Document:

ex103.htm

 

NOCTUA FUND, LP                                         From the Desk of: James B. Panther, II

                                                     2038 Corte del Nogal, Suite 110

                                                     Carlsbad, California 92011

                                                     Phone: (760) 804-8844

                                                      Facsimile: (760) 804-8845

 

 

 

June 1, 2009

Shrink Nanotechnologies, Inc. (f/k/a Audiostocks, Inc.)

2038 Corte Del Nogal, Suite 110

Carlsbad, CA 92011

Re:  Secured Convertible Promissory Note

Gentlemen:

 

 

           Reference is hereby made to that certain Debt Consolidation Agreement (the “Agreement”) and Secured Convertible Promissory Note (the “Convertible Note”) entered into in favor of Noctua Fund, LP (“Noctua”) as of May 7, 2009.

In particular, the undersigned certifies and acknowledges that the specific anti dilution provision contained and referenced in Section 2.7(g) of the Convertible Note is a typographical error and was not intended by either party, and therefore, is null and void and unenforceable ab-initio.

Accordingly, Noctua irrevocably waives any and all past, present or future adjustments, imputed or accrued or otherwise that could accrue as a result of said Section 2.7(g) of the Convertible Note and further warrants and covenants that it can not and will not seek enforcement of the same.  It is understood that the Company may represent the same to third parties for purposes of a possible share exchange, acquisition or other financing transactions from time to time.

Notwithstanding the foregoing, the remaining portions of said agreement and Convertible Note, as may be amended from time to time, are in full force and effect, and enforceable by their terms, and are not waived in any way.

 

Accepted and Acknowledged-

	
NOCTUA FUND, LP

	  	
SHRINK NANOTECHNOLOGIES, INC.

 

	
 

/s/ James B. Panther, II

______________________________

	  	
 

/s/ Mark L. Baum, Esq

________________________________

	
By: Noctua Fund Manager, LLC

	  	
Name: Mark L. Baum, Esq.

	
Its: General Partner

	  	
Title: Chief Executive Officer

	
Administrative Manager, BCGU, Inc.

	  	  
	
By: James B. Panther, II

Its: Managing Director2006 Employee Stock Purchase Plan

 Exhibit 10.1 

2006 EMPLOYEE STOCK PURCHASE PLAN 

1. Establishment of Plan. 

SAIC, Inc. (the “Company”) proposes to grant options for purchase of the Company’s Class A Preferred
Stock or the Company’s Common Stock as determined by the Committee to eligible employees of the Company and its Participating Subsidiaries pursuant to this 2006 Employee Stock Purchase Plan (this “Plan”). The Company
intends this Plan to qualify as an “employee stock purchase plan” under Section 423 of the Code (including any amendments to or replacements of such Section), although the Company makes no undertaking or representation to maintain
such qualification. In addition, the Plan authorizes the grant of options under a Non-423 Plan Component pursuant to rules, procedures or sub-plans adopted by the Board (or its designate) designed to achieve desired tax or other objectives. To the
extent that the Company grants options to employees of its Affiliates, such grants shall be made under the Non-423 Plan Component. Any term not expressly defined in this Plan but defined for purposes of Section 423 of the Code shall have the
same definition herein. 
 2. Definitions. 

This Plan uses the following defined terms: 

(a) “Affiliate” means any entity other than a Subsidiary in which the Company has a controlling interest and which
is not a “subsidiary corporation” as defined in Section 424(f) of the Code. 
 (b) “Annual
Increase” means the automatic annual increase in the Share Limit described in Section 3. 
 (c)
“Board” means the Board of Directors of the Company. 
 (d) “Class A Preferred
Stock” means the Class A Preferred Stock of the Company. 
 (e) “Code” means the
Internal Revenue Code of 1986, as amended. 
 (f) “Committee” means the Compensation Committee of the
Board. 
 (g) “Common Stock” means the Common Stock of the Company. 

(h) “Company” means SAIC, Inc., a Delaware corporation. 

(i) “employee” has the meaning set forth in Section 4. 

