Document:

Polycom, Inc. 2004 Equity Incentive Plan, as amended

 Exhibit 10.21 
 POLYCOM, INC. 
 2004 EQUITY INCENTIVE PLAN 
 (February 7, 2006 Restatement) 

 TABLE OF CONTENTS 
  

							
	 	    	 	  	 	  	Page
	SECTION 1 BACKGROUND AND PURPOSE	  	1
				
		    	 1.1
	  	Background and Effective Date	  	1
		    	 1.2
	  	Purpose of the Plan	  	1
		
	SECTION 2 DEFINITIONS	  	1
				
		    	 2.1
	  	“1934 Act”	  	1
		    	 2.2
	  	“Award”	  	1
		    	 2.3
	  	“Award Agreement”	  	1
		    	 2.4
	  	“Board” or “Board of Directors”	  	1
		    	 2.5
	  	“Code”	  	1
		    	 2.6
	  	“Committee”	  	2
		    	 2.7
	  	“Company”	  	2
		    	 2.8
	  	“Consultant”	  	2
		    	 2.9
	  	“Director”	  	2
		    	 2.10
	  	“Disability”	  	2
		    	 2.11
	  	“Earnings Per Share”	  	2
		    	 2.12
	  	“Employee”	  	2
		    	 2.13
	  	“Exchange Program”	  	2
		    	 2.14
	  	“Exercise Price”	  	2
		    	 2.15
	  	“Fair Market Value”	  	2
		    	 2.16
	  	“Fiscal Year”	  	2
		    	 2.17
	  	“Grant Date”	  	3
		    	 2.18
	  	“Incentive Stock Option”	  	3
		    	 2.19
	  	“Nonemployee Director”	  	3
		    	 2.20
	  	“Nonqualified Stock Option”	  	3
		    	 2.21
	  	“Option”	  	3
		    	 2.22
	  	“Participant”	  	3
		    	 2.23
	  	“Performance Goals”	  	3
		    	 2.24
	  	“Performance Period”	  	3
		    	 2.25
	  	“Performance Share”	  	3
		    	 2.26
	  	“Performance Unit”	  	3
		    	 2.27
	  	“Period of Restriction”	  	3
		    	 2.28
	  	“Plan”	  	4
		    	 2.29
	  	“Profit After Tax”	  	4
		    	 2.30
	  	“Restricted Stock”	  	4
		    	 2.31
	  	“Retirement”	  	4
		    	 2.32
	  	“Return on Equity”	  	4
		    	 2.33
	  	“Revenue”	  	4
		    	 2.34
	  	“Rule 16b-3”	  	4
		    	 2.35
	  	“Section 16 Person”	  	4
		    	 2.36
	  	“Shares”	  	4
		    	 2.37
	  	“Stock Appreciation Right” or “SAR”	  	4

  

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 TABLE OF CONTENTS 
 (continued) 
  

							
	 	    	 	  	 	  	Page
		    	2.38	  	“Subsidiary”	  	4
		    	2.39	  	“Termination of Service”	  	4
		    	2.40	  	“Total Shareholder Return”	  	5
		
	 SECTION 3 ADMINISTRATION
	  	5
				
		    	3.1	  	The Committee	  	5
		    	3.2	  	Authority of the Committee	  	5
		    	3.3	  	Delegation by the Committee	  	5
		    	3.4	  	Decisions Binding	  	5
		
	 SECTION 4 SHARES SUBJECT TO THE PLAN
	  	6
				
		    	4.1	  	Number of Shares	  	6
		    	4.2	  	Lapsed Awards	  	6
		    	4.3	  	Adjustments in Awards and Authorized Shares	  	6
		
	SECTION 5 STOCK OPTIONS	  	6
				
		    	5.1	  	Grant of Options	  	6
		    	5.2	  	Award Agreement	  	7
		    	5.3	  	Exercise Price	  	7
		    	5.4	  	Expiration of Options	  	7
		    	5.5	  	Exercisability of Options	  	8
		    	5.6	  	Payment	  	8
		    	5.7	  	Restrictions on Share Transferability	  	8
		    	5.8	  	Certain Additional Provisions for Incentive Stock Options	  	8
		
	SECTION 6 STOCK APPRECIATION RIGHTS	  	9
				
		    	6.1	  	Grant of SARs	  	9
		    	6.2	  	SAR Agreement	  	9
		    	6.3	  	Expiration of SARs	  	9
		    	6.4	  	Payment of SAR Amount	  	9
		
	SECTION 7 RESTRICTED STOCK	  	10
				
		    	7.1	  	Grant of Restricted Stock	  	10
		    	7.2	  	Restricted Stock Agreement	  	10
		    	7.3	  	Transferability	  	10
		    	7.4	  	Other Restrictions	  	10
		    	7.5	  	Removal of Restrictions	  	11
		    	7.6	  	Voting Rights	  	11
		    	7.7	  	Dividends and Other Distributions	  	11
		    	7.8	  	Return of Restricted Stock to Company	  	11
		
	 SECTION 8 PERFORMANCE UNITS
	  	11
				
		    	8.1	  	Grant of Performance Units	  	11
		    	8.2	  	Value of Performance Units	  	11

  

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 TABLE OF CONTENTS 
 (continued) 
  

							
	 	    	 	  	 	  	Page
		    	 8.3
	  	Performance Objectives and Other Terms	  	11
		    	 8.4
	  	Earning of Performance Units	  	12
		    	 8.5
	  	Form and Timing of Payment of Performance Units	  	12
		    	 8.6
	  	Cancellation of Performance Units	  	12
		
	SECTION 9 PERFORMANCE SHARES	  	12
				
		    	 9.1
	  	Grant of Performance Shares	  	12
		    	 9.2
	  	Value of Performance Shares	  	13
		    	 9.3
	  	Performance Share Agreement	  	13
		    	 9.4
	  	Performance Objectives and Other Terms	  	13
		    	 9.5
	  	Earning of Performance Shares	  	13
		    	 9.6
	  	Form and Timing of Payment of Performance Shares	  	14
		    	 9.7
	  	Cancellation of Performance Shares	  	14
		
	SECTION 10 NONEMPLOYEE DIRECTOR OPTIONS	  	14
				
		    	 10.1
	  	Granting of Options	  	14
		    	 10.2
	  	Terms of Options	  	14
		    	 10.3
	  	Elections by Nonemployee Directors	  	15
		
	SECTION 11 MISCELLANEOUS	  	16
				
		    	 11.1
	  	Deferrals	  	16
		    	 11.2
	  	No Effect on Employment or Service	  	16
		    	 11.3
	  	Participation	  	16
		    	 11.4
	  	Indemnification	  	16
		    	 11.5
	  	Successors	  	16
		    	 11.6
	  	Beneficiary Designations	  	16
		    	 11.7
	  	Limited Transferability of Awards	  	17
		    	 11.8
	  	No Rights as Stockholder	  	17
		
	 SECTION 12 AMENDMENT, TERMINATION, AND DURATION
	  	17
				
		    	 12.1
	  	Amendment, Suspension, or Termination	  	17
		    	 12.2
	  	Duration of the Plan	  	17
		
	 SECTION 13 TAX WITHHOLDING
	  	17
				
		    	 13.1
	  	Withholding Requirements	  	17
		    	 13.2
	  	Withholding Arrangements	  	17
		
	 SECTION 14 LEGAL CONSTRUCTION
	  	18
				
		    	 14.1
	  	Gender and Number	  	18
		    	 14.2
	  	Severability	  	18
		    	 14.3
	  	Requirements of Law	  	18
		    	 14.4
	  	Securities Law Compliance	  	18
		    	 14.5
	  	Governing Law	  	18
		    	 14.6
	  	Captions	  	18
		
	 EXECUTION
	  	18

  

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 POLYCOM, INC. 
 2004 EQUITY INCENTIVE PLAN 
 (February 7, 2006 Restatement) 
 SECTION 1 
 BACKGROUND AND PURPOSE 

1.1 Background and Effective Date. The Plan permits the grant of Nonqualified Stock Options, Incentive Stock Options, SARs, Restricted
Stock, Performance Units, and Performance Shares. The Plan is effective as of June 2, 2004 upon approval by an affirmative vote of the holders of a majority of the Shares that are present in person or by proxy and entitled to vote at the 2004
Annual Meeting of Stockholders of the Company. 
 1.2 Purpose of the Plan. The Plan is intended to attract, motivate, and retain
(a) employees of the Company and its Subsidiaries, (b) consultants who provide significant services to the Company and its Subsidiaries, and (c) directors of the Company who are employees of neither the Company nor any Subsidiary. The
Plan also is designed to encourage stock ownership by Participants, thereby aligning their interests with those of the Company’s shareholders and to permit the payment of compensation that qualifies as performance-based compensation under
Section 162(m) of the Code. 
 SECTION 2 
 DEFINITIONS 
 The following words and phrases shall have the following meanings unless a different meaning
is plainly required by the context: 
 2.1 “1934 Act” means the Securities Exchange Act of 1934, as amended. Reference
to a specific section of the 1934 Act or regulation thereunder shall include such section or regulation, any valid regulation promulgated under such section, and any comparable provision of any future legislation or regulation amending,
supplementing or superseding such section or regulation. 
 2.2 “Award” means, individually or collectively, a grant
under the Plan of Incentive Stock Options, Nonqualified Stock Options, SARs, Restricted Stock, Performance Units, or Performance Shares. 
 2.3 “Award Agreement” means the written agreement setting forth the terms and conditions applicable to each Award granted under the Plan. 
 2.4 “Board” or “Board of Directors” means the Board of Directors of the Company. 
 2.5 “Code” means the Internal Revenue Code of 1986, as amended. Reference to a specific section of the Code or regulation thereunder shall include such section or regulation, any valid regulation
promulgated under such section, and any comparable provision of any future legislation or regulation amending, supplementing or superseding such section or regulation. 

 2.6 “Committee” means the committee appointed by the Board (pursuant to
Section 3.1) to administer the Plan. 
 2.7 “Company” means Polycom, Inc., a Delaware corporation, or any
successor thereto. 
 2.8 “Consultant” means any consultant, independent contractor, or other person who provides
significant services to the Company or its Subsidiaries, but who is neither an Employee nor a Director. 
 2.9
“Director” means any individual who is a member of the Board of Directors of the Company. 
 2.10
“Disability” means a permanent disability in accordance with a policy or policies established by the Committee (in its discretion) from time to time. 
 2.11 “Earnings Per Share” means as to any Performance Period, the Company’s Profit After Tax, divided by a weighted average
number of common shares outstanding and dilutive common equivalent shares deemed outstanding, determined in accordance with generally accepted accounting principles. 
 2.12 “Employee” means any employee of the Company or of a Subsidiary, whether such employee is so employed at the time the Plan is adopted or becomes so employed subsequent to the adoption of the
Plan. 
 2.13 “Exchange Program” means a program established by the Committee under which outstanding Awards are
amended to provide for a lower Exercise Price or surrendered or cancelled in exchange for (a) Awards with a lower Exercise Price, (b) a different type of Award, (c) cash, or (d) a combination of (a), (b) and/or (c).
Notwithstanding the preceding, the term Exchange Program does not include any (i) program under which an outstanding Award is surrendered or cancelled in exchange for a different type of Award and/or cash having a total value equal to or less
than the value of the surrendered or cancelled Award, (ii) action described in Section 4.3, nor (iii) transfer or other disposition permitted under Section 11.7. 
 2.14 “Exercise Price” means the price at which a Share may be purchased by a Participant pursuant to the exercise of an Option.

