a company acquired by
the Company or Compaq or with which the Company or Compaq combines.
SECTION 3.
ADMINISTRATION.
(A)
AUTHORITY OF COMMITTEE.
THE PLAN SHALL BE
ADMINISTERED BY THE COMMITTEE.
SUBJECT TO THE TERMS OF THE PLAN AND APPLICABLE
LAW, AND IN ADDITION TO OTHER EXPRESS POWERS AND AUTHORIZATIONS CONFERRED ON THE
COMMITTEE BY THE PLAN, THE COMMITTEE SHALL HAVE FULL POWER AND AUTHORITY TO: (I)
DESIGNATE PARTICIPANTS; (II) DETERMINE THE TYPE OR TYPES OF AWARDS TO BE GRANTED
TO AN ELIGIBLE EMPLOYEE; (III) DETERMINE THE NUMBER OF SHARES TO BE COVERED BY,
OR WITH RESPECT TO WHICH PAYMENTS, RIGHTS, OR OTHER MATTERS ARE TO BE CALCULATED
IN CONNECTION WITH, AWARDS; (IV) DETERMINE THE TERMS AND CONDITIONS OF ANY
AWARD; (V) DETERMINE WHETHER, TO WHAT EXTENT, AND UNDER WHAT CIRCUMSTANCES
AWARDS MAY BE SETTLED OR EXERCISED IN CASH, SHARES, OTHER SECURITIES, OTHER
AWARDS OR OTHER PROPERTY, OR CANCELED, FORFEITED, OR SUSPENDED AND THE METHOD OR
METHODS BY WHICH AWARDS MAY BE SETTLED, EXERCISED, CANCELED, FORFEITED, OR
SUSPENDED; (VI) DETERMINE WHETHER, TO WHAT EXTENT, AND UNDER WHAT CIRCUMSTANCES
CASH, SHARES, OTHER SECURITIES, OTHER AWARDS, OTHER PROPERTY, AND OTHER AMOUNTS
PAYABLE WITH RESPECT TO AN AWARD SHALL BE DEFERRED EITHER AUTOMATICALLY OR AT
THE ELECTION OF THE HOLDER THEREOF OR OF THE COMMITTEE; (VII) INTERPRET AND
ADMINISTER THE PLAN AND ANY INSTRUMENT OR AGREEMENT RELATING TO, OR AWARD MADE
UNDER, THE PLAN; (VIII) ESTABLISH, AMEND, SUSPEND, OR WAIVE SUCH RULES AND
REGULATIONS AND APPOINT SUCH AGENTS AS IT SHALL DEEM APPROPRIATE FOR THE PROPER
ADMINISTRATION OF THE PLAN; (IX) ADOPT RULES, PROCEDURES, AND SUB-PLANS TO THE
PLAN RELATING TO THE OPERATION AND ADMINISTRATION OF THE PLAN, AS THE COMMITTEE
DEEMS DESIRABLE TO ACCOMMODATE TAX AND OTHER LAWS, REGULATIONS AND PRACTICES IN
FOREIGN JURISDICTIONS; (X) APPROVE FORMS OF NOTICE FOR USE UNDER THE PLAN; (XI)
AUTHORIZE SUBSTITUTION UNDER THE PLAN OF ANY OR ALL OUTSTANDING NON-QUALIFIED
STOCK OPTIONS OR OUTSTANDING STOCK APPRECIATION RIGHTS HELD BY SERVICE PROVIDERS
OF AN ENTITY ACQUIRED BY THE COMPANY; AND (XII) MAKE ANY OTHER DETERMINATION AND
TAKE ANY OTHER ACTION THAT THE COMMITTEE DEEMS NECESSARY OR DESIRABLE FOR THE
ADMINISTRATION OF THE PLAN AND ANY AWARD GRANTED HEREUNDER.
(B)
COMMITTEE DISCRETION BINDING.
UNLESS
OTHERWISE EXPRESSLY PROVIDED IN THE PLAN, ALL DESIGNATIONS, DETERMINATIONS,
INTERPRETATIONS, AND OTHER DECISIONS UNDER OR WITH RESPECT TO THE PLAN OR ANY
AWARD SHALL BE WITHIN THE SOLE DISCRETION OF THE COMMITTEE, MAY BE MADE AT ANY
TIME AND SHALL BE FINAL, CONCLUSIVE, AND BINDING UPON ALL PERSONS, INCLUDING THE
COMPANY, COMPAQ, ANY AFFILIATE, ANY PARTICIPANT, ANY HOLDER OR BENEFICIARY OF
ANY AWARD, ANY STOCKHOLDER AND ANY EMPLOYEE.
3
(C)
DELEGATION OF AUTHORITY FOR THE DAY-TO-DAY
ADMINISTRATION OF THE PLAN.
EXCEPT TO THE EXTENT PROHIBITED BY APPLICABLE LAW
OR APPLICABLE RULES OF A STOCK EXCHANGE, THE BOARD OR ANY OF ITS COMMITTEES AS
SHALL BE ADMINISTERING THE PLAN MAY DELEGATE TO ONE OR MORE INDIVIDUALS THE
DAY-TO-DAY ADMINISTRATION OF THE PLAN AND ANY OF THE FUNCTIONS ASSIGNED TO IT IN
THIS PLAN. THE