(j) “Employee Stock Purchase Committee” means a committee consisting of one or more management employees of the
Company appointed in accordance with Section 5. 
 (k) “fair market value” means the value of a
Share as determined under Section 10. 
 (l) “First Offering Period” means the period commencing and
ending on those dates determined by the Committee. 
 (m) “Maximum Share Amount” means a maximum number
of Shares which may be purchased by any employee at any single Purchase Date described in Section 12. 
 (n)
“Non-423 Plan Component” means a component of this Plan which does not qualify under Section 423 of the Code. 

(o) “Notice Period” means the period within two (2) years from the Offering Date relating to the applicable
shares or one (1) year from the Purchase Date on which the applicable shares were purchased. 
 (p) “Offering
Date” means the first business day of each Offering Period. 
 (q) “Offering Period” means a
period of three (3) months except for the First Offering Period as set forth in Section 7 of this Plan. The duration and timing of Offering Periods may be changed pursuant to Section 7, Section 16 and Section 29 of this
Plan, provided that no Offering Period shall exceed a period of twenty-four (24) months. 
 (r) “Parent
Corporation” shall have the same meaning as “parent corporation” in Section 424(e) of the Code. 
  

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 (s) “Participating Subsidiaries” means Science Applications
International Corporation and such Parent Corporations, Subsidiaries or Affiliates that the Board designates from time to time as corporations that shall participate in this Plan. 

(t) “Plan” means this 2006 Employee Stock Purchase Plan of the Company. 

(u) “Purchase Date” means the last business day of each Purchase Period. 

(v) “Purchase Period” means a period of three (3) months, except for the first Purchase Period, coincident
with an Offering Period. The duration and timing of Purchase Periods may be changed pursuant to Section 7, Section 16 and Section 29 of this Plan, provided that no Purchase Period shall exceed a period of six (6) months.

 (w) “Reserves” means the number and type of Shares covered by each option under this Plan which has
not yet been exercised and the number and type of Shares which have been authorized for issuance under this Plan, including the Annual Increase, but have not yet been placed under option. 

(x) “Share” means a share of the Class A Preferred Stock or Common Stock, as determined by the Committee.

 (y) “Share Limit” means the limit on the total number of Shares available for issuance under this Plan
described in Section 3. 
 (z) “Subsidiary” shall have the same meaning as “subsidiary
corporation” in Section 424(f) of the Code. 
 (aa) “Value Date” means the date the fair market
value of a Share is to be determined. 
 3. Number of Shares. 

The total number of Shares initially available for issuance pursuant to this Plan shall be 9,000,000 (the “Share
Limit”), subject to adjustments effected in accordance with Section 16 of this Plan. Notwithstanding the foregoing and subject to Section 16, the Share Limit shall automatically increase on February 1, 2007 and
February 1 of each year thereafter until and including February 1, 2016 (unless the Plan is terminated earlier in accordance with the provisions hereof) by the “Annual Increase” which shall consist of a number of
shares equal to the least of (i) 9,000,000, (ii) two percent (2%) of the number of shares of Common Stock of the Company outstanding on the last day of the immediately preceding fiscal year (measured on an as-converted basis with
respect to outstanding shares of Class A Preferred Stock), or (iii) a lesser number determined by the Committee prior to such February 1. To the extent the Board (or its designate) shall have implemented a Non-423 Plan Component, the
Share Limit shall be reduced by the number of shares issued under the Non-423 Plan Component. Shares issued under this Plan may consist, in whole or in part, of authorized and unissued shares or treasury shares reacquired in private transactions or
open market purchases, but all shares issued under this Plan and the Non-423 Plan Component shall be counted against the Share Limit. 
 4.
Purpose. 
 The purpose of this Plan is to provide eligible employees of the Company and Participating Subsidiaries with a
convenient means of acquiring an equity interest in the Company through payroll deductions, to enhance such employees’ sense of participation in the affairs of the Company and Participating Subsidiaries, and to provide an incentive for
continued employment. For the purposes of this Plan, “employee” shall mean any individual who is an employee of the Company or a Participating Subsidiary. Whether an individual qualifies as an employee shall be determined by the Committee,
in its sole discretion. The Committee shall be guided by the provisions of Treasury Regulation Section 1.421-7 and Section 3401(c) of the Code and the Treasury Regulations thereunder as to employees in the United States, with the intent
that the Plan cover all “employees” within the meaning of those provisions other than those who are not eligible to participate in the Plan, provided, however, that any determinations regarding whether an individual is an
“employee” shall be prospective only, unless otherwise determined by the Committee. Unless the Committee makes a contrary determination, the employees of the Company shall, for all purposes of this Plan, be those individuals who are
carried as employees of the Company or a Participating Subsidiary for regular payroll purposes or are on a leave of absence for not more than 90 days. Any inquiries regarding eligibility to participate in the Plan shall be directed to the Committee,
whose decision shall be final. 
 5. Administration. 