 2.15 “Fair Market Value” means the closing per share selling price for Shares on Nasdaq on the relevant date, or if
there were no sales on such date, average of the closing sales prices on the immediately following and preceding trading dates, in either case as reported by The Wall Street Journal or such other source selected in the discretion of the Committee
(or its delegate). Notwithstanding the preceding, for federal, state, and local income tax reporting purposes, fair market value shall be determined by the Committee (or its delegate) in accordance with uniform and nondiscriminatory standards
adopted by it from time to time. 
 2.16 “Fiscal Year” means the fiscal year of the Company. 
  

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 2.17 “Grant Date” means, with respect to an Award, the date that the Award was
granted. The Grant Date of an Award shall not be earlier than the date the Award is approved by the Committee. 
 2.18 “Incentive
Stock Option” means an Option to purchase Shares that is designated as an Incentive Stock Option and is intended to meet the requirements of Section 422 of the Code. 
 2.19 “Nonemployee Director” means a Director who is an employee of neither the Company nor of any Subsidiary. 
 2.20 “Nonqualified Stock Option” means an option to purchase Shares that is not intended to be an Incentive Stock Option.

 2.21 “Option” means an Incentive Stock Option or a Nonqualified Stock Option. 
 2.22 “Participant” means an Employee, Consultant, or Nonemployee Director who has an outstanding Award. 
 2.23 “Performance Goals” means the goal(s) (or combined goal(s)) determined by the Committee (in its discretion) to be applicable
to a Participant with respect to an Award. As determined by the Committee, the Performance Goals applicable to an Award may provide for a targeted level or levels of achievement using one or more of the following measures: (a) Earnings Per
Share, (b) Profit After Tax, (c) Return on Equity, (d) Revenue, and (e) Total Shareholder Return. The Performance Goals may differ from Participant to Participant and from Award to Award. Any criteria used may be measured, as
applicable, (i) in absolute terms, (ii) in relative terms (including, but not limited to, passage of time and/or against another company or companies), (iii) on a per-share basis, (iv) against the performance of the Company as a
whole or a business unit of the Company and/or (v) on a pre-tax or after-tax basis. Prior to the Determination Date, the Committee shall determine whether any element(s) or item(s) shall be included in or excluded from the calculation of any
Performance Goal with respect to any Participants. 
 2.24 “Performance Period” means any Fiscal Year or such longer period
as determined by the Committee in its sole discretion. 
 2.25 “Performance Share” means an Award granted to a
Participant pursuant to Section 9. 
 2.26 “Performance Unit” means an Award granted to a Participant pursuant to
Section 8. 
 2.27 “Period of Restriction” means the period during which the transfer of Shares of Restricted
Stock are subject to restrictions and therefore, the Shares are subject to a substantial risk of forfeiture. As provided in Section 7, such restrictions may be based on the passage of time, the achievement of target levels of performance, or
the occurrence of other events as determined by the Committee, in its discretion. 
  

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 2.28 “Plan” means the Polycom, Inc. 2004 Equity Incentive Plan, as set forth in
this instrument and as hereafter amended from time to time. 
 2.29 “Profit After Tax” means as to any Performance
Period, the Company’s income after taxes, determined in accordance with generally accepted accounting principles. 
 2.30
“Restricted Stock” means an Award granted to a Participant pursuant to Section 7. 
 2.31
“Retirement” means, in the case of an Employee or a Nonemployee Director a Termination of Service occurring in accordance with a policy or policies established by the Committee (in its discretion) from time to time. With
respect to a Consultant, no Termination of Service shall be deemed to be on account of “Retirement.” 
 2.32 “Return on
Equity” means as to any Performance Period, the percentage equal to the Company’s Profit After Tax divided by average stockholder’s equity, determined in accordance with generally accepted accounting principles. 

2.33 “Revenue” means as to any Performance Period, the Company’s net revenues generated from third parties, determined in
accordance with generally accepted accounting principles. 
 2.34 “Rule 16b-3” means Rule 16b-3 promulgated under the
1934 Act, and any future regulation amending, supplementing or superseding such regulation. 
 2.35 “Section 16
Person” means a person who, with respect to the Shares, is subject to Section 16 of the 1934 Act. 
 2.36
“Shares” means the shares of common stock of the Company. 
 2.37 “Stock Appreciation Right” or
“SAR” means an Award, granted alone or in connection with a related Option, that pursuant to Section 6 is designated as an SAR. 
 2.38 “Subsidiary” means any corporation in an unbroken chain of corporations beginning with the Company as the corporation at the top of the chain, but only if each of the corporations below the
Company (other than the last corporation in the unbroken chain) then owns stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other corporations in such chain. 
 2.39 “Termination of Service” means (a) in the case of an Employee, a cessation of the employee-employer relationship between
the Employee and the Company or a Subsidiary for any reason, including, but not by way of limitation, a termination by resignation, discharge, death, Disability, Retirement, or the disaffiliation of a Subsidiary, but excluding any such termination
where there is a simultaneous reemployment by the Company or a Subsidiary; (b) in the case of a Consultant, a cessation of the service relationship between the Consultant and the Company or a Subsidiary for any reason, including, but not by way
of limitation, a termination by resignation, 
  

 -4- 

 discharge, death, Disability, or the disaffiliation of a Subsidiary, but excluding any such termination where there is a
simultaneous re-engagement of the consultant by the Company or a Subsidiary; and (c) in the case of a Nonemployee Director, a cessation of the Director’s service on the Board for any reason, including, but not by way of limitation, a
termination by resignation, death, Disability, Retirement or non-reelection to the Board. 
 2.40 “Total Shareholder
Return” means as to any Performance Period, the total return (change in share price plus reinvestment of any dividends) of a Share. 
 SECTION 3 
 ADMINISTRATION 
 3.1 The Committee. The Plan shall be administered by the Committee. The Committee shall consist of not less than two (2) Directors who shall be appointed from time to time by, and shall serve at the pleasure of, the Board
of Directors. The Committee shall be comprised solely of Directors who are (a) ”outside directors” under Section 162(m), and (b) ”non-employee directors” under Rule 16b-3. 
 3.2 Authority of the Committee. It shall be the duty of the Committee to administer the Plan in accordance with the Plan’s provisions.
The Committee shall have all powers and discretion necessary or appropriate to administer the Plan and to control its operation, including, but not limited to, the power to (a) determine which Employees, Consultants and directors shall be
granted Awards, (b) prescribe the terms and conditions of the Awards, (c) interpret the Plan and the Awards, (d) adopt such procedures and subplans as are necessary or appropriate to permit participation in the Plan by Employees,
Consultants and Directors who are foreign nationals or employed outside of the United States, (e) adopt rules for the administration, interpretation and application of the Plan as are consistent therewith, and (f) interpret, amend or
revoke any such rules. Notwithstanding the preceding, the Committee shall not implement an Exchange Program without the approval of the holders of a majority of the Shares that are present in person or by proxy and entitled to vote at any Annual or
Special Meeting of Stockholders of the Company. 
 3.3 Delegation by the Committee. The Committee, in its sole discretion and on
such terms and conditions as it may provide, may delegate all or any part of its authority and powers under the Plan to one or more Directors or officers of the Company. Notwithstanding the foregoing, with respect to Awards that are intended to
qualify as performance-based compensation under Section 162(m) of the Code, the Committee may not delegate its authority and powers with respect to such Awards if such delegation would cause the Awards to fail to so qualify. 
 3.4 Decisions Binding. All determinations and decisions made by the Committee, the Board, and any delegate of the Committee pursuant to the
provisions of the Plan shall be final, conclusive, and binding on all persons, and shall be given the maximum deference permitted by law. 
  

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 SECTION 4 
 SHARES SUBJECT TO THE PLAN 
 4.1 Number of Shares. Subject to adjustment as provided in
Section 4.3, the total number of Shares available issuance under the Plan shall equal the sum of (a) 12,500,000, (b) the number of Shares (not to exceed 2,700,000) that remain available for grant under the Company’s 1996 Stock
Incentive Plan as of June 2, 2004, and (c) any Shares (not to exceed 11,991,366) that otherwise would have been returned to the 1996 Stock Incentive Plan after June 1, 2004 on account of the expiration, cancellation or forfeiture of
awards granted under the 1996 Stock Incentive Plan. No more than fifty percent (50%) of the Shares available under the Plan may be issued pursuant to Awards that are not Options or SARs. Shares granted under the Plan may be either authorized
but unissued Shares or treasury Shares. 
 4.2 Lapsed Awards. If an Award is settled in cash, or is cancelled, terminates,
expires, or lapses for any reason, any Shares subject to such Award again shall be available to be the subject of an Award, except as determined by the Committee. 
 4.3 Adjustments in Awards and Authorized Shares. In the event that any dividend or other distribution (whether in the form of cash, Shares, other securities, or other property), recapitalization, stock
split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase, or exchange of Shares or other securities of the Company, or other change in the corporate structure of the Company affecting the Shares
such that an adjustment is determined by the Committee (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 Committee
shall, in such manner as it may deem equitable, adjust the number and class of Shares which may be delivered under the Plan, the number and class of Shares which may be added annually to the Shares reserved under the Plan, the number, class, and
price of Shares subject to outstanding Awards, and the numerical limits of Sections 5.1, 6.1, 7.1, 8.1, 9.1 and 10.1. Notwithstanding the preceding, the number of Shares subject to any Award always shall be a whole number. 
 SECTION 5 
 STOCK OPTIONS 
 5.1 Grant of Options. Subject to the terms and provisions of the Plan, Options may be granted to Employees, Directors and Consultants at any
time and from time to time as determined by the Committee in its sole discretion. The Committee, in its sole discretion, shall determine the number of Shares subject to each Option, provided that during any Fiscal Year, no Participant shall be
granted Options (and/or SARs) covering more than a total of 750,000 Shares. Notwithstanding the foregoing, during the Fiscal Year in which a Participant first becomes an Employee, he or she may be granted Options (and/or SARs) to purchase up to a
total of an additional 750,000 Shares. The Committee may grant Incentive Stock Options, Nonqualified Stock Options, or a combination thereof. 
  

