Document:

Exhibit 10.1

Exhibit 10.1

DigitalGlobe, Inc.

2010 EXECUTIVE SUCCESS SHARING PLAN

PART I. PLAN DESCRIPTION

	A.	 	THE PLAN

1)    Purpose and Objectives. This document sets forth the DigitalGlobe, Inc. 2010
Executive Success Sharing Plan (the “Plan”) for the Company’s President and eligible,
non-commissionable Vice Presidents (including Senior Vice Presidents and Executive Vice
Presidents, but excluding non-executive functional vice presidents) (collectively
“Executives”). A key component of the business strategy of DigitalGlobe, Inc. (the
“Company”) is to provide incentives to attract and retain outstanding employees. The
Plan is designed to recognize overall Company success, departmental and team
contributions, as well as to reward individual contributions.

2)    Participant Eligibility. An employee shall be eligible to participate in
this Plan (and thus be a “Participant”) if the Company classifies the individual as (i)
having been employed with the Company on or before October 1, 2010 as a regular
full-time non-commissionable Executive; and as (ii) continuously employed thereafter by
the Company through the bonus payment date and as not having given notice of intent to
terminate employment before the bonus payment date. Any employee who terminates
employment with the Company or provides notice of intent to do so before bonus payments
are made is not eligible to receive a bonus under the Plan. 

(a)    Employees Hired Or Promoted During 2010 Plan Year. Employees who are
hired or promoted to a Plan-eligible position, between January 1, 2010 and October 1,
2010 will be eligible for a prorated bonus for the duration of their Plan
participation during 2010. Employees hired, or non-Participant employees promoted, to
an otherwise Plan-eligible position after October 1, 2010 are not eligible to
participate in the Plan. A Participant who is promoted from one bonus-eligible role
to another between the beginning of the 2010 Plan Year and October 1, 2010 will
continue to be eligible for a target bonus opportunity hereunder based on his or her
former and new target bonus opportunities (determined pursuant to Section I.B.2 below)
prorated for such 2010 Plan Year.

(b)    Change
in Employment Status. In certain situations, employment
status may change mid-year from an otherwise eligible position to a non-eligible
position (such as a transition from full-time to part-time, change in employment
classification, leaves of absence, change to eligibility under another bonus plan, or
otherwise). Under these circumstances, the employee will be eligible for a prorated
bonus, prorated for the period of their Plan participation during 2010, subject to the
other conditions hereunder (including, without limitation, those specified in the last
sentence of the introductory language of this Section I.A.2).

3)    Participant Ineligibility. No employee shall be eligible to receive a bonus
under the Plan if (i) he or she is not employed in good standing by the Company on the
bonus payment date, is not classified by the Company as an employee in its payroll
records, or otherwise does not satisfy all of the foregoing eligibility requirements to
be a Plan Participant; (ii) he or she has competed with
the Company’s business during employment with the Company or made plans to compete with
such business following termination of employment; or (iii) he or she has breached any
agreement with or other obligation to the Company or any Company policy.

 

 

 

4)    Plan Termination or Amendment. The Plan will be in effect from January 1,
2010 through December 31, 2010, or such earlier date as the Plan may be terminated in
the sole discretion of the Company (the “2010 Plan Year”). No notice of Plan
termination is necessary. The Company also reserves the right to implement a new
incentive bonus plan or renew this Plan for future periods. Any such action shall be
approved by the Compensation Committee of the Board of Directors of the Company (the
“Compensation Committee”). The Company reserves the right to amend or discontinue this
Plan at any time. The Plan may only be amended by resolution duly adopted by the
Compensation Committee. Participation in this Plan is not a guarantee of receipt of any
bonus or LTI Award hereunder, or of participation in future Company incentive plans.

5)    Discretionary Adjustments.

(a)    The provisions of Sections B and C below of this Part I are guidelines only.
Notwithstanding those sections or any other provisions of this Plan, any bonus
targets, percentages, awards, payment amounts or other bonus-related provisions
(except for the deadline of March 15, 2011 for bonus payments, if any) may be modified
at any time, in whole or in part, in the Company’s discretion (including without
limitation by reducing target bonus percentages or bonus payments otherwise payable
under the Plan), subject to the approval of the Compensation Committee.

(b)    Without limiting the foregoing in any way, as of the date of issuance of this
Plan, the Company is in the midst of an RFP process for a potential government
contract, the outcome of which may impact 2010 revenues upwards or downwards and thus
also 2010 A-EBITDA (as defined in Section I.B.6 below). Based on such events and
results, the Company reserves the right in its discretion to make (or not make)
adjustments (whether increases, decreases or other modifications) as it deems
appropriate in order to better achieve the objectives of the Plan in light of such
contingencies, including without limitation to applicable bonus targets, percentages,
awards, payment amounts or other bonus-related provisions (except for the deadline of
March 15, 2011 for bonus payments, if any). Again, these are examples only and do not
limit the provisions of Section I.A.5.a in any way.

	B.	 	CASH BONUS AWARDS

1)    Bonus Award Composition and Performance Targets. The intent of the Plan is
to motivate Participants to achieve specified goals of the Company by rewarding for
annual Company performance, as well as for maintenance of positive growth trends in the
Company’s business throughout the year, and for individual performance.

As such, 70% of a Participant’s target bonus opportunity will be based on the
achievement of performance goals for each of three performance metrics (each, a “Metric”
and together, the “Metrics”): (1) commercial revenue; (2) defense and intelligence
revenue; and (3) A-EBITDA. The performance goals will be approved by the Compensation
Committee in its discretion. The remaining 30% of a Participant’s target bonus
opportunity will be based on the Participant’s achievement of various individual
performance criteria (the “MBOs”).

 

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As discussed further in Section I.B.3 below, a Participant is eligible to receive a reduced bonus
(i.e., less than 70% of his or her target bonus opportunity) if actual Company performance with
respect to one or more of the Metrics is less than the Target for such Metric(s), provided that in
order for any Metric to pay out, the Company must achieve the minimum “Threshold” level of
performance (below “Target” levels) for such Metric. Alternatively, a Participant is eligible for
an enhanced bonus for above-Target performance up to a maximum level of “High” performance.
Applicable Threshold, Target and High performance levels for each of the Metrics for 2010 are as
set forth on Schedule I (subject to adjustment as provided in Section I.A.5 above).

