

(i)      More than three months after the date when the
Optionee ceases to be an Employee for any reason other than death or Disability; 

(ii)     More than 12 months after the date when the Optionee
ceases to be an Employee by reason of Disability; or 
 (iii)    More
than three months after the date when the Optionee has been on a leave of absence for 90 days, unless the Optionee’s reemployment rights following such leave were guaranteed by statute or by contract. 

SECTION 7.   RIGHT OF FIRST REFUSAL. 

(a)        Right of First Refusal.  Subject to Section 10(a),
below, in the event that the Optionee proposes to sell, pledge or otherwise transfer to a third party any Shares acquired under this Agreement, or any interest in such Shares, the Company shall have the Right of First Refusal with respect to all
(and not less than all) of such Shares. If the Optionee desires to transfer Shares acquired under this Agreement, the Optionee shall give a written Transfer Notice to the Company describing fully the proposed transfer, including the number of Shares
proposed to be transferred, the proposed transfer price, the name and address of the proposed Transferee and proof satisfactory to the Company that the proposed sale or transfer will not violate any applicable federal, State or foreign securities
laws. The Transfer Notice shall be signed both by the Optionee and by the proposed Transferee and must constitute a binding commitment of both parties to the transfer of the Shares. The Company shall have the right to purchase all, and not less than
all, of the Shares on the terms of the proposal described in the Transfer Notice (subject, however, to any change in such terms permitted under Subsection (b) below) by delivery of a notice of exercise of the Right of First Refusal within 30
days after the date when the Transfer Notice was received by the Company. 

(b)        Transfer of Shares.   If the Company fails to
exercise its Right of First Refusal within 30 days after the date when it received the Transfer Notice, the Optionee may, not later than 90 days following receipt of the Transfer Notice by the Company, conclude a transfer of the Shares
subject to the Transfer Notice on the terms and conditions described in the Transfer 

  
 4 








 
Notice, provided that any such sale is made in compliance with applicable federal, State and foreign securities laws and not in violation of any other contractual restrictions to which the
Optionee is bound. Any proposed transfer on terms and conditions different from those described in the Transfer Notice, as well as any subsequent proposed transfer by the Optionee, shall again be subject to the Right of First Refusal and shall
require compliance with the procedure described in Subsection (a) above. If the Company exercises its Right of First Refusal, the parties shall consummate the sale of the Shares on the terms set forth in the Transfer Notice within 60 days
after the date when the Company received the Transfer Notice (or within such longer period as may have been specified in the Transfer Notice); provided, however, that in the event the Transfer Notice provided that payment for the Shares was to be
made in a form other than cash or cash equivalents paid at the time of transfer, the Company shall have the option of paying for the Shares with cash or cash equivalents equal to the present value of the consideration described in the Transfer
Notice. 
 (c)      Additional or Exchanged Securities and
Property.    In the event of a merger or consolidation of the Company with or into another entity, any other corporate reorganization, a stock split, the declaration of a stock dividend, the declaration of an extraordinary
dividend payable in a form other than stock, a spin-off, an adjustment in conversion ratio, a recapitalization or a similar transaction affecting the Company’s outstanding securities, any securities or
other property (including cash or cash equivalents) that are by reason of such transaction exchanged for, or distributed with respect to, any Shares subject to this Section 7 shall immediately be subject to the Right of First Refusal.
Appropriate adjustments to reflect the exchange or distribution of such securities or property shall be made to the number and/or class of the Shares subject to this Section 7. 

(d)      Termination of Right of First Refusal.    Any other
provision of this Section 7 notwithstanding, in the event that the Stock is readily tradable on an established securities market when the Optionee desires to transfer Shares, the Company shall have no Right of First Refusal, and the Optionee
shall have no obligation to comply with the procedures prescribed by Subsections (a) and (b) above. 

(e)      Permitted Transfers.    This Section 7 shall not apply
to (i) a transfer by beneficiary designation, will or intestate succession or (ii) a transfer to one or more members of the Optionee’s Immediate Family or to a trust established by the Optionee for the benefit of the Optionee and/or
one or more members of the Optionee’s Immediate Family, provided in either case that the Transferee agrees in writing on a form prescribed by the Company to be bound by all provisions of this Agreement. If the Optionee transfers any Shares
acquired under this Agreement, either under this Subsection (e) or after the Company has failed to exercise the Right of First Refusal, then this Agreement shall apply to the Transferee to the same extent as to the Optionee. 