 -6- 

 5.2 Award Agreement. Each Option shall be evidenced by an Award Agreement that shall specify
the Exercise Price, the expiration date of the Option, the number of Shares covered by the Option, any conditions to exercise the Option, and such other terms and conditions as the Committee, in its discretion, shall determine. The Award Agreement
shall also specify whether the Option is intended to be an Incentive Stock Option or a Nonqualified Stock Option. 
 5.3 Exercise
Price. Subject to the provisions of this Section 5.3, the Exercise Price for each Option shall be determined by the Committee in its sole discretion. 
 5.3.1 Nonqualified Stock Options. The Exercise Price of each Nonqualified Stock option shall be determined by the Committee in its discretion but shall be not less than one hundred percent (100%) of the
Fair Market Value of a Share on the Grant Date. 
 5.3.2 Incentive Stock Options. In the case of an Incentive Stock Option, the
Exercise Price shall be not less than one hundred percent (100%) of the Fair Market Value of a Share on the Grant Date; provided, however, that if on the Grant Date, the Employee (together with persons whose stock ownership is attributed to the
Employee pursuant to Section 424(d) of the Code) owns stock possessing more than 10% of the total combined voting power of all classes of stock of the Company or any of its Subsidiaries, the Exercise Price shall be not less than one hundred and
ten percent (110%) of the Fair Market Value of a Share on the Grant Date. 
 5.3.3 Substitute Options. Notwithstanding the
provisions of Section 5.3.2, in the event that the Company or a Subsidiary consummates a transaction described in Section 424(a) of the Code (e.g., the acquisition of property or stock from an unrelated corporation), persons who become
Employees, Nonemployee Directors or Consultants on account of such transaction may be granted Options in substitution for options granted by their former employer. If such substitute Options are granted, the Committee, in its sole discretion and
consistent with Section 424(a) of the Code, may determine that such substitute Options shall have an exercise price less than one hundred percent (100%) of the Fair Market Value of the Shares on the Grant Date. 
 5.4 Expiration of Options.
 5.4.1
Expiration Dates. Each Option shall terminate no later than the first to occur of the following events: 
 (a) The date for
termination of the Option set forth in the written Award Agreement; or 
 (b) The expiration of ten (10) years from the Grant Date.

 5.4.2 Death of Participant. Notwithstanding Section 5.4.1, if a Participant dies prior to the expiration of his or her
Options, the Committee, in its discretion, may provide that his or her Options shall be exercisable for up to three (3) years after the date of death. 
  

 -7- 

 5.4.3 Committee Discretion. Subject to the ten and thirteen-year limits of Sections 5.4.1 and
5.4.2, the Committee, in its sole discretion, (a) shall provide in each Award Agreement when each Option expires and becomes unexercisable, and (b) may, after an Option is granted, extend the maximum term of the Option (subject to
Section 5.8.4 regarding Incentive Stock Options). 
 5.5 Exercisability of Options. Options granted under the Plan shall be
exercisable at such times and be subject to such restrictions and conditions as the Committee shall determine in its sole discretion. After an Option is granted, the Committee, in its sole discretion, may accelerate the exercisability of the Option.

 5.6 Payment. Options shall be exercised by the Participant giving notice and following such procedures as the Company (or its
designee) may specify from time to time. Exercise of an Option also requires that the Participant make arrangements satisfactory to the Company for full payment of the Exercise Price for the Shares. All exercise notices shall be given in the form
and manner specified by the Company from time to time. 
 The Exercise Price shall be payable to the Company in full in cash or its
equivalent. The Committee, in its sole discretion, also may permit exercise (a) by tendering previously acquired Shares having an aggregate Fair Market Value at the time of exercise equal to the total Exercise Price, or (b) by any other
means which the Committee, in its sole discretion, determines to both provide legal consideration for the Shares, and to be consistent with the purposes of the Plan. As soon as practicable after receipt of a notification of exercise satisfactory to
the Company and full payment for the Shares purchased, the Company shall deliver to the Participant (or the Participant’s designated broker), Share certificates (which may be in book entry form) representing such Shares. 
 5.7 Restrictions on Share Transferability. The Committee may impose such restrictions on any Shares acquired pursuant to the exercise of an
Option as it may deem advisable, including, but not limited to, restrictions related to applicable federal securities laws, the requirements of any national securities exchange or system upon which Shares are then listed or traded, or any blue sky
or state securities laws. 
 5.8 Certain Additional Provisions for Incentive Stock Options.
 5.8.1 Exercisability. The aggregate Fair Market Value (determined on the Grant Date(s)) of the Shares with respect to which Incentive Stock Options
are exercisable for the first time by any Employee during any calendar year (under all plans of the Company and its Subsidiaries) shall not exceed $100,000. 
 5.8.2 Termination of Service. No Incentive Stock Option may be exercised more than three (3) months after the Participant’s Termination of Service for any reason other than Disability or death, unless
(a) the Participant dies during such three-month period, and/or (b) the Award Agreement or the Committee permits later exercise (in which case the Option instead may be deemed to be a Nonqualified Stock Option). No Incentive Stock Option
may be exercised more than one (1) year after the Participant’s Termination of Service on account of Disability, unless (a) the 
  

 -8- 

 Participant dies during such one-year period, and/or (b) the Award Agreement or the Committee permit later exercise
(in which case the option instead may be deemed to be a Nonqualified Stock Option). 
 5.8.3 Employees Only. Incentive Stock Options
may be granted only to persons who are Employees on the Grant Date. 
 5.8.4 Expiration. No Incentive Stock Option may be exercised
after the expiration of ten (10) years from the Grant Date; provided, however, that if the Option is granted to an Employee who, together with persons whose stock ownership is attributed to the Employee pursuant to Section 424(d) of the
Code, owns stock possessing more than 10% of the total combined voting power of all classes of the stock of the Company or any of its Subsidiaries, the Option may not be exercised after the expiration of five (5) years from the Grant Date.

 SECTION 6 
 STOCK APPRECIATION
RIGHTS 
 6.1 Grant of SARs. Subject to the terms and conditions of the Plan, a SAR may be granted to Employees, Directors and
Consultants at any time and from time to time as shall be determined by the Committee, in its sole discretion. 
 6.1.1 Number of
Shares. The Committee shall have complete discretion to determine the number of SARs granted to any Participant, provided that during any Fiscal Year, no Participant shall be granted SARs (and/or Options) covering more than a total of 750,000
Shares. Notwithstanding the foregoing, during the Fiscal Year in which a Participant first becomes an Employee, he or she may be granted SARs (and/or Options) covering up to a total of an additional 750,000 Shares. 
 6.1.2 Exercise Price and Other Terms. The Committee, subject to the provisions of the Plan, shall have complete discretion to determine the terms
and conditions of SARs granted under the Plan. The Exercise Price of each SAR shall be determined by the Committee in its discretion but shall not be less than one hundred percent (100%) of the Fair Market Value of a Share on the Grant Date.

 6.2 SAR Agreement. Each SAR grant shall be evidenced by an Award Agreement that shall specify the exercise price, the term of
the SAR, the conditions of exercise, and such other terms and conditions as the Committee, in its sole discretion, shall determine. 
 6.3
Expiration of SARs. An SAR granted under the Plan shall expire upon the date determined by the Committee, in its sole discretion, and set forth in the Award Agreement. Notwithstanding the foregoing, the rules of Section 5.4 also
shall apply to SARs. 
 6.4 Payment of SAR Amount. Upon exercise of an SAR, a Participant shall be entitled to receive payment
from the Company in an amount determined by multiplying: 
 (a) The difference between the Fair Market Value of a Share on the date of
exercise over the exercise price; times 
  

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 (b) The number of Shares with respect to which the SAR is exercised. At the discretion of the Committee,
the payment upon SAR exercise may be in cash, in Shares of equivalent value, or in some combination thereof. 
 SECTION 7 
 RESTRICTED STOCK 
 7.1 Grant of Restricted
Stock. Subject to the terms and provisions of the Plan, the Committee, at any time and from time to time, may grant Shares of Restricted Stock to Employees, Directors and Consultants as the Committee, in its sole discretion, shall
determine. The Committee, in its sole discretion, shall determine the number of Shares to be granted to each Participant, provided that during any Fiscal Year, no Participant shall receive more than a total of 375,000 Shares of Restricted Stock
(and/or Performance Shares). Notwithstanding the foregoing, during the Fiscal Year in which a Participant first becomes an Employee, he or she may be granted up to a total of an additional 375,000 Shares of Restricted Stock (and/or Performance
Shares). 
 7.2 Restricted Stock Agreement. Each Award of Restricted Stock shall be evidenced by an Award Agreement that shall
specify the Period of Restriction, the number of Shares granted, and such other terms and conditions as the Committee, in its sole discretion, shall determine. Unless the Committee determines otherwise, Shares of Restricted Stock shall be held by
the Company as escrow agent until the restrictions on such Shares have lapsed. 
 7.3 Transferability. Except as provided in this
Section 7, Shares of Restricted Stock may not be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated until the end of the applicable Period of Restriction. 
 7.4 Other Restrictions. The Committee, in its sole discretion, may impose such other restrictions on Shares of Restricted Stock as it may
deem advisable or appropriate, in accordance with this Section 7.4. 
 7.4.1 General Restrictions. The Committee may set
restrictions based upon continued employment or service with the Company and its affiliates, the achievement of specific performance objectives (Company-wide, departmental, or individual), applicable federal or state securities laws, or any other
basis determined by the Committee in its discretion. 
 7.4.2 Section 162(m) Performance Restrictions. For purposes of qualifying
grants of Restricted Stock as “performance-based compensation” under Section 162(m) of the Code, the Committee, in its discretion, may set restrictions based upon the achievement of Performance Goals. The Performance Goals shall be
set by the Committee on or before the latest date permissible to enable the Restricted Stock to qualify as “performance-based compensation” under Section 162(m) of the Code. In granting Restricted Stock which is intended to qualify
under Section 162(m) of the Code, the Committee shall follow any procedures determined by it from time to time to be necessary or appropriate to ensure qualification of the Restricted Stock under Section 162(m) of the Code (e.g., in
determining the Performance Goals). 
  

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 7.4.3 Legend on Certificates. The Committee, in its discretion, may legend the certificates
representing Restricted Stock to give appropriate notice of such restrictions. 
 7.5 Removal of Restrictions. Except as
otherwise provided in this Section 7, Shares of Restricted Stock covered by each Restricted Stock grant made under the Plan shall be released from escrow as soon as practicable after the last day of the Period of Restriction. The Committee, in
its discretion, may accelerate the time at which any restrictions shall lapse or be removed. After the restrictions have lapsed, the Participant shall be entitled to have any legend or legends under Section 7.4.3 removed from his or her Share
certificate, and the Shares shall be freely transferable by the Participant. The Committee (in its discretion) may establish procedures regarding the release of Shares from escrow and the removal of legends, as necessary or appropriate to minimize
administrative burdens on the Company 
 7.6 Voting Rights. During the Period of Restriction, Participants holding Shares of
Restricted Stock granted hereunder may exercise full voting rights with respect to those Shares, unless the Committee determines otherwise. 
 7.7 Dividends and Other Distributions. During the Period of Restriction, Participants holding Shares of Restricted Stock shall be entitled to receive all dividends and other distributions paid with respect to such Shares unless
otherwise provided in the Award Agreement. Any such dividends or distribution shall be subject to the same restrictions on transferability and forfeitability as the Shares of Restricted Stock with respect to which they were paid, unless otherwise
provided in the Award Agreement. 
 7.8 Return of Restricted Stock to Company. On the date set forth in the Award Agreement, the
Restricted Stock for which restrictions have not lapsed shall revert to the Company and again shall become available for grant under the Plan. 
 SECTION 8 
 PERFORMANCE UNITS 
 8.1 Grant of Performance Units. Performance Units may be granted to Employees, Directors and Consultants at any time and from time to time, as shall be determined by the Committee, in its sole discretion. The Committee shall
have complete discretion in determining the number of Performance Units granted to each Participant provided that during any Fiscal Year, no Participant shall receive Performance Units having an initial value greater than $3,000,000. 
 8.2 Value of Performance Units. Each Performance Unit shall have an initial value that is established by the Committee on or before the Grant
Date. 
 8.3 Performance Objectives and Other Terms. The Committee, in its discretion, shall set performance objectives or other
vesting criteria which, depending on the extent to which they are 
  