This Plan shall be administered by the Committee. The Committee may delegate certain administrative responsibilities to an Employee Stock
Purchase Committee, including (a) prescribing, amending and rescinding rules and regulations relating to the Plan; (b) prescribing forms for carrying out the provisions and purposes of the Plan; (c) interpreting the Plan; and
(d) making all other determinations deemed necessary or advisable for the administration of the Plan, including factual determinations. Subject to the provisions of this Plan, the Committee shall have all authority to (i) determine and
change the percentage discount pursuant to Section 10, (ii) determine and change the Offering Periods and Offering Dates pursuant to Section 7, (iii) determine and change the purchase price for shares pursuant to Section 10,
(iv) prescribe minimum holding periods for the Shares issued under this Plan, and (v) prescribe, amend and rescind rules and regulations relating to this Plan. All decisions of the Committee and the Employee Stock Purchase Committee shall
be final and binding upon all participants. Members of the Committee and the Employee Stock Purchase Committee shall receive no compensation for their services in connection with the administration of this Plan, other than standard fees as
established from time to time by the Board for services rendered by Board members serving on Board committees. All expenses incurred in connection with the administration of this Plan shall be paid by the Company. 

 

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 6. Eligibility. 

Any employee of the Company or the Participating Subsidiaries is eligible to participate in an Offering Period (as hereinafter defined)
under this Plan except the following: 
 (a) employees who are not employed by the Company or a Participating Subsidiary prior
to the beginning of such Offering Period or prior to such other time period as specified by the Committee; 
 (b)
employees  who,  together  with  any  other  person  whose  stock  would  be  attributed  to  such  employee  pursuant  to  Section 424(d) of the Code, own
stock or hold options to purchase stock possessing five percent (5%) or more of the total combined voting power or value of all classes of stock of the Company or any of its Participating Subsidiaries or who, as a result of being granted an
option under this Plan with respect to such Offering Period, would own stock or hold options to purchase stock possessing five percent (5%) or more of the total combined voting power or value of all classes of stock of the Company or any of its
Participating Subsidiaries; 
 (c) individuals who provide services to the Company or any of its Participating Subsidiaries as
independent contractors who are reclassified as common law employees for any reason except for federal income and employment tax purposes; and 

(d) employees who reside in countries for whom such employees’ participation in the Plan would result in a violation under any
corporate or securities laws of such country of residence. 
 7. Offering Dates. 

The Offering Periods of this Plan may be up to twenty-four (24) months in duration and may consist of up to eight (8) Purchase
Periods of up to six (6) months in duration during which payroll deductions of the participants are accumulated under this Plan. However, unless and until determined otherwise by the Committee, except for the First Offering Period, each
Offering Period shall have a duration of three months and shall commence on April 1, July 1, October 1 or January 1 and each Offering Period shall have only one Purchase Period which shall run simultaneously with the
Offering Period. The First Offering Period shall commence and end on those dates determined by the Committee. The Committee shall have the power to change the Offering Dates, the Purchase Dates and the duration of Offering Periods or Purchase
Periods without stockholder approval if such change is announced prior to the relevant Offering Period or prior to such other time period as specified by the Committee. 

