Table of Contents

EXHIBIT 10.1
















ST. JUDE MEDICAL, INC.

2007 EMPLOYEE STOCK PURCHASE PLAN

As Amended Effective August 1, 2012




















TABLE OF CONTENTS


	
 

	
 

	
 

	
 


	
 

	
 

	
 

	
Page




	
 

	
 

	
 

	
 


	
Section 1.

	
Introduction

	
 

	
1


	
Section 2.

	
Definitions

	
 

	
1


	
Section 3.

	
Eligibility

	
 

	
4


	
Section 4.

	
Contribution Periods

	
 

	
4


	
Section 5.

	
Participation

	
 

	
4


	
Section 6.

	
Method of Payment of Contributions

	
 

	
4


	
Section 7.

	
Grant of Option

	
 

	
5


	
Section 8.

	
Exercise of Option

	
 

	
6


	
Section 9.

	
Delivery

	
 

	
6


	
Section 10.

	
Withdrawal; Termination of Employment

	
 

	
6


	
Section 11.

	
Interest

	
 

	
7


	
Section 12.

	
Shares

	
 

	
7


	
Section 13.

	
Administration

	
 

	
7


	
Section 14.

	
Death of Participant

	
 

	
8


	
Section 15.

	
Transferability

	
 

	
8


	
Section 16.

	
Use of Funds

	
 

	
8


	
Section 17.

	
Reports

	
 

	
8


	
Section 18.

	
Adjustments Upon Changes in Capitalization; Corporate
Transactions

	
 

	
8


	
Section 19.

	
Amendment or Termination

	
 

	
9


	
Section 20.

	
Notices

	
 

	
10


	
Section 21.

	
Conditions Upon Issuance of Shares

	
 

	
10


	
Section 22.

	
Term of Plan; Effective Date

	
 

	
10


	
Section 23.

	
Additional Restrictions of Rule 16b-3

	
 

	
10


	
Section 24.

	
Governing Law

	
 

	
11


	
Section 25.

	
Severability

	
 

	
11


	
Section 26.

	
No Rights as an Employee

	
 

	
11


	
Section 27.

	
International Participants

	
 

	
11


	
Section 28.

	
Taxes

	
 

	
12


	
Section 29.

	
Acceptance of Terms

	
 

	
12




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ST. JUDE MEDICAL, INC.

2007 EMPLOYEE STOCK PURCHASE PLAN

As Amended Effective August 1, 2012


          The
following constitute the provisions of the 2007 Employee Stock Purchase Plan of
St. Jude Medical, Inc. 


	
 

	
 


	
Section 1.

	
Introduction.






          (a)          Purpose.
The purpose of the Plan is to enable the Company to obtain and retain the
services of employees. In addition, the Plan provides a convenient, meaningful
opportunity for employees to purchase St. Jude Medical, Inc. stock, thereby
increasing participating employees’ personal interest in the Company’s success.
It is the intention of the Company to have a portion of the Plan qualify as an
“Employee Stock Purchase Plan” within the meaning of Section 423 of the Code,
and it is intended that such portion of the Plan be treated as a separate plan
which shall comply with Section 423 of the Code in all respects. Separately,
certain provisions of this Plan document, including Section 27 and any
additional provisions or rules adopted by the Committee pursuant thereto, govern
the purchase of St. Jude Medical, Inc. stock other than through the portion of
the Plan governed by Section 423 of the Code. It is intended that such
purchases shall not be subject to the requirements of Section 423 of the Code. 


          (b)          Portion
of Plan to Comply with Section 423. The Company intends to have a portion
of the Plan qualify as an “employee stock purchase plan” within the meaning of
Section 423 of the Code; and intends that such portion of the Plan be treated
as a separate plan. Such portion of the Plan shall, accordingly, be construed
so as to extend and limit participation in a manner that is consistent with
Section 423 of the Code. 


          (c)          Portions
of Plan Not Complying with Section 423. Section 27 of this Plan, and any
additional provisions adopted by the Committee pursuant thereto, are intended
by the Company to allow creation of separate portions of the Plan providing for
the offering of Common Stock other than through the portion of the Plan
governed by Section 423 of the Code, for purchase by individuals who are either
(i) generally not subject to income taxation by the United States or (ii) are
employed by Subsidiaries other than Designated Subsidiaries. 


	
 

	
 


	
Section 2.

	
Definitions.






          (a)          “Account”
means the funds accumulated with respect to a Participant as a result of
deduction from such Participant’s paycheck for the purpose of purchasing Shares
under the Plan. The funds allocated to a Participant’s Account shall remain the
property of the Participant at all times but may be commingled with the general
funds of the Company, except to the extent such commingling may be prohibited
by the laws of any applicable jurisdiction. 