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 met, will determine the number or value of Performance Units that will be paid out to the Participants. Each Award of
Performance Units shall be evidenced by an Award Agreement that shall specify the Performance Period, and such other terms and conditions as the Committee, in its sole discretion, shall determine. 
 8.3.1 General Performance Objectives or Vesting Criteria. The Committee may set performance objectives or vesting criteria based upon the
achievement of Company-wide, departmental, or individual goals, applicable federal or state securities laws, or any other basis determined by the Committee in its discretion (for example, but not by way of limitation, continuous service as an
Employee, Director or Consultant). 
 8.3.2 Section 162(m) Performance Objectives. For purposes of qualifying grants of
Performance Units as “performance-based compensation” under Section 162(m) of the Code, the Committee, in its discretion, may determine that the performance objectives applicable to Performance Units shall be based on the achievement
of Performance Goals. The Performance Goals shall be set by the Committee on or before the latest date permissible to enable the Performance Units to qualify as “performance-based compensation” under Section 162(m) of the Code. In
granting Performance Units that are intended to qualify under Section 162(m) of the Code, the Committee shall follow any procedures determined by it from time to time to be necessary or appropriate to ensure qualification of the Performance
Units under Section 162(m) of the Code (e.g., in determining the Performance Goals). 
 8.4 Earning of Performance
Units. After the applicable Performance Period has ended, the holder of Performance Units shall be entitled to receive a payout of the number of Performance Units earned by the Participant over the Performance Period, to be determined as a
function of the extent to which the corresponding performance objectives have been achieved. After the grant of a Performance Unit, the Committee, in its sole discretion, may reduce or waive any performance objectives for such Performance Unit.

 8.5 Form and Timing of Payment of Performance Units. Payment of earned Performance Units shall be made as soon as practicable
after the expiration of the applicable Performance Period. The Committee, in its sole discretion, may pay earned Performance Units in the form of cash, in Shares (which have an aggregate Fair Market Value equal to the value of the earned Performance
Units at the close of the applicable Performance Period) or in a combination thereof. 
 8.6 Cancellation of Performance
Units. On the date set forth in the Award Agreement, all unearned or unvested Performance Units shall be forfeited to the Company, and again shall be available for grant under the Plan. 
 SECTION 9 
 PERFORMANCE SHARES 
 9.1 Grant of Performance Shares. Performance Shares may be granted to Employees, Directors and Consultants at any time and from time to time,
as shall be determined by the Committee, in its sole discretion. The Committee shall have complete discretion in determining the 
  

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 number of Performance Shares granted to each Participant, provided that during any Fiscal Year, no Participant shall be
granted more than a total of 375,000 Performance Shares (and/or Shares of Restricted Stock). Notwithstanding the foregoing, during the Fiscal Year in which a Participant first becomes an Employee, he or she may be granted up to a total of an
additional 375,000 Performance Shares (and/or Shares of Restricted Stock). 
 9.2 Value of Performance Shares. Each Performance
Share shall have an initial value equal to the Fair Market Value of a Share on the Grant Date. 
 9.3 Performance Share
Agreement. Each Award of Performance Shares shall be evidenced by an Award Agreement that shall specify any vesting conditions, the number of Performance Shares granted, and such other terms and conditions as the Committee, in its sole
discretion, shall determine. 
 9.4 Performance Objectives and Other Terms. The Committee, in its discretion, shall set
performance objectives or other vesting criteria which, depending on the extent to which they are met, will determine the number or value of Performance Shares that will be paid out to the Participants. Each Award of Performance Shares shall be
evidenced by an Award Agreement that shall specify the Performance Period, and such other terms and conditions as the Committee, in its sole discretion, shall determine. 
 9.4.1 General Performance Objectives or Vesting Criteria. The Committee may set performance objectives or vesting criteria based upon the achievement of Company-wide, departmental, or individual goals,
applicable federal or state securities laws, or any other basis determined by the Committee in its discretion (for example, but not by way of limitation, continuous service as an Employee, Director or Consultant). 
 9.4.2 Section 162(m) Performance Objectives. For purposes of qualifying grants of Performance Shares as “performance-based
compensation” under Section 162(m) of the Code, the Committee, in its discretion, may determine that the performance objectives applicable to Performance Shares shall be based on the achievement of Performance Goals. The Performance Goals
shall be set by the Committee on or before the latest date permissible to enable the Performance Shares to qualify as “performance-based compensation” under Section 162(m) of the Code. In granting Performance Shares that are intended
to qualify under Section 162(m) of the Code, the Committee shall follow any procedures determined by it from time to time to be necessary or appropriate to ensure qualification of the Performance Shares under Section 162(m) of the Code
(e.g., in determining the Performance Goals). 
 9.5 Earning of Performance Shares. After the applicable Performance Period has
ended, the holder of Performance Shares shall be entitled to receive a payout of the number of Performance Shares earned by the Participant over the Performance Period, to be determined as a function of the extent to which the corresponding
performance objectives have been achieved. After the grant of a Performance Share, the Committee, in its sole discretion, may reduce or waive any performance objectives for such Performance Share. 
  

 -13- 

 9.6 Form and Timing of Payment of Performance Shares. Payment of vested Performance Shares
shall be made as soon as practicable after vesting (subject to any deferral permitted under Section 11.1). The Committee, in its sole discretion, may pay Performance Shares in the form of cash, in Shares or in a combination thereof. 

9.7 Cancellation of Performance Shares. On the date set forth in the Award Agreement, all unvested Performance Shares shall be forfeited
to the Company, and except as otherwise determined by the Committee, again shall be available for grant under the Plan. 
 SECTION 10

 NONEMPLOYEE DIRECTOR OPTIONS 
 10.1 Granting of Options.
 10.1.1 Initial Grants. Each Nonemployee Director who first becomes a Nonemployee Director
on or after the effective date of this Plan, automatically shall receive, as of the date that the individual first is appointed or elected as a Nonemployee Director, an Option to purchase 60,000 Shares. 
 10.1.2 Ongoing Grants. Each Nonemployee Director who is reelected as such at an Annual Meeting of the Company’s Stockholders, automatically
shall receive, as of the date of such Annual Meeting, an Option to purchase 25,000 Shares. 
 10.2 Terms of Options.
 10.2.1 Option Agreement. Each Option granted pursuant to this Section 10 shall be evidenced by a written Award Agreement between the
Participant and the Company. 
 10.2.2 Exercise Price. The Exercise Price for the Shares subject to each Option granted pursuant to
this Section 10 shall be 100% of the Fair Market Value of such Shares on the Grant Date. 
 10.2.3 Exercisability. 
 (a) Each Option granted pursuant to Section 10.1.1 shall become exercisable as to 25% of the Shares (covered by the Option on the Grant Date) on the
first anniversary of the Grant Date, and as to an additional 25% of the Shares on each succeeding anniversary, so that the Option shall be 100% exercisable on the fourth anniversary of the Grant Date. 
 (b) Each Option granted pursuant to Section 10.1.2 shall become exercisable as to 1/12th of the Shares (covered by the Option on the Grant Date) on the first monthly anniversary of the Grant Date, and as to an additional 1/12th of the Shares on each succeeding anniversary, so that the Option shall be 100% exercisable on the first annual anniversary of
the Grant Date. 
  

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 (c) Notwithstanding any contrary provision of this Section 10.2.3, once a Participant ceases to be
a Director, his or her Options which are not then exercisable shall never become exercisable and shall be immediately forfeited, except to the limited extent provided in Section 10.2.5. 
 10.2.4 Expiration of Options. Each Option granted pursuant to this Section 10 shall terminate upon the first to occur of the following
events: 
 (a) The expiration of seven (7) years from the Grant Date; or 
 (b) The expiration of one (1) year from the date of the Participant’s Termination of Service for any reason. 
 10.2.5 Death or Disability of Participant and Accelerated Vesting. Notwithstanding the provisions of Sections 10.2.3 and 10.2.4, in the event
of a Participant’s Termination of Service due to his or her death or Disability before any Options (granted to him or her under Section 10.1) otherwise have expired in accordance with Section 10.2.4, then (a) one hundred percent
(100%) of the Shares covered by such Options immediately shall become exercisable, (b) in the case of Disability, such Options shall terminate one (1) year after the date of the Termination of Service (subject to the seven
(7) year limit of Section 10.2.4), and (c) in the case of death, such options shall terminate one (1) year after the date of death. If there is a change of control of the Company (as determined by the Committee in its discretion)
and the Participant is not asked to be a member of the board of directors of the acquiring or combined company, then any Options granted to him or her under Section 10.1 that have not expired in accordance with Section 10.2.4 immediately
shall become one hundred percent (100%) exercisable and thereafter shall expire in accordance with Section 10.2.4. 
 10.2.6 Not
Incentive Stock Options. Options granted pursuant to this Section 10 shall not be designated as Incentive Stock Options. 
 10.2.7
Other Terms. All provisions of the Plan not inconsistent with this Section 10 shall apply to Options granted to Nonemployee Directors. 
 10.3 Elections by Nonemployee Directors. Pursuant to such procedures as the Committee (in its discretion) may adopt from time to time, each Nonemployee Director may elect to forego receipt of all or a portion of the annual
retainer, committee fees and meeting fees otherwise due to the Nonemployee Director in exchange for Awards. The number of Shares subject to Awards received by any Nonemployee Director shall equal the amount of foregone compensation divided by the
Fair Market Value of a Share on the date the compensation otherwise would have been paid to the Nonemployee Director, rounded up to the nearest whole number of Shares. The procedures adopted by the Committee for elections under this
Section 10.3 shall be designed to ensure that any such election by a Nonemployee Director will not disqualify him or her as a “non-employee director” under Rule 16b-3. 
  