With respect to the 30% of the target bonus opportunity that is based on MBO
achievement, the MBOs for 2010, actual performance relative to those MBOs, and payout
for a given level of MBO achievement, will be determined by the Company’s Chief
Executive Officer (“CEO”), subject to the review and approval of the Compensation
Committee.

2)    Target Bonus Opportunity. Each Participant is eligible to receive a target
bonus opportunity, expressed as a percentage of Base Salary, depending upon the
Participant’s Tier, as set forth below:

	 	 	 	 	 
	LEVEL	 	TARGET BONUS OPPORTUNITY
	 	 	(expressed as a percentage of Base Salary)
	Executive Tier III

	 	 	60	%
	Executive Tier II

	 	 	50	%
	Executive Tier I

	 	 	40	%

3)    Payout Opportunities.

(a)    Portion Based on Revenue and A-EBITDA. A portion of a given
Participant’s bonus opportunity is payable based on the level of achievement for each
Metric, as set forth in the table below; provided, however, that in order for any
bonus to be payable on a particular Metric, the minimum Threshold of 80% of Target (as
set forth in the table above) must be met for that Metric. The following table
demonstrates the bonus payout (in each case as a percentage of a Participant’s target
bonus opportunity) at various levels of achievement of the Metrics:1

 

	 	 	 
	1	 	This chart applies to all Participants regardless of
whether they are in the commercial, defense and intelligence or some other area
of the Company.

 

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	Components	 	Bonus Opportunity
as a Percentage of a Participant's Target Bonus Opportunity, Based on Various Performance
Metric Achievement Levels
	 	 	Threshold	 	Target	 	High
	 	 	Performance	 	Performance	 	Performance
	 	 	(80% of Target)	 	(100% of Target)	 	(120% of Target)
	COMMERCIAL REVENUE

	 	 	8.75	%	 	 	17.5	%	 	 	35	%
	DEFENSE AND INTELLIGENCE REVENUE

	 	 	8.75	%	 	 	17.5	%	 	 	35	%
	A-EBITDA

	 	 	17.5	%	 	 	35	%	 	 	70	%
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	TOTALS

	 	 	35	%	 	 	70	%	 	 	140	%
	 
	 	 	 	 	 	 	 	 	 	 	 	 

	 	•	 	To illustrate the foregoing provisions, if a Participant achieves
Target-level performance on all Metrics, he or she will be eligible to receive
an aggregate bonus for such performance equal to 70% of his or her target bonus
opportunity. By contrast, if a Participant achieves Threshold-level
performance or High-level performance, respectively, on all Metrics, he or she
will be eligible to receive a bonus for such performance equal to 35% or 140%,
respectively, of his or her target bonus opportunity. This is in addition to
whatever bonus payout, if any, the Participant may earn based on his or her
level of MBO achievement.

	 
	 	•	 	As discussed further below, in the event that achievement levels vary across
the Metrics, a Participant’s bonus eligibility will be determined based on the
achievement level for each distinct Metric, respectively. For example, if
commercial revenue is at the High performance level, defense and intelligence
revenue is at the Threshold level, and A-EBITDA is at Target, a Participant’s
bonus eligibility will be 78.75% of his or her target bonus opportunity based
on such components (i.e., 35% for commercial revenue + 8.75% for defense and
intelligence revenue + 35% for A-EBITDA), in addition to whatever MBO-based
bonus payout the Participant also may earn (if any).

	 
	 	•	 	If the Company achieves between 80% and 100% of Target for a given Metric,
every 1% increase in achievement over 80% will increase the total bonus payable
for that Metric by 5% of the Threshold payout for that Metric. For example, in
the event of achievement of 91% of Target defense and intelligence revenue, the
bonus payable for defense and intelligence revenue achievement (as a percentage
of a Participant’s target bonus opportunity) would be 13.5625% (calculated as
8.75% + (8.75% x 5% x (91% - 80%)). As another example, in the event of
achievement of 98% of Target A-EBITDA, the bonus payable for A-EBITDA
achievement (again, as a percentage of a Participant’s target bonus
opportunity) would be 33.25% (calculated as 17.5% + (17.5% x 5% x (98% - 80%)).

	 
	 	•	 	For achievement of between 100% and 120% of Target for a given Metric, every
1% increase in achievement over 100% will increase the total bonus payable for
that Metric by 5% of the Target payout for that Metric. For example, in the
event of achievement of 115% of Target commercial revenue, the bonus payable
for commercial revenue achievement (as a percentage of a Participant’s target
bonus opportunity) would be 30.625% (calculated as 17.5% + (17.5% x 5% x (115%
- 100%)).

 

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(b)    Portion Based on MBOs. As stated, 30% of a Participant’s target
bonus opportunity will be based on the Participant’s achievement of his or her MBOs.
Actual payout may range from a minimum of 0% up to a maximum of 60% of the target
bonus opportunity, depending on MBO performance.

(c)    Maximum Payout Opportunity. The maximum total bonus award payable
under this Plan is 200% of the target bonus opportunity, payable upon achievement of
120% of the Target goal for each of the three Metrics, and the maximum level of
performance on the MBOs. Under no circumstances shall a Participant’s total bonus
payments under this Plan exceed 200% of his or her target bonus opportunity.

4)    Sample Calculations.