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


          (c)          “Business
Day” means any day (other than a Saturday or Sunday) on which the New York
Stock Exchange is permitted to be open for trading. 


          (d)          “Code”
means the Internal Revenue Code of 1986, as amended. 


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          (e)          “Commencement
Date” means the first calendar day of each Contribution Period of the Plan. 


          (f)          “Common
Stock” means the Common Stock, par value $.10 per share, of the Company. 


          (g)          “Committee”
means the committee described in Section 13(a) of the Plan. 


          (h)          “Company”
means St. Jude Medical, Inc., a Minnesota corporation. Effective as of the date
any Subsidiary becomes a Designated Subsidiary, references herein to the “Company”
shall be interpreted to include such Designated Subsidiary, as appropriate. 


          (i)          “Compensation”
means regular straight time earnings, commissions and commission-based sales
bonuses annualized at the time of enrollment prior to the Commencement Date,
excluding payments, if any, for overtime, incentive compensation, incentive
payments, premiums, bonuses (including bonuses paid under the Company’s
Management Incentive Compensation Plan) and any other special remuneration. 


          (j)          “Continuous
Status as an Employee” means the absence of any interruption or termination of
service as an Employee. Continuous Status as an Employee shall not be
considered interrupted in the case of (i) medical leave; (ii) leave allowed
under the Family and Medical Leave Act; (iii) personal leave; (iv) military
leave; (v) jury duty; (vi) any other leave of absence approved by the
Committee; provided that any such leave referred to in (i) through (vi) does
not exceed three months, unless re-employment upon the expiration of such leave
is guaranteed by contract or statute; or (vii) transfers between locations of
the Company or between the Company and its Subsidiaries. In the case of an
approved leave that exceeds 3 months and the Employee’s right to reemployment
is not provided either by contract or by statute, the Employee is deemed to
incur a termination of his or her Continuous Status as an Employee (for
purposes of this Plan) on the first day immediately following such three-month
period. 


          (k)          “Contribution
Period” means a 1-year period; provided, however, that the Board shall have the
power to change the duration and/or frequency of Contribution Periods with
respect to future purchases without shareholder approval if such change is
announced at least 5 Business Days prior to the scheduled beginning of the
first Contribution Period to be affected; provided further, however, that no
Contribution Period shall exceed 27 months. 


          (l)          “Contributions”
means all amounts credited to the Account of a Participant pursuant to the
Plan. 


          (m)          “Corporate
Transaction” means (i) a sale of all or substantially all of the Company’s
assets or (ii) a merger, consolidation or other capital reorganization of the Company
with or into another corporation or any other transaction or series of related
transactions in which the Company’s shareholders immediately prior thereto own
less than 50% of the voting stock of the Company (or its successor or parent)
immediately thereafter. 


          (n)          “Designated
Subsidiaries” means the Subsidiaries that have been designated by the Board
from time to time in its sole discretion as eligible to participate in the
portion of the Plan subject to Section 423 of the Code. 


          (o)          “Employee”
means any person, including an Officer or director who is also an employee, but
excluding any person whose customary employment is (i) less than 20 hours per
week or (ii) for not more than 5 months in any calendar year. 


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


          (q)          “Fair
Market Value” means, with respect to the Common Stock on a given date, the
closing price for the Common Stock for such date, or if such date is not a
Business Day, the last reported sale price for the Common Stock for the last
Business Day preceding such date, as quoted on the New York Stock Exchange or
another exchange; provided, however, that if the Common Stock ceases to be
listed for trading on the New York Stock Exchange or another exchange, “Fair
Market Value” of the Common Stock for a given date shall mean the value
determined in good faith by the Board. 


          (r)          “New
Purchase Date” shall have the meaning set forth in Section 18(b) hereof. 


          (s)          “Officer”
means a person who has been designated by the Board as a reporting officer for
purposes of Section 16 of the Exchange Act and the rules and regulations
promulgated thereunder. 


          (t)          “Participant”
means any Employee who is eligible and has elected to participate in the Plan
accordance with Sections 3 and 5 hereof and who has not withdrawn from the Plan
or whose participation in the Plan is not otherwise terminated. 


          (u)          “Plan”
means this 2007 Employee Stock Purchase Plan, as may be amended from time to
time. 


          (v)          “Purchase
Date” means the last calendar day of each Contribution Period of the Plan. 