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 SECTION 11 
 MISCELLANEOUS 
 11.1 Deferrals. The Committee, in its sole discretion, may permit a Participant
to defer receipt of the payment of cash or the delivery of Shares that would otherwise be due to such Participant under an Award. Any such deferral elections shall be subject to such rules and procedures as shall be determined by the Committee in
its sole discretion. 
 11.2 No Effect on Employment or Service. Nothing in the Plan shall interfere with or limit in any way the
right of the Company to terminate any Participant’s employment or service at any time, with or without cause. For purposes of the Plan, transfer of employment of a Participant between the Company and any one of its Subsidiaries (or between
Subsidiaries) shall not be deemed a Termination of Service. Employment with the Company and its Subsidiaries is on an at-will basis only. 
 11.3 Participation. No Employee, Director or Consultant shall have the right to be selected to receive an Award under this Plan, or, having been so selected, to be selected to receive a future Award. 
 11.4 Indemnification. Each person who is or shall have been a member of the Committee, or of the Board, shall be indemnified and held
harmless by the Company against and from (a) any loss, cost, liability, or expense that may be imposed upon or reasonably incurred by him or her in connection with or resulting from any claim, action, suit, or proceeding to which he or she may
be a party or in which he or she may be involved by reason of any action taken or failure to act under the Plan or any Award Agreement, and (b) from any and all amounts paid by him or her in settlement thereof, with the Company’s approval,
or paid by him or her in satisfaction of any judgment in any such claim, action, suit, or proceeding against him or her, provided he or she shall give the Company an opportunity, at its own expense, to handle and defend the same before he or she
undertakes to handle and defend it on his or her own behalf. The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such persons may be entitled under the Company’s Certificate of
Incorporation or Bylaws, by contract, as a matter of law, or otherwise, or under any power that the Company may have to indemnify them or hold them harmless. 
 11.5 Successors. All obligations of the Company under the Plan, with respect to Awards granted hereunder, shall be binding on any successor to the Company, whether the existence of such successor is the
result of a direct or indirect purchase, merger, consolidation, or otherwise, of all or substantially all of the business or assets of the Company. 
 11.6 Beneficiary Designations. If permitted by the Committee, a Participant under the Plan may name a beneficiary or beneficiaries to whom any vested but unpaid Award shall be paid in the event of the Participant’s death.
Each such designation shall revoke all prior designations by the Participant and shall be effective only if given in a form and manner acceptable to the Committee. In the absence of any such designation, any vested benefits remaining unpaid at the
Participant’s death shall be paid to the Participant’s estate and, subject to the terms of the Plan and of the applicable Award Agreement, any unexercised vested Award may be exercised by the administrator or executor of the
Participant’s estate. 
  

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 11.7 Limited Transferability of Awards. No Award granted under the Plan may be sold,
transferred, pledged, assigned, or otherwise alienated or hypothecated, other than by will, by the laws of descent and distribution, or to the limited extent provided in Section 11.6. All rights with respect to an Award granted to a Participant
shall be available during his or her lifetime only to the Participant. Notwithstanding the foregoing, a Participant may, if the Committee (in its discretion) so permits, transfer an Award to an individual or entity other than the Company. Any such
transfer shall be made in accordance with such procedures as the Committee may specify from time to time. 
 11.8 No Rights as
Stockholder. Except to the limited extent provided in Sections 7.6, no Participant (nor any beneficiary) shall have any of the rights or privileges of a stockholder of the Company with respect to any Shares issuable pursuant to an
Award (or exercise thereof), unless and until certificates representing such Shares shall have been issued, recorded on the records of the Company or its transfer agents or registrars, and delivered to the Participant (or beneficiary). 

SECTION 12 
 AMENDMENT, TERMINATION, AND
DURATION 
 12.1 Amendment, Suspension, or Termination. The Board, in its sole discretion, may amend, suspend or terminate the
Plan, or any part thereof, at any time and for any reason. The amendment, suspension, or termination of the Plan shall not, without the consent of the Participant, alter or impair any rights or obligations under any Award theretofore granted to such
Participant. No Award may be granted during any period of suspension or after termination of the Plan. 
 12.2 Duration of the
Plan. The Plan shall be effective as of June 2, 2004, and subject to Section 12.1 (regarding the Board’s right to amend or terminate the Plan), shall remain in effect thereafter. However, without further stockholder approval,
no Incentive Stock Option may be granted under the Plan after June 2, 2014. 
 SECTION 13 
 TAX WITHHOLDING 
 13.1 Withholding
Requirements. Prior to the delivery of any Shares or cash pursuant to an Award (or exercise thereof), the Company shall have the power and the right to deduct or withhold, or require a Participant to remit to the Company, an amount
sufficient to satisfy federal, state, and local taxes (including the Participant’s FICA obligation) required to be withheld with respect to such Award (or exercise thereof). 
 13.2 Withholding Arrangements. The Committee, in its sole discretion and pursuant to such procedures as it may specify from time to time, may
permit a Participant to satisfy such tax withholding obligation, in whole or in part by (a) electing to have the Company withhold otherwise deliverable Shares, or (b) delivering to the Company already-owned Shares having a Fair Market
Value equal to the minimum amount required to be withheld. 
  

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 SECTION 14 
 LEGAL CONSTRUCTION 
 14.1 Gender and Number. Except where otherwise indicated by the context,
any masculine term used herein also shall include the feminine; the plural shall include the singular and the singular shall include the plural. 
 14.2 Severability. In the event any provision of the Plan shall be held illegal or invalid for any reason, the illegality or invalidity shall not affect the remaining parts of the Plan, and the Plan shall be construed and
enforced as if the illegal or invalid provision had not been included. 
 14.3 Requirements of Law. The granting of Awards and
the issuance of Shares under the Plan shall be subject to all applicable laws, rules, and regulations, and to such approvals by any governmental agencies or national securities exchanges as may be required. 
 14.4 Securities Law Compliance. With respect to Section 16 Persons, transactions under this Plan are intended to qualify for the
exemption provided by Rule 16b-3. To the extent any provision of the Plan, Award Agreement or action by the Committee fails to so comply, it shall be deemed null and void, to the extent permitted by law and deemed advisable or appropriate by the
Committee. 
 14.5 Governing Law. The Plan and all Award Agreements shall be construed in accordance with and governed by the
laws of the State of California (with the exception of its conflict of laws provisions). 
 14.6 Captions. Captions are provided
herein for convenience only, and shall not serve as a basis for interpretation or construction of the Plan. 
 EXECUTION 
 IN WITNESS WHEREOF, the Company, by its duly authorized officer, has executed this Plan on the date indicated below. 
  

					
	 	 	POLYCOM, INC.
			
	Dated: February 7, 2006	 	By	 	 /s/ Robert C. Hagerty

		 	Title:	 	Chief Executive Officer

  

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 APPENDIX A 
 Terms and Conditions for French Option Grants 
 The following terms and
conditions will apply in the case of Option grants to French residents and to those individuals who are otherwise subject to the laws of France who satisfy the eligibility requirements of Section 2 below. 
 SECTION 1 
 DEFINITIONS 
 As used in this Appendix A, the following definitions will apply: 
 1.1 “Applicable Laws” means the legal requirements relating to the administration of equity compensation plans under U.S. state corporate laws, U.S. federal and state securities laws, the Code, any
stock exchange or quotation system on which the Common Stock is listed or quoted and French corporate, securities, labor and tax laws. 
 1.2
“Employee” means (i) any person employed by the Company or a Subsidiary in a salaried position within the meaning Applicable Laws, who does not own more than 10% of the voting power of all classes of stock of the Company, or
any Parent or Subsidiary, and who is a resident of the Republic of France or (ii) any person employed by the Company or a Subsidiary who is a resident of the Republic of France for tax purposes or who performs his or her duties in France and is
subject to French income social security contributions on his or her remuneration. 
 1.3 “Fair Market Value” means, as of
any date, the dollar value of Common Stock determined as follows: 
 1.3.1 If the Common Stock is listed on any established stock exchange or
a national market system, including without limitation the Nasdaq National Market of the Nasdaq Stock Market, its Fair Market Value will be the average quotation price for the last 20 days preceding the date of determination for such Common Stock
(or the average closing bid for such 20 day period, if no sales were reported) as quoted on such exchange or system and reported in The Wall Street Journal or such other source as the Committee deems reliable; 
 1.3.2 If the Common Stock is quoted on the Nasdaq Stock market (but not on the Nasdaq National Market thereof) or regularly quoted by a recognized
securities dealer but selling prices are not reported, its Fair Market Value will be the mean between the high bid and low asked prices for the Common Stock for the last 20 days preceding the date of determination; or 
 1.3.3 In the absence of an established market for the Common Stock, the Fair Market Value thereof will be determined in good faith by the Committee.

 1.4 “Subsidiary” means any participating subsidiary of the Company located in the
Republic of France and that falls within the definition of “subsidiary” within the meaning of Section L. 225-180 paragraph 1 of the French commercial code. 
 1.5 “Termination of Service” means if the Participant is an Employee, the last day of any statutory or contractual notice period whether worked or not (provided, only the employer, and not the
Participant, may decide whether the Participant works during the notice period) and irrespective of whether the termination of the employment agreement is due to resignation or dismissal of the Employee for any reason whatsoever; if the Participant
is a corporate officer as defined in Section 2 of this Appendix A, Termination of Service means the date on which he or she effectively leaves his or her position as a corporate officer for any reason whatsoever. 
 SECTION 2 
 ELIGIBILITY 
 2.1 Eligibility. Options granted pursuant to this Appendix A may be granted only to Employees, the Président du conseil
d’administration, the membres du directoire, the Directeur général, the directeurs généraux délégués, the Gérant of a company with capital divided by shares;
provided, however, that the administrateurs and the membres du conseil de surveillance who are also Employees of the Subsidiary in accordance with a valid employment agreement pursuant to Applicable Laws may be granted Options
hereunder. For the purpose of this Appendix A, when applicable, the rules set forth for an Employee will be applicable to the aforementioned corporate officers. 
 SECTION 3 
 STOCK SUBJECT TO THE PLAN 
 3.1 Stock Subject to the Plan. The total number of Options outstanding which may be exercised for newly issued Shares may at no time exceed that
number equal to one-third of the Company’s voting stock, whether preferred stock of the Company or Common Stock. If any Optioned Stock is to consist of reacquired Shares, such Optioned Stock must be purchased by the Company, in the limit of 10%
of its share capital, prior to the date of the grant of the corresponding new Option and must be reserved and set aside for such purposes. In addition, the new Option must be granted within one (1) year of the acquisition of the Shares
underlying such new Option. 
 SECTION 4 
 LIMITATIONS 
 4.1 Limitations Upon Granting of Options. 
 4.1.1 Declaration of Dividend; Capital Increase. To the extent applicable to the Company, Options cannot be granted during the 20 trading days from
(i) the date the Common Stock is trading on an ex-dividend basis or (ii) a capital increase. 
  