The following table demonstrates the potential payout of this Plan using
several different scenarios, solely for illustration purposes:

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	EXAMPLE 1:	 	EXAMPLE 2:	 	EXAMPLE 3:
	 	 	Commercial Achieves 80%
of Target Revenue,  Defense and
Intelligence Achieves 80% of
Target Revenue, A-EBITDA
Achievement at 80% of Target,
MBO Achievement at Target	 	Commercial Revenue at 100%,
Defense and Intelligence Revenue
at 75%, A-EBITDA at 100%, MBO
Achievement Below Target	 	Commercial Revenue at 90%,

Defense and Intelligence Revenue
at 117%, A-EBITDA at 120%, MBO
Achievement at High Performance
	Factors Included in

Bonus Calculation	 	(as determined

by the Company)	 	(as determined

by the Company)	 	(as determined

by the Company)
	Base Salary

	 	$	100,000	 	 	$	100,000	 	 	$	100,000	 
	Individual Target
Bonus Opportunity %

	 	 	40	%	 	 	40	%	 	 	40	%
	Individual Target
Bonus Opportunity $ (at Overall Target performance)
	 	$	40,000	 	 	$	40,000	 	 	$	40,000	 
	Individual Bonus Award*
	 	$	26,000	 	 	$	21,000	 	 	$	70,200	 
	 	
(i.e., $40,000 x 65%, calculated as
8.75% (commercial) + 8.75% (defense
and intelligence) + 17.5% (A-EBITDA)
+ 30% (MBO))
	 	(i.e., $40,000 x 52.5%,
calculated as 17.5%
(commercial) + 0% (defense
and intelligence) + 35%
(A-EBITDA) + 0%
(MBO)2)
	 	(i.e., $40,000 x 175.5%,
calculated as 13.125% (commercial
= 8.75% + (8.75% x 5% x (90% -
80%)) + 32.375% (defense and
intelligence = 17.5% + (17.5% x 5%
x (117% - 100%)) + 70% (A-EBITDA)
+ 60% (MBO))

	 	 	 
	*	 	All potential payout amounts in examples are based on the assumption that an
employee was employed with DigitalGlobe on or preceding January 1, 2010 and was a
Participant as of that date. Bonus calculations for employees hired after January 1, 2010,
or who otherwise become Participants
after that date, or who cease being Participants at some point during the 2010 Plan Year
after January 1, 2010, will be reflective of the Base Salary earnings for the applicable
duration of employment in the 2010 Plan Year during which the employee is a Participant.

 

	 	 	 
	2	 	In this example, below-Target MBO achievement results
in no payout on the MBO component of the potential bonus award. As stated,
whether and to what extent below-Target MBO performance results in any bonus
payout is entirely discretionary.

 

5

 

5)    Bonus Payment. Any bonus that becomes payable under this Plan
to a Participant will be paid as described above no later than March 15, 2011 for
the 2010 Plan Year.

6)    Definitions.

(a)    “Base Salary” means an employee’s total gross earned base salary for
calendar year 2010, subject to Section I.A.2.a above. Base Salary does not include pay
for commissions, overtime, shift differential, or any other premiums, bonuses, or
incentive compensation or expense reimbursements, or disability, paid leaves, or other
similar benefits, but does include amounts deferred by the employee under the
Company’s “401(k)” plan or contributed on a pre-tax basis under the Company’s
“cafeteria” plan. For purposes of calculating a bonus (if any) that becomes payable
hereunder to an employee who is a Participant for only part of the 2010 Plan Year,
such Participant’s Base Salary shall be deemed prorated based on the portion of the
2010 Plan Year during which such employee was a Participant.

(b)    “A-EBITDA” means Net Income or Loss adjusted for depreciation and
amortization, net interest income or expense, income tax expense (benefit), loss on
disposal of assets, restructuring, loss on early extinguishment of debt, bonus expense
and non-cash stock compensation expense; as such calculation may be adjusted in the
Company’s discretion.

(c)    “Net Income or Loss” means the consolidated net income or net loss of
the Company and its subsidiaries for calendar year 2010 as determined by the Company
in accordance with Generally Accepted Accounting Principles.

C.    LONG TERM INCENTIVES — In addition to the cash bonus provided for above, Participants in
this Plan are eligible for Long Term Incentive awards (“LTI Awards”). While the granting,
amount (if any) and other terms and conditions of LTI Awards remain discretionary, the
Company’s general intent is as follows:

1)    Scope. The Company’s present intention is to make an LTI Award following the
2010 Plan Year to each Participant who, in the Company’s judgment, achieves satisfactory
overall performance during 2010.

2)    Annual Target Value and Composition. The value of any Participant’s LTI
Award target depends on his or her Executive Tier and will be communicated separately to such
Participant. The Company’s present expectation is that approximately 30% of the LTI Award
value would be granted in the form of restricted stock shares and the remaining 70% of the
LTI Award value granted in the form of stock options. The Company reserves the right in its
discretion to grant other values, forms or compositions of LTI Awards. Any LTI Award granted
to a given Participant pursuant to some other plan or program of the Company will also be
governed by the terms and conditions of such plan or program (including without limitation,
as applicable, the DigitalGlobe, Inc. 2007 Employee Stock Option Plan) and any applicable
award agreement or notice, each as in effect or amended from time to time in the Company’s
discretion (collectively, the “Award Documentation”). All LTI Awards are subject to
approval by the Compensation Committee. The granting of an LTI Award hereunder to any given
Participant does not entitle any other Participant(s) to an LTI Award, regardless of whether
such other Participant(s) receive any cash bonus under this Plan.

 

6

 

3)    Grant Date. Any LTI Award that the Company elects to grant to a given
Participant under this Plan for the 2010 Plan Year will be granted no later than March 15,
2011.

4)    Vesting. Any LTI Award granted hereunder shall be eligible to vest in four
equal successive increments on each of the first four successive annual anniversaries of the
grant date of the award (i.e., 25% will be eligible to vest on the first anniversary of the
grant date, and another 25% on each of the second, third and fourth anniversaries of the
grant date). Unless otherwise stated in the Award Documentation for a given LTI Award, a
Participant must be actively employed on a given vesting date in order to be eligible for his
or her LTI Award (or any applicable portion thereof) to vest, and any unvested LTI Award (or
portion thereof) as of a Participant’s separation from employment shall be null and void.
Other terms and conditions of the LTI Award, such as any provisions for accelerated vesting
(if any) upon certain instances of separation from employment or other circumstances, shall
be set forth in the applicable Award Documentation for such LTI Award.

PART II. MISCELLANEOUS

	A.	 	PLAN ADMINISTRATION

	 
	 	 	The Compensation Committee is responsible for the administration and management of the Plan
and shall have all powers and duties necessary to fulfill its responsibilities including, but
not limited to, the discretion to interpret and apply the Plan and to determine all questions
relating to eligibility for benefits. The Compensation Committee may in its discretion, at
any time and from time to time, delegate any and all of its authority and responsibilities
under the Plan to such person(s) or committee(s) as the Compensation Committee may designate,
and may terminate or change any such delegation made, in whole or in part, at any time and
from time to time. The Compensation Committee and its delegates shall have the discretion to
interpret or construe ambiguous, unclear, or implied (but omitted) terms in any fashion they
deem to be appropriate in their sole and absolute discretion, and to make any findings of
fact needed in the administration of the Plan. All determinations of the Compensation
Committee or its delegate shall be binding on all persons if taken in good faith.