          (w)          “Purchase
Price” means with respect to a Contribution Period that price as announced by
the Committee prior to the first Business Day of that Contribution Period,
which price may, in the discretion of the Committee, be a price which is not
fixed or determinable as of the first Business Day of that Contribution Period;
provided, however, that in no event shall the Purchase Price for any
Contribution Period be less than the lesser of 85% of the Fair Market Value of
a Share on the Commencement Date or on the Purchase Date, in each case rounded
up to the next higher full cent. If the Commencement Date or the Purchase Date
is not a Business Day, then the Purchase Price for any Contribution Period
shall not be less than the lesser of 85% of the Fair Market Value of a Share on
the Business Day immediately preceding the Commencement Date or the Purchase
Date. 


          (x)          “Share”
means a share of Common Stock, as adjusted in accordance with Section 18
hereof. 


          (y)          “Subsidiary”
means a corporation, domestic or foreign, of which not less than 50% of the
total combined voting power of all classes of stock is held by the Company or
any such subsidiary of the Company, whether or not such corporation now exists
or is hereafter organized or acquired by the Company or another such subsidiary
of the Company. “Subsidiary” also means an unincorporated business entity, such
as a limited liability company or partnership, in which the Company holds
directly or indirectly not less than 50% of the total combined voting power with
respect to all classes of equity ownership of such entity, whether or not such
unincorporated business entity now exists or is hereafter organized or acquired
by the Company or another Subsidiary of the Company, but only if such entity
either (i) has duly elected under applicable treasury regulations to be an
association treated as a corporation for federal income tax purposes, and such
election continues in effect; or (ii) is disregarded as a separate entity for
federal income tax purposes, has not made an election described in clause (i)
of this sentence and, pursuant to applicable treasury regulations, its assets
are considered to be owned by another Subsidiary that is a corporation or is
treated as one under clause (i) of this sentence. 


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Section 3.

	
Eligibility.






          (a)          Any
person who is an Employee and has completed 30 days of continuous employment
service for the Company or one or more of its Designated Subsidiaries shall
become eligible to participate in the Plan on the first day of the month
coincident with or following completion of such period of service, subject to
the requirements of Section 5(a) hereof and the limitations imposed by Section
423(b) of the Code. 


          (b)          Any
provisions of the Plan to the contrary notwithstanding, no Employee shall be
granted an option under the Plan (i) if, immediately after the grant, such
Employee (together with any other person whose stock would be attributed to
such Employee pursuant to Section 424(d) of the Code) would own capital stock
of the Company and/or hold outstanding options to purchase stock possessing 5%
or more of the total combined voting power or value of all classes of stock of
the Company or of any Subsidiary of the Company, or (ii) if such option would
permit his or her rights to purchase stock under all employee stock purchase
plans (described in Section 423 of the Code) of the Company and its
Subsidiaries to accrue at a rate that exceeds $25,000 of the Fair Market Value
of such stock (determined at the time such option is granted), or that exceeds
2,000 Shares, for each calendar year in which such option is outstanding at any
time. 


	
 

	
 


	
Section 4.

	
Contribution
Periods. 





          The
Plan shall be implemented by a series of consecutive Contribution Periods. The
first Contribution Period shall commence on August 1, 2007 and shall end on
July 31, 2008. The Plan shall continue until terminated in accordance with
Sections 19 and 22 hereof. 


	
 

	
 


	
Section 5.

	
Participation.






          (a)          An
eligible Employee may become a Participant by following the established
enrollment procedure as directed by the Committee, or other entity designated
by the Committee, prior to the Commencement Date of the applicable Contribution
Period, unless an earlier or later time for completing the enrollment procedure
is set by the Committee for all eligible Employees with respect to a given
Contribution Period. The eligible Employee shall determine the amount of the
Participant’s Compensation (subject to Section 6(a) hereof) to be paid as
Contributions pursuant to the Plan. 


          (b)          Payroll
deductions shall commence on the first payroll paid on or following the
Commencement Date and shall end on the last payroll paid on or prior to the
Purchase Date of the Contribution Period, unless sooner terminated as provided
in Section 10 hereof. A Participant who has elected to participate in a
Contribution Period shall automatically participate in the next Contribution
Period until such time as such Participant withdraws from the Plan or
terminates employment as provided in Section 10 hereof. 


	
 

	
 


	
Section 6.

	
Method of
Payment of Contributions. 





          (a)          Contribution
Amounts. A Participant shall elect to have payroll deductions made on each
payroll paid during the Contribution Period in full dollar amounts not less
than $5 and not more than 10% of the Participant’s rate of Compensation in
effect at the time of enrollment (or such other maximum percentage as the Board
may establish from time to time before any Commencement Date). All payroll
deductions made by a Participant shall be credited to his or her Account under
the Plan. A Participant may not make any additional payments into his or her
Account. No assets in a Participant’s Account shall be subject to the debts, contracts,
liabilities, engagements or torts of the Participant. 


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          (b)          Contribution
Changes by a Participant. 