(f)      Termination of Rights as Stockholder.  If the Company makes
available, at the time and place and in the amount and form provided in this Agreement, the consideration for the Shares to be purchased in accordance with this Section 7, then after such time the person from whom such Shares are to be
purchased shall no longer have any rights as a holder of such Shares (other than the right to receive payment of such consideration in accordance with this Agreement). Such Shares shall be deemed to have been purchased in accordance with the
applicable provisions hereof, whether or not the certificate(s) therefor have been delivered as required by this Agreement. 

  
 5 








 (g)        Assignment of Right of
First Refusal.    The Board of Directors may freely assign the Company’s Right of First Refusal, in whole or in part. Any person who accepts an assignment of the Right of First Refusal from the Company shall assume all
of the Company’s rights and obligations under this Section 7. 
 SECTION 8.   LEGALITY OF INITIAL ISSUANCE. 

No Shares shall be issued upon the exercise of this option unless and until the Company has determined that: 

(a)      It and the Optionee have taken any actions required
to register the Shares under the Securities Act or to perfect an exemption from the registration requirements thereof; 

(b)      Any applicable listing requirement of any stock
exchange or other securities market on which Stock is listed has been satisfied; and 

(c)      Any other applicable provision of federal, State or
foreign law has been satisfied. 
 SECTION 9.   NO REGISTRATION RIGHTS. 

The Company may, but shall not be obligated to, register or qualify the sale of Shares under the Securities Act or any other
applicable law. The Company shall not be obligated to take any affirmative action in order to cause the sale of Shares under this Agreement to comply with any law. 

SECTION 10.   RESTRICTIONS ON TRANSFER OF SHARES. 

(a)        Bylaws Restrictions.  The Shares acquired under this
Agreement shall be subject to the transfer restrictions in Article XIV of the Company’s Amended and Restated Bylaws in addition to, and not in limitation of, the provisions of Section 7 of this Agreement. 

(b)        Securities Law Restrictions.  Regardless of whether the
offering and sale of Shares under the Plan have been registered under the Securities Act or have been registered or qualified under the securities laws of any State, the Company at its discretion may impose restrictions upon the sale, pledge or
other transfer of such Shares (including the placement of appropriate legends on stock certificates or the imposition of stop-transfer instructions) if, in the judgment of the Company, such restrictions are
necessary or desirable in order to achieve compliance with the Securities Act, the securities laws of any State or any other law. 

(c)        Market Stand-Off.  In connection with any underwritten
public offering by the Company of its equity securities pursuant to an effective registration statement filed under the Securities Act, including the Company’s initial public offering, the Optionee or a Transferee shall not directly or
indirectly sell, make any short sale of, loan, hypothecate, pledge, offer, grant 

  
 6 








 
or sell any option or other contract for the purchase of, purchase any option or other contract for the sale of, or otherwise dispose of or transfer, or agree to engage in any of the foregoing
transactions with respect to, any Shares acquired under this Agreement without the prior written consent of the Company or its managing underwriter. Such restriction (the “Market Stand-Off”) shall be in effect for such period of time
following the date of the final prospectus for the offering as may be requested by the Company or such underwriter. In no event, however, shall such period exceed 180 days plus such additional period as may reasonably be requested by the Company or
such underwriter to accommodate regulatory restrictions on (i) the publication or other distribution of research reports or (ii) analyst recommendations and opinions, including (without limitation) the restrictions set forth in
Rule 2711(f)(4) of the National Association of Securities Dealers and Rule 472(f)(4) of the New York Stock Exchange, as amended, or any similar successor rules. The Market Stand-Off shall in any event terminate two years after the date of
the Company’s initial public offering. In the event of the declaration of a stock dividend, a spin-off, a stock split, an adjustment in conversion ratio, a recapitalization or a similar transaction
affecting the Company’s outstanding securities without receipt of consideration, any new, substituted or additional securities which are by reason of such transaction distributed with respect to any Shares subject to the Market Stand-Off, or
into which such Shares thereby become convertible, shall immediately be subject to the Market Stand-Off. In order to enforce the Market Stand-Off, the Company may impose stop-transfer instructions with respect to the Shares acquired under this
Agreement until the end of the applicable stand-off period. The Company’s underwriters shall be beneficiaries of the agreement set forth in this Subsection (c). This Subsection (c) shall not apply to Shares registered in the public
offering under the Securities Act. 
 (d)      Investment Intent at
Grant.  The Optionee represents and agrees that the Shares to be acquired upon exercising this option will be acquired for investment, and not with a view to the sale or distribution thereof. 

(e)      Investment Intent at Exercise.  In the event that the sale of Shares
under the Plan is not registered under the Securities Act but an exemption is available that requires an investment representation or other representation, the Optionee shall represent and agree at the time of exercise that the Shares being acquired
upon exercising this option are being acquired for investment, and not with a view to the sale or distribution thereof, and shall make such other representations as are deemed necessary or appropriate by the Company and its counsel. 