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 4.1.2 Non-Public Information. To the extent applicable to the Company, the Company will not grant
Options during the closed periods required under Section L 225-177 of the French Commercial Code. As a result, notwithstanding any other provision of the Plan, Options cannot be granted: 
 (a) during the ten (10) trading days preceding and following the date on which the consolidated accounts, or, if unavailable, the annual accounts,
are made public; 
 (b) during the period between the date on which the Company’s governing bodies (i.e., the Committee) become aware
of information which, if made public, could have a material impact on the price of the Shares, and the date ten (10) trading days after such information is made public. 
 4.1.3 Right to Employment. Neither the Plan nor any Option will confer upon any Participant any right with respect to continuing the
Participant’s employment relationship with the Company or any Subsidiary. 
 SECTION 5 
 EXERCISE PRICE 
 5.1 Exercise Price.
The exercise price for the Shares to be issued pursuant to exercise of an Option will be determined by the Committee upon the date of grant of the Option and stated in the Award Agreement, but in no event will be lower than the higher of
(i) eighty percent (80%) of the Fair Market Value on the date the Option is granted or of the average purchase price of these Shares by the Company, or (ii) the exercise price as determined under Section 5.3 of the Plan. The
exercise price cannot be modified while the Option is outstanding, except as required by Applicable Laws. 
 SECTION 6 
 TERM OF OPTION 
 6.1 Term of Option.
The term of each Option will be as stated in the Award Agreement; provided, however, that the maximum term of an Option will not exceed ten (10) years from the date of grant of the Option. 
 SECTION 7 
 EXERCISE OF OPTION; RESTRICTION ON
SALE 
 7.1 Exercise of Option; Restriction on Sale. 
 7.1.1 Except as otherwise explicitly set forth in the Award Agreement, Options granted hereunder may be not be exercised within one (1) year of the date the Option is granted (the “Initial Exercise
Date”) whether or not the Option has vested prior to such time; provided, however, that the Initial Exercise Date will be automatically adjusted to conform with any changes under Applicable Laws so that the length of time from the date of grant
to the Initial Exercise Date when added to the length of time in which Shares may not be disposed of after the Initial Exercise Date as 
  

 -3- 

 provided in Section 7.1.2 below, will allow for favorable tax and social security treatment under Applicable Laws.
Thereafter, Options may be exercised to the extent they have vested. Options granted hereunder will vest as the Committee determines, subject to Section 5.5 of the Plan. 
 7.1.2 The Shares subject to an Option may not be transferred, assigned or hypothecated in any manner otherwise than by will or by the laws of descent or
distribution before the date three (3) years from the Initial Exercise Date, except for any events provided for in Article 91 ter of Annex II to the French tax code; provided, however, that the duration of this restriction on sale
will be automatically adjusted to conform with any changes to the holding period required for favorable tax and social security treatment under Applicable Laws to the extent permitted under Applicable Laws. 
 7.1.3 Death of Participant. In the event of the death of an Participant while an Employee, the Option may be exercised at any time
within six (6) months following the date of death by the Participant’s estate or by a person who acquired the right to exercise the Option by bequest or inheritance, but only to the extent that the Participant was entitled to exercise the
Option at the date of death. 
 SECTION 8 
 NON-TRANSFERABILITY OF OPTIONS 
 8.1 Non-Transferability of Options. An Option may not be sold, pledged, assigned,
hypothecated, transferred, or disposed of in any manner other than by will or by the laws of descent or distribution and may be exercised, during the lifetime of the Participant, only by the Participant. 
 SECTION 9 
 CHANGES IN CAPITALIZATION

 9.1 Changes in Capitalization. If any adjustment provided for in Section 4.3 of the Plan to the exercise price and the number
of shares of Common Stock covered by outstanding Options would violate Applicable Laws in such a way to jeopardize the favorable tax and social security treatment of this Plan together with this Appendix A and the Options granted thereunder, then no
such adjustment will be made prior to the exercise of any such outstanding Option. 
 SECTION 10 
 INFORMATION STATEMENTS TO PARTICIPANTS 
 10.1
Information Statements to Participants. The Company or its French Parent or Subsidiary, as required under Applicable Laws, will provide to each Participant, with copies to the appropriate governmental entities, such statements of information
as required by the Applicable Laws. 
  

 -4- 

 SECTION 11 
 AMENDMENT OR TERMINATION OF PLAN 
 11.1 Effect of Amendment or Termination. No
amendment, alteration, suspension or termination of the Plan will impair the rights of any Participant, unless mutually agreed otherwise between the Participant and the Committee, which agreement must be in writing and signed by the Participant and
the Company. Any favorable amendments or alterations are automatically deemed to be approved by Participant. Termination of the Plan will not affect the Committee’s ability to exercise the powers granted to it hereunder with respect to Options
granted under the Plan prior to the date of such termination. 
 SECTION 12 
 REPORTS TO SHAREHOLDERS 
 12.1 Reporting to the Shareholders’ Meeting. The
Subsidiary of the Company, if required under Applicable Laws, will provide its shareholders with an annual report with respect to Options granted and/or exercised by its Employees in the financial year. 
  

 -5-EXHIBIT 10.31

 Exhibit 10.31 
  
 TRUST AGREEMENT 
  
 THIS TRUST AGREEMENT is made by and between HOST MARRIOTT, L.P., a Delaware limited partnership (the “Employer”), and T. ROWE PRICE TRUST
COMPANY, a Maryland limited purpose trust company (the “Trustee”). 
  
 W I T N E S S E T H     T H A T: 
  
 WHEREAS, the Employer has established the HOST MARRIOTT, L.P. EXECUTIVE DEFERRED COMPENSATION PLAN (the “Plan”) to provide deferred compensation benefits for a select group of its management or highly
compensated employees; 
  
 WHEREAS, the Employer has incurred or
expects to incur liability under the terms of the Plan with respect to the participants of the Plan and their beneficiaries (collectively referred to as “Trust Beneficiaries”); 
  
 WHEREAS, it is the intention of the Employer to make contributions to a trust
to provide it with a source of funds to assist it in meeting some or all of its liabilities under the Plan; 
  
 NOW THEREFORE, in consideration of the mutual covenants herein contained, the Employer and the Trustee declare and agree as follows: 
  
 SECTION 1.     Establishment of the Trust.

  
 1.1    The Employer hereby establishes
with the Trustee a trust to accept such sums of money and other property acceptable to the Trustee as from time to time shall be paid or delivered to the Trustee (the “Trust”). All such money and other property, all investments and
reinvestments made therewith or proceeds thereof and all earnings and profits thereon, less all payments and charges as authorized herein, are hereinafter referred to as the (“Trust Fund”). The Trust Fund shall be held, administered
and disposed of by the Trustee in accordance with the provisions of this Trust Agreement. 
  
 1.2    It is the intention of the parties that this Trust shall constitute an unfunded arrangement and shall not affect the status of the Plan as an unfunded plan for purposes of Title I of the
Employee Retirement Income Security Act of 1974, as amended (“ERISA”). This Trust is not intended to be subject to Part 4 of Title I of ERISA. The Employer represents that this Trust is not intended to be and is not subject to Part
4 of Title I of ERISA. 
  
 1.3    This Trust
is intended to be a grantor trust, of which the Employer is the grantor, within the meaning of subpart E, part I, subchapter J, chapter 1, subtitle A of the Internal Revenue Code of 1986, as amended (the “Code”), and shall be
construed accordingly. 
  
 1.4    The Trust
Fund shall be held separate and apart from other funds of the Employer and shall be used exclusively for the uses and purposes of Trust Beneficiaries and general creditors as herein set forth. Trust Beneficiaries shall have no preferred claim on, or
any beneficial ownership interest in, any assets of the Trust Fund. Any rights credited under the Plan and this Trust Agreement shall be mere unsecured contractual rights of Trust Beneficiaries against the Employer. Any assets held in the Trust Fund
will be subject to the claims of the Employer’s general creditors under federal and state law in the event that the Employer is Insolvent, as defined in Section 8.1 hereof. 
  

 1 

 SECTION 2.    Acceptance by the Trustee. 
  
 The Trustee accepts the Trust established under this Trust Agreement on the
terms and subject to the provisions set forth herein, and it agrees to discharge and perform fully and faithfully all of the duties and obligations imposed upon it under this Trust Agreement. 
  
 SECTION 3.    Limitation on Use of Funds.

  
 The Trust established hereby shall be irrevocable and the
Employer shall have no right or power to direct Trustee to return to the Employer or to divert to others any assets of the Trust Fund before all payment of benefits have been made to Trust Beneficiaries pursuant to the terms of the Plan[s];
provided, however, that (i) nothing in this Section 3 shall be deemed to limit or otherwise prevent the payment from the Trust Fund of expenses and other charges as provided in Sections 5.1(h), 10.1 and 10.2 of this Trust Agreement or the
application of the Trust Fund as provided in Section 14 of this Trust Agreement and (ii) the Trust Fund shall at all times be subject to the claims of the general creditors of the Employer as set forth in Section 8 of this Trust
Agreement. The Trustee shall have no duty to determine whether all benefit payments have been made to Trust Beneficiaries and may rely on the Employer’s notification regarding such payment. 
  
 SECTION 4.    Duties and Powers of the Trustee with
Respect to Investments. 
  
 4.1    The
Trustee shall invest and reinvest the principal and income of the Trust Fund and keep the Trust Fund invested, without distinction between principal and income, solely as directed by the Employer, in publicly traded common and preferred stocks,
publicly traded bonds and other evidences of indebtedness, governmental obligations, savings and time deposits, certificates of deposit, cash, guaranteed investment contracts, bank investment contracts, synthetic investment contracts, individual or
group annuity contracts, or regulated investment companies registered under the Investment Company Act of 1940 (including any investment company which has an investment management or other agreement with an affiliate of the Trustee). The
Employer’s investment direction to the Trustee may represent the aggregate of deemed investment elections of Trust Beneficiaries with respect to amounts allocated to each Trust Beneficiary’s account under the Plan. The Trustee shall have
no duty to question any action or direction of the Employer or any failure to give directions, or to make any suggestion to the Employer as to the investment or reinvestment of, or the disposition of, such assets. 
  
 4.2    Notwithstanding any provisions of this Trust
Agreement to the contrary, the Employer shall not direct the Trustee to invest any portion of the Trust Fund in any security or other obligation issued by Employer, other than a de minimis amount held in a common investment vehicle in which the
Trustee invests. 
  
 4.3    During the term of
this Trust, all income received in the Trust Fund, net of expenses and taxes, shall be accumulated and reinvested. 
  

 2 

 SECTION 5.    Additional Powers and Duties of the Trustee. 
  
 5.1 Subject to the provisions of Section 4, the Trustee shall have the
following powers and authority with respect to property constituting a part of the Trust Fund: 
  
         (a)    To receive and hold all contributions paid to it by the Employer; provided, however, that the Trustee shall have no duty to require any
contributions to be made, or to determine that any of the contributions received comply with the conditions and limitations of the Plan. 
  
         (b)    At the direction of the Employer, to sell, exchange or transfer any property at
public or private sale for cash or on credit and grant options for the purchase or exchange thereof, including call options for property held in the Trust Fund and put options for the purchase of property. 
  
         (c)    To
participate in any plan of reorganization, consolidation, merger, combination, liquidation or other similar plan relating to any such property, and at the direction of the Employer, to consent to or oppose any such plan or any action thereunder, or
any contract, lease, mortgage, purchase, sale or other action by any corporation or other entity. 
  
         (d)    To deposit any such property with any protective, reorganization or similar
committee and to pay part of the expenses and compensation of any such committee and any assessments levied with respect to any property so deposited. 
  
         (e)    At the direction of the Employer, to exercise any conversion privilege or
subscription right available in connection with any such property; to oppose or to consent to the reorganization, consolidation, merger or readjustment of the finances of any corporation, company or association, or to the sale, mortgage, pledge or
lease of the property of any corporation, company or association any of the securities of which may at any time be held in the Trust Fund and to do any act with reference thereto, including the exercise of options, the making of agreements or
subscriptions and the payment of expenses, assessments or subscriptions, which may be deemed necessary or advisable in connection therewith, and to hold and retain any securities or other property which it may so acquire. 
  