                          i.          A
Participant may discontinue his or her participation in the Plan as provided in
Section 10 hereof. 


                          ii.          Unless
otherwise provided by the Committee, a Participant may decrease the amount of
his or her Contributions once during a Contribution Period by following the
established administrative procedures as directed by the Committee to authorize
a decrease in the payroll deduction amount. The decrease in amount shall be
effective as soon as administratively feasible following the date of receipt by
the Company, or other entity designated by the Committee. However, any decrease
in amount must be made at least 30 days prior to the end of the Contribution
Period to ensure such decrease shall be effective within the current
Contribution Period. 


                          iii.          Unless
otherwise provided by the Committee, a Participant may not increase the amount
of his or her Contributions during a Contribution Period. A Participant may
only increase the amount of his or her Contributions with respect to a future
Contribution Period by following the established administrative procedures as
directed by the Committee to authorize an increase in the payroll deduction
amount. The increase in amount shall be effective as of the Commencement Date
of the next Contribution Period following the date of receipt by the Company,
or other entity designated by the Committee. 


          (c)          Contribution
Changes by the Company. 


                          i.          Notwithstanding
the foregoing, to the extent necessary to comply with Section 423(b)(8) of the
Code and Section 3(b) hereof, a Participant’s payroll deductions may be
adjusted during any Contribution Period, subject to the discretion of the
Committee. Payroll deductions shall re-commence at the amount provided in such
Participant’s most recently submitted enrollment materials at the beginning of
the first Contribution Period that is scheduled to end in the next succeeding
calendar year, unless terminated by the Participant as provided in Section 10
hereof. 


                          ii.          If
a Participant goes on an approved paid leave of absence during a Contribution
Period, the Participant’s payroll deductions shall continue in effect during
such leave unless the Participant is deemed to incur a termination of his or
her Continuous Status as an Employee prior to the Purchase Date of the
Contribution Period (i.e.,
because the leave exceeds three months and re-employment upon the expiration of
such leave is not guaranteed by contract or statute). 


                          iii.          If
a Participant goes on an approved unpaid leave of absence during a Contribution
Period, the Participant’s payroll deductions shall be suspended during such
leave. Except as otherwise provided by the Committee, if such Participant
returns from leave (without incurring a termination of his or her Continuous
Status as an Employee), payroll deductions shall resume at an adjusted amount
to account for payroll deductions in arrears, unless the Participant elects to
decrease the amount of his or her Contributions as set forth in Section 6(b)
above). 


	
 

	
 


	
Section 7.

	
Grant of
Option. 





          On
the Commencement Date of each Contribution Period, each eligible Employee
participating in such Contribution Period shall be granted an option to
purchase on the Purchase Date a number of Shares determined by dividing such
Employee’s Contributions accumulated prior to such Purchase Date and retained
in the Participant’s Account as of the Purchase Date by the applicable Purchase
Price, subject to the limitations set forth in Sections 3(b) and 12 hereof. 


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Section 8.

	
Exercise of
Option. 





          Unless
a Participant ceases to be an eligible Employee as provided in Section 3 or
withdraws from the Plan as provided in Section 10 hereof, his or her option for
the purchase of Shares will be exercised automatically on each Purchase Date of
each Contribution Period, and the maximum number of Shares (rounded down to the
nearest whole Share) subject to the option will be purchased at the applicable
Purchase Price with the accumulated Contributions in his or her Account. Unused
Contributions representing the amount of any fractional Share shall be returned
to the Participant. The Shares purchased upon exercise of an option hereunder
shall be deemed to be transferred to the Participant on the Purchase Date.
During his or her lifetime, a Participant’s option to purchase Shares hereunder
is exercisable only by him or her. 


	
 

	
 


	
Section 9.

	
Delivery.






          As
promptly as practicable after each Purchase Date of each Contribution Period,
the number of Shares purchased by each Participant upon exercise of his or her
option shall be delivered in accordance with procedures established from time
to time by the Committee, and a transfer agent for the Common Stock may be
utilized or a brokerage or nominee account may be established for this purpose.
The terms of such transfer agency or brokerage or nominee account shall be at
the sole discretion of the Company, and participation in the Plan is expressly
conditioned on the acceptance of such terms. 


	
 

	
 


	
Section 10.

	
Withdrawal;
Termination of Employment. 