8. Participation in this Plan. 

Eligible employees may become participants in an Offering Period under this Plan on the Offering Date, after satisfying the eligibility
requirements, by delivering a subscription agreement to the Company prior to such Offering Date, or such other time period as specified by the Committee. An eligible employee who does not deliver a subscription agreement to the Company after
becoming eligible to participate in an Offering Period shall not participate in that Offering Period or any subsequent Offering Period unless such employee enrolls in this Plan by delivering a subscription agreement with the Company prior to such
Offering Period, or such other time period as specified by the Committee. Once an employee becomes a participant in an Offering Period by filing a subscription agreement, such employee shall automatically participate in the Offering Period
commencing immediately following the last day of the prior Offering Period unless the employee withdraws or is deemed to withdraw from this Plan or terminates further participation in the Offering Period as set forth in Section 13 below. Such
participant is not required to file any additional subscription agreement in order to continue participation in this Plan. 
 9. Grant of
Option on Enrollment. 
 Enrollment by an eligible employee in this Plan with respect to an Offering Period shall constitute
the grant (as of the Offering Date) by the Company to such employee of an option to purchase on the Purchase Date up to that number of Shares determined by a fraction, the numerator of which is the amount accumulated in such employee’s payroll
deduction account during such Purchase Period and the denominator of which is eighty-five percent (85%) (unless such percentage is changed pursuant to Section 10) of the fair market value of a Share on the Purchase Date (but in no event
less than the par value of a Share), provided, however, that the number of Shares subject to any option granted pursuant to this Plan shall not exceed the lesser of (x) the maximum number of shares set by the Committee pursuant to
Section 12(c) below with respect to the applicable Purchase Date, or (y) the maximum number of shares which may be purchased pursuant to Section 12(b) below with respect to the applicable Purchase Date. The fair market value of a
Share shall be determined as provided in Section 10 below. Notwithstanding the foregoing, in the event of a change in generally accepted accounting principles which would adversely affect the accounting treatment applicable to any current
Offering Period, the Committee may make such changes to the number of Shares purchased at the end of Purchase Period or the purchase price paid as are allowable under generally accepted accounting principles and as it deems necessary in the sole
discretion of the Committee to avoid or minimize adverse accounting consequences. 
  

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 10. Purchase Price. 

The purchase price per Share at which a Share shall be sold in any Offering Period shall be eighty-five percent (85%) of the fair
market value of the Shares on the Purchase Date; provided that the Committee may change the purchase price to be anywhere from eighty-five percent (85%) to one hundred percent (100%) of the fair market value of a Share on the Offering Date
or the Purchase Date. 
 For purposes of this Plan, “fair market value” of a Share shall be determined as follows:

 (a) Listed Stock. If Shares are traded on any established stock exchange or quoted on a national market system,
fair market value shall be the closing sales price as quoted on that stock exchange or system for the day before the Value Date as reported in The Wall Street Journal or a similar publication. If no sales are reported as having occurred on the day
before the Value Date, fair market value shall be that closing sales price for the last preceding trading day on which sales of Shares are reported as having occurred. If no sales are reported as having occurred during the five trading days before
the Value Date, fair market value shall be the closing bid for the Shares on the day before the Value Date. If the Shares of the Company are listed on multiple exchanges or systems, fair market value shall be based on sales or bid prices on the
primary exchange or system on which Shares of the Company are traded or quoted. 
 (b) Stock Quoted by Securities
Dealer. If Shares are regularly quoted by a recognized securities dealer but selling prices are not reported on any established stock exchange or quoted on a national market system, fair market value shall be the mean between the high bid
and low asked prices on the day before the Value Date. If no prices are quoted for the day before the Value Date, fair market value shall be the mean between the high bid and low asked prices on the last preceding trading day on which any bid and
asked prices were quoted. 
 (c) No Established Market. If Shares are not traded on any established stock exchange
or quoted on a national market system and are not quoted by a recognized securities dealer, the Committee (following guidelines established by the Board) will determine the fair market value of the Shares in good faith. 

(d) Class A Preferred Stock. If shares of the Company’s Common Stock are traded on any established stock exchange
or quoted on a national market system, the fair market value of shares of the Company’s Class A Preferred Stock shall be equal to the fair market value of the Company’s Common Stock, as of the relevant valuation date, for all purposes
under this Plan. 
 11. Payment of Purchase Price; Changes in Payroll Deductions; Issuance of Shares. 