	B.	 	ENTIRE STATEMENT

	 
	 	 	The Plan, including all documentation referred to herein, is a complete and exclusive
statement of the Plan’s terms. This Plan supersedes all prior communications, oral or
written, concerning this subject matter. Any provision of the Plan that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective only to the
extent of such prohibition or unenforceability without invalidating the remaining provisions
hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate
or render unenforceable such provision in any other jurisdiction.

 

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	C.	 	NO EMPLOYMENT AGREEMENT

	 
	 	 	This Plan is not to be construed as an employment agreement and in no way limits the right of
the Company to terminate the employment of any Participant at any time, with or without cause
or advance notice. Each Participant’s employment with the Company is, and continues to be,
“at-will” with either party having the right to terminate the employment relationship at any
time, with or without cause or advance notice. By participating in the Plan, each
Participant acknowledges his or her at-will employment status and that such at-will status
only may be changed by a written agreement signed by the Participant and the Company’s CEO.
Except to the extent governed by federal law, the Plan is governed by the laws of the State
of Colorado, excluding choice of law principles.

	D.	 	ISSUE RESOLUTION

	 
	 	 	In the event that there is a dispute between the Company and a Participant arising under or
relating to this Plan, including but not limited to any dispute over any compensation alleged
to be due, further including, but not limited to, disputes concerning the Participant’s bonus
or LTI Award (or lack thereof), the Participant will promptly bring such dispute to the
attention of the Company’s General Counsel or VP Human Resources. The Participant and the
Company shall use their commercially reasonable efforts to resolve any such dispute on an
informal basis. In the event the dispute cannot be resolved informally, the Participant and
the Company agree to resolve the dispute exclusively through binding arbitration in Longmont,
Colorado (or in such other place to which the parties agree) before a single arbitrator in
accordance with the JAMS Employment Arbitration Rules and Procedures (as in effect or amended
from time to time), except as set forth below, and in accordance with the laws of the State
of Colorado. Each party will pay their own costs associated with such arbitration,
including, but not limited to, cost of legal counsel. The arbitrator shall have no power to
modify the provisions of this Plan, or to make an award or impose a remedy that is not
available to a court of general jurisdiction sitting in Denver, Colorado or that was not
requested by a party to the dispute, and the jurisdiction of the arbitrator is limited
accordingly. The arbitrator’s decision or award shall be final and binding, and judgment
thereupon may be entered in any Colorado or other court having jurisdiction thereof.
Notwithstanding the foregoing: (i) either party may in such party’s respective discretion
seek temporary or preliminary injunctive relief in any court of competent jurisdiction in
order to preserve the status quo or avoid irreparable harm pending arbitration; and (ii) if
and to the extent required by Section 8116 of the 2010 Department of Defense Appropriations
Act, Pub. L. No. 111-118, 123 Stat. 2409 (2009), the provisions of this Section II.D shall
not apply to or be enforced by the Company with respect to any claim by a Participant under
Title VII of the Civil Rights Act of 1964, as amended, or any tort claim by a Participant
related to or arising out of sexual assault or harassment, including all such claims for
assault and battery, intentional infliction of emotional distress, false imprisonment, or
negligent hiring, supervision, or retention.

	E.	 	TAX WITHHOLDING

	 
	 	 	The Company may withhold from any payments made under this Plan all applicable taxes and
other withholdings including, but not limited to, Federal, state and local income, employment
and social insurance taxes, as it determines are required or permitted by law. All amounts
paid to Participants under this Plan will be treated as compensation, and each Participant
agrees to such treatment by accepting a payment under the Plan. The Company cannot guarantee
the tax treatment of any payments under the Plan and each Participant agrees that he or she,
and not the Company, shall be liable for any excise taxes, penalties, or interest imposed on
the Participant.

 

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	F.	 	SECTION 409A

	 
	 	 	This Plan is not intended to provide “nonqualified deferred compensation” within the meaning
of Section 409A of the Internal Revenue Code of 1986, as amended (“Section 409A”), and shall
be administered and interpreted in accordance with such intent. The payment(s), if any, made
under this Plan to any Participant are intended to be exempt from Section 409A to the maximum
extent possible as short-term deferrals pursuant to Treasury regulation section
1.409A-1(b)(4). Notwithstanding the foregoing, under no circumstances shall the Company be
responsible for any taxes, penalties, interest or other losses or expenses incurred by a
Participant due to any noncompliance with Section 409A.

	 
	G.	 	SOURCE OF PLAN ASSETS

	 
	 	 	The Plan shall be unfunded. Payments under the Plan shall be made from the general assets of
the Company. To the extent any Participants have any right to payments under the Plan, such
Participants shall be general unsecured creditors of the Company. No Participant shall have
any right, title, claim or interest in or with respect to any specific assets of the Company
or any of its affiliates in connection with the Participant’s participation in the Plan.

 

9exv10w2

Exhibit 10.2

INTEVAC, INC.

2003 EMPLOYEE STOCK PURCHASE PLAN

AS AMENDED, FEBRUARY 2009

     The following constitute the provisions of the 2003 Employee Stock Purchase Plan of Intevac,
Inc. Capitalized terms used herein shall have the meanings assigned to such terms in the attached
Appendix.

     1. Purpose. The purpose of the Plan is to provide employees of the Company and its
Designated Subsidiaries with an opportunity to purchase Common Stock of the Company through
accumulated payroll deductions. It is the intention of the Company to have the Plan qualify as an
“Employee Stock Purchase Plan” under Section 423 of the Code. The provisions of the Plan,
accordingly, shall be construed so as to extend and limit participation in a uniform and
nondiscriminatory basis consistent with the requirements of Section 423.

     2. Eligibility.

          (a) Offering Periods. Any individual who is an Employee as of the Enrollment Date of
any Offering Period under this Plan shall be eligible to participate in such Offering Period,
subject to the requirements of Section 4. Additionally, provided that an individual is an Employee
as of a Semi-Annual Entry Date within an Offering Period, such individual may enter such Offering
Period on such Semi-Annual Entry Date.