          (a)          Voluntary
Withdrawal. A Participant may withdraw from the Plan by following the
established administrative procedures as directed by the Committee, or other
entity designated by the Committee. The withdrawal request will be effective as
soon as administratively feasible. However, any withdrawal request must be made
at least 30 days prior to the end of a Contribution Period to ensure such
withdrawal request shall be effective within such Contribution Period. Once the
withdrawal request is effective, all of the Participant’s Contributions
credited to his or her Account will be paid to him or her, his or her option
will be automatically terminated, and no further Contributions for the purchase
of Shares will be made absent re-enrollment. Notwithstanding the foregoing, an
Officer shall not have the right to withdraw Contributions credited to his or
her account under the Plan except in accordance with Section 10(b) hereof. Upon
withdrawal from the Plan, a Participant may not re-enroll in the Plan until the
next Contribution Period. In order to re-enroll, a Participant must follow the
provisions set forth under Section 5(a) hereof. 


          (b)          Termination
of Continuous Status as an Employee. 


                          i.          Upon
termination of the Participant’s Continuous Status as an Employee prior to the
Purchase Date of a Contribution Period for any reason, including death or
retirement, the Contributions credited to his or her Account will be returned
to him or her or, in the case of his or her death, to the person or persons
entitled thereto under Section 14 hereof, and his or her option will be
automatically terminated. Whether the Participant’s Continuous Status as an Employee
has been terminated shall be determined by the Committee in its sole
discretion. In the event that any Designated Subsidiary ceases to be a
Designated Subsidiary of the Company, the employees of such Designated
Subsidiary shall no longer be Employees for purposes of Section 3(a) hereof as
of the date such Designated Subsidiary ceases to be a Designated Subsidiary. 


                          ii.          Notwithstanding
the foregoing, if any Participant on an approved leave of absence is deemed to
incur a termination of the Participant’s Continuous Status as an Employee (i.e., because the leave exceeds three
months and re-employment upon the expiration of such leave is not guaranteed by



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contract or
statute) within three months preceding the Purchase Date of a Contribution
Period, his or her option will not be terminated, and any Contributions
previously credited to the Participant’s Account will remain in the Account and
be applied toward the purchase of Shares. 


          (c)          Hardship
Withdrawal. If, during a Contribution Period, the Participant receives a
hardship withdrawal under the Company’s tax-qualified cash or deferral
arrangement under Section 401(k) of the Code, the Participant’s participation
in the Plan shall be discontinued. Once the hardship withdrawal request is
effective, all of the Participant’s Contributions credited to his or her
Account will be paid to him or her, his or her option will be automatically
terminated, and no further Contributions for the purchase of Shares will be
made absent re-enrollment. Upon withdrawal from the Plan, a Participant may not
re-enroll in the Plan until the next Contribution Period that begins at least
six months after receipt of the hardship distribution. In order to re-enroll, a
Participant must follow the provisions set forth under Section 5(a) hereof. 


          (d)          A
Participant’s withdrawal from the Plan shall not have any effect upon his or
her eligibility to participate in any similar plan that may hereafter be
adopted by the Company or any Subsidiary. 


	
 

	
 


	
Section 11.

	
Interest.






          No
interest shall accrue on the Contributions or the Account balance of a
Participant in the Plan, unless otherwise determined necessary by the Committee
for the Accounts of Participants in the portion of the Plan that is not
intended to qualify under Section 423 of the Code. 


	
 

	
 


	
Section 12.

	
Shares.






          (a)          The
maximum number of Shares originally authorized for issuance under the Plan was
5,000,000 Shares (subject to adjustment as provided in Section 18 hereof).
Effective for Purchase Dates occuring on or after August 1, 2012, the number of
Shares available for issuance under the Plan is increased by 6,000,000 Shares
to a total of 11,000,000 Shares (subject to adjustment as provided in Section
18 hereof). If on a given Purchase Date, the number of Shares with respect to
which options are to be exercised exceeds the number of Shares available for
sale under the Plan on such Purchase Date, the Committee shall make a pro rata
allocation of the Shares available for purchase on such Purchase Date among all
Participants, and the balances in the Accounts shall be refunded to the
respective Participants. 


          (b)          The
Participant shall have no interest or voting right in Shares covered by his or
her option until such option has been exercised. 


	
 

	
 


	
Section 13.

	
Administration.






          (a)          The
Committee. The Plan shall be administered by a committee (the “Committee”)
established by the Board. The members of the Committee need not be directors of
the Company and shall be appointed by and serve at the pleasure of the Board. 


          (b)          Powers
of Committee. The Committee shall supervise and administer the Plan and
shall have full power to adopt, amend and rescind any rules deemed desirable
and appropriate for the administration of the Plan and not inconsistent with
the Plan, to construe and interpret the Plan, and to make all other
determinations necessary or advisable for the administration of the Plan. Decisions
of the Committee will be final and binding on all parties who have an interest
in the Plan. The Committee may 


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delegate ministerial duties to such of the Company’s
employees, outside entities and outside professionals as the Committee so
determines.