(a) The purchase price of the shares is accumulated by regular payroll deductions made during each Offering Period. The deductions are
made as a percentage of the participant’s compensation in one percent (1%) increments, not less than one percent (1%), nor greater than ten percent (10%), or such lower limit set by the Committee. Compensation shall mean, in the case of
employees subject to tax in the United States, all W-2 cash compensation, including, but not limited to, base salary, wages, bonuses, incentive compensation, commissions, overtime, shift premiums, plus draws against commissions, provided, however
that compensation shall not include any long term disability or workers’ compensation payments, car allowances, relocation payments or expense reimbursements and further provided, however, that for purposes of determining a participant’s
compensation, any election by such participant to reduce his or her regular cash remuneration under Sections 125 or 401(k) of the Code shall be treated as if the participant did not make such election. In the case of employees not subject to tax in
the United States, the Committee shall establish a comparable definition of compensation. Payroll deductions shall commence on the first payday of the Offering Period and shall continue to the end of the Offering Period unless sooner altered or
terminated as provided in this Plan. If payroll deductions are not permitted in a jurisdiction, participants in that jurisdiction may contribute via check or pursuant to another method approved by the Committee. 

 

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 (b) A participant may increase or decrease the rate of payroll deductions during an Offering
Period by filing with the Company a new authorization for payroll deductions, in which case the new rate shall become effective for the next payroll period commencing after the Company’s receipt and processing of the authorization and shall
continue for the remainder of the Offering Period unless changed as described below. Such change in the rate of payroll deductions may be made at any time during an Offering Period. The Committee shall have the authority to impose restrictions on
the number of increases or decreases a participant may make within an Offering Period as set forth in this Subsection (b) or in Section 11(c) below. 

(c) A participant may reduce his or her payroll deduction percentage to zero during an Offering Period by filing with the Company a
request for cessation of payroll deductions. Such reduction shall be effective beginning with the next payroll period after the Company’s receipt of the request and no further payroll deductions shall be made for the duration of the Offering
Period unless the rate of payroll deduction is subsequently increased. Payroll deductions credited to the participant’s account prior to the effective date of the request shall be used to purchase Shares in accordance with Section
(e) below. A participant may subsequently increase his or her payroll deductions during the Offering Period as long as he or she has not withdrawn participation in the Offering Period as set forth in Section 13 below. 

(d) All payroll deductions made for a participant are credited to his or her account under this Plan and are deposited with the general
funds of the Company. No interest accrues on the payroll deductions, unless required by local law. All payroll deductions received or held by the Company may be used by the Company for any corporate purpose, and the Company shall not be obligated to
segregate such payroll deductions, unless required by local law. 
 (e) On each Purchase Date, for so long as this Plan remains
in effect, and provided that the participant has not submitted a signed and completed withdrawal form before that date, which notifies the Company that the participant wishes to withdraw from that Offering Period under this Plan and have all payroll
deductions accumulated in the account maintained on behalf of the participant, as of that date returned to the participant, the Company shall apply the funds then in the participant’s account to the purchase of whole and fractional Shares
reserved under the option granted to such participant with respect to the Offering Period to the extent that such option is exercisable on the Purchase Date. The purchase price per share shall be as specified in Section 10 of this Plan. In the
event that this Plan has been oversubscribed, all funds not used to purchase shares on the Purchase Date shall be returned to the participant, without interest. No Share shall be purchased on a Purchase Date on behalf of any employee whose
participation in this Plan has terminated prior to such Purchase Date. 
 (f) As soon as practicable after the Purchase Date,
the Company shall issue shares for the participant’s benefit representing the shares purchased upon exercise of his or her option. 

(g) During a participant’s lifetime, his or her option to purchase shares hereunder is exercisable only by him or her. The
participant shall have no interest or voting rights in shares covered by his or her option until such option has been exercised and shares have been issued to the participant. 