(f)      Legends.      All certificates evidencing Shares
purchased under this Agreement shall bear the following legends: 
 “THE SHARES REPRESENTED HEREBY MAY
NOT BE SOLD, ASSIGNED, TRANSFERRED, ENCUMBERED OR IN ANY MANNER DISPOSED OF, EXCEPT IN COMPLIANCE WITH THE TERMS OF A WRITTEN AGREEMENT BETWEEN THE COMPANY AND THE REGISTERED HOLDER OF THE SHARES (OR THE PREDECESSOR IN INTEREST TO THE SHARES). SUCH
AGREEMENT GRANTS TO THE COMPANY CERTAIN RIGHTS OF FIRST REFUSAL UPON AN ATTEMPTED TRANSFER OF THE SHARES. THE SECRETARY OF THE COMPANY WILL UPON WRITTEN REQUEST FURNISH A COPY OF SUCH AGREEMENT TO THE HOLDER HEREOF WITHOUT CHARGE.” 

  
 7 








 “THE SHARES REPRESENTED HEREBY MAY NOT BE SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR IN ANY MANNER DISPOSED OF, EXCEPT IN COMPLIANCE WITH THE BYLAWS OF THE COMPANY. COPIES OF THE BYLAWS OF THE COMPANY MAY BE OBTAINED UPON WRITTEN REQUEST TO THE SECRETARY OF THE COMPANY.” 

All certificates evidencing Shares purchased under this Agreement in an unregistered transaction shall bear the following legend (and such
other restrictive legends as are required or deemed advisable under the provisions of any applicable law): 

“THE SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
AND MAY NOT BE SOLD, PLEDGED, OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED.” 

(g)      Removal of Legends.   If, in the opinion of the Company and its
counsel, any legend placed on a stock certificate representing Shares sold under this Agreement is no longer required, the holder of such certificate shall be entitled to exchange such certificate for a certificate representing the same number of
Shares but without such legend. 
 (h)      Administration.   Any
determination by the Company and its counsel in connection with any of the matters set forth in this Section 10 shall be conclusive and binding on the Optionee and all other persons. 

SECTION 11.   ADJUSTMENT OF SHARES. 

In the event of any transaction described in Section 8(a) of the Plan, the terms of this option (including, without
limitation, the number and kind of Shares subject to this option and the Exercise Price) shall be adjusted as set forth in Section 8(a) of the Plan. In the event that the Company is a party to a merger or consolidation, this option shall be
subject to the agreement of merger or consolidation, as provided in Section 8(b) of the Plan. 
 SECTION 12.   MISCELLANEOUS
PROVISIONS. 
 (a)      Rights as a Stockholder.    Neither
the Optionee nor the Optionee’s representative shall have any rights as a stockholder with respect to any Shares subject to this option until the Optionee or the Optionee’s representative becomes entitled to receive such Shares by filing a
notice of exercise and paying the Purchase Price pursuant to Sections 4 and 5. 

(b)      No Retention Rights.   Nothing in this option or in the Plan
shall confer upon the Optionee any right to continue in Service for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Company (or any Parent or Subsidiary employing or retaining the Optionee) or of
the Optionee, which rights are hereby expressly reserved by each, to terminate his or her Service at any time and for any reason, with or without cause. 

  
 8 








 (c)      Notice.   Any
notice required by the terms of this Agreement shall be given in writing. It shall be deemed effective upon (i) personal delivery, (ii) deposit with the United States Postal Service, by registered or certified mail, with postage and fees
prepaid or (iii) deposit with Federal Express Corporation, with shipping charges prepaid. Notice shall be addressed to the Company at its principal executive office and to the Optionee at the address that he or she most recently provided to the
Company in accordance with this Subsection (c). 
 (d)      Entire
Agreement.   The Notice of Stock Option Grant, this Agreement and the Plan constitute the entire contract between the parties hereto with regard to the subject matter hereof. They supersede any other agreements, representations or
understandings (whether oral or written and whether express or implied) that relate to the subject matter hereof. 

(e)      Choice of Law.   This Agreement shall be governed by, and
construed in accordance with, the laws of the State of Delaware, as such laws are applied to contracts entered into and performed in such State. 

SECTION 13.   ACKNOWLEDGEMENTS OF THE OPTIONEE. 