          (b) Limitations. Any provisions of the Plan to the contrary notwithstanding, no
Employee shall be granted a purchase right under the Plan (i) to the extent that, immediately after
the grant, such Employee (or 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 or any Parent or
Subsidiary of the Company and/or hold outstanding options to purchase such stock possessing five
percent (5%) or more of the total combined voting power or value of all classes of the capital
stock of the Company or of any Parent or Subsidiary of the Company, or (ii) to the extent that his
or her rights to purchase stock under all employee stock purchase plans (as defined in Section 423
of the Code) of the Company or any Parent or Subsidiary of the Company accrues at a rate which
exceeds twenty-five thousand dollars ($25,000) worth of stock (determined at the Fair Market Value
of the stock at the time such purchase right is granted) for each calendar year in which such
purchase right is outstanding at any time.

     3. Offering Periods. The Plan shall be implemented by a series of successive Offering
Periods, with such succession continuing thereafter until (i) the maximum number of shares of
Common Stock available for issuance under the Plan have been purchased, or (ii) terminated in
accordance with Section 19. Each new Offering Period shall commence on such date as determined by
the Administrator; provided, however, that the first Offering Period shall commence on the first
Trading Day on or after August 1, 2003. The Administrator shall have the power to change the
duration of Offering Periods (including the commencement dates thereof) with respect to future

-1-

 

offerings without stockholder approval if such change is announced prior to the scheduled beginning
of the first Offering Period to be affected thereafter, except as provided in Section 23.

     4. Participation.

          (a) First Purchase Interval in the Offering Period. An Employee who is eligible to
participate in the Plan pursuant to Section 2 shall be entitled to participate in the first
Purchase Interval in the first Offering Period only if such individual submits to the Company’s
payroll office (or its designee), a properly completed subscription agreement authorizing payroll
deductions in the form provided by the Administrator for such purpose (i) no earlier than the
effective date of the Form S-8 registration statement with respect to the issuance of Common Stock
under this Plan and (ii) no later than five (5) business days from the effective date of such S-8
registration statement (the “Enrollment Window”). An eligible Employee’s failure to submit the
subscription agreement during the Enrollment Window shall result in the automatic termination of
such individual’s participation in the Offering Period.

          (b) Subsequent Purchase Intervals and Offering Periods. An Employee who is eligible
to participate in the Plan pursuant to Section 2 may become a participant by (i) submitting to the
Company’s payroll office (or its designee), on or before a date prescribed by the Administrator
prior to an applicable Enrollment Date or Semi-Annual Entry Date, a properly completed subscription
agreement authorizing payroll deductions in the form provided by the Administrator for such
purpose, or (ii) following an electronic or other enrollment procedure prescribed by the
Administrator.

     5. Payroll Deductions.

          (a) At the time a participant enrolls in the Plan pursuant to Section 4, he or she shall elect
to have payroll deductions made on each payday during the Offering Period in an amount not
exceeding ten percent (10%) of the Compensation which he or she receives on each such payday;
provided, that should a payday occur on a Purchase Date, a participant shall have the payroll
deductions made on such payday applied to his or her account under the new Offering Period or
Purchase Interval, as the case may be. A participant’s subscription agreement shall remain in
effect for successive Offering Periods unless terminated as provided in Section 9.

          (b) Payroll deductions authorized by a participant shall commence on the first payday
following the Entry Date and shall end on the last payday in the Offering Period to which such
authorization is applicable, unless sooner terminated by the participant as provided in Section 9;
provided, however, that for the first Offering Period, payroll deductions shall commence on the
first payday on or following the end of the Enrollment Window.

          (c) All payroll deductions made for a participant shall be credited to his or her account
under the Plan and shall be withheld in whole percentages only. A participant may not make any
additional payments into such account.

          (d) A participant may (i) discontinue his or her participation in the Plan as provided in
Section 9, (ii) increase the rate of his or her payroll deductions once during each Purchase
Interval, and (iii) decrease the rate of his or her payroll deductions once during each
Purchase Interval by (x) properly completing and submitting to the Company’s payroll office
(or its

-2-

 

designee), on or before a date prescribed by the Administrator prior to an applicable
Purchase Date, a new subscription agreement authorizing the change in payroll deduction rate in the
form provided by the Administrator for such purpose, or (y) following an electronic or other
procedure prescribed by the Administrator. If a participant has not followed such procedures to
change the rate of payroll deductions, the rate of his or her payroll deductions shall continue at
the originally elected rate throughout the Offering Period and future Offering Periods (unless
terminated as provided in Section 9). The Administrator may, in its sole discretion, change or
institute any limit as to the nature and/or number of payroll deduction rate changes that may be
made by participants during any Offering Period. Any change in payroll deduction rate made
pursuant to this Section 5(d) shall be effective as of the first full payroll period following five
(5) business days after the date on which the change is made by the participant (unless the
Administrator, in its sole discretion, elects to process a given change in payroll deduction rate
more quickly).

          (e) Notwithstanding the foregoing, to the extent necessary to comply with Section 423(b)(8) of
the Code and Section 2(b), a participant’s payroll deductions may be decreased to zero percent (0%)
at any time during a Purchase Interval. Payroll deductions shall recommence at the rate originally
elected by the participant effective as of the beginning of the first Purchase Interval which is
scheduled to end in the following calendar year, unless terminated by the participant as provided
in Section 9.

          (f) At the time the purchase right is exercised, in whole or in part, or at the time some or
all of the Company’s Common Stock issued under the Plan is disposed of, the participant must make
adequate provision for the Company’s federal, state, or other tax withholding obligations, if any,
that arise upon the exercise of the purchase right or the disposition of the Common Stock. At any
time, the Company may, but shall not be obligated to, withhold from the participant’s compensation
the amount necessary for the Company to meet applicable withholding obligations, including any
withholding required to make available to the Company any tax deductions or benefits attributable
to the sale or early disposition of Common Stock by the Employee.