12. Limitations on Shares to be Purchased. 

(a) No participant shall be entitled to purchase stock under this Plan at a rate which, when aggregated with his or her rights to purchase
stock under all other employee stock purchase plans of the Company or any Subsidiary, exceeds $25,000 in fair market value, determined as of the Offering Date (or such other limit as may be imposed by the Code) for each calendar year in which the
employee participates in this Plan. The Company shall have the authority to take all necessary action, including but not limited to, suspending the payroll deductions of any participant, in order to ensure compliance with this Section. 

(b) No participant shall be entitled to purchase more than the Maximum Share Amount on any single Purchase Date. Prior to the
commencement of any Offering Period or prior to such time period as specified by the Committee, the Committee may, in its sole discretion, set a Maximum Share Amount. The Maximum Share Amount shall be 2,500 shares. If a new Maximum Share Amount is
set, then all participants must be notified of such Maximum Share Amount prior to the commencement of the next Offering Period. The Maximum Share Amount shall continue to apply with respect to all succeeding Purchase Dates and Offering Periods
unless revised by the Committee as set forth above. 
 (c) If the number of shares to be purchased on a Purchase Date by all
employees participating in this Plan exceeds the number of shares then available for issuance under this Plan, then the Company shall make a pro rata allocation of the remaining shares in as uniform a manner as shall be reasonably practicable and as
the Committee shall determine to be equitable. In such event, the Company shall give written notice of such reduction of the number of shares to be purchased under a participant’s option to each participant affected. 

 

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 (d) Any payroll deductions accumulated in a participant’s account which are not used to
purchase stock due to the limitations in this Section 12 shall be returned to the participant as soon as practicable after the end of the applicable Purchase Period, without interest unless required by local law. 

13. Withdrawal. 
 (a) Each
participant may withdraw from an Offering Period under this Plan by signing and delivering to the Company a written notice to that effect on a form provided for such purpose. Such withdrawal may be elected at any time prior to the end of an Offering
Period, or such other time period as specified by the Committee. 
 (b) Upon withdrawal from this Plan, the accumulated payroll
deductions shall be returned to the withdrawn participant, without interest, and his or her interest in this Plan shall terminate. In the event a participant voluntarily elects to withdraw from this Plan, he or she may not resume his or her
participation in this Plan during the same Offering Period, but he or she may participate in any Offering Period under this Plan which commences on a date subsequent to such withdrawal by filing a new authorization for payroll deductions in the same
manner as set forth in Section 8 above for initial participation in this Plan. 
 (c) At such times, if any, when there are
multiple Purchase Periods within an Offering Period and the purchase price can be based on the fair market value at the beginning of the Offering Period, if the fair market value on the first day of the current Offering Period in which a participant
is enrolled is higher than the fair market value on the first day of any subsequent Offering Period, the Company shall automatically enroll such participant in the subsequent Offering Period. Any funds accumulated in a participant’s account
prior to the first day of such subsequent Offering Period shall be applied to the purchase of shares on the Purchase Date immediately prior to the first day of such subsequent Offering Period, if any. 

14. Termination of Employment. 

Termination of a participant’s employment for any reason, including retirement, death or the failure of a participant to remain an
eligible employee of the Company or of a Participating Subsidiary, shall immediately terminate his or her participation in this Plan. In such event, the payroll deductions credited to the participant’s account shall be returned to him or her
or, in the case of his or her death, to his or her legal representative, without interest. For purposes of this Section 14, an employee shall not be deemed to have terminated employment or failed to remain in the continuous employ of the
Company or of a Participating Subsidiary in the case of sick leave, military leave, or any other leave of absence approved by the Board, provided, however that such leave is for a period of not more than ninety (90) days or reemployment upon
the expiration of such leave is guaranteed by contract or statute. 
 15. Return of Payroll Deductions. 

In the event a participant’s interest in this Plan is terminated by withdrawal, termination of employment or otherwise, or in the
event this Plan is terminated by the Board, the Company shall deliver to the participant all payroll deductions credited to such participant’s account. No interest shall accrue on the payroll deductions of a participant in this Plan, unless
required by local law. 
 16. Capital Changes. 