         (f)    Subject to its proper indemnification as provided in Section 18, to commence or defend suits or legal proceedings and to represent the Trust in all suits or
legal proceedings; to settle, compromise or submit to arbitration, any claims, debts or damages, due or owing to or from the Trust. 
  
         (g)    At the direction of the Employer, to exercise any right, including the right to
vote or tender, appurtenant to any securities or other such property. 
  
         (h)    To engage any legal counsel, including counsel to the Employer or counsel to the Trustee, or any other suitable agents, to consult with such counsel or agents with
respect to the construction of this Trust Agreement, the duties of the Trustee hereunder, the transactions contemplated by this Trust Agreement or any act which the Trustee proposes to take or omit, to rely upon the advice of such counsel or agents
and to pay its reasonable fees, expenses and compensation out of the Trust Fund, if not paid by the Employer. 
  

 3 

         (i)    To register any securities
held by it in its own name or in the name of any custodian of such property or of its nominee, including the nominee of any system for the central handling of securities, with or without the addition of words indicating that such securities are held
in a fiduciary capacity, to deposit or arrange for the deposit of any such securities with such a system and to hold any securities in bearer form. 
  
         (j)    To make, execute and deliver, as Trustee, any and all deeds, leases, notes,
bonds, guarantees, mortgages, conveyances, contracts, waivers, releases or other instruments in writing necessary or proper for the accomplishment of any of the foregoing powers. 
  
         (k)    At the direction of the Employer, to transfer
assets of the Trust Fund to a successor trustee as provided in Section 12.4. 
  
 Each and all of the foregoing powers may be exercised without a court order or approval. 
  
 The Trustee shall have, without exclusion, all powers conferred on directed trustees by applicable law, unless expressly provided otherwise herein,
provided, however, that if an insurance policy is held as an asset of the Trust, Trustee shall have no power to name a beneficiary of the policy other than the Trust, to assign the policy (as distinct from conversion of the policy to a different
form) other than to a successor Trustee, or to loan to any person the proceeds of any borrowing against such policy. 
  
 Notwithstanding any powers granted to Trustee pursuant to this Trust Agreement or to applicable law, Trustee shall not have any power that could give this
Trust the objective of carrying on a business and dividing the gains therefrom, within the meaning of Section 301.7701-2 of the Procedure and Administrative Regulations promulgated pursuant to the Internal Revenue Code. 
  
 SECTION 6.    Payments to Trust Beneficiary.

  
 6.1    The Employer shall provide the
Trustee with payment instructions that indicate the amounts payable to each Trust Beneficiary, the form in which such amounts are to be paid (as provided for under the Plan) and the time of commencement for payment of such amounts. Except as
otherwise provided herein, the Trustee shall make payments out of the Trust Fund to Trust Beneficiaries in accordance with such payment instructions. Pursuant to instructions by the Employer, the Trustee shall withhold federal and state income taxes
from each payment made under this Trust Agreement at the rate(s) designated by the Employer and shall report and pay such amounts to the appropriate federal and state taxing authorities. The Trustee shall rely on Employer instructions and shall have
no duty to inquire into the accuracy of such instructions. 
  
 6.2    If any check for a benefit directed to be made from the Trust has been mailed by the Trustee, by regular United States mail, to the last known address of the Trust Beneficiary and is returned unclaimed, or if a
benefit payment check is not cashed by the Trust Beneficiary, 

  

 4 

 
the Trustee shall notify the Employer and the Employer shall be responsible for locating such Trust Beneficiary and for instructing the Trustee on the action
to take with respect to the payment of such Trust Beneficiary’s benefits. 
  
 6.3    The entitlement of a Trust Beneficiary to benefits under the Plan shall be determined by the Employer or its designee (which may not be the Trustee) and any claim for benefits shall be
considered and reviewed under the claims procedures set forth in the Plan. The Trustee shall follow the instructions of the Employer and shall have no duty or right to inquire into the Employer’s decision with respect to the payment of benefits
and shall be fully indemnified therefor by the Employer. 
  
 6.4    The Employer may make payment of benefits directly to Trust Beneficiaries as they become due under the terms of the Plan. The Employer shall notify the Trustee of its decision to make payment of benefits directly
prior to the time amounts are payable to Trust Beneficiaries. In addition, if the Trust Fund is not sufficient to make payments of benefits in accordance with the terms of the Plan, the Employer shall make the balance of each such payment as it
falls due. The Trustee shall notify the Employer where the Trust Fund is not sufficient to make the requested benefit payments. 
  
 6.5    The Employer shall remain primarily liable to pay benefits under the Plan. However, the Employer’s liability under the
Plan shall be reduced or offset to the extent benefit payments are made from the Trust Fund. 
  
 SECTION 7.    Funding of the Trust. 
  
 7.1    Funding of the Trust Fund by the Employer is not mandatory. 
  
 7.2    The Employer may at any time or from time to time make additional deposits of money or other
property acceptable to the Trustee to the Trust Fund to augment the principal to be held, administered and disposed of by the Trustee as provided in this Trust Agreement. Neither the Trustee nor any Trust Beneficiary shall have any right to compel
such additional deposits. 
  
 SECTION
8.    Trustee Responsibility Regarding Payments  
 to Trust Beneficiaries When the Employer is
Insolvent. 
  
  
 8.1    Upon receipt of notification issued in accordance with Section 8.2(a) hereof, the Trustee shall cease payment of benefits
to Trust Beneficiaries if the Employer is Insolvent. The Employer shall be considered “Insolvent” for purposes of this Trust Agreement if: (i) the Board of Directors or the Chief Executive Officer of the Employer provides
written certification to the Trustee that the Employer is unable to pay its debts as they become due, or (ii) the Employer is subject to a pending proceeding as a debtor under the United States Bankruptcy Code. 
  
 8.2    At all times during the continuance of this Trust,
as provided in Section 1.4 hereof, the principal and income of the Trust Fund shall be subject to the claims of general creditors of the Employer in the event of the Employer’s Insolvency as set forth below: 
  

 5 

         (a)    The Board of Directors and the
Chief Executive Officer of the Employer shall have the duty to inform the Trustee in writing if the Employer becomes Insolvent. If a person claiming to be a creditor of the Employer alleges in writing to the Trustee that the Employer has become
Insolvent, the Trustee shall determine solely through written certification of the Employer whether the Employer is Insolvent and, pending such determination, the Trustee shall discontinue payment of benefits to Trust Beneficiaries. 
  
         (b)    Unless the Trustee has received written notice from the Employer or a person claiming to be creditor of the Employer alleging that the Employer is Insolvent, the
Trustee shall have no duty to inquire whether the Employer is Insolvent. The Trustee may in all events rely on such certification concerning the Employer’s solvency as may be furnished to the Trustee by the Employer in accordance with
Section 8.2(a) hereof. 
  
         (c)    If at any time the Trustee has received written notice of Insolvency from the Board of Directors or the Chief Executive Officer of the Employer, the Trustee shall
discontinue payments of benefits under the Plan to Trust Beneficiaries and shall hold the assets of the Trust Fund for the benefit of the Employer’s general creditors. The Trustee shall deliver the assets of the Trust Fund to satisfy the claims
of the Employer’s general creditors as directed by final order of a court of competent jurisdiction. Nothing in this Trust Agreement shall in any way diminish any rights of Trust Beneficiaries to pursue their rights as general creditors of the
Employer with respect to benefits due under the Plan or otherwise. 
  
         (d)    The Trustee shall resume the payment of benefits to Trust Beneficiaries in accordance with this Trust Agreement only after the Board of Directors or Chief Executive
Officer of the Employer has notified the Trustee in writing that the Employer is not Insolvent (or is no longer Insolvent). 
  
 8.3    If the Trustee discontinues the payment of benefits from the Trust Fund pursuant to Section 8.2 hereof and subsequently
resumes such payments, the first payment to each Trust Beneficiary following such discontinuance shall, provided that there are sufficient assets in the Trust Fund, include the aggregate amount of all payments which would have been made to such
Trust Beneficiary in accordance with the relevant provisions of the Plan during the period of such discontinuance, less the aggregate amount of any payments made to such Trust Beneficiary by the Employer during any such period of discontinuance.

  
 SECTION 9.    Third Parties.

  
 A third party dealing with the Trustee shall not be
required to make inquiry as to the authority of the Trustee to take any action nor be under any obligation to see to the proper application by the Trustee of the proceeds of sale of any property sold by the Trustee or to inquire into the validity or
propriety of any act of the Trustee. 
  
 SECTION
10.    Taxes, Expenses and Trustee Fees. 
  
 10.1    The Employer shall from time to time pay taxes of any and all kinds whatsoever which at any time are lawfully levied or assessed upon or become payable in respect of the Trust Fund, the income or any property
forming a part thereof, or any security transaction pertaining 

  

 6 

 
thereto. To the extent that any taxes levied or assessed upon the Trust Fund are not paid by the Employer, the Trustee shall pay such taxes out of the Trust
Fund. The Trustee shall if requested by the Employer, or may, in its discretion, contest the validity of taxes in any manner deemed appropriate by the Employer or its counsel, but at the Employer’s expense, and only if it has received an
indemnity bond or other security satisfactory to it to pay any such expenses. In the alternative, the Employer may itself contest the validity of any such taxes. The Trustee will withhold federal and state income taxes from any payments made to a
Trust Beneficiary in accordance with Section 6.1 of this Agreement. 
  
 10.2    The Employer shall pay the Trustee a fee of $5,000.00 annually as compensation for its services hereunder. The Trustee fee may be changed by the Trustee upon 90 days prior written notice to
the Employer. The Employer also shall pay the administrative expenses and other expenses incurred by the Trustee in the performance of its duties under this Trust Agreement, including but not limited to brokerage commissions, fees of counsel engaged
by the Trustee pursuant to Section 5.1(h) hereof and fees for preparation of annual trust tax returns. Such fees and expenses shall be charged against and paid from the Trust Fund, to the extent the Employer does not pay such fees and expenses.

  
 SECTION 11.    Administration and
Records. 
  
 11.1    The Trustee shall
keep or cause to be kept accurate and detailed accounts of any investments, receipts, disbursements and other transactions under the Trust and all accounts, books and records relating thereto shall be open to inspection and audit at all reasonable
times by any person designated by the Employer. All such accounts, books and records shall be preserved (in original form, or on microfilm, magnetic tape or any other similar process) for such period as the Trustee may determine, but the Trustee may
only destroy such accounts, books and records after first notifying the Employer in writing of its intention to do so and transferring to Employer any of such accounts, books and records requested. 
  
 11.2    Within ninety (90) days after the close of
each Plan Year (as such term is defined in the Plan), and within ninety (90) days after the removal or resignation of the Trustee or the termination of the Trust, the Trustee shall file with the Employer a written account setting forth all
investments, receipts, disbursements and other transactions effected by it during the preceding Plan Year, or during the period from the close of the preceding Plan Year to the date of such removal, resignation or termination, including a
description of all investments and securities purchased and sold with the cost or net proceeds of such purchases or sales and showing all cash, securities and other property held at the end of such Plan Year or other period. Upon the expiration of
ninety (90) days from the date of filing such annual or other account, the Trustee shall to the maximum extent permitted by applicable law be forever released and discharged from all liability and accountability with respect to the propriety of
its acts and transactions shown in such account except with respect to any such acts or transactions as to which the Employer shall within such ninety (90) day period file with the Trustee written objections. 
  