     6. Grant of Purchase Right. On the Enrollment Date of each Offering Period, or the
Semi-Annual Entry Date of each Offering Period for each Employee who entered such Offering Period
on a Semi-Annual Entry Date, each Employee participating in such Offering Period shall be granted a
purchase right to purchase on each Purchase Date during such Offering Period (at the applicable
Purchase Price) up to a number of shares of Common Stock determined by dividing such participant’s
payroll deductions accumulated prior to such Purchase Date and retained in the participant’s
account as of the Purchase Date by the applicable Purchase Price; provided that in no event shall a
participant be permitted to purchase during each Purchase Interval more than 750 shares of Common
Stock (subject to any adjustment pursuant to Section 18), and provided further that such purchase
shall be subject to the limitations set forth in Sections 2(b) and 8. The Employee may accept the
grant of such purchase right by electing to participate in the Plan in accordance with the
requirements of Section 4. The Administrator may, for future Offering Periods, increase or
decrease, in its absolute discretion, the maximum number of shares of Common Stock that a
participant may purchase during each Purchase Interval of such Offering Period. Exercise of the
purchase right shall occur as provided in Section 7, unless the participant has withdrawn pursuant
to Section 9. The purchase right shall expire on the last day of the Offering Period.

-3-

 

     7. Exercise of Purchase Right.

          (a) Unless a participant withdraws from the Plan as provided in Section 9, his or her purchase
right for the purchase of shares of Common Stock shall be exercised automatically on the Purchase
Date, and the maximum number of full shares subject to purchase right shall be purchased for such
participant at the applicable Purchase Price with the accumulated payroll deductions in his or her
account. No fractional shares of Common Stock shall be purchased; any payroll deductions
accumulated in a participant’s account which are not sufficient to purchase a full share shall be
retained in the participant’s account for the subsequent Purchase Interval or Offering Period,
subject to earlier withdrawal by the participant as provided in Section 9. Any other funds left
over in a participant’s account after the Purchase Date shall be returned to the participant.
During a participant’s lifetime, a participant’s purchase right to purchase shares hereunder is
exercisable only by him or her.

          (b) Notwithstanding any contrary Plan provision, if the Administrator determines that, on a
given Purchase Date, the number of shares of Common Stock with respect to which purchase rights are
to be exercised may exceed (i) the number of shares of Common Stock that were available for sale
under the Plan on an Entry Date of the applicable Offering Period, or (ii) the number of shares of
Common Stock available for sale under the Plan on such Purchase Date, the Administrator may in its
sole discretion (x) provide that the Company shall make a pro rata allocation of the shares of
Common Stock available for purchase on such Entry Date or Purchase Date, as applicable, in as
uniform a manner as shall be practicable and as it shall determine in its sole discretion to be
equitable among all participants exercising purchase rights to purchase Common Stock on such
Purchase Date, and continue the Offering Period then in effect, or (y) provide that the Company
shall make a pro rata allocation of the shares of Common Stock available for purchase on such Entry
Date or Purchase Date, as applicable, in as uniform a manner as shall be practicable and as it
shall determine in its sole discretion to be equitable among all participants exercising purchase
rights to purchase Common Stock on such Purchase Date, and terminate the Offering Period then in
effect pursuant to Section 19. The Company may make pro rata allocation of the shares of Common
Stock available on the Entry Date of any applicable Offering Period pursuant to the preceding
sentence, notwithstanding any authorization of additional shares of Common Stock for issuance under
the Plan by the Company’s shareholders subsequent to such Entry Date.

     8. Delivery. As soon as administratively practicable after each Purchase Date on
which a purchase of shares of Common Stock occurs, the Company shall arrange the delivery to each
participant, the shares purchased upon exercise of his or her purchase right in a form determined
by the Administrator (in its sole discretion). No participant shall have any voting, dividend, or
other shareholder rights with respect to shares of Common Stock subject to any purchase right
granted under the Plan until such shares have been purchased and delivered to the participant as
provided in this Section 8.

     9. Withdrawal.

          (a) Under procedures established by the Administrator, a participant may withdraw all but not
less than all the payroll deductions credited to his or her account and not yet used to exercise
his or her purchase right under the Plan at any time by (i) submitting to the Company’s payroll
office (or its designee) a written notice of withdrawal in the form prescribed by

-4-

 

the Administrator for such purpose, or (ii) following an electronic or other withdrawal
procedure prescribed by the Administrator. All of the participant’s payroll deductions credited to
his or her account shall be paid to such participant as promptly as practicable after the effective
date of his or her withdrawal and such participant’s purchase right for the Offering Period shall
be automatically terminated, and no further payroll deductions for the purchase of shares shall be
made for such Offering Period. If a participant withdraws from an Offering Period, payroll
deductions shall not resume at the beginning of the succeeding Offering Period unless the
participant re-enrolls in the Plan in accordance with the provisions of Section 4.

          (b) A participant’s withdrawal from an Offering Period 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
in succeeding Offering Periods that commence after the termination of the Offering Period from
which the participant withdraws.

     10. Termination of Employment. In the event a participant ceases to be an Employee of
an Employer, his or her purchase right shall immediately expire and any payroll deductions credited
to such participant’s account during the Offering Period but not yet used to purchase shares of
Common Stock under the Plan shall be returned to such participant or, in the case of his or her
death, to the person or persons entitled thereto under Section 14, and such participant’s purchase
right shall be automatically terminated.

     11. Interest. No interest shall accrue on the payroll deductions of a participant in
the Plan.

     12. Stock.

          (a) Subject to adjustment upon changes in capitalization of the Company as provided in Section
18, the maximum number of shares of Common Stock which shall be made available for sale under the
Plan shall be 1,250,000 shares plus any shares which have been reserved but not issued under the
Company’s 1995 Employee Stock Purchase Plan as of the date of its termination.

          (b) Shares of Common Stock to be delivered to a participant under the Plan shall be registered
in the name of the participant or in the name of the participant and his or her spouse.

     13. Administration. The Administrator shall administer the Plan and shall have full
and exclusive discretionary authority to construe, interpret and apply the terms of the Plan, to
determine eligibility and to adjudicate all disputed claims filed under the Plan. Every finding,
decision and determination made by the Administrator shall, to the full extent permitted by law, be
final and binding upon all parties.