Subject to any required action by the stockholders of the Company, the Reserves, as well as the price per Share covered by each option
under this Plan which has not yet been exercised, shall be proportionately adjusted for any increase or decrease in the number of issued and outstanding Shares resulting from a stock split or the payment of a stock dividend (but only on the Shares),
any other increase or decrease in the number of issued and outstanding Shares effected without receipt of any consideration by the Company or other change in the corporate structure or capitalization affecting the Company’s present Shares,
provided, however, that conversion of any convertible securities of the Company shall not be deemed to have been “effected without receipt of consideration.” Such adjustment shall be made by the Committee, whose determination 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 affect, and no adjustment by reason thereof shall be made
with respect to, the number or price of Shares subject to an option. 
 In the event of the proposed dissolution or liquidation
of the Company, the Offering Period shall terminate immediately prior to the consummation of such proposed action, unless otherwise provided by the Committee. The Committee may, in the exercise of its sole discretion in such instances, declare that
this Plan shall terminate as of a date fixed by the Committee and give each participant the right to purchase shares under this Plan prior to such termination. In the event of (i) a merger or consolidation in which the Company is not the
surviving corporation (other than a merger or consolidation with a wholly-owned subsidiary, a reincorporation of the Company in a different jurisdiction, or other transaction in which there is no substantial change in the stockholders of the Company
or their relative stock holdings and the options under this Plan are assumed, converted or replaced by the successor corporation, which assumption shall be binding on all participants), (ii) a merger in which the Company is the surviving
corporation but after which the stockholders of the Company immediately prior to such merger (other than any stockholder that merges, or which owns or controls another corporation that merges, with the Company in such merger) cease to own their
shares or other equity interest in the Company, (iii) the sale of all or substantially all of the assets of the Company, or (iv) the acquisition, sale, or transfer of more than 50% of the outstanding shares of the Company by tender offer
or similar transaction, the Plan shall continue with regard to Offering Periods that commenced prior to the closing of the proposed transaction and shares shall be purchased based on the fair market value of the surviving corporation’s stock on
each Purchase Date, unless otherwise provided by the Committee. 
  

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 The Committee may, if it so determines in the exercise of its sole discretion, also make
provision for adjusting the Reserves, 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 Shares, or in the event of the Company being consolidated with or merged into any other corporation. 
 17. Nonassignability.

 Neither payroll deductions credited to a participant’s account nor any rights with regard to the exercise of an
option or to receive shares under this Plan may be assigned, transferred, pledged or otherwise disposed of in any way (other than by will, the laws of descent and distribution or as provided in Sections 25 or 26 below) by the participant. Any such
attempt at assignment, transfer, pledge or other disposition shall be void and without effect. 
 18. Reports. 

Individual accounts shall be maintained for each participant in this Plan. Each participant shall receive, as soon as practicable after
the end of each Purchase Period, a report of his or her account setting forth the total payroll deductions accumulated, the number of shares purchased, the per share price thereof and the remaining cash balance, if any, carried forward to the next
Purchase Period or Offering Period, as the case may be. 
 19. Notice of Disposition. 

Each participant shall notify the Company in writing if the participant disposes of any of the shares purchased in any Offering Period
pursuant to this Plan if such disposition occurs within the Notice Period. The Company may, at any time during the Notice Period, place a legend or legends on any certificate representing shares acquired pursuant to this Plan requesting the
Company’s transfer agent to notify the Company of any transfer of the shares. The obligation of the participant to provide such notice shall continue notwithstanding the placement of any such legend on the certificates. 

20. No Rights to Continued Employment. 

An employee’s employment with the Company or a Subsidiary is not for any specified term and may be terminated by such employee or by
the Company or a Subsidiary at any time, for any reason, with or without cause. Nothing in this Plan shall confer upon any employee any right to continue in the employ of, or affiliation with, the Company or a Subsidiary nor constitute any promise
or commitment by the Company or a Subsidiary regarding future positions, future work assignments, future compensation or any other term or condition of employment or affiliation. 