          (c)         Power
and Authority of the Board. Notwithstanding anything to the contrary
contained herein, the Board may, at any time and from time to time, without any
further action of the Committee, exercise the powers and duties of the
Committee under the Plan.


	
  

 	
  

 
	
 Section
 14.

 	
 Death of Participant.

 



          In
the event of the death of a Participant, the Company shall deliver any Shares
and cash in the Participant’s Account to a beneficiary previously designated by
the Participant or, if there is no surviving beneficiary duly designated, to
the executor or administrator of the estate of the Participant, or if no such
executor or administrator has been appointed (to the knowledge of the Company),
the Company, in its discretion, may deliver such Shares and/or cash to the
spouse or to any one or more dependents or relatives of the Participant, or if
no spouse, dependent or relative is known to the Company, then to such other
person as the Company may designate.


	
  

 	
  

 
	
 Section
 15.

 	
 Transferability.

 



          Neither
Contributions credited to a Participant’s Account nor any rights with regard to
the exercise of an option or to receive Shares under the Plan may be assigned,
transferred, pledged or otherwise disposed of in any way (other than as
provided in Section 14 hereof) by the Participant. Any such attempt at
assignment, transfer, pledge or other disposition shall be without effect,
except that the Company may treat such act as an election to withdraw funds in
accordance with Section 10 hereof.


	
  

 	
  

 
	
 Section
 16.

 	
 Use of Funds.

 



          All
Contributions received or held by the Company under the Plan may be used by the
Company for any corporate purpose, and the Company shall not be obligated to
segregate such Contributions. The Plan is unfunded and shall not create nor be
construed to create a trust or separate fund of any kind or a fiduciary
relationship among the Company, the Board, the Committee and the Participant.
To the extent a Participant acquires a right to receive payment from the
Company pursuant to the Plan, such right shall be no greater than the right of
any unsecured general creditor of the Company.


	
  

 	
  

 
	
 Section 17.

 	
 Reports.

 



          Accounts
will be maintained for each Participant in the Plan. Account statements will be
made available to participating Employees by the Company and will set forth the
amounts of Contributions, the Purchase Price per Share, the number of Shares
purchased and the remaining cash balance, if any.


	
  

 	
  

 
	
 Section
 18.

 	
 Adjustments Upon Changes in Capitalization; Corporate
 Transactions.

 



          (a)          Adjustment
The number of Shares set forth in Section 12 hereof, the price per Share
covered by each option under the Plan that has not yet been exercised and the
maximum number of Shares that may be purchased by a Participant in a calendar
year pursuant to Section 3(b) hereof, shall be proportionately adjusted
for any increase or decrease in the number of outstanding Shares resulting from
a stock split, reverse stock split, stock dividend, combination or
reclassification of the Common Stock (including any such change in the number
of Shares effected in connection with a change in domicile of the Company).
Such adjustment shall be made by the Board, whose determination in that respect
shall be final, binding and conclusive. Except as expressly provided herein, no
issue by the Company of shares of stock of any class, or securities convertible
into shares of stock of any class, shall


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affect, and no adjustment by reason thereof shall be
made with respect to, the number or price of Shares issuable hereunder or
subject to an option hereunder.


          (b)          Corporate
Transactions. In the event of a dissolution or liquidation of the Company,
any Contribution Period then in progress will terminate immediately prior to
the consummation of such action, unless otherwise provided by the Board in its
sole discretion, and in such event, all outstanding options shall automatically
terminate and the balance in the Accounts shall be refunded to the respective
Participants. In the event of a Corporate Transaction, each option outstanding
under the Plan shall be assumed or an equivalent option shall be substituted by
the successor corporation or a parent or subsidiary of such successor
corporation. In the event that the successor corporation refuses to assume or
substitute for outstanding options, the Contribution Period then in progress
shall be shortened and a new Purchase Date shall be set (the “New Purchase
Date”), as of which date the Contribution Period then in progress will
terminate. The New Purchase Date shall be on or before the date of consummation
of the Corporate Transaction and the Board shall notify each Participant in
writing, at least 10 days prior to the New Purchase Date, that the Purchase
Date for his or her option has been changed to the New Purchase Date and that
his or her option will be exercised automatically on the New Purchase Date,
unless prior to such date he or she has withdrawn from the Plan as provided in
Section 10 hereof. For purposes of this Section 18, an option granted
under the Plan shall be deemed to be assumed, without limitation, if, at the
time of issuance of the stock or other consideration upon a Corporate
Transaction, each holder of an option under the Plan would be entitled to
receive upon exercise of the option the same number and kind of shares of stock
or the same amount of property, cash or securities as such holder would have
been entitled to receive upon the occurrence of the Corporate Transaction if
the holder had been, immediately prior to the Corporate Transaction, the holder
of the number of Shares covered by the option at such time (after giving effect
to any adjustments in the number of Shares covered by the option as provided
for in this Section 18); provided however that if the consideration
received in the transaction is not solely common stock of the successor
corporation or its parent (as defined in Section 424(e) of the Code), the
Board may, with the consent of the successor corporation, provide for the
consideration to be received upon exercise of the option to be solely common
stock of the successor corporation or its parent equal in fair market value, as
determined by the Committee, to the per Share consideration received by holders
of Common Stock in the Corporate Transaction.