     14. Designation of Beneficiary.

          (a) A participant may designate a beneficiary who is to receive any shares of Common Stock and
cash, if any, from the participant’s account under the Plan in the event of such participant’s
death subsequent to an Purchase Date on which the purchase right is exercised but prior to delivery
to such participant of such shares and cash. In addition, a participant may designate a
beneficiary who is to receive any cash from the participant’s account under the Plan in the event
of

-5-

 

such participant’s death prior to exercise of the purchase right. If a participant is married
and the designated beneficiary is not the spouse, spousal consent shall be required for such
designation to be effective.

          (b) In the event of the death of a participant and in the absence of a beneficiary validly
designated under the Plan who is living at the time of such participant’s death, the Company shall
deliver such shares and/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 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.

          (c) All beneficiary designations under this Section 14 shall be made in such form and manner
as the Administrator may prescribe from time to time.

     15. Transferability. Neither payroll deductions credited to a participant’s account
nor any rights with regard to the exercise of a purchase right or to receive shares of Common Stock
under the 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 Section 14) 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 from an
Offering Period in accordance with Section 9.

     16. Use of Funds. All payroll deductions 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 payroll deductions. Until shares of Common Stock are issued under the Plan (as
evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer
agent of the Company), a participant shall only have the rights of an unsecured creditor with
respect to such shares.

     17. Reports. Individual accounts shall be maintained for each participant in the
Plan. Statements of account shall be given to participating Employees at least annually, which
statements shall set forth the amounts of payroll deductions, the Purchase Price, the number of
shares of Common Stock purchased and the remaining cash balance, if any.

     18. Adjustments, Dissolution, Liquidation, Merger or Change of Control.

          (a) Adjustments. In the event that any dividend or other distribution (whether in the
form of cash, Common Stock, other securities, or other property), recapitalization, stock split,
reverse stock split, reorganization, merger, consolidation, split-up, spin-off, combination,
repurchase, or exchange of Common Stock or other securities of the Company, or other change in the
corporate structure of the Company affecting the Common Stock such that an adjustment is determined
by the Administrator (in its sole discretion) to be appropriate in order to prevent dilution or
enlargement of the benefits or potential benefits intended to be made available under the Plan,
then the Administrator shall, in such manner as it may deem equitable, adjust the number and class
of Common Stock which may be delivered under the Plan, the Purchase Price per share and the

-6-

 

number of shares of Common Stock covered by each purchase right under the Plan which has not
yet been exercised, and the numerical limits of Section 6.

          (b) Dissolution or Liquidation. In the event of the proposed dissolution or
liquidation of the Company, the Offering Period then in progress shall be shortened by setting a
new Purchase Date (the “New Purchase Date”), and shall terminate immediately prior to the
consummation of such proposed dissolution or liquidation, unless provided otherwise by the Board.
The New Purchase Date shall be before the date of the Company’s proposed dissolution or
liquidation. The Board shall notify each participant in writing, at least ten (10) business days
prior to the New Purchase Date, that the Purchase Date for the participant’s purchase right has
been changed to the New Purchase Date and that the participant’s purchase right shall be exercised
automatically on the New Purchase Date, unless prior to such date the participant has withdrawn
from the Offering Period as provided in Section 9.

          (c) Merger or Change of Control. In the event of a merger of the Company with or into
another corporation or a Change of Control, each outstanding purchase right shall be assumed or an
equivalent purchase right substituted by the successor corporation or a Parent or Subsidiary of the
successor corporation. In the event that the successor corporation refuses to assume or substitute
for the purchase right, the Purchase Interval then in progress shall be shortened by setting a new
Purchase Date (the “New Purchase Date”) and the Offering Period then in progress shall end on the
New Purchase Date. The New Purchase Date shall be before the date of the Company’s proposed merger
or Change of Control. The Administrator shall notify each participant in writing, at least ten
(10) business days prior to the New Purchase Date, that the Purchase Date for the participant’s
purchase right has been changed to the New Purchase Date and that the participant’s purchase right
shall be exercised automatically on the New Purchase Date, unless prior to such date the
participant has withdrawn from the Offering Period as provided in Section 9.

     19. Amendment or Termination.

          (a) The Administrator may at any time and for any reason terminate or amend the Plan. Except
as otherwise provided in the Plan, no such termination can affect purchase rights previously
granted under the Plan, provided that an Offering Period may be terminated by the Administrator on
any Purchase Date if the Administrator determines that the termination of the Plan is in the best
interests of the Company and its stockholders. Except as provided in Section 18 and this Section
19, no amendment may make any change in any purchase right theretofore granted which adversely
affects the rights of any participant. To the extent necessary to comply with Section 423 of the
Code (or any successor rule or provision or any other applicable law, regulation or stock exchange
rule), the Company shall obtain stockholder approval in such a manner and to such a degree as
required.

          (b) Without stockholder consent and without regard to whether any participant rights may be
considered to have been “adversely affected,” the Administrator shall be entitled to change the
Offering Periods, limit the frequency and/or number of changes in the amount withheld during an
Offering Period, establish the exchange ratio applicable to amounts withheld in a currency other
than U.S. dollars, permit payroll withholding 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
withholding elections, establish reasonable waiting and adjustment periods and/or

-7-

 

accounting and crediting procedures to ensure that amounts applied toward the purchase of
Common Stock for each participant properly correspond with amounts withheld from the participant’s
Compensation, and establish such other limitations or procedures as the Administrator determines in
its sole discretion advisable which are consistent with the Plan.

          (c) In the event the Administrator determines that the ongoing operation of the Plan may
result in unfavorable financial accounting consequences, the Board may, in its discretion and, to
the extent necessary or desirable, modify or amend the Plan to reduce or eliminate such accounting
consequence including, but not limited to:

               (i) altering the Purchase Price for any Offering Period including an Offering Period underway
at the time of the change in Purchase Price;

               (ii) shortening any Offering Period so that Offering Period ends on a new Purchase Date,
including an Offering Period underway at the time of the Board action; and

               (iii) allocating shares.

Such modifications or amendments shall not require stockholder approval or the consent of any Plan
participants.

     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.

     21. Conditions Upon Issuance of Shares. Shares of Common Stock shall not be issued
with respect to a purchase right under the Plan unless the exercise of such purchase right 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,
including the rules and regulations promulgated thereunder, the Exchange Act 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 a purchase right, the Company may require the person
exercising such purchase right 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.