21. Equal Rights and Privileges. 

All eligible employees shall have equal rights and privileges with respect to this Plan so that this Plan qualifies as an “employee
stock purchase plan” within the meaning of Section 423 or any successor provision of the Code and the related regulations, except for differences that may be mandated by local law and that are consistent with Code Section 423(b)(5);
provided, however, that participants participating in the Non-423 Plan Component by means of rules, procedures or sub-plans adopted pursuant to Section 22 need not have the same rights and privileges as participants participating in the
Section 423 Plan. 
 22. Additional Provisions to Comply with Local Law. 

The Committee may from time to time establish one or more sub-plans under the Plan for purposes of satisfying applicable laws of state and
local domestic United States and non-United States jurisdictions. The Committee shall establish such sub-plans by adopting supplements to this Plan containing such additional terms and conditions not otherwise inconsistent with the Plan as the
Committee shall deem necessary or desirable. To the extent inconsistent with the requirements of Code Section 423, such sub-plans and/or supplements shall be considered part of the Non-423 Plan Component, and the options granted thereunder
shall not be considered to comply with Section 423. All supplements adopted by the Committee shall be deemed to be part of the Plan and the Company shall not be required to provide copies of any supplement to participants in any jurisdiction
that is not the subject of such supplement. 
  

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 23. Notices. 

All notices or other communications by a participant to the Company under or in connection with this 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. 

24. Term; Stockholder Approval. 

After this Plan is adopted by the Board, this Plan shall become effective on the date on which the First Offering Period commences subject
to the effectiveness of the merger of SAIC Merger Sub, Inc. with and into Science Applications International Corporation. This Plan shall be approved by the stockholders of the Company, in any manner permitted by applicable corporate law, within
twelve (12) months before or after the date this Plan is adopted by the Board. No purchase of shares pursuant to this Plan shall occur prior to such stockholder approval. This Plan shall continue until the earlier to occur of
(a) termination of this Plan by the Board (which termination may be effected by the Board at any time), (b) issuance of all of the Shares available for issuance under this Plan, or (c) ten (10) years from the approval of this
Plan by stockholders. 
 25. Death of a Non-U.S. Participant. 

In the event a non U.S. participant dies with accumulated payroll deductions having been accumulated to purchase shares at the next
Purchase Date, such amounts shall be paid to the estate of the participant. 
 26. Designation of Beneficiary. 

(a) A participant may file a written designation of a beneficiary who is to receive any shares and cash, if any, from the
participant’s account under this Plan in the event of such participant’s death subsequent to the end of an Purchase Period but prior to delivery to him of such shares and cash. In addition, a participant may file a written designation of a
beneficiary who is to receive any cash from the participant’s account under this Plan in the event of such participant’s death prior to a Purchase Date. 

(b) Such designation of beneficiary may be changed by the participant at any time by written notice. In the event of the death of a
participant and in the absence of a beneficiary validly designated under this Plan who is living at the time of such participant’s death, the Company shall deliver such shares or cash 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 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. 
 27.
Conditions Upon Issuance of Shares; Limitation on Sale 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
Securities Exchange Act of 1934, as amended, the rules and regulations promulgated thereunder, and the requirements of any stock exchange or automated quotation system 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. 
 28. Applicable Law. 

The Plan shall be governed by the substantive laws (excluding the conflict of laws rules) of the State of Delaware. 

29. Amendment or Termination. 

The Board may at any time amend or terminate this Plan, except that any such termination cannot affect options previously granted under
this Plan, nor may any amendment make any change in an option previously granted which would adversely affect the right of any participant, nor may any amendment be made without approval of the stockholders of the Company obtained in accordance with
Section 24 above within twelve (12) months of the adoption of such amendment (or earlier if required by Section 24) if such amendment would: 

(a) increase the number of shares that may be issued under this Plan; or 

(b) change the designation of the employees (or class of employees) eligible for participation in this Plan. 

 

 8 

 Notwithstanding the foregoing, the Board may make such amendments to the Plan as the Board
determines to be advisable, including changes with respect to current Offering Periods or Purchase Periods, if the continuation of the Plan or any Offering Period would result in financial accounting treatment for the Plan that is different from the
financial accounting treatment in effect on the date this Plan is adopted by the Board. 
  

 9

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