          The
Board may, if it so determines in the exercise of its sole discretion, also
make provision for adjusting the number of Shares set forth in Section 12
hereof, as well as the price per Share covered by each outstanding option, in
the event that the Company effects one or more reorganizations,
recapitalizations, rights offerings or other increases or reductions of its
outstanding Common Stock, and in the event the Company is consolidated with or
merged into any other corporation.


	
  

 	
  

 
	
 Section 19.

 	
 Amendment or Termination.

 



          (a)          The
Board may at any time and for any reason terminate or amend the Plan. Except as
provided in Section 18 hereof, no such termination of the Plan may affect
options previously granted, provided that the Plan or the Contribution Period
may be terminated by the Board on a Purchase Date or by the Board’s setting a
new Purchase Date with respect to a Contribution Period then in progress if the
Board determines that termination of the Plan and/or the Contribution Period is
in the best interests of the Company and the shareholders or if continuation of
the Plan and/or the Contribution Period would cause the Company to incur
adverse accounting charges as a result of a change after the effective date of
the Plan in the generally accepted accounting principles applicable to the
Plan. Except as provided in Section 18 hereof and in this Section 19, no
amendment to the Plan shall make any change in any option previously granted
that adversely affects the rights of any Participant. In addition, to the
extent necessary to comply with Rule 16b‐3 under the Exchange Act or
Section 423 of the Code (or, in either


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case, any successor rule or
provision or any applicable law or regulation) or the requirements of any stock
exchange upon which the Shares may then be listed, the Company shall obtain
shareholder approval in such a manner and to such a degree as so required.


          (b)          Without
shareholder approval and without regard to whether any Participant rights may
be considered to have been adversely affected, the Board shall be entitled to
change the Contribution Periods and/or the Purchase Price as permitted under
the Plan, limit the frequency and/or number of changes in the amount deducted
during a Contribution Period, establish the exchange ratio applicable to
amounts deducted in a currency other than U.S. dollars, permit payroll
deductions in excess of the amount designated by a Participant in order to
adjust for delays or mistakes in the Company’s processing of properly completed
payroll deduction elections, establish reasonable waiting and adjustment
periods and/or accounting and crediting procedures to ensure that amounts
applied toward the purchase of Shares for each Participant properly correspond
with amounts deducted from the Participant’s Compensation, and establish such
other limitations or procedures as the Board determines in its sole discretion
to be advisable and consistent with the Plan.


	
  

 	
  

 
	
 Section 20.

 	
 Notices.

 



          All
notices or other communications by a Participant to the Company under or in
connection with the Plan shall be deemed to have been duly given when received
in the form specified by the Company at the location, or by the person,
designated by the Company for the receipt thereof.


	
  

 	
  

 
	
 Section 21.

 	
 Conditions Upon Issuance of Shares.

 



          Shares
shall not be issued with respect to an option unless the exercise of such
option and the issuance and delivery of such Shares pursuant thereto shall
comply with all applicable provisions of law, domestic or foreign, including,
without limitation, the Securities Act of 1933, as amended, the Exchange Act,
the rules and regulations promulgated thereunder, applicable state securities
laws and the requirements of any stock exchange upon which the Shares may then
be listed, and shall be further subject to the approval of counsel for the
Company with respect to such compliance.


          As
a condition to the exercise of an option, the Company may require the person
exercising such option to represent and warrant at the time of any such
exercise that the Shares are being purchased only for investment and without
any present intention to sell or distribute such Shares if, in the opinion of
counsel for the Company, such a representation is required by any of the
aforementioned applicable provisions of law.


	
  

 	
  

 
	
 Section 22.

 	
 Term of Plan; Effective Date.

 



          The
Plan shall become effective upon approval by the Company’s shareholders. It
shall continue in effect until all of the Shares set forth in Section 12
hereof are exhausted or such earlier time as the Plan is terminated pursuant to
Section 19 hereof.


	
  

 	
  

 
	
 Section 23.

 	
 Additional Restrictions of
 Rule 16b-3.