(a)      Tax Consequences.    The Optionee agrees that the Company
does not have a duty to design or administer the Plan or its other compensation programs in a manner that minimizes the Optionee’s tax liabilities. The Optionee shall not make any claim against the Company or its Board of Directors, officers or
employees related to tax liabilities arising from this option or the Optionee’s other compensation. In particular, the Optionee acknowledges that this option is exempt from Section 409A of the Code only if the Exercise Price is at least
equal to the Fair Market Value per Share on the Date of Grant. Since Shares are not traded on an established securities market, the determination of their Fair Market Value is made by the Board of Directors or by an independent valuation firm
retained by the Company. The Optionee acknowledges that there is no guarantee in either case that the Internal Revenue Service will agree with the valuation, and the Optionee shall not make any claim against the Company or its Board of Directors,
officers or employees in the event that the Internal Revenue Service asserts that the valuation was too low. 

(b)      Electronic Delivery of Documents.    The Optionee agrees
that the Company may deliver by email all documents relating to the Plan or this option (including, without limitation, a copy of the Plan) and all other documents that the Company is required to deliver to its security holders (including, without
limitation, disclosures that may be required by the Securities and Exchange Commission). The Optionee also agrees that the Company may deliver these documents by posting them on a website maintained by the Company or by a third party under contract
with the Company. If the Company posts these documents on a website, it shall notify the Optionee by email. 
 SECTION 14.   DEFINITIONS.

 (a)      “Agreement” shall mean this Stock Option Agreement. 

(b)      “Board of Directors” shall mean the Board of Directors of the
Company, as constituted from time to time or, if a Committee has been appointed, such Committee. 

  
 9 








 (c)      “Code” shall mean the
Internal Revenue Code of 1986, as amended. 
 (d)      “Committee” shall
mean a committee of the Board of Directors, as described in Section 2 of the Plan. 

(e)      “Company” shall mean Etsy, Inc., a Delaware corporation. 

(f)      “Consultant” shall mean a person who performs bona fide services for
the Company, a Parent or a Subsidiary as a consultant or advisor, excluding Employees and Outside Directors. 

(g)      “Date of Grant” shall mean the date of grant specified in the Notice
of Stock Option Grant, which date shall be the later of (i) the date on which the Board of Directors resolved to grant this option or (ii) the first day of the Optionee’s Service. 

(h)      “Disability” shall mean that the Optionee is unable to engage in any
substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted, or can be expected to last, for a continuous period of not less than 12 months. 

(i)      “Employee” shall mean any individual who is a common-law employee of the Company, a Parent or a Subsidiary. 

(j)      “Exercise Price” shall mean the amount for which one Share may be
purchased upon exercise of this option, as specified in the Notice of Stock Option Grant. 

(k)      “Fair Market Value” shall mean the fair market value of a Share, as
determined by the Board of Directors in good faith. Such determination shall be conclusive and binding on all persons. 

(l)      “Immediate Family” shall mean any child, stepchild, grandchild,
parent, stepparent, grandparent, spouse, sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law or sister-in-law and shall include adoptive relationships. 

(m)      “ISO” shall mean an employee incentive stock option described in
Section 422(b) of the Code. 
 (n)      “Notice of Stock Option Grant”
shall mean the document so entitled to which this Agreement is attached. 

(o)      “NSO” shall mean a stock option not described in Sections 422(b)
or 423(b) of the Code. 
 (p)      “Optionee” shall mean the person named in
the Notice of Stock Option Grant. 
 (q)      “Outside Director” shall mean
a member of the Board of Directors who is not an Employee. 

  
 10 








 (r)      “Parent” shall mean any
corporation (other than the Company) in an unbroken chain of corporations ending with the Company, if each of the corporations other than the Company owns stock possessing 50% or more of the total combined voting power of all classes of stock in one
of the other corporations in such chain. 
 (s)      “Plan” shall mean the
Etsy, Inc. 2006 Stock Plan, as in effect on the Date of Grant. 
 (t)      “Purchase
Price” shall mean the Exercise Price multiplied by the number of Shares with respect to which this option is being exercised. 

(u)      “Right of First Refusal” shall mean the Company’s right of first
refusal described in Section 7. 
 (v)      “Securities Act” shall mean
the Securities Act of 1933, as amended. 
 (w)      “Service” shall mean
service as an Employee, Outside Director or Consultant. 
 (x)      “Share”
shall mean one share of Stock, as adjusted in accordance with Section 8 of the Plan (if applicable). 

(y)      “Stock” shall mean the Common Stock of the Company. 

(z)      “Subsidiary” shall mean any corporation (other than the Company) in
an unbroken chain of corporations beginning with the Company, if each of the corporations other than the last corporation in the unbroken chain owns stock possessing 50% or more of the total combined voting power of all classes of stock in one of
the other corporations in such chain. 
 (aa)    “Transferee” shall mean any person to
whom the Optionee has directly or indirectly transferred any Share acquired under this Agreement. 

(bb)    “Transfer Notice” shall mean the notice of a proposed transfer of Shares
described in Section 7. 

  
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