 11.3    The Trustee shall upon the Employer’s
reasonable request permit an independent public accountant selected by the Employer to have access during ordinary business hours to such records as may be necessary to audit the Trustee’s accounts for the Trust. 
  

 7 

 11.4    As of each valuation date set forth in the Plan and at such other times as is
necessary or as the Trustee and Employer agree, the fair market value of the assets held in the Trust Fund shall be determined. The valuation shall be based, without independent investigation, upon valuations provided by investment managers,
trustees of common trust funds, sponsors of mutual funds and records of securities exchanges. Notwithstanding the foregoing, the Trustee shall not be responsible for providing the value of any bank investment contracts, structured or synthetic
investment contracts or insurance contracts, or for any asset which is not liquid or not publicly traded, the value of which shall be provided by the Employer. The Trustee may obtain the opinions of qualified appraisers, as necessary in the
discretion of the Trustee, to determine the fair market value of any security or other obligation issued by the Employer, the fees of which appraiser shall, unless paid by the Employer, be paid from the Trust Fund. 
  
 11.5    Nothing contained in this Trust Agreement shall
be construed as depriving the Trustee or Employer of the right to have a judicial settlement of the Trustee’s accounts. 
  
 11.6    In the event of the removal or resignation of the Trustee, the Trustee shall deliver to the successor trustee all records
which shall be required by the successor trustee to enable it to carry out the provisions of this Trust Agreement. 
  
 11.7    The Trustee shall prepare and file such tax reports and other returns as the Employer and the Trustee may from time to time
agree to in writing. 
  
 SECTION
12.    Removal or Resignation of the Trustee and 
 Designation of Successor Trustee. 

 
 12.1    At any time the Employer may remove the
Trustee with or without cause, upon at least sixty (60) days advance written notice to the Trustee. 
  
 12.2    The Trustee may resign at any time upon at least sixty (60) days advance written notice to the Employer. 
  
 12.3    In the event of such removal or resignation, the
Trustee shall duly file with the Employer a written account as provided in Section 11.2 of this Trust Agreement for the period since the last previous annual accounting, listing the investments of the Trust and any uninvested cash balance
thereof, and setting forth all receipts, disbursements, distributions and other transactions respecting the Trust not included in any previous account, and if written objections to such account are not filed as provided in Section 11.2, the
Trustee shall to the maximum extent permitted by applicable law be forever released and discharged from all liability and accountability with respect to the propriety of its acts and transactions shown in such account. 
  
 12.4    Prior to the effective date of the removal or
resignation of the Trustee, the Employer shall designate a successor trustee qualified to act hereunder. In the event that the Employer fails to designate a successor trustee as of the effective date of the Trustee’s resignation or removal, the
Trustee shall have the right to apply to a court of competent jurisdiction for the appointment of a successor. All of the Trustee’s expenses in such court proceeding, including attorneys’ fees, shall, if not paid by the Employer, be
allowed as administrative expenses of the Trust. Each such successor trustee, during such period as it shall 

  

 8 

 
act as such, shall have the powers and duties herein conferred upon the Trustee, and the word “Trustee” wherever used herein, except where the
context otherwise requires, shall be deemed to include any successor trustee. Upon designation of a successor trustee and delivery to the resigned or removed Trustee of written acceptance by the successor trustee of such designation, such resigned
or removed Trustee shall promptly assign, transfer, deliver and pay over to such Trustee, in conformity with the requirements of applicable law, the funds and properties in its control or possession then constituting the Trust Fund. 
  
 SECTION 13.    Enforcement of Trust Agreement and
Legal Proceedings. 
  
 The Employer shall have the right
to enforce any provision of this Trust Agreement, and any Trust Beneficiary shall have the right as a beneficiary of the Trust to enforce any provision of this Trust Agreement that affects the right, title and interest of such Trust Beneficiary in
the Trust. In any action or proceedings affecting the Trust, the only necessary parties shall be the Employer, the Trustee and the Trust Beneficiaries and, except as otherwise required by applicable law, no other person shall be entitled to any
notice or service of process. Any judgment entered in such an action or proceedings shall, to the maximum extent permitted by applicable law, be binding and conclusive on all persons having or claiming to have any interest in the Trust. 

 
 SECTION 14.    Termination and Suspension.

  
 The Trust shall terminate when all payments, which have or
may become payable pursuant to the terms of the Trust, have been made or the Trust Fund has been exhausted, and all remaining assets shall then be paid by the Trustee to Employer. 
  
 SECTION 15.    Amendments. 
  
 15.1    Any or all of the provisions of this Trust Agreement may from time to time be amended by written
instrument, executed by both the Trustee and the Employer. Notwithstanding the foregoing, no such amendment shall conflict with the terms of the Plan or shall make the Trust revocable after it has become irrevocable in accordance with Section 3
hereof. 
  
 15.2    The Employer shall furnish
the Trustee with a copy of all amendments to the Plan prior to their adoption. 
  
 SECTION 16.    Nonalienation. 
  
 Except insofar as applicable law may otherwise require and subject to Sections 1, 3 and 8 of this Trust Agreement: (i) no amount payable to or in
respect of any Trust Beneficiary at any time under the Trust shall be subject to any manner of alienation by anticipation, sale, transfer, assignment, bankruptcy, pledge, attachment, charge or encumbrance of any kind, and any attempt to so alienate,
sell, transfer, assign, pledge, attach, charge or otherwise encumber any such amount, whether presently or thereafter payable, shall be void; and (ii) the Trust Fund shall in no manner be liable for or subject to the debts or liabilities of any
Trust Beneficiary. 
  

 9 

 SECTION 17.    Communications. 
  
 17.1    Communications to the Employer shall be addressed
to Host Marriott, L.P. at 6903 Rockledge Drive, Suite 1500, Bethesda, MD 20817; provided, however, that upon the Employer’s written request, such communications shall be sent to such other address as the Employer may specify. 
  
 17.2    Communications to the Trustee shall be addressed
to T. Rowe Price Trust Company at 100 East Pratt Street, Baltimore, Maryland 21202; Attention Legal Department; provided, however, that upon the Trustee’s written request, such communications shall be sent to such other address as the Trustee
may specify. 
  
 17.3    No communication
shall be binding on the Trustee until it is received by the Trustee, and no communication shall be binding on the Employer until it is received by the Employer. 
  

17.4    Any action of the Employer pursuant to this Trust Agreement, including all orders, requests, directions, instructions,
approvals and objections of the Employer to the Trustee, shall be in writing or by such electronic transmission as agreed upon by the Employer and the Trustee, signed on behalf of the Employer by any duly authorized officer of the Employer. Any
communication by a Trust Beneficiary with the Trustee must be in writing in order to have effect. The Trustee may rely on, and will be fully protected with respect to, any such action taken or omitted in reliance on any information, order, request,
direction, instruction, approval, objection, or list delivered to the Trustee by the Employer. 
  
 SECTION 18.    Indemnification. 
  
 The Employer shall indemnify and hold harmless the Trustee (including its affiliates, representatives, agents and employees) from and against any
liability, cost or other expense, including, but not limited to, the payment of attorneys’ fees that the Trustee incurs in prosecuting or defending against any claim or litigation in connection with the Trust or that the Trustee otherwise
incurs in connection with this Trust Agreement or the Plan, unless such liability, cost or other expense arises from the Trustee’s own willful misconduct or gross negligence. 
  
 SECTION 19.    Miscellaneous Provisions. 
  
 19.1    Successors and Assigns. This Trust
Agreement shall be binding upon and inure to the benefit of the Employer and the Trustee and their respective successors and assigns. 
  
 19.2    No Assumption/Limitation of Duties. The Trustee assumes no obligation or responsibility with respect to any action
required by this Trust Agreement on the part of the Employer. The duties of the Trustee with respect to the Plan and this Trust are limited to those as set forth under the terms of this Trust Agreement. 
  
 19.3    Headings. Titles to the Sections as well
as all headings and subheadings of this Trust Agreement are included for convenience only and shall not control the meaning or interpretation of any provision of this Trust Agreement. 
  

 10 

 19.4    Conflict with Plan. In the event of any conflict between the
provisions of the Plan document and this Trust Agreement, the provisions of this Trust Agreement shall prevail. 
  
 19.5    Construction. Whenever used in this Trust Agreement, unless the context indicates otherwise, the singular shall include
the plural, the plural shall include the singular, and the male gender shall include the female gender. 
  
 19.6    Severability. If any provision of this Trust Agreement is held invalid or unenforceable, such invalidity or
unenforceability shall not affect any other provision, and this Agreement shall be construed and enforced as if such provision had not been included. 
  
 19.7    Law to Govern. This Trust Agreement and the Trust established hereunder shall be governed by and construed, enforced
and administered in accordance with the laws of the State of Maryland and the Trustee shall be liable to account only in the courts of the State of Maryland. 
  
 19.8    Counterparts. This Trust Agreement may be executed in any number of counterparts, each of which shall be deemed to be
the original and all of which together shall constitute one and the same instrument. 
  
 19.9    Trustee as Successor Trustee. If the Trustee is acting as a successor trustee with respect to the Trust, the Employer shall indemnify the Trustee against all liabilities with respect
to the Trust arising prior to the appointment of the Trustee and its acceptance thereof. 
  
 19.10    Patriot Act Compliance. Pursuant to federal law, the Trustee is required to obtain certain information relating to the Trust and/or the Employer and to verify and maintain the
information. Before the Trust can be established, the Trustee must be provided with: (a) the taxpayer identification number of the Trust and/or the Employer (or have a copy of a submitted taxpayer identification number application for the
Trust); (b) a copy of the Plan document; and (c) a street address for the Employer. If the Trustee is not provided or able to verify any such information, the Trust may be frozen or closed. 
  
 19.11    Effective Date. This Agreement shall be
effective as of the date of transfer to T. Rowe Trust Company of the assets which are to be held in trust pursuant to this Agreement but in any event no earlier than November 1, 2005. 
  
 19.12    Signature Authority and Conformity with the
Plan. The person executing this Trust Agreement on behalf of the Employer certifies that he or she is duly authorized by the Employer consistent with the terms of the Plan to do so. The Employer represents that copies of all Plan documents as in
effect on the date of this Trust Agreement have been delivered to the Trustee. 
  
 IN WITNESS WHEREOF, this Trust Agreement has been duly executed by the parties hereto. 
  

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ATTEST/WITNESS:
  
 /s/ Lisa A. Whittington
  
	  	 HOST MARRIOTT, L.P. 
  
 By:   HOST MARRIOTT CORORATION,
it’s general partner
  
 /s/ Elizabeth A. Abdoo
  

 Elizabeth A. Abdoo
 Executive Vice President and
 General Counsel of Host Marriott Corporation
  
 Date:  November 15, 2005
  

  
  

			
	  
  
  

ATTEST/WITNESS:
  
 /s/ Kelly Zanes
  
	  	 T. ROWE PRICE TRUST COMPANY 
  
 /s/ Nancy Maitland
  

 Nancy Maitland
 Vice President
  
 Date:  November 23, 2005
  
  

  

 12

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