     22. Term of Plan. The Plan shall become effective upon the earlier to occur of its
adoption by the Board or its approval by the stockholders of the Company. It shall continue in
effect until terminated pursuant to Section 19.

     23. Automatic Transfer to Low Price Offering Period. To the extent permitted by any
applicable laws, regulations, or stock exchange rules if the Fair Market Value of the Common Stock
on any Purchase Date in an Offering Period is lower than the Fair Market Value of the Common Stock
on the Enrollment Date of such Offering Period, then all participants in such Offering Period

-8-

 

shall be automatically withdrawn from such Offering Period immediately after the exercise of
their purchase right on such Purchase Date and automatically re-enrolled in the immediately
following Offering Period and the current Offering Period shall automatically terminate after such
purchase of shares on the Purchase Date. The Administrator may shorten the duration of such new
Offering Period within five (5) business days following the start date of such new Offering Period.

-9-

 

APPENDIX

	 	 	The following definitions shall be in effect under the Plan:

          Definitions.

          (a) “Administrator” means the Board or any committee thereof designated by the Board
in accordance with Section 13.

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

          (c) “Change of Control” means the occurrence of any of the following events:

               (i) Any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act)
becomes the “beneficial owner” (as defined in Rule 13d-3 of the Exchange Act), directly or
indirectly, of securities of the Company representing fifty percent (50%) or more of the total
voting power represented by the Company’s then outstanding voting securities; or

               (ii) The consummation of the sale or disposition by the Company of all or substantially all of
the Company’s assets; or

               (iii) The consummation of a merger or consolidation of the Company, with any other
corporation, other than a merger or consolidation which would result in the voting securities of
the Company outstanding immediately prior thereto continuing to represent (either by remaining
outstanding or by being converted into voting securities of the surviving entity or its parent) at
least fifty percent (50%) of the total voting power represented by the voting securities of the
Company, or such surviving entity or its parent outstanding immediately after such merger or
consolidation.

               (iv) A change in the composition of the Board, as a result of which fewer than a majority of
the Directors are Incumbent Directors. “Incumbent Directors” means Directors who either (A) are
Directors as of the effective date of the Plan (pursuant to Section 22), or (B) are elected, or
nominated for election, to the Board with the affirmative votes of at least a majority of those
Directors whose election or nomination was not in connection with any transaction described in
subsections (i), (ii) or (iii) or in connection with an actual or threatened proxy contest relating
to the election of Directors of the Company.

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

          (e) “Common Stock” means the common stock of the Company.

          (f) “Company” means Intevac, Inc., a California corporation.

          (g) “Compensation” means an Employee’s base straight time gross earnings, but
exclusive of payments for commissions, overtime, shift premium and other compensation.

-10-

 

          (h) “Designated Subsidiary” means any Subsidiary that has been designated by the
Administrator from time to time in its sole discretion as eligible to participate in the Plan.

          (i) “Director” means a member of the Board.

          (j) “Employee” means any individual who is a common law employee of an Employer and is
customarily employed for at least twenty (20) hours per week and more than five (5) months in any
calendar year by the Employer. For purposes of the Plan, the employment relationship shall be
treated as continuing intact while the individual is on sick leave or other leave of absence
approved by the Company. Where the period of leave exceeds 90 days and the individual’s right to
reemployment is not guaranteed either by statute or by contract, the employment relationship shall
be deemed to have terminated on the 91st day of such leave.

          (k) “Employer” means any one or all of the Company and its Designated Subsidiaries.

          (l) “Enrollment Date” means the first Trading Day of each Offering Period.

          (m) “Entry Date” means the Enrollment Date or Semi-Annual Entry Date on which an
individual becomes a participant in the Plan.

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

          (o) “Fair Market Value” means, as of any date, the value of Common Stock determined as
follows:

               (i) If the Common Stock is listed on any established stock exchange or a national market
system, including without limitation the Nasdaq National Market or The Nasdaq SmallCap Market of
The Nasdaq Stock Market, its Fair Market Value shall be the closing sales price for the Common
Stock (or the closing bid, if no sales were reported) as quoted on such exchange or system on the
date of determination, as reported in The Wall Street Journal or such other source as the
Administrator deems reliable, or;

               (ii) If the Common Stock is regularly quoted by a recognized securities dealer but selling
prices are not reported, its Fair Market Value shall be the mean of the closing bid and asked
prices for the Common Stock on the date of determination, as reported in The Wall Street Journal or
such other source as the Administrator deems reliable, or;

               (iii) In the absence of an established market for the Common Stock, its Fair Market Value
shall be determined in good faith by the Administrator.

          (p) “Offering Periods” means the successive periods of approximately twenty-four (24)
months, each comprised of one or more successive Purchase Intervals. The duration and timing of
Offering Periods may be changed pursuant to Section 3 of this Plan.

          (q) “Parent” means a “parent corporation,” whether now or hereafter existing, as
defined in Section 424(e) of the Code.

-11-

 

          (r) “Plan” means this 2003 Employee Stock Purchase Plan.

          (s) “Purchase Date” means the last Trading Day in January and July of each year. The
first Purchase Date under the Plan shall be January 30, 2004.

          (t) “Purchase Interval” shall mean the approximately six (6) month period running from
the first Trading Day in February of each year through the last Trading Day in July of each year or
from the first Trading Day in August of each year through the last Trading Day in January of the
following year. However, the initial Purchase Interval shall commence on the Enrollment Date of
the first Offering Period and end on the last Trading Day in January 2004.

          (u) “Purchase Price” means, for each participant, an amount equal to eighty-five
percent (85%) of the Fair Market Value of a share of Common Stock on (i) the Participant’s Entry
Date into that Offering Period, or (ii) on the Purchase Date, whichever is lower; provided however,
that the Purchase Price may be adjusted by the Administrator pursuant to Section 19.

          (v) “Semi-Annual Entry Date” means the first Trading Day of each Purchase Interval
provided that such Trading Day is not an Enrollment Date.

          (w) “Subsidiary” means a “subsidiary corporation,” whether now or hereafter existing,
as defined in Section 424(f) of the Code.

          (x) “Trading Day” means a day on which the U.S. national stock exchanges and the
Nasdaq System are open for trading.

-12-

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