 



          The
terms and conditions of options granted hereunder to, and the purchase of
Shares by, Officers shall comply with the applicable provisions of
Rule 16b-3. This Plan shall be deemed to contain, and such options
shall be deemed to contain, and the Shares issued upon exercise thereof shall
be subject to, such additional conditions and restrictions as may be required
by Rule 16b-3 to qualify for the maximum exemption from
Section 16 of the Exchange Act with respect to Plan transactions.


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 Section 24.

 	
 Governing Law.

 



          The
internal law, and not the law of conflicts, of the State of Minnesota, shall
govern all questions concerning the validity, construction and effect of the
Plan, and any rules and regulations relating to the Plan.


	
  

 	
  

 
	
 Section 25.

 	
 Severability.

 



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


	
  

 	
  

 
	
 Section 26.

 	
 No Rights as an Employee.

 



          This
Plan shall not form part of any contract of employment between the Company or
any of the Designated Subsidiaries or Subsidiaries not constituting Designated
Subsidiaries nor shall this Plan amend, abrogate or affect any existing
employment contract between the Company or any Designated Subsidiary or any
Subsidiary not being a Designated Subsidiary and their respective employees.
Nothing in the Plan shall be construed to give any person (including an
Employee or Participant) the right to remain in the employ of the Company or a
Subsidiary or to affect the right of the Company or a Subsidiary to terminate
the employment of any person (including the Employee or Participant) at any
time with or without cause. Nothing in this Plan shall confer on any person any
legal or equitable right against the Company or any Subsidiary, or give rise to
any cause of action at law or in equity against the Company or any Subsidiary.
Neither the Shares purchased hereunder nor any other benefits conferred hereby,
including the right to purchase Common Stock at a discount, shall form any part
of the wages or salary of any eligible Employee for purposes of severance pay
or termination indemnities, irrespective of the reason for termination of
employment. Under no circumstances shall any person ceasing to be an Employee
be entitled to any compensation for any loss of any right or benefit under this
Plan which such Employee might otherwise have enjoyed but for termination of
employment, whether such compensation is claimed by way of damages for wrongful
or unfair dismissal, breach of contract or otherwise.


	
  

 	
  

 
	
 Section 27.

 	
 International Participants.

 



          The Committee
shall have the power and authority to allow any of the Company’s Subsidiaries
other than Designated Subsidiaries to adopt and join in the portion of this
Plan that is not intended to comply with Section 423 of the Code and to
allow employees of such Subsidiaries who work or reside outside of the United
States an opportunity to acquire Shares in accordance with such special terms
and conditions as the Committee may establish from time to time, which terms
and conditions may modify the terms and conditions of the Plan set forth
elsewhere in this Plan. Without limiting the authority of the Committee, the
special terms and conditions which may be established with respect to any
foreign country, and which need not be the same for all foreign countries,
include but are not limited to the right to participate, procedures for
elections to participate, the payment of any interest with respect to amounts
received from or credited to accounts held for the benefit of participants, the
purchase price of any Shares to be acquired, the length of any Contribution
Period, the maximum amount of contributions, credits or Shares which may be
acquired by any participating employees, and a participating employee’s rights
in the event of his or her death, disability, withdrawal from participation in
the purchase of Shares 


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hereunder, or termination of employment. Any purchases
made pursuant to the provisions of this Section 27 shall not be subject to
the requirements of Section 423 of the Code.



	
  

 	
  

 
	
 Section 28.

 	
 Taxes.

 



          Participants
are responsible for the payment of all income taxes, employment, social
insurance, welfare and other taxes under applicable law relating to any amounts
deemed under the laws of the country of their residency or of the organization
of the Subsidiary employing such Participant to constitute income arising out
of the Plan, the purchase and sale of Shares pursuant to the Plan and the
distribution of Shares or cash to the Participant in accordance with this Plan.
Each Participant hereby authorizes the relevant Subsidiary to make appropriate
withholding deductions from each Participant’s compensation, which shall be in
addition to any payroll deductions made pursuant to Section 6, and to pay
such amounts to the appropriate tax authorities in the relevant country or
countries in order to satisfy any of the above tax liabilities of the
Participant under applicable law.


	
  

 	
  

 
	
 Section 29.

 	
 Acceptance of Terms.

 



          By
participating in the Plan, each Participant shall be deemed to have accepted
all the conditions of the Plan and the terms and conditions of any rules and
regulations adopted by the Committee and shall be fully bound thereby.


Adopted
by the Board on February 23, 2007 and approved by Shareholders on
May 16, 2007.


Amended
by the Board on February 24, 2012 and approved by Shareholders on May 3,
2012, but effective for Contribution Periods and Purchase Dates beginning on
and after August 1, 